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Claimant filed a Petition for Reinstatement on August 14, 2000. However, his benefits had been previously suspended on September 19, 1992 and terminated effective November 3, 1995. Defendant denied the Petition arguing that it was barred by the three year statute of limitations. The parties stipulated that claimant was totally disabled between 1/1/98 and 1/23/01 but that the Judge should address the statute of limitations argument.

The WCJ did award benefits. He concluded that because there had been the payment of medical expenses made on 12/8/97 in the amount of $2,050.28, the Petition was filed within 3 years of such payment, and therefore was timely.

Employer appealed and the Board denied the defendant’s request for supersedeas pending appeal. The Board affirmed the Decision of the Judge. The Commonwealth Court reversed concluding that claimant’s Petition to Reinstate was time barred pursuant to Section 413(a) of the Act because the payment of medical expenses does not constitute "compensation" so as to toll the statute of limitations on a Reinstatement or Review Petition. J.P. Lamb Construction, Inc. v. WCAB (Strohl), No. 745 CD 2004.

The employer then filed an Application for Superseas Fund Reimbursement. The WCJ and Board denied this request. The Bureau had argued that the parties stipulation was not an arms-length or adversarial type determination made by the Judge or Board so it did not bind the Fund.

Significantly, the defendant had made payments in the amount of $51,791.49.

The Court outlined that reimbursement from the supersedeas fund is appropriate if 5 requirements are met: (1) a supersedeas must have been requested; (2) the request for supersedeas must have been denied; (3) the request must have been made in a proceeding under Section 413 or Section 430; (4) payments were continued because of the Order denying supersedeas; and (5) in the final outcome of the proceedings it is determined that such compensation was not, in fact payable.

The Court further noted it is well settled that reimbursement from the supersedeas fund has generally been denied when it is determined that compensation was not, in fact, payable but that determination is made by a stipulation of facts rather than an arms-length or adversarial type determination. Bureau of WC v. WCAB (Bethlehem Steel Corp.), 723 A.2d 1061 (Pa. Cmwlth. 1998).

In the instant case, the Commonwealth Court concluded that the defendant was entitled to reimbursement. The Court noted that the parties never stipulated that benefits were not payable. Instead, there was a stipulation that there was no medical issue but they disagreed as to whether claimant was legally entitled to compensation. Thus, there was no danger of the employer "invading" the fund by stipulation. They distinguished prior case law noting this case was not conceded on the merits. Accordingly, the Court’s reversal of the Board on the Statute of Limitations issues constituted an "adversarial determination that benefits were not, in fact payable."

Practice Pointer: The JP Lamb case illustrates when an employer is entitled to reimbursement from the supersedeas fund. Specifically, the employer has to have properly requested reimbursement and it must subsequently be determined that benefits were not payable by way of adversarial determination. The parties can stipulate to a limited factual issue. In JP Lamb, the Bureau had argued that the stipulation of disability did control the result. However, this ignores the fact that there was a statute of limitations argument which eventually prevailed.

The other significant rule highlighted by JP Lamb is the fact that payment of medical benefits does not constitute compensation so as to toll the statute of limitations. Instead, the Court applied the 3-year statute of limitations following termination and where Petition for Reinstatement was untimely, such Petition was denied.