J-A01020-16


                                   2016 PA Super 79

LARRY LIBERATORE                                  IN THE SUPERIOR COURT OF
                                                        PENNSYLVANIA
                            Appellee

                       v.

MONONGAHELA RAILWAY COMPANY,
AND AMERICAN PREMIER
UNDERWRITERS, INC., FORMERLY
KNOWN AS PENN CENTRAL
CORPORATION, INDIVIDUALLY AND/OR
AS SUCCESS-IN-INTEREST OR LIABILITY
TO PENN CENTRAL TRANSPORTATION
COMPANY, PENN CENTRAL COMPANY,
THE PENNSYLVANIA NEW YORK
CENTRAL RAILROAD COMPANY, AND/OR
THE PENNSYLVANIA RAILROAD AND
CONSOLIDATED RAIL CORPORATION,
AND NORFOLK SOUTHERN RAILWAY
COMPANY

                            Appellants                No. 1011 EDA 2015


                    Appeal from the Order February 25, 2015
              In the Court of Common Pleas of Philadelphia County
                       Civil Division at No(s): No. 02075


BEFORE: LAZARUS, J., OTT, J., and STEVENS, P.J.E.*

OPINION BY OTT, J.:                                    FILED APRIL 07, 2016

        Consolidated Rail Corporation and Norfolk Southern Railway Company,

(collectively “Railroad”), appeal from the judgment of $87,500.00, entered

on February 25, 2015, in the Philadelphia County Court of Common Pleas, in


____________________________________________


*
    Former Justice specially assigned to the Superior Court.
J-A01020-16



favor of plaintiff, Larry Liberatore, in an action to recover personal injury

damages pursuant to the Federal Employers’ Liability Act (“FELA”). 1               On

appeal, Railroad argues the trial court erred in granting Liberatore’s motion

to enforce full satisfaction of the verdict, thereby precluding it from

deducting Liberatore’s share of Railroad Retirement Tax Act (“RRTA”) 2 taxes,

as well as sick benefits Liberatore had received through the Railroad

Retirement Board (“RRB”),3 and a collectively-bargained supplemental

sickness plan, from the jury award.4           Railroad also challenges the court’s

preliminary determination that its issues are waived because they were not

raised in a post-trial motion.        For the reasons that follow, we vacate the

judgment      entered    in   favor    of   Liberatore,   and   remand   for   further

proceedings.

        The factual and procedural history underlying this appeal are aptly

summarized by the trial court as follows:


____________________________________________


1
    45 U.S.C. § 51 et seq.
2
    26 U.S.C. § 3201 et seq.
3
    45 U.S.C. § 231f.
4
  We note that both the United States of America (Department of Justice,
Tax Division) and the Association of American Railroads have filed amicus
curiae briefs on appeal in support of Railroad’s contention that it was
required to deduct the aforementioned taxes and benefit payments from
Liberatore’s jury award.    See Amicus Curie Brief of United States of
America; Amicus Curie Brief of Association of American Railroads.



                                            -2-
J-A01020-16


            On May 22, 2013 Plaintiff Larry Liberatore [] filed a
     complaint for negligence against Defendants American Premier
     Underwriters, Inc., Monongahela Railway Company, Consolidated
     Rail Corporation, and Norfolk Southern Corporation pursuant to
     the Federal Employers’ Liability Act (“FELA”), 45 U.S.C. § 51, et
     seq., alleging that he developed injuries to his right shoulder
     during the course and scope of his employment with Defendants.
     On May 13, 2014, the parties stipulated to substitute Norfolk
     Southern Railway Company for Norfolk Southern Corporation
     Defendant. On May 13, 2014, the parties also stipulated to
     dismiss American Premier Underwriters, Inc. from the lawsuit.
     Therefore, Consolidated Rail Corporation and Norfolk Southern
     Railway Company were the two remaining Defendants that went
     to trial. The jury was instructed to attribute any negligence on
     Monongahela Railway Company’s behalf to Consolidated Rail
     Corporation.

           A jury trial began for this matter on October 24, 2014. On
     November 7, 2014, the jury reached its verdict, awarding
     [Liberatore] damages in the amount of $175,000 and finding
     Consolidated Rail Corporation to be 25% negligent, Norfolk
     Southern Railway Company to be 25% negligent, and
     [Liberatore] to be 50% negligent. On November 11, 2014, the
     Court issued a trial worksheet stating “Jury Verdict for Plaintiff”
     and that that the total amount awarded to [Liberatore] was
     $87,500.00.

           On November 17, 2014, pursuant to Section 53 of the
     FELA2, Defendants Consolidated Rail Corporation and Norfolk
     Southern Railway Company (hereinafter "[Railroad]") filed a
     post-trial Motion to Mold the Verdict. On November 19, 2014,
     this Court granted that Motion and molded the verdict to reflect
     a verdict of $87,500 to be awarded to [Liberatore].

     __________
        2
          Section 53 of the FELA states that the fact that an
        employee is guilty of contributory negligence shall not bar
        recovery, but that the damages shall be diminished in
        proportion to the amount of the employee’s negligence.
        45 U.S.C. § 53.

     __________

           On January 27, 2015, [Liberatore] filed a Motion to Enforce
     Full Satisfaction of Verdict and Judgment which stated that

                                    -3-
J-A01020-16


       [Railroad] had arbitrarily decided to reduce the molded verdict
       amount by the additional tax and lien amounts. [Liberatore]
       also stated that the deductions denied [him] the “opportunity to
       negotiate and/or reduce those purported liens.” That motion
       contained a scanned letter from [Railroad] that stated the
       following:

          Enclosed please find our drafts in the total amount of
          $52,172.65, calculated as follows:

             Net Verdict Amount                    $87,500.00
             Plus Interest thru 12/23/14           $647.25
                      [5]
             Less SSB Lien                         ($17,320.50)
             Less RRB Lien                         ($8,132.35)
             Less RRB Taxes                        ($10,521.75)
             Net Draft Amount                      $52,172.65
          This constitutes full and final satisfaction of the verdict in
          case number 120502075, filed in the Philadelphia Court of
          Common Pleas on May 22, 2013.

       This Court granted said Motion on January 28, 2015.

              On February 11, 2015, [Liberatore] filed a Motion to Hold
       [Railroad] in Contempt for its Refusal to Obey This Court’s
       January 28, 2015 Order.         Among the relief requested,
       [Liberatore] asked the Court to order [Railroad] to pay the
       difference between $87,500.00 and $52,172.65, or $35,327.35.

            On February 13, 2015, [Railroad] filed a Motion for
       Reconsideration of the Court’s January 28, 2015 Order. On
       February 19, 2015, the Court denied this Motion as untimely.

             The morning of February 23, 2015, [Railroad] [f]iled a
       Notice of Appeal appealing this Court’s January 28, 2015 Order.
       Later that day, this Court held a hearing on [Liberatore’s] Motion
       to Hold [Railroad] in Contempt on February 23, 2015. From the
       bench, this Court granted the Motion and issued an Order that
       ordered [Railroad] to pay: (1) $35,327.35 within three days of
       the Court’s Order; (2) reasonable attorney’s fees associated with
       said Motion; (3) cost for filing the Motion; (4) sanctions at the
____________________________________________


5
  The SSB Lien pertained to payments Liberatore received pursuant to the
parties’ collectively bargained Supplemental Sickness Benefits (“SSB”) Plan.




