Tuesday, July 11, 2017

Court declines to compel SIF to pay interest on awards

Deckard v Eric Schmitt Treasurer,
WD 80154  (July 11, 2017). 

The second injury fund failed has had insolvency problems for years and was sued for contempt when it failed to pay judgments and interest on several permanent total awards.  The only issue remaining on appeal was unpaid interest. 

The workers sued, seeking a writ of mandamus and an order of contempt.  The workers lost in a motion for summary judgment.  The court of appeals affirmed and concluded the appellants could not appeal an interlocutory order and the appellants had not preserved for appellate review by obtaining an evidentiary hearing on the issue of contempt.

The legislature adopted a surcharge to attempt to solve the insolvency of the Fund and adopted a list of priority creditors or payments.  The surcharge applies through 2021.  The list is in section 287.220.15.

The court found purposeful legislative intent for the provision to apply retroactively by the use of the word "any." The court found that appellants failed to establish they had a clear, unequivocal right to require respondents to pay interest.  Section 287.220.15 set a list of priorities to satisfy Fund obligations and the statutory obligation was below 5th out of 5 other priorities.

The fund is paid through a surcharge on employers and "ran out of money" to meet its obligations and is not funded out of general state revenue. 

Hon Gabbert
Atty:  Ieezi, Harris