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09/28/95 ROODHOUSE ENVELOPE COMPANY v. INDUSTRIAL

September 28, 1995

ROODHOUSE ENVELOPE COMPANY, APPELLANT,
v.
THE INDUSTRIAL COMMISSION ET AL. (MYRTLE ALLEN, APPELLEE).



Appeal from Circuit Court of Greene County. No. 93MR32. Honorable James W. Day, Judge Presiding.

As Corrected November 15, 1995. Released for Publication January 9, 1996.

Honorable William E. Holdridge, J., Honorable John T. McCULLOUGH, P.j., Honorable Michael J. Colwell, J., Honorable Philip J. Rarick, J., Honorable Thomas R. Rakowski, J., Concurring. Justice Holdridge delivered the opinion of the court: McCULLOUGH, P.j., and Colwell, Rarick, and Rakowski, JJ., concur.

The opinion of the court was delivered by: Holdridge

The Honorable Justice HOLDRIDGE delivered the opinion of the court:

Claimant, Myrtle Allen, filed an application for adjustment of claim, pursuant to the Workers' Compensation Act (Act) (Ill. Rev. Stat. 1989, ch. 48, pars. 138.1 through 138.30 (now 820 ILCS 305/1 through 305/30 (Michie 1993))) alleging injuries arising out of and in the course of her employment with Roodhouse Envelope Company (employer).

Following an emergency hearing pursuant to section 19(b-1) of the Act (Ill. Rev. Stat. 1989, ch. 48, par. 131.19(b-1) (now 820 ILCS 305/19(b-1) (Michie 1993))), the arbitrator found that the claimant was entitled to 94 5/7 weeks of temporary total disability benefits (TTD) at the rate of $168.67 per week, i.e., $15,975, and $7,419.29 for necessary medical expenses. The arbitrator also found, pursuant to a stipulation of the parties, that the respondent had paid $7,421.92 in TTD benefits prior to the hearing.

The employer filed a petition for review of the arbitrator's decision with the Industrial Commission (Commission). The Commission affirmed the arbitrator's award. The employer did not seek review of the Commission's decision by the circuit court.

After more than two months had passed without the employer paying the award, the claimant filed a petition with the Commission for penalties pursuant to sections 19(k) and 19(l) of the Act (Ill. Rev. Stat. 1989, ch. 48, pars. 138.19 (k),(l) (now 820 ILCS 305/19(k),(l) (Michie 1993))). The claimant also petitioned for attorney fees pursuant to section 16 of the Act (Ill. Rev. Stat. 1989, ch. 48, par. 138.16 (now 820 ILCS 305/16 (Michie 1993))).

The Commission, finding that the employer's failure to pay the award promptly was unreasonable and vexatious, awarded section 19(k) penalties in the amount of 50% of the total TTD award ($15,974.74), for a penalty of $7,987.37. The Commission also awarded section 19(l) penalties in the amount of $870 representing 87 days at $10 per day. Section 16 attorney fees were found to be $1,597.47, based upon 20% of the section 19(k) penalties. The employer appealed the Commission's award to the circuit court, and the circuit court confirmed the Commission's order.

On appeal, the employer contends that (1) the Commission lost jurisdiction to impose penalties after no appeal was taken on the Commission's original award of TTD and medical expenses; (2) the Commission's determination that the employer's delay in payment of the award was unreasonable and vexatious was against the manifest weight of the evidence; and (3) the Commission improperly calculated the amount of penalties by failing to give the employer credit for voluntary TTD payments of $7,421.92 made prior to the arbitration award. We affirm the Commission's imposition of penalties and attorney fees, and remand with direction that the section 19(k) penalty and attorney fees be recalculated.

The employer initially argues that the Commission lacked jurisdiction to impose penalties and attorney fees. The employer suggests that once the time for appeal of a Commission award has lapsed, the circuit court has sole jurisdiction to enforce the award and assess penalties under section 19(g) of the Act (Ill. Rev. Stat. 1989, ch. 48, par. 131.19(g) (now 820 ILCS 305/19(g) (Michie 1993))).

The employer's argument has been rejected by our supreme court in Board of Education v. Industrial Comm'n (1932), 351 Ill. 128, 184 N.E. 202. In Board of Education, a petition for penalties was filed with the Commission pursuant to section 19(k), after the Commission had entered an award and the circuit court confirmed. On appeal, the employer argued that the Commission had no jurisdiction under section 19(k) to assess penalties after its decision entering an award became final. Our supreme court rejected this argument, stating:

"[Section 19(k)] clearly contemplates that proceedings to impose the penalty there provided shall first be instituted before the Industrial Commission. By its nature it is clear that such proceeding can be brought only after the Industrial Commission has made an award which has become final either by confirmation on review or the lapse of time for review without such being sought. " (Emphasis added.) ( Board of Education, 351 Ill. at 131, 184 N.E. at 203.)

Based upon the controlling authority of Board of Education, we find the employer's argument that the Commission lacked jurisdiction to impose ...


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