                                           -4-
J-A01020-16


       rate of $1,000 per day after the three-day grace period after the
       Court’s order for payment of $35,327.35.

             On February 25, 2015, [Railroad] filed a Praecipe to Enter
       Judgment. On February 25, 2015, the Prothonotary entered
       judgment which stated “Judgment is entered in favor of Larry R.
       Liberatore  and    against  Norfolk    Southern     Corporation,
       Monongahela Railway Corporation and Consolidated Rail
       Corporation on the amount of $87,500.00 on the Court Order
       dated 01/28/2015.”

              On February 26, 2015, [Liberatore] filed a Motion for Award
       of Attorney’s Fees. On March 4, 2015, this Court granted the
       Motion, ordering [Railroad] to pay attorney’s fees in the amount
       of $2,550 and costs in the amount of $28 within 20 days of the
       Order.

             On February 27, 2015, [Railroad] paid $35,327.35 plus
       twenty percent interest, for a total of $42,392.82 to the Office of
       Judicial Records in compliance with this Court’s February 23,
       2015 Order. [Railroad] therefore avoided the imposition of the
       $1,000.00 per day sanction for failure to timely deposit the
       aforementioned funds with the Court.

             Also on February 27, 2015, [Railroad] filed a Motion to
       Amend Judgment Entered on February 25, 2015. [Railroad]
       stated that the docket should be revised to reflect that a verdict
       was only entered against Norfolk Southern Railway Company
       and Consolidated Rail Corporation.

              On March 27, 2015, [Railroad] filed a second Notice of
       Appeal, appealing the judgment entered by the Prothonotary on
       February 25, 2015.

           On April 6, 2015, this Court denied [Railroad’s] Motion to
       Amend Judgment Entered on February 25, 2015.

            On April 15, 2015, [Railroad] filed a third Notice of Appeal,
       appealing this Court’s April 6, 2015 Order.

Trial Court Opinion, 5/12/2015, at 2-5 (internal citations omitted).6, 7
____________________________________________


6
 Preliminarily, we note Railroad filed three separate notices of appeal in this
case. The first, filed on February 23, 2015, was from the January 28, 2015,
(Footnote Continued Next Page)


                                           -5-
J-A01020-16



      In its first issue, Railroad addresses the trial court’s determination that

it failed to preserve any claims for review on appeal. Specifically, the court

found that, pursuant to Pa.R.C.P. 227.1, Railroad was required to file a post-

trial motion, within 10 days of the verdict, to “present the manner in which
                       _______________________
(Footnote Continued)

order of the trial court granting Liberatore’s motion to enforce full
satisfaction of the verdict. On April 17, 2015, this Court quashed that
appeal as premature because it was filed before the entry of judgment. The
second notice of appeal, filed on March 27, 2015, was from the entry of
judgment on February 25, 2015, and is the one before this panel. The third
notice of appeal, filed on April 15, 2015, was from the April 6, 2015, order of
the trial court denying Railroad’s motion to amend the judgment. That
appeal was discontinued after the trial court amended the judgment to
reflect the correct parties on May 12, 2015.

      We reject the assertion by both the trial court and Liberatore that this
appeal may be untimely because it was not filed within 30 days of the
court’s November 19, 2014, molded verdict. See Trial Court Opinion,
5/12/2015, at 10; Liberatore’s Brief at 11. This Court has held “the proper,
procedural course to pursue in perfecting an appeal from an adverse jury
verdict is to reduce the verdict to judgment and take an appeal
therefrom[.]” Crosby v. Com., Dep't of Transp., 548 A.2d 281, 283 (Pa.
Super. 1988), appeal denied, 559 A.2d 37 (Pa. 1989). See also Johnston
the Florist, Inc. v. TEDCO Const. Corp., 657 A.2d 511, 514 (Pa. Super.
1995) (“Because the entry of judgment was considered to be a prerequisite
to the exercise of this Court's jurisdiction, it was long this Court's policy to
quash an appeal from an order upon which judgment had not been
entered.”). When Railroad attempted to appeal the order entered January
28, 2015, granting Liberatore’s motion to enforce full satisfaction of the
verdict, this Court quashed the appeal as premature since a final judgment
had not been entered on the docket. See Docket No. 627 EDA 2015, Order,
4/17/2015. Accordingly, the appeal at issue, filed within 30 days of the
court’s entry of judgment on the docket, was proper.
7
  On March 11, 2015, the trial court ordered Railroad to file a concise
statement of errors complained of on appeal pursuant to Pa.R.A.P. 1925(b).
Railroad complied with the court’s directive, and filed a concise statement on
April 1, 2015.



                                            -6-
J-A01020-16



[it] intended to distribute the funds.” Trial Court Opinion, 5/12/2015, at 9.

Because Railroad failed to do so, the court concluded Liberatore “was not

given a chance to respond and/or dispute the proposed distribution.”      Id.

Accordingly, the court determined Railroad’s claims were waived.

      Conversely, Railroad asserts it was not required to file post-trial

motions. First, it emphasizes that post-trial motions are necessary to permit

a trial court to correct errors it made at trial.   Here, however, the issues

arose for the first time in a post-trial context, when Railroad paid the

adjusted award, and the trial court granted Liberatore’s motion to enforce

the full judgment. See Railroad’s Brief at 13-14. Second, Railroad claims it

was not required to seek the trial court’s approval to deduct RRTA taxes and

previously-paid sick benefits from the jury award because it was legally

required to deduct those amounts and “no court permission is needed to

perform a legally-required act.” Id. at 15.

      We agree with Railroad’s contention that it was not required to file a

post-trial motion seeking the trial court’s permission to deduct the RRTA

taxes, the RRB lien and the supplementary sick benefits from Liberatore’s

FELA award. As we will discuss infra, Railroad was legally required to deduct

these amounts from the judgment, and, consequently, it was not obligated

to seek the trial court’s permission to do so.

      Moreover, Railroad was not required to file post-trial motions to

challenge a court ruling that occurred after trial. Railroad is not disputing

either the jury’s award to Liberatore or its finding of liability, but rather,

                                     -7-
J-A01020-16



contests the trial court’s grant of Liberatore’s post-trial motion to enforce

the judgment – an issue that did not arise until after trial. See Atwell v.

Beckwith Machinery Co., 872 A.2d 1216, 1220 (Pa. Super. 2005) (finding

appellant’s challenge of trial court order entered on December 22, 2003,

which struck a judgment entered on December 1, 2003, was not waived

based upon appellant’s failure to file timely post-trial motions as appellant

“could not possibly have entered a post-trial motion challenging this issue

within 10 days of the February 2003 verdict.”).          Indeed, the note to

Pennsylvania Rule of Civil Procedure 227.1 provides:

      A motion for post-trial relief may not be filed to orders disposing
      of preliminary objections, motions for judgment on the pleadings
      or for summary judgment, motions relating to discovery or
      other proceedings which do not constitute a trial.

