                                                                                                                           Opinions of the United
1995 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


5-22-1995

Krysztoforski v Chater
Precedential or Non-Precedential:

Docket 94-1886




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Recommended Citation
"Krysztoforski v Chater" (1995). 1995 Decisions. Paper 136.
http://digitalcommons.law.villanova.edu/thirdcircuit_1995/136


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           UNITED STATES COURT OF APPEALS
               FOR THE THIRD CIRCUIT
               _____________________

                     No. 94-1886
                _____________________

                JOSEPH KRYSZTOFORSKI,




                              Appellant,

                         v.

                 SHIRLEY S. CHATER,
          COMMISSIONER OF SOCIAL SECURITY,

                             Appellee
                _____________________

   On Appeal from the United States District Court
      for the Eastern District of Pennsylvania
                  (D.C. No. 93-5228)
                _____________________

                 Argued May 2, 1995

Before: MANSMANN, SCIRICA, and SAROKIN, Circuit Judges

                 (Filed May 22, l995)
                _____________________

                        B. Adam Sagan
                        Flager & Sagan
                        1210 Northbrook Drive
                        Suite 280
                        Trevose, PA 19053

                        James B. Mogul (argued)
                        Sagan & Greenberg
                        3260 Tillman Drive
                        Suite 120
                        Bensalem, PA 19020
                             Attorneys for Appellant
Margaret J. Krecke (argued)
Department of Health & Human
Services
DHHS/OGC/Region III
3535 Market Street
P.O. Box 13716, Room 9100
Philadelphia, PA 19101
     Attorney for Appellee
                        ____________________

                        OPINION OF THE COURT
                       _____________________

PER CURIAM.


            The issues presented are whether workers' compensation

benefits for specific loss of use of a particular body part

constitute "disability" benefits for purposes of offset against

Social Security Disability Insurance ("SSDI") benefits and

whether workers' compensation for one injury may be offset

against SSDI benefits for a separate, unrelated injury.    We

conclude that the compensation paid is a disability benefit, and

that offset is appropriate even if the benefits arise from

unrelated injuries or disabilities.



                                 I.

            On January 27, 1989, plaintiff Joseph Krysztoforski

injured his left ankle and foot and was awarded weekly worker's

compensation benefits of $ 306.66.    See 77 Pa.C.S.A. § 101, et

seq.   His ankle improved, and he planned to return to work.

            On October 27, 1989, he suffered a cerebral vascular

accident ("stroke"), leaving him permanently paralyzed and unable

to speak.   As a result of the effects of his stroke, plaintiff

received SSDI benefits of $ 852.70 per month from the onset date

of October 27, 1989.   According to the formula in 42 U.S.C. §
424a, his worker's compensation payments were subtracted from his

SSDI benefits.

            He continued to receive workers' compensation benefits

for his ankle and foot injury until early November 1990 when

plaintiff and his employer stipulated that this disability had

resolved into a specific loss of the use of his left foot, and he

was awarded $ 306.66 per week for 250 weeks from December 5,

1990.   He requested these payments in a lump sum of $ 76,665.00,

which he was granted on December 6, 1990.

            After plaintiff received his lump sum award, the

Secretary, pursuant to 42 U.S.C. § 424a(b), prorated the lump sum

at $ 260.66 per week through September 1995, for a total of 250

weeks, and continued to offset that amount against his SSDI

benefits.    Plaintiff objected to the offset which was affirmed

upon reconsideration.    He filed a timely request for a hearing

before the administrative law judge ("ALJ") who determined that

the offset was proper.

            The Appeals Council denied plaintiff's request for

review of the ALJ's decision which became the final decision of

the Secretary.    Having exhausted his administrative remedies,

plaintiff appealed to federal district court which had

jurisdiction under 42 U.S.C. § 405(g) and adopted a magistrate

judge's report and recommendation to affirm the ALJ's decision.

Plaintiff has filed a timely notice of appeal to this court.      We

exercise jurisdiction pursuant to 28 U.S.C. § 1291.
                               II.

          The court must accept the ALJ's factual findings if

there is substantial evidence to support them.     Van Horn v.

Schweiker, 717 F.2d 871, 873 (3d Cir. 1983).     Our review is

plenary as to the Secretary's application of the law.    Wilkerson

v. Bowen, 828 F.2d 117, 119 (3d Cir. 1987).



                               III.

