Dennis Crosen v. Rockingham Electric, Inc.  – Where incapacity was apportioned by decree, and first insurer’s compensation benefit payments ceased, the remaining insurer was not permitted to increase its 60% share of offset afforded by Crosen’s receipt of Social Security Old Age Benefits to 100%. In this decision, the Appellate Division addressed apportionment of social security retirement offset under 39-A M.R.S.A. sec. 221(3)(A))(1), and provided reminders of the continuing liability for payment of inflation adjustments and the impact of an apportioned insurer becoming insolvent.

In Crosen v. Rockingham Electric, Inc., Dec. No. 23-08, Crosen suffered a compensable 1984 neck injury with Rockingham, insured by Bedivere Ins. and a compensable 2002 low back injury with Blouin Motors, Inc., insured by the MADA WC Trust. A 2012 decree awarded total incapacity benefits and pursuant to the apportionment statute 39-A M.R.S.A. sec. 354 assigned 40% responsibility to Rockingham and 60% responsibility to Blouin. Blouin was ordered to pay Crosen initially, receiving reimbursement from Rockingham. Rockingham was ordered to pay Crosen the inflation adjustment owed under the law in effect at the time of the 1984 injury, citing Dunson v. South Portland Housing Authority and 39-A M.R.S.A. 201(6). Crosen began receiving social security old age retirement benefits in 2014. An offset was not allowed under the law for a 1984 injury. Blouin was permitted an offset under 39-A M.R.S.A. sec. 221(3)(A)(1). Blouin and Rockingham informally agreed that Blouin would reduce it weekly compensation paid to Crosen by 60% of the full social security offset, in line with the 2012 apportionment finding.

This arrangement continued until 2021 when Bedivere was declared insolvent and Maine Insured Guaranty Association (MIGA) stepped in to pay Bedivere’s “covered claims”. Because 24-A M.R.S.A. 4435 excludes payment for WC apportionment reimbursement from “covered claims”, Rockingham ceased contributing payments to Blouin. Blouin filed a Petition to Determine Rights & Responsibilities and a Petition to Exclude Inflation Adjustments & To Take Full Social Security Offset. Citing Juliano v. Ameri-cana Transport, 2007 ME 9, the ALJ found that Blouin must pay the inflation adjustment under the 1984 injury even without reimbursement from Rockingham. Juliano held that reducing benefits owed to an injured employee because of an insurer’s insolvency would contradict sec. 354(3), which prohibits apportionment from reducing an employee’s benefits. The ALJ further found that Blouin could not increase its offset to the full amount because (1) 40% of the incapacity was attributable to the 1984 injury, (2) the social security retirement offset is not available for benefits due under the 1984 injury, and (3) apportionment findings “may not affect an employee’s rights and benefits under this Act”, citing sec. 354(3).

On appeal Blouin argued that (1) sec. 221 mandates a full offset to prevent double recovery and contains no authority for apportioning the offset, (2) sec. 354 no longer applies due to Bedivere’s insolvency because apportionment no longer exists in the case, (3) the Law Court’s decision in Berry v. H.R. Beal & Sons, 649 A.2d 1101 (Me. 1994) permits Blouin to take the full offset. The Appellate Division rejected these arguments and affirmed the ALJ’s decision. The panel found no error with the ALJ’s conclusion that Blouin was required to pay Crosen the full benefit even though MIGA no longer contributes the amounts that Rockingham reimbursed. The panel further concluded the Law Court in Berry expressly stated it would not decide the issue of whether a proportionate share was warranted even though it did conclude in that case it was correct to give the remaining insurer the full amount of the offset because the offset amount was less than the proportionate share of benefits owed by the remaining insurer. The panel found this part of the decision to be obiter dictum. Compared to the “clear holding of Juliano“, it found the ALJ committed no reversible error based on the Berry decision.

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Thomas Getchell
Daniel F. Gilligan