Pa.R.C.P. 227.1 (emphasis supplied).

      This Court’s recent en banc decision in Vautar v. First National Bank

of Pennsylvania, ___ A.3d ___, 2016 PA Super 5 (Pa. Super. 2016) (en

banc), is instructive. In that case, Jean Sojak held two certificates of deposit

(“CD’s”) in trust for her sisters Frances Sakmar and Bertha Vauatar. Sakmar

later mistakenly believed that Sojak had retitled the CD’s in trust for her

alone. When Sojak died, Sakmar attempted to redeem the CD’s; however,

because they were not in her possession, the bank required her to sign

indemnity bonds, in which she represented she was entitled to the proceeds.

The bank then released the proceeds to her. Id. at *1.




                                     -8-
J-A01020-16



      Vautar later filed a civil action against the bank, demanding it pay her

half of the proceeds from the CD’s.            The bank, in turn, demanded

reimbursement from Sakmar who declined to pay the disputed funds.

Rather, the funds were placed in an Oppenheimer account and, upon

Sakmar’s death, distributed to the appellants, her beneficiaries. The bank

filed a third-party complaint seeking to join Sakmar in Vautar’s action.

When Sakmar died, her estate was substituted as a party. The Bank later

filed an amended third-party complaint to join the appellants, asserting their

liability under a claim of, inter alia, unjust enrichment. See id.

      The case proceeded to a non-jury trial, and, on September 5, 2013,

the court entered a verdict and award for the bank and against the estate.

The bank filed a post-trial motion arguing that the court should have also

imposed a “constructive trust on the funds held by the [a]ppellants.” Id. at

*2. Without taking any additional evidence or testimony, the court entered

an “Amended/Supplemental” verdict on December 16, 2013, “finding against

both [the] estate and the [a]ppellants and concluding that [the a]ppellants

were unjustly enriched by their receipt of the Disputed Funds.”       Id.    The

appellants thereafter filed a timely appeal.

      On appeal, the bank argued the appellants’ claims were waived

because they failed to file a timely post-trial motion after the court’s entry of

the “amended/supplemental verdict.”      Id.   An en banc panel of this Court

disagreed. Rather, we determined the appellants were not required to file

post-trial motions to the court’s “amended/supplemental verdict” because

                                      -9-
J-A01020-16



the post-trial proceedings that preceded its entry “clearly did not ‘amount to

a trial’” as contemplated in Pa.R.C.P. 227.1. Id. at *4 (emphasis omitted).

The en banc panel also noted the issues the appellants raised on appeal

were the same ones argued on the bank’s post-trial motions, such that

requiring the appellants to file post-trial motions would have been a “waste

of judicial resources.” Id.

        While we recognize the issues involved in the present case, unlike

those in Vautar, were not addressed by the trial court prior to appeal, we

find the court had no authority to excuse Railroad from deducting from the

jury’s award either Liberatore’s share of RRTA taxes, or the RRB and

supplemental sickness benefits he had received.        Accordingly, Railroad’s

claims are not barred by its failure to file post-trial motions, and we may

now turn to the substantive matters on appeal.

        Railroad next contends the trial court erred in determining it was not

permitted to deduct from the jury award Liberatore’s share of RRTA taxes.

Its argument is two-fold. First, Railroad asserts an award for time lost due

to personal injury is taxable “compensation” under the RRTA and Railroad

Retirement Act (“RRA”).8 Second, Railroad claims because Liberatore sought

damages for lost time and the jury’s award was not apportioned, the entire

FELA verdict should be treated as “lost time” pay for RRTA tax purposes.

____________________________________________


8
    45 U.S.C. § 231 et seq.




                                          - 10 -
J-A01020-16



        This issue involves the interplay between the RRA, the RRTA, the

Internal Revenue Code (IRC),9 and the Federal Insurance Contributions Act

(“FICA”).10     By way of background, “[t]he [RRA], first passed in 1934,

provides a system of retirement and disability benefits for persons who

pursue careers in the railroad industry.”          Hisquierdo v. Hisquierdo, 439

U.S. 572, 573 (1979) (internal citation omitted). For that reason, railroad

workers do not receive social security benefits, but rather, retirement

benefits under the RRA.          Heckman v. Burlington Northern Santa Fe

Railway Co., 837 N.W.2d 532 (Neb. 2013).11

        The RRTA is a subsection of the Internal Revenue Code (IRC).
        Retirement benefits paid through the RRA are funded through
        the RRTA. Under the RRTA, taxes are imposed on compensation
        earned by railroad employees. The RRTA implements a dual tax
        system, in which railroad employers must withhold their tax
        shares, as well as their employees’ tax shares, and then provide
        both shares to the Internal Revenue Service (IRS). The first part
        of this dual system is “Tier 1.” Tier 1 taxes are imposed against
        both railroad employee and railroad employer.           They are
        analogous to taxes imposed on nonrailroad workers by the
        Federal Insurance Contributions Act (FICA). The second part of
____________________________________________


9
    United States Code, Title 26.
10
     26 U.S.C. § 3101 et seq.
11
  We recognize “this Court is not bound by the decisions of federal courts,
other than the United States Supreme Court, or the decisions of other states’
courts.” Eckman v. Erie Ins. Exch., 21 A.3d 1203, 1207 (Pa.Super.
2011). Nevertheless, “we may consider these cases for their persuasive
value” particularly where, as here, there is no Pennsylvania case law
addressing the claims on appeal. Red Vision Sys., Inc. v. Nat'l Real
Estate Info. Servs., L.P., 108 A.3d 54, 60 n.4 (Pa. Super. 2015), appeal
denied, 116 A.3d 605 (Pa. 2015).



                                          - 11 -
J-A01020-16


      the dual system, “Tier 2,” also imposes taxes against both
      railroad employee and railroad employer. “[Tier 2] benefits are
      similar to those that workers would receive from a private multi-
      employer pension fund.”       RRTA taxes also include certain
      Medicare withholdings.

Cowden v. BNSF Ry. Co., 2014 WL 3096867, *2 (E.D. Mo. 2014) (internal

citations omitted).

      At issue here is whether a FELA award, which includes a claim for time

lost due to personal injury, is taxable under the RRTA.    The RRTA directs

railroad employers to deduct retirement taxes “from the compensation of the

employee as and when paid.”        26 U.S.C. § 3202(a).     The Act defines

“compensation” simply as “any form of money remuneration paid to an

individual for services rendered as an employee to one or more employers.”

26 U.S.C. § 3231(e)(1). Although in prior versions of the Act, the definition

of “compensation” specifically included pay for time lost due to personal

injury, “Congress deleted the … language from the RRTA in 1983 as part of

an overhaul to both the RRA and the RRTA.” Phillips v. Chicago Cent. &

Pacific R. Co., 853 N.W.2d 636, 641 (Iowa 2014).

