Published on:

Municipality of Anchorage v. Stenseth: Workers’ Compensation Benefits

Municipality of Anchorage v. Stenseth, a case from the Supreme Court of the State of Alaska, involved claimant who had been injured at work “many years ago.” When claimant filed a request for workers’ compensation benefits, the parties eventually reached an agreement, and the parties agreed employee would waive any future benefits other than medical benefits and that employer would pay employee $37,000.

brownenvelopemoneybribe3Claimant retired in 1996 but was still receiving medical benefits in connection with his chronic pain management. However, ten years later, he was charged with multiple felony criminal charges, including selling narcotics. Some of these were prescription painkillers and were somehow related the medicine he was getting as part of his medical benefits. He eventually pleaded guilty to some of charges prosecutors had filed against him, and he spent at least some time in jail.

Following his release from jail in 2012, his workers’ compensation provider filed a petition alleging fraud on behalf of claimant and requested his benefits be terminated and he be required to repay his past benefits. Claimant denied making any false statements or fraud in connection with obtaining his workers’ compensation benefits.

Both employee and employer agreed to submit to mediation to resolve this issue short of a full hearing. A hearing officer for the state workers’ compensation board agreed to serve as the parties’ mediator. The mediator requested both parties come to mediation with the ability and authority to enter into a settlement. An attorney represented employer. The claims administrator was not present at the mediation but agreed to participate by telephone. Both attorney and claims administrator believed they had authority to bind employer to a settlement.

Following the meeting, attorney for employer summarized that they had agreed to settle the matter for $30,000 in cash within 90 days or by claimant signing a promissory note for $40,000 including interest. In consideration for this agreement, employer would agree to waive the statutory claim to $125,000. This attorney then requested a change that the agreement would be voidable by employer in the event that a payment was missed, and this created a disagreement. Claimant’s attorney agreed to the original offer, and employer’s attorney said there was a “glitch,” and she needed to speak with her clients again.

As it turns out, the glitch was that employer claimed their attorney could only settle for $50,000 without approval from the employer for a lower amount. Lawyer and administrator both said they were not aware of this limitation. At this point, claimant filed motion to dismiss employer’s claim of fraud on grounds they had breached their own agreement. The commission held a hearing and eventually dismissed employer’s claim, finding the settlement agreement was binding.

At this point, employer appealed to the state supreme court, and that court found there was no reason for the agreement to be made void and affirmed the commission’s original findings that a contract existed and was enforceable.

While these issues obviously do not present themselves in the average Boston workers’ compensation claim, every case is complicated, and you should speak with an experienced attorney as soon as possible.

If you are injured on the job in Massachusetts, call the Law Offices of Jeffrey S. Glassman for a free and confidential consultation to discuss your workers’ compensation claim: 1-888-367-2900.

Additional Resources:

Municipality of Anchorage v. Stenseth, November 25, 2015, Supreme Court of Alaska

More Blog Entries:

Frith v. WSI – Proving Worsening Condition Is Related to Work Injury, May 27, 2014, Boston Workers’ Compensation Lawyers Blog