          The Social Security Act ("Act") provides that any

person who is "disabled" as defined in the Act is eligible for

SSDI benefits.   42 U.S.C. § 423(a).   The Secretary determined

that plaintiff is disabled and eligible for benefits.     However,

the Act limits the amount of benefits an individual may receive

from both SSDI and workers' compensation.     42 U.S.C. § 424a;

Richardson v. Belcher, 404 U.S. 78 (1971).
          Section 424a provides in pertinent part:

          (a) If for any month prior to the month in
          which an individual attains the age of 65 --
               (1) such individual is entitled to
               benefits under section 423 of this
               title, and
               (2) such individual is entitled for
               such month to --
               (A) periodic benefits on account of
               his or her total or partial
               disability (whether or not
               permanent) under a workmen's
               compensation law or plan of the
               United States or a State, . . . .
               the total of his benefits under
               section 423 of this title for such
               month . . . based on his wages and
                 self-employment income shall be
                 reduced (but not below zero) by the
                 amount by which the sum of --
                 (3) such total of benefits under
                 section[] 423 . . . of this title
                 for such month, and
                 (4) such periodic benefits payable
                 (and actually paid) for such month
                 to such individual under such laws
                 or plans, exceeds the higher of --
                 (5) 80 per centum of his "average
                 current earnings", or
                 (6) the total of such individual's
                 disability insurance benefits under
                 section 423 of this title for such
                 month . . . based on his wages and
                 self-employment income, prior to
                 reduction under this section.

42 U.S.C. § 424a(a).


            As a preliminary matter, we hold that federal law

governs in determining whether a workers' compensation loss-of-

use award should be offset against SSDI benefits.      Section 424a

does not refer or defer to state law for the determination of

whether a person's periodic workers' compensation benefits are

subject to offset.    Plaintiff's claim that Pennsylvania law

applies to the issue of whether the offset itself is appropriate

is without merit, but we agree with plaintiff that we should look

to state law to inform the nature of the workers' compensation

payments, particularly whether the benefits were for "total or

partial disability . . . under a workmen's compensation law or

plan."    42 U.S.C. § 424a(a)(2)(A).   Neither the statute nor the

regulations provide a definition of "disability" for purposes of

§ 424a.    "Where Congress uses terms that have accumulated settled
meaning under either equity or the common law, a court must

infer, unless the statute otherwise dictates, that Congress means

to incorporate the established meaning of these terms."    NLRB v.

Amax Coal Co., Div. of Amax, Inc., 453 U.S. 322, 329 (1981).

           The Pennsylvania Workmen's Compensation Act ("Act")

provides benefits for three general classifications of injured

workers:   (1) total disability under § 306(a) of the Act, 77

Pa.C.S.A. § 511; (2) partial disability under § 306(b); 77

Pa.C.S.A. § 512; and (3) disability from permanent injuries of

certain classes under § 306(c), 77 Pa.C.S.A. § 513.   Plaintiff's

benefits arose from § 513 which provides in pertinent part:

           For all disability resulting from permanent
           injuries of the following classes, the
           compensation shall be exclusively as follows:
           . . . (4) For the loss of a foot, sixty-six
           and two-thirds per centum of wages during two
           hundred fifty weeks.

77 Pa.C.S.A. § 513.


           Plaintiff claims that benefits for specific loss of use

of his foot do not constitute disability benefits.    He asserts
that he was entitled to his workers' compensation "whether or not

he had missed any time from gainful employment" and that this is

contrary to the purpose of disability payments -- to compensate

for lost earning potential.   Pltf. Br. at 7.   Plaintiff refers to

§ 513 as compensating "statutory disability."   He argues the

specific loss workers' compensation benefits were not paid for

any actual disability and hence were not disability benefits.
          Pennsylvania workers' compensation case law has defined

"disability" as "'the loss, total or partial, of earning power'"

resulting from a work-related injury.   Kachinski v. Workmen's

Compensation Appeal Bd. (Vepco Constr. Co.), 516 Pa. 240, 248

(1987)(quoting Woodward v. Pittsburgh Engineering and

Construction Co., 293 Pa. 338, 340 (1928)).     Although plaintiff

is correct that permanent injury benefits are not dependent upon

loss of earnings, § 513 benefits encompass "all disability" which

may arise from a permanent injury, including inability to work if

such were to result from the injury.    See Killian v. Heintz Div.

Kelsey Hayes, 468 Pa. 200, 204-06 (Pa. 1976).

          Thus, "by awarding benefits even where there is no

actual loss of earnings, § 306(c) [§ 513] creates a presumption

that there is disability associated with a specific loss."       Sun

Oil Co. v. Workmen's Compensation Appeal Board (Davis), 144 Pa.