      However, the definition of “compensation” in the RRA specifically

includes pay for time lost due to personal injury:

      (h)(1) The term “compensation” means any form of money
      remuneration paid to an individual for services rendered as an
      employee to one or more employers or as an employee
      representative, including remuneration paid for time lost as
      an employee, but remuneration paid for time lost shall be
      deemed earned in the month in which such time is lost. …

      (2) An employee shall be deemed to be paid “for time lost” the
      amount he is paid by an employer with respect to an identifiable
      period of absence from the active service of the employer,

                                    - 12 -
J-A01020-16


      including absence on account of personal injury, and the
      amount he is paid by the employer for loss of earnings resulting
      from his displacement to a less remunerative position or
      occupation. If a payment is made by an employer with
      respect to a personal injury and includes pay for time lost,
      the total payment shall be deemed to be paid for time lost
      unless, at the time of payment, a part of such payment is
      specifically apportioned to factors other than time lost, in
      which event only such part of the payment as is not so
      apportioned shall be deemed to be paid for time lost.

45 U.S.C. § 231(h)(1)-(2) (emphasis supplied).

      By comparison, the social security equivalent of the RRTA is FICA.

FICA imposes “a tax equal to 6.2 percent of the wages … received by the

individual with respect to employment” on an individual’s income. 26 U.S.C.

§ 3101(a). The term “wages” in FICA is defined, similarly to “compensation”

under the RRTA, as “all remuneration for employment, including the cash

value of all remuneration (including benefits) paid in any medium other than

cash[.]” 26 U.S.C. § 3121(a)(1).    However, the IRC, which is the umbrella

statute under which both the RRTA and FICA are codified, specifically

excludes from its definition of “gross income” “the amount of any damages

… received … on account of personal physical injuries or physical sickness[.]”

26 U.S.C. § 104(a)(2).    Because the definition of “wages” under FICA is

narrower than the definition of “gross income” under the IRC, several Circuit

Courts of Appeal have held that “[d]amages not included in the [IRC’s]

definition of ‘income’ are not considered ‘wages’” for purposes of FICA.

Gerbec v. United States, 164 F.3d 1015, 1025 (6th Cir. 1999), quoting

Dotson v. United States, 87 F.3d 682, 689 (5th Cir. 1996).          See also



                                    - 13 -
J-A01020-16



Redfield v. Ins. Co. of N. Am., 940 F.2d 542, 548 (9th Cir. 1991)

(“Personal injury damages are simply not ‘income’ as used in the FICA

statutes.”).

      Relying upon the decision of the Missouri Supreme Court in Mickey v.

BNSF Railway Company, 437 S.W.3d 207 (Mo. 2014), the trial court sub

judice found Liberatore’s “judgment is not subject to RRTA withholding taxes

‘both because the RRTA does not make lost wages received on account of a

FELA personal injury suit subject to RRTA taxes and because there is no

basis for a presumption that part of the award was for lost wages or that any

loss in earning capacity precluded him from taking jobs that would not have

been subject to RRTA taxes.’”      Trial Court Opinion, 5/12/2015, at 14,

quoting Mickey, supra, 437 S.W.3d at 218.       In doing so, the trial court

rejected decisions of the Supreme Courts of Nebraska and Iowa, which held

an employee’s entire FELA award is subject to RRTA taxes when the plaintiff

has made a claim for lost wages and the jury returned a general verdict.

See Heckman, supra; Phillips, supra.

      A brief synopsis of the cases relied upon by the trial court and the

parties will be helpful to our discussion.    In Heckman, Phillips, and

Mickey, the plaintiffs sued their railroad employers for workplace injuries

under FELA, which included a claim for “lost wages.”   Moreover, in all three

cases, the jury returned a general verdict, that did not allocate damages,

and the railroad employers withheld a portion of the damages award for




                                   - 14 -
J-A01020-16



RRTA taxes. See Heckman, supra, 837 N.W.2d at 535; Phillips, supra,

853 N.W.2d at 638; Mickey, supra, 437 S.W.3d at 208.

      In Heckman, the Nebraska Supreme Court held that the plaintiff’s

entire, general FELA award was subject to RRTA taxation.       The Court first

considered the preliminary question of whether any portion of the jury’s

general verdict could be considered “lost wages,” and, consequently, taxable

under the RRTA. Heckman, supra, 837 N.W.2d at 536. Relying upon state

law, the Court found that when a verdict does not “specify the basis for an

award,” it is presumed “the winning party prevailed on all issues presented

to the jury.”   Id. at 537.    Because the pleadings and jury instructions

included a claim for lost wages, the Heckman Court held that the jury

presumptively found for the plaintiff on that claim. Id. at 538.

      Next, the Heckman Court considered whether the plaintiff’s “lost

wages” award was taxable “compensation” under the RRTA.            The Court

looked to the definition of compensation in the RRA, which explicitly includes

“remuneration for time lost” as compensation. Id. at 539, citing 45 U.S.C.

231(h)(1). Further, the Court indicated the RRA also provides that when an

employee receives a personal injury award that includes “time lost” pay, the

total award is “deemed to be paid for time lost unless” it is specifically

apportioned. Id. at 539-540, citing 45 U.S.C. § 231(h)(1)-(2). Moreover,

the Court noted that Treasury Regulation § 31.3231(e)-1 interpreted the

RRTA’s definition of “compensation” to include “amounts paid for an

identifiable period during which the employee is absent from active service

                                    - 15 -
J-A01020-16



of the employer” and, specifically, “pay for time lost.” Id. at 540, quoting

26 C.F.R. § 31.3231(e)-1(a)(3), (4).          The Heckman Court concluded:

“Based on the definition of compensation as stated in the RRA and RRTA and

the agencies’ interpretations found in federal regulations, we conclude that

time lost is compensation that is subject to taxation.” Id.

      Lastly, the Court looked to opinions of the RRB for guidance in

determining what portion of the general verdict was subject to RRTA

taxation.     In those decisions, the RRB treated the entire FELA award for

personal injury as pay for time lost, absent a specific allocation.         Id.

Accordingly, the Heckman Court held:

      Because the jury returned a general verdict that was based in
      part on [plaintiff’s] lost wages, we presume that he prevailed on
      all issues presented to the jury and that [plaintiff] was awarded
      lost wages. The district court failed to recognize that absent
      specific allocations to other components, the award is deemed
      compensation for lost wages. See, 45 U.S.C. § 231(h)(2); RRB
      Legal Opinions L–87–91 and L–92–18. Classification of the
      award as compensation affects both [plaintiff] and [railroad]
      because it triggers obligations and benefits of both parties under
      the RRA. [Railroad] is required to pay tiers 1 and 2 taxes, and
      [plaintiff] receives retirement benefits for the amount of time he
      was absent due to his personal injury.

Id. at 542.

      The Supreme Court of Iowa came to the same conclusion in Phillips.

In that case, the court first found that under either federal or state law, the

entire FELA verdict would be considered payment for time lost.        Phillips,

supra, 853 N.W.2d at 644.         Although recognizing the RRTA does not

explicitly include “time lost” pay in its definition of compensation, the court,


                                     - 16 -
J-A01020-16



nonetheless, noted the RRA “expressly provides” so, and “there is no logical

reason to conclude that such silence [in the RRTA] is an indication Congress

intended a different rule to apply for purposes of tax withholding under the

RRTA.” Id.

      Next, the Phillips Court considered whether “remuneration for time

lost is subject to tax withholding under the RRTA.” Id. at 645. In doing so,

the court again noted that while the RRA explicitly includes “time lost” pay in

its definition of “compensation,” the RRTA does not.     Moreover, the Court

pointed out prior versions of the RRTA did include pay for time lost in its

definition but the language was omitted in subsequent amendments to the

statute. Id. at 640-641. Regardless, the Phillips Court explained that, in

1994, after those amendments were enacted, the IRS issued Treasury

Regulations “that provided the definition of compensation under the RRTA

included pay for time lost.”   Id. at 642, citing 26 C.F.R. § 31.3231(e)-1.

The Court emphasized the commentary accompanying the Regulations

expressly stated that, despite the omission of “time lost” language in the

amendments to the Act, “[t]he legislative history does not indicate that

Congress intended to exclude payments for time lost from compensation.”

Id. at 642, quoting Update of Railroad Retirement Tax Act Regulations, 59




                                    - 17 -
J-A01020-16



FR 66188-01 (12/24/1994).12           Consequently, the Phillips Court held that

“time lost is properly taxed as compensation under the RRTA.” Id. at 652.

       However, in Mickey, the decision relied upon by the trial court herein,

the Supreme Court of Missouri held that the employee’s general FELA award

was not subject to RRTA taxation. In that case, like here, after the railroad

employer deducted RRTA taxes from the employee’s FELA award, the trial

court ordered the railroad to satisfy the judgment.        In an appeal by the

railroad, the Mickey court affirmed the trial court’s ruling.

       First, the Mickey Court determined that a FELA judgment is not

taxable “compensation” pursuant to the RRTA.            The court explained the

definition of “gross income” under the IRC specifically excludes “‘the

amount of any damages … received … on account of personal physical

____________________________________________


12
   Before relying upon Treasury Regulations, the Phillips Court recognized
that the United States Supreme Court provided guidelines as to when a court
may defer to an administrative agency’s interpretation of a statute. See
Chevron, U.S.A., Inc. v. National Res. Defense Council, Inc., 467 U.S.
837, 842-843 (1984) (holding deference is appropriate when (1) “the statute
is silent or ambiguous with respect to the specific issue” and (2) “the
agency’s answer is based on a permissible construction of the statute.”).

       In following the Chevron guidelines, the Phillips Court determined
the Treasury Regulations at issue were entitled to deference. First, the court
found that Congress’s intent, in omitting a reference to “time lost” was not
clear, particularly since the RRA “explicitly includes time lost in its definition
of compensation,” and “[t]he RRA and the RRTA are inextricably
interconnected because the latter funds the former.” Phillips, supra, 853
N.W.2d at 649. Next, the court concluded the Treasury Department’s
interpretation of the Act was reasonable, and supported by decisions of the
RRB. Id. at 651.



                                          - 18 -
J-A01020-16



injuries or physical sickness[.]’”     Mickey, supra, 437 S.W.3d at 210,

quoting 26 U.S.C. § 104(a)(2). Likewise, personal injury judgments “are not

subject to [FICA] withholding taxes, which fund Social Security and Medicare

benefits and closely parallel RRTA withholding taxes.” Id. at 211 (footnote

omitted). The Mickey Court noted the Treasury Regulation interpreting the

RRTA’s definition of compensation specifically states it “has the same

meaning as the term wages in [FICA] section 3121(a) … except as

specifically limited by the [RRTA].”       Id. at 212, quoting 26 C.F.R. §

31.3231(e)-1(a)(1) (emphasis omitted).             Because the Court found no

“specific limitation in the RRTA,” it explained:

      It necessarily follows that “compensation” received as a part of a
      personal injury judgment is not subject to RRTA withholding
      taxes for the same reason that lost wages received as part of a
      personal injury judgment are not subject to FICA withholding
      taxes. [A] payment for lost wages is normally subject to FICA
      withholding taxes, but where such payment is on account of a
      personal injury suit or settlement, it is not. This is because the
      lost wages damages award is excluded from income under
      section 104(a)(2) of the [IRC], and a payment that does not
      qualify as income cannot qualify as wages. Consequently, such
      a payment is not subject to FICA’s taxes on “wages.” Likewise,
      lost wages obtained through a personal injury suit are not taxed
      under the RRTA because they do not constitute income and,
      therefore, do not qualify as taxable “compensation” under the
      RRTA.

Id. at 212. In other words, the Mickey Court applied the personal injury

award exemption for “gross income” under the IRC to both FICA and RRTA

withholding taxes.




                                     - 19 -
J-A01020-16



       Further,   the   Mickey   Court   found    the   decision    in   Phillips

“unpersuasive.”    Id. at 213.   Contrary to that decision, the Mickey Court

concluded there were “many reasons why the term ‘compensation’ has a

different meaning under the RRTA than it has under the RRA.” Id. First, the

court explained damages for “time lost” are treated differently when the

time lost is due to personal injury.     Indeed, the Regulation upon which

Phillips relied refers only to “pay for time lost.” Id. Second, the Mickey

Court noted that under state law, a plaintiff seeking lost wages due to

personal injury is actually seeking “the loss of the capacity to earn,” and it

would be “speculative to presume that any future lost earnings necessarily

would have been” in the railroad industry and subject to RRTA taxes. Id. at

214.    Finally, the Court opined the Phillips decision paid “insufficient

attention to the different purposes of the RRA and the RRTA[,]” explaining:

       Although the RRA and the RRTA overlap to the extent that taxes
       collected under the RRTA fund benefits provided under the RRA,
       they differ in significant ways. Most basically, the acts are
       administered by separate agencies: the RRTA is part of the
       Internal Revenue Code and is administered by the Internal
       Revenue Service of the Department of the Treasury, while the
       RRA is administered by the Railroad Retirement Board, which is
       an independent agency in the executive branch. And, the RRA is
       a remedial act that provides benefits to railroad workers, while
       the RRTA is a tax act.

Id. at 214-215 (internal citations omitted).     For that reason, the Mickey

Court found the inclusion of time lost due to personal injury as compensation

in the RRA, but not in the RRTA, makes sense because the RRA’s purpose is

remedial, that is, “is to help workers qualify for RRA benefits.”    Id. at 215.


                                     - 20 -
J-A01020-16



Accordingly, the Court concluded: “These foundational distinctions confirm

that section 231(h) of the RRA does not determine the scope of taxable

compensation under the RRTA.” Id. (footnote omitted).

     The Mickey Court also cited an alternative basis for its decision.

Namely, the railroad could not presume the entirety of the jury’s general

verdict was subject to RRTA taxes. Id. at 216. The Court noted that, under

Missouri law, “a general verdict is not necessarily presumed to constitute a

finding on all issues, for [Missouri Supreme Court Rule 71.01] says it may be

a pronouncement ‘upon all or any’ of the issues presented.”      Id. at 217

(emphasis in original). Therefore, the Mickey Court held:

     Mr. Mickey’s judgment is not subject to RRTA withholding taxes
     both because the RRTA does not make lost wages received on
     account of a FELA personal injury suit subject to RRTA taxes and
     because there is no basis for a presumption that part of the
     award was for lost wages or that any loss in earning capacity
     precluded him from taking jobs that would not have been subject
     to RRTA taxes.