Commw. 51, 54-55 (Pa.Comm.Ct. 1991); see also Davidson v.

Sullivan, 942 F.2d 90, 95 (1st Cir. 1991)(a statutorily

prescribed award for permanent injury "compensates for a

conclusively presumed wage loss" and is subject to offset).       This

interpretation makes sense given that a worker who suffers a

permanent injury is not able to recover separately for loss of

use under § 513 and for loss of earnings.     See Carnevali v.
Heckler, 616 F.Supp. 1500, 1504 (W.D.Pa. 1985)("Compensation

received under 77 P.S. § 513 makes an individual ineligible for
partial or total disability compensation under 77 P.S. § [sic.]

511 and 512").

          Although plaintiff emphasizes the fact that a worker

could receive § 513 benefits and continue to work at her job, §

513 permanent injury benefits clearly include compensation in the

event of lost earnings and hence constitute disability benefits

for purposes of offset under § 424a.

          Plaintiff mentions Senator Edward M. Kennedy's

criticism of offsetting permanent injury benefits during debate

of the Social Security Amendments of 1965.   However, the

Senator's comments were not incorporated into the statute, and as

the First Circuit remarked, the "'unfortunate effects'" of

reducing the worker's benefits were "contemplated by the offset

provision as enacted, notwithstanding Senator Kennedy's

criticism."   Davidson, 942 F.2d at 96.

          We now turn to examining whether workers' compensation

benefits for one injury may be offset against SSDI benefits for a

separate, unrelated injury.   If the language of the statute is

clear, we need not look to the legislative history.   Barnes v.
Cohen, 749 F.2d 1009, 1013 (3d Cir. 1984)(citations omitted),

cert. denied sub nom. Cohen v. Betson, 471 U.S. 1061 (1985).    A

plain reading of § 424a calls for offset regardless of whether

the benefits derived from identical or different injuries.     The

statute simply does not make such distinctions.   See Kananen v.

Matthews, 555 F.2d 667, 670 (8th Cir. 1977)("No portion of § 424a
limits its application to payments for a disability caused by the

same physical or mental condition"); Campbell, 14 F.3d at 428

(following Kananen, supra).

          As we noted in Sciarotta v. Bowen,

          Congress enacted § 424a because of concern
          about the concurrent receipt by many injured
          workers of both federal disability benefits
          and state workers' compensation benefits.
          See S. Rep. No. 404, 89th Cong., 1st Sess.,
          reprinted in 1965 U.S. Code Cong. & Admin.
          News 1943, 2040 . . . . [T]he [Senate
          committee's] report makes clear that "the
          committee believes that it is desirable as a
          matter of sound principle to prevent the
          payment of excessive combined benefits." Id.
          at 2040.


837 F.2d 135, 138 (3d Cir. 1988).   The clear intent of the

statute was to preserve and protect a level of income for the

disabled employee while avoiding a duplication of benefits

irrespective of the cause of the disability.     Accordingly we

conclude that the offset at issue was proper.1

          As to plaintiffs' argument that it was unreasonably

excessive and harsh for the ALJ to prorate his lump sum award of

$ 76,665.00 through September 1995, instead of over the course of

his employment lifetime, we decline to entertain his argument


    1 In addition, plaintiff consistently refers to his workers'
compensation benefits as a "lump sum," but there is no doubt that
the lump sum award is "periodic benefits on account of his or her
total or partial disability." 42 U.S.C. § 424a(a)(2). The lump
sum award arose from plaintiff's own request to commute his 250
weeks of compensation. The Act specifically authorizes proration
of commuted periodic payments. 42 U.S.C. § 424a(b).
since it was not raised before the ALJ or the district court.

See, e.g., Salvation Army v. Department of Community Affairs, 919

F.2d 183, 196 (3d Cir. 1990); Matney v. Sullivan, 981 F.2d 1016,

1019 (9th Cir. 1992); Keating v. Secretary of Health and Human

Services, 848 F.2d 271, 275 (1st Cir. 1988).     Plaintiff contends

that we permitted the appellant in Sciarotta to raise a

miscalculated proration allegation for the first time.     His

assertion is misleading:   the appellant had raised the

miscalculation issue before the district court, Sciarotta, 647

F.Supp. 132, 136 n.4 (D.N.J. 1986), and we reached the issue,

noting that the district court "did not reach the miscalculation

argument in the original proceedings," having disposed of the

case on other grounds.   837 F.2d at 141 n. 9.




                                IV.


          For the foregoing reasons, we will affirm the district

court's affirmance of the Secretary's final determination.

                         __________________