Id. at 218.

     As noted above, the trial court in the present case relied exclusively

upon Mickey in determining Liberatore’s general FELA verdict was not

subject to RRTA taxes.    The court found the Mickey decision drew “an

appropriate parallel” between FICA, which funds Social Security, and the

RRTA, which funds the RRA.      Trial Court Opinion, 5/12/2015, at 13.   The

court determined that because a personal injury award is excluded from the

definition of “gross income” under the IRC, it is also not taxable for social

security benefits under FICA.     Id.   Under the trial court’s analysis, it

                                    - 21 -
J-A01020-16



therefore follows the award is not subject to RRTA taxes, as well. The trial

court concluded the contrary reasoning in Heckman and Phillips was

“unpersuasive.” Id. at 14.

       Railroad contends, however, the RRTA and the RRA “are the flip-sides

of a single comprehensive program[;]” they should be considered “in pari

materia, and [] the RRTA’s definition of ‘compensation’ must be interpreted

consistently with the RRA’s definition of that same term.” Railroad’s Brief at

25. We agree.13

       As set forth above, both FICA and the RRTA are taxing statutes, and

are codified in the IRC. Neither specifically excludes personal injury awards

from its definition of taxable income. See 26 U.S.C. § 3121(a)(1) (defining

“wages” under FICA); 26 Pa.C.S. § 3123(e)(1) (defining “compensation”

under the RRTA). However, the IRC excepts personal injury awards from its

definition of “gross income,”14 and some federal courts have held that this

exclusion also applies when determining an individual’s “wages” for purposes

of calculating FICA taxes.       See Redfield, supra.     Under the reasoning of

Mickey, the IRC’s exclusion applies, as well, to the taxable “compensation”
____________________________________________


13
   “Because [the issues on appeal] are purely legal ones involving statutory
interpretation, we exercise a de novo standard of review and a plenary
scope of review of the [trial court’s] decision.” Bowling v. Office of Open
Records, 75 A.3d 453, 466 (Pa. 2013) (citation omitted).
14
  See 26 U.S.C. § 104(a)(2).            We note that this definition is under the
subtitle for “Income Taxes.”




                                          - 22 -
J-A01020-16



of a railroad worker for purposes of the RRTA.             See Mickey, supra, 437

S.W.3d at 212 (“[L]ost wages obtained through a personal injury suit are

not taxed under the RRTA because they do not constitute income …”).

       However, the RRA specifically includes payment for time lost “on

account of personal injury” in its definition of “compensation” for purposes of

calculating RRA benefits.           Although the Mickey Court attempted to

disassociate the RRA and RRTA, we find the statutes are inextricably

intertwined, and must be considered in pari materia.            Indeed, without the

benefits provided for in the RRA, there would be no need for the taxing

provisions of the RRTA.          See Phillips, supra, 853 N.W.2d at 649 (noting

one court described the RRA “as ‘the expenditure side of the coin’ and the

RRTA ‘the revenue side[.]’”).

       Moreover,     as    the    Mickey       Court   acknowledged,    the   Treasury

Regulations provide some guidance in this matter.15                    The Regulation




____________________________________________


15
   We agree with, and rely upon, the discussion of the Phillips Court
regarding the deference due to a Treasury Regulation that passes the test
set forth by the Supreme Court in Chevron. See Phillips, supra, 853
N.W.2d at 647-650. See also supra at 17-18. Indeed, in a recent
decision, the Federal District Court for the Eastern District of Missouri also
found the regulation at issue “withstands scrutiny under Chevron” and was
entitled to deferential authority. Cowden, supra, 2014 WL 3096867 at *6.
Nevertheless, that court ultimately concluded the lost time on account of
personal injury was excluded from RRTA taxes pursuant to the IRC’s
exemption, and the plaintiff’s general verdict was “excluded in its entirety.”
Id. at *10-11.



                                          - 23 -
J-A01020-16



interpreting the RRTA’s definition of “compensation” provides, in relevant

part:

        (a) Definition—(1) The term compensation has the same
        meaning as the term wages in section 3121(a), … except as
        specifically limited by the Railroad Retirement Tax Act (chapter
        22 of the Internal Revenue Code) or regulation. …

                                     ****

        (4) Compensation includes amounts paid to an employee for
        loss of earnings during an identifiable period as the result of the
        displacement of the employee to a less remunerative position or
        occupation as well as pay for time lost.

26 C.F.R. § 31.3231(e)-1 (emphasis supplied).         The Mickey Court found

that because neither the Regulation nor the RRTA specifically include pay for

time lost due to personal injury in its definition of compensation, the FICA

definition of “wages” controlled.      Mickey, supra, 437 S.W.3d at 212.

Accordingly, the Court held lost wages recovered in a personal injury award

are not taxable “compensation.”

        However, what the Mickey Court, and the trial court herein, failed to

consider, is the difference in the way in which the RRA and the Social

Security Act (“SSA”) treat lost wages awarded in a personal injury suit.

Under the RRA, a railroad employee receives an increase in benefits based

upon his “average monthly compensation.” 45 U.S.C. § 231b(b)(1). That

“compensation” includes pay for time lost “on account of personal injury.”

45 U.S.C. § 231(h)(2). Because an employee’s RRA benefits increase based

upon “time lost” pay in a personal injury award, it follows that the same

“time lost” award should be taxed under RRTA to pay for those benefits.


                                      - 24 -
J-A01020-16



The Department of Justice, Tax Division, in its amicus brief explained the

relationship between the two statutes as follows:

              The RRA and the RRTA work in concert to provide
       retirement benefits for railroad workers. Under the RRA, when
       an employee receives compensation, the amount thereof adds to
       his creditable service and affects the level of benefits to which he
       will be entitled when he retires. The RRTA imposes a tax on the
       compensation paid to railroad employees in order to fund the
       benefits they will later receive. Both statutes, therefore, use the
       same definition of “compensation” to ensure that there is
       sufficient funding to pay the benefits that will later be owed.

United States of America’s Amicus Brief at 4.

       Conversely, the SSA does not explicitly include an employee’s pay for

lost time due to personal injury when calculating benefits. See 45 U.S.C. §§

409, 415.     Therefore, it follows that for purposes of collecting SSA taxes,

FICA also does not tax an award for time lost due to personal injury.

       Furthermore, we note the IRS has issued a Revenue Ruling 16 on this

subject, which comports with our interpretation of the statutes. In Revenue

Ruling 61-1, a railroad employee received an award under a settlement

agreement for personal injuries he sustained while employed by the railroad.

See Rev. Rul. 61-1, 1961-1 C.B. (1961), at *1.        He elected to apportion a

part of that settlement for time lost “for the purpose of computing railroad

____________________________________________


16
  “A revenue ruling is an official interpretation by the Service of the Internal
Revenue Code, related statutes, tax treaties, and regulations. It is the
conclusion of the Service on how the law is applied to a specific set of facts.”
www.irs.gov/irm/part32/irm_32-002-002.html (IRS Manual at 32.2.2.3.1,
“Revenue Ruling Defined”).



                                          - 25 -
J-A01020-16



retirement credit.” Id. The IRS was asked to determine the “federal income

tax consequence” of his decision to apportion part of the settlement for time

lost. Id. The IRS found:

       In the instant case, it is held that the amount received by the
       taxpayer was in settlement of any and all claims which he had
       against the railroad for the personal injuries he sustained and is,
       therefore, excludable from gross income under section 104(a)(2)
       of the Code. The fact that in this case ‘time lost payments'
       constitute compensation for the purposes of taxes imposed by
       the Railroad Retirement Tax Act is not controlling for Federal
       income tax purposes.

Id. Therefore, the IRS recognized that income received for time lost due to

personal injury is treated differently for income tax purposes than for RRTA

taxation purposes. Although Revenue Rulings are not binding on this Court,

and “do not have the force and effect of regulations,” the United States

Supreme Court has stated that “an agency’s interpretations and practices

[are   to    be    given]    considerable      weight   where   they   involve   the

contemporaneous construction of a statute and where they have been in

long use.” Davis v. United States, 495 U.S. 472, 484 (1990). This ruling

comports with our interpretation of the statutes, and we find it persuasive

authority.17

____________________________________________


17
   The federal district court in Cowden, supra, downplayed the significance
of this Revenue Ruling, explaining that such rulings are “not as influential as
Treasury Regulations and statutes.” Cowden, supra, 2014 WL 3096867, at
*11.     The court then summarily dismissed the decision, finding it
“conflict[ed] with mandatory statutory and regulatory authority.” Id. The
Cowden Court, like the Mickey Court, relied upon the exclusion of personal
(Footnote Continued Next Page)


                                          - 26 -
J-A01020-16



      Accordingly, we conclude the trial court erred in ruling that an award

for lost time due to personal injury is not taxable under the RRTA. However,

that finding only resolves the first part of this claim.      As noted supra, the

jury returned a general verdict, rendering it impossible to determine what

portion of the award was for lost wages.            Railroad asserts that we must

presume the jury found for Liberatore on all issues, including the claim for

lost wages.      Railroad’s Brief at 42-45.          Moreover, because the RRA

specifically provides that a personal injury award is deemed to be for time

lost unless the award is specifically apportioned, Railroad argues Liberatore’s

general verdict, in its entirety, was taxable. Id. at 45-47.       The trial court,

however, rejected this argument, claiming there was no Pennsylvania

authority to support this contention that “a general verdict presumes that

the entire amount … [is] payment for time lost.”             Trial Court Opinion,

5/12/2015, at 11. We disagree.

      Our Supreme Court has long recognized “[a] general finding for the

plaintiff [is] a finding wholly against the pleas of the defendant.”        In re

Fulton’s Estate, 51 Pa. 204, 211 (1866). See also Heitz v. Bridge, 39

A.2d 287, 289 (Pa. Super. 1944) (“A presumption that a verdict is

responsive to the issues as raised by the pleadings and the proofs, arises in

support of a general verdict[.]”). As such, it was incumbent upon Liberatore

                       _______________________
(Footnote Continued)

injury awards from personal income and FICA taxation to shape its analysis
of the RRTA. As explained above, we disagree with that comparison.



                                           - 27 -
J-A01020-16



to seek a special verdict form so that the jury’s separate assignment of

damages could be determined.

      Interestingly, Liberatore did initially file a motion in limine requesting

the court employ a special verdict form for this very reason.              See

Liberatore’s Motion in Limine, 6/13/2014, at 18-21.          Citing Heckman,

supra, Liberatore acknowledged that if he obtained a general verdict, “the

railroads may claim that the entire verdict should be deemed compensation

for lost wages[, and at] that point any award be subject to taxation.” Id. at

20-21.   However, Railroad states Liberatore withdrew this request on the

eve of trial, and asked the court to provide a general verdict form “that did

not itemize specific categories of damages.”      Railroad’s Brief at 6.    Our

review of the trial transcript reveals counsel for Liberatore indicated to the

court that the issue regarding a special verdict form could “be deferred” and

“discussed in chambers and/or decided on the papers rather than oral

argument.”    N.T., 10/27/2014, at 12-13.       The court commented it was

“really an issue for the charging conference[,]” a contention with which

Liberatore’s counsel agreed. Id. at 13. Nevertheless, during oral argument

before this Court, Liberatore’s counsel stated he did, indeed, withdraw his

request for a special verdict, because he believed the Mickey decision,

decided only a few months before trial, was advantageous to his client. He

cannot now be heard to complain when the lack of apportionment works to

his detriment.




                                    - 28 -
J-A01020-16



       We also must briefly address Liberatore’s assertion that Railroad

routinely takes an inconsistent position when it settles a FELA claim.

Indeed, Liberatore contends Railroad arbitrarily requires successful trial

litigants to pay RRTA taxes “in an attempt to punish a plaintiff for going to

trial[.]”   Liberatore’s Brief at 37.    In support of this claim, Liberatore

reproduced in his brief a purported “Settlement and Final Release” from

another case in which the amount listed for RRTA taxes is “$0.00.”

Liberatore’s Brief at 38.

       This claim is specious. “Parties with possible claims may settle their

differences upon such terms as are suitable to them.”        Buttermore v.

Aliquippa Hosp., 561 A.2d 733, 735 (Pa. 1989). A railroad employer could

structure a settlement agreement so that none of the award was allocated

for time lost pay.   Therefore, the payment would not be subject to RRTA

taxation, and additionally, would not count towards the employee’s RRA

benefits.   As Railroad states in its reply brief, “there is nothing wrong or

nefarious about this mutually-beneficial approach.” Railroad’s Reply Brief at

17. Consequently, Railroad’s purported failure to deduct RRTA taxes from a

settlement award in an unrelated matter, when it is unclear any of the award

was for lost time, is of no moment.

       Accordingly, we conclude Railroad was statutorily required to deduct

RRTA taxes from Liberatore’s general FELA verdict, and the trial court erred




                                      - 29 -
J-A01020-16



when it directed Railroad to satisfy the entire verdict. 18 We note Liberatore’s

remedy, if he is entitled to one, lies with the IRS or in federal court. See

United States v. Clintwood Elkhorn Min. Co., 553 U.S. 1, 4 (2008) (“A

taxpayer seeking a refund of taxes erroneously or unlawfully assessed or

collected may bring an action against the Government either in United

States district court or in the United States Court of Federal Claims” after

first filing a claim for a refund with the IRS). 19

       In its last issue, Railroad argues the trial court erred in preventing it

from deducting from Liberatore’s award the full amount of sick benefits he

received through the RRB and a collectively bargained SSB Plan.            With

regard to the RRB lien, Railroad contends it was statutorily required to

deduct the lien amount under the Railroad Unemployment Insurance Act
____________________________________________


18
    We note neither the trial court, nor Liberatore, addresses the clear
mandate in the RRA that an unapportioned personal injury verdict should be
considered as all “time lost” pay. See 45 U.S.C.A. § 231(h)(2) (“If a
payment is made by an employer with respect to a personal injury and
includes pay for time lost, the total payment shall be deemed to be paid for
time lost unless, at the time of payment, a part of such payment is
specifically apportioned to factors other than time lost, in which event only
such part of the payment as is not so apportioned shall be deemed to be
paid for time lost.”).
19
   We also find Section 7421 of the IRC instructive. See 26 U.S.C. §
7421(a). “The object of § 7421(a) is to withdraw jurisdiction from the state
and federal courts to entertain suits seeking injunctions prohibiting the
collection of federal taxes.” Enochs v. Williams Packing & Nav. Co., 370
U.S. 1, 5 (1962). Here, the trial court improperly attempted to exercise its
jurisdiction to prevent Railroad from deducting RRTA taxes from Liberatore’s
jury award.




                                          - 30 -
J-A01020-16



(“RUIA”).20 Further, with regard to the SSB Plan benefits, Railroad asserts it

was required to deduct the amount based on the parties’ collective

bargaining agreement.

        By way of background, the RUIA, through the RRB, provides

unemployment and sick benefits to railroad workers.            See 45 U.S.C. §

352(a)(1).     After payments are made, the RRB obtains a lien upon any

damage award the employee receives for the amount of the benefits paid.

45 U.S.C. § 362(o). See also 20 C.F.R. § 341.1 (“After notice in accordance

with this part, the Board shall have a lien upon any sum or damages paid or

payable to an employee based upon an infirmity for which the employee

received sickness benefits.”).        Pursuant to RRB Regulations, an employer,

who pays a damages award to an employee, remains liable to the RRB for

the amount of the lien unless it either withholds the lien amount from the

damages award and forwards it to the RRB, or includes the RRB as a payee

on the damages check. 20 C.F.R. § 341.7.

        Here, in addition to RRB benefits, Liberatore also received additional

sickness benefits pursuant to the parties’ SSB Plan, which is part of their

collective bargaining agreement.           The Plan benefits are administered by

Aetna Life Insurance Company, and, like RRB benefits, are offset by any




____________________________________________


20
     See 45 U.S.C. § 351 et seq.



                                          - 31 -
J-A01020-16



damages award the employee may receive. The Plan provides, in relevant

part:

        This Plan has been established and maintained in fulfillment of
        certain collective bargaining agreements.    The agreements
        contain the following provision:

          “In case of a disability for which the employee may have a
          right of recovery against the employing railroad …, benefits
          will be paid under this Plan pending final resolution of the
          matter so that the employee will not be exclusively
          dependent upon his sickness benefits under the [RUIA].
          However, the parties hereto do not intend that benefits
          under this Plan will duplicate, in whole or in part, any
          amount recovered for loss of wages from the employing
          railroad …, and they intend that benefits paid under this
          Plan will satisfy any right of recovery for loss of wages
          against the employing railroad to the extent of the benefits
          so paid. Accordingly, benefits paid under this Plan will be
          offset against any right of recovery for loss of wages the
          employee may have against the employing railroad; …

        Thus, if benefits are paid under this Plan, the benefits payments
        will be deducted from any payment made in any case involving a
        claim for loss of wages and in which the employer or a third
        party may be liable for the injury.

Railroad’s Motion for Reconsideration, 2/13/2015, Exhibit O, Supplemental

Sickness Benefits Plan (1/1/2010) at 18. Relevant to this appeal, the SSB

Plan also states any dispute involving the application of the plan must be

submitted to a Disputes Committee.            See id., Exhibit Q, Memorandum

Agreement to Supplemental Sickness Benefit Agreement, at Section 2 (c).

        The trial court concluded Railroad’s actions violated Liberatore’s due

process rights.    See Trial Court Opinion, 5/12/2015, at 14.       The court

claimed that because Railroad did not provide prior notice it intended to

deduct the full amount of these benefits from the jury award, Liberatore

                                     - 32 -
J-A01020-16



“was not given an opportunity to be heard, or to present an alternative

argument, or to simply negotiate some of the lien amounts down to a lower

amount.”   Id. at 14-15.    Liberatore “piggybacks” on the trial court’s due

process argument, emphasizing Railroad failed to notify him that it intended

to deduct the sick benefits from the jury award before it did so. Liberatore’s

Brief at 40. He further claims Railroad’s deduction of those benefit amounts

“effectively eliminated the ability of [his] counsel to attempt to obtain a

reduction in the amount of any RRB lien” or the lien of the SSB plan

provider. Liberatore’s Brief at 42-43.

      Contrary to the trial court’s characterization, we find Railroad’s

deduction of the RRB lien and SSB benefits from the jury award did not

violate Liberatore’s due process rights.      “The core requirements of due

process are notice and the opportunity to be heard ‘at a meaningful time and

in a meaningful matter.’” In re Bridgeport Fire Litig., 8 A.3d 1270, 1288

(Pa. Super. 2010) (citations omitted), appeal denied, 23 A.3d 1003 (Pa.

2011). Here, Liberatore has not lost his right to be heard on the amount of

the RRB lien and SSB benefits deducted from his award.               The RRB

Regulations state the Board has the exclusive authority to “compromise

an amount recoverable” under the Act.        20 C.F.R. § 340.13.   Indeed, the

Regulations explicitly provide:    “Compromise is at all time within the

discretionary authority of the Board or its designee.”       Id.    Therefore,

Liberatore still retains the opportunity to challenge the amount of the RRB

lien before the Board. Moreover, neither the trial court, nor Railroad, had

                                    - 33 -
J-A01020-16



any authority to reduce the amount of the lien. Accordingly, we find the trial

court erred when it precluded Railroad from deducting the RRB lien from the

jury award.

      With regard to the SSB deduction, as noted above, the parties’ SSB

Plan provides that any payments will be deducted from a damages award.

Railroad’s Motion for Reconsideration, 2/13/2015, Exhibit O, Supplemental

Sickness Benefits Plan (1/1/2010) at 18. Moreover, the Plan states that all

disputes involving the application of the Agreement fall within the exclusive

jurisdiction of a Disputes Committee.        See id., Exhibit Q, Memorandum

Agreement to Supplemental Sickness Benefit Agreement, at Section 2(c).

Again, neither the trial court nor Railroad had the authority to forgive or

compromise any part of the SSB benefits owed. However, Liberatore may

still challenge the amount of the deduction before the Disputes Committee.

Accordingly, we find Liberatore’s due process rights were not violated

because he was aware of the amount of sickness benefits he received, and

he still retains the opportunity to seek a reduction in the deductions amount

before the RRB or the SSB’s Disputes Committee.

      Because we conclude the trial court erred when it directed Railroad to

pay full satisfaction of the judgment award, and prevented it from deducting

RRTA taxes, an RRB lien and SSB benefits from the jury’s award, we vacate

the judgment entered on February 25, 2015, and remand for further

proceedings consistent with this opinion.




                                    - 34 -
J-A01020-16



      Judgment    vacated.   Case   remanded   for   further   proceedings.

Jurisdiction relinquished.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 4/7/2016




                                - 35 -
