                IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Jason Lewis,                                  :
                            Petitioner        :
                                              :
                     v.                       :
                                              :
Workers’ Compensation Appeal                  :
Board (Fastrack Construction, Inc.),          :   No. 416 C.D. 2016
                        Respondent            :   Submitted: September 16, 2016


BEFORE:       HONORABLE RENÉE COHN JUBELIRER, Judge
              HONORABLE ANNE E. COVEY, Judge
              HONORABLE JOSEPH M. COSGROVE, Judge


OPINION NOT REPORTED

MEMORANDUM OPINION BY
JUDGE COVEY                                       FILED: December 19, 2016

              Jason Lewis (Claimant) petitions this Court for review of the Workers’
Compensation (WC) Appeal Board’s (Board) March 4, 2016 order affirming the
Workers’ Compensation Judge’s (WCJ) decision, on remand, granting Fastrack
Construction, Inc.’s (Employer) Review Benefit Offset Petition (Offset Petition).
The sole issue before the Court is whether the Board erred in affirming the WCJ’s
decision.1 After review, we affirm.
              Claimant sustained a work-related back injury on January 23, 2009
when, while in the course and scope of his employment as a carpenter with Employer,
another contractor’s (McGregor Industries, Inc.) employee assaulted him. By June 8,
2009 decision, a WCJ accepted Employer’s and Claimant’s Stipulation of Facts,

       1
         Claimant presented two issues for this Court’s review: (1) whether the Board erred by
affirming the WCJ’s decision ordering the Philadelphia County Common Pleas Court’s
prothonotary (Prothonotary) to release funds; and (2) whether substantial evidence supports the
Board’s holding that the WCJ merely “directed” the Prothonotary to release funds. Both issues are
subsumed in the issue of whether the Board erred in affirming the WCJ’s decision.
wherein, the parties agreed to Claimant’s work injury and Employer would provide
Claimant temporary total disability benefits in the amount of $836.00 per week
beginning January 24, 2009. Thereafter, by January 13, 2010 decision, the WCJ
approved a Compromise and Release Agreement (Agreement), pursuant to which
Employer and Claimant agreed that, in resolution of all future indemnity claims for
Claimant’s January 23, 2009 work injury, Employer would pay Claimant $90,000.00,
less a 20% counsel fee. Under the Agreement, Employer would not be responsible
for any medical treatment incurred by Claimant on or after January 13, 2010, and
Employer would assert a $140,000.00 subrogation lien against McGregor Industries,
Inc.
            On August 27, 2012, Employer filed the Offset Petition, seeking a
subrogation credit for a third-party recovery. Claimant filed an Answer denying the
allegations. On April 30, 2013, because the WCJ concluded that Employer
established its immediate $140,000.00 subrogation right, the WCJ granted
Employer’s Offset Petition. The WCJ ordered Claimant to immediately make an out-
of-pocket $140,000.00 lump sum payment to Employer’s WC insurer, Liberty Mutual
Insurance Company (Liberty Mutual). Claimant appealed to the Board.
            On February 20, 2015, the Board reversed the WCJ’s order directing
Claimant to pay Employer $140,000.00, vacated the WCJ’s decision and remanded
the matter to the WCJ to reopen the record as necessary to receive additional
evidence, and to issue appropriate findings of fact, conclusions of law and an order
addressing Employer’s Offset Petition. The Board specifically directed the WCJ to
make “an explicit finding concerning the amount of attorney’s fees or costs which
were paid, which require resolution pursuant to the cited cases.     Stalmaster [v.
Workmen’s Comp. Appeal Bd. (SEPTA), 679 A.2d 293 (Pa. Cmwlth. 1996)]; [Pa.
Mfrs. Ass’n Ins. Co v.] Wolf[, 626 A.2d 522 (Pa. 1993)].”        Board Dec. at 6,
Reproduced Record (R.R.) at 26a.
                                         2
              On remand, the WCJ granted the Offset Petition for a total amount of
$30,015.47, after determining that Employer had a right to subrogation in the amount
of $60,000.00, less $21,000.00 in attorney fees and $8,984.53 in litigation expenses.
The WCJ specified:

              It is ORDERED that the [Philadelphia Common Pleas
              Court’s (trial court) prothonotary (Prothonotary)] or
              otherwise, make payments of $30,0150.47 [sic] for
              satisfaction of the [WC] Lien to [Liberty Mutual], in care of
              Counsel of record for the [WC] matter of Jason Lewis v.
              Fastrack Construction, Inc., Rhonda Harris, Esquire . . . of
              $21,000.00 for Counsel Fees . . . to Counsel of record for
              [Claimant], The Law Offices of Christy Adams, PC . . . and
              of $8,984.53 for reimbursement of costs in the matter of
              Jason Lewis v. McGregor Industries, Inc. . . . to Counsel of
              record for [Claimant], The Law Offices of Christy Adams,
              PC . . . from the deposits as a result of the arbitration of the
              civil action, Jason Lewis v. McGregor Industries, Inc. and
              Gilbane Building Company, October Term, 2010, No.
              00550, in the [trial court], and in an account with the
              [Prothonotary], in accordance with the terms of the [WC
              Act (Act)2].

WCJ Dec. at 10, R.R. at 18a. Claimant appealed to the Board. On March 4, 2016,
the Board affirmed the WCJ’s order granting Employer’s Offset Petition. Claimant
appealed to this Court.3
              Claimant argues that the Board erred by affirming the WCJ’s decision
ordering the Prothonotary to release third-party recovery funds to satisfy Employer’s
subrogation lien because the Act does not confer such jurisdiction on WCJs.




       2
        Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2708.
       3
        “On review[,] this Court must determine whether constitutional rights were violated, errors
of law were committed, or necessary findings of fact were supported by substantial competent
evidence.” Stepp v. Workers’ Comp. Appeal Bd. (FairPoint Commc’ns, Inc.), 99 A.3d 598, 601 n.6
(Pa. Cmwlth. 2014).


                                                3
Employer responds that the WCJ had exclusive jurisdiction to determine its
entitlement to the lien.
               Initially, the third-party recovery funds were put in escrow as a result of
McGregor Industries, Inc.’s Motion to Confirm Judgment of Arbitrator and Enforce
Settlement and Stay Distribution of Third Party Settlement Funds (Motion)4 filed
with the trial court. On March 26, 2013, the trial court granted the Motion and
expressly ordered that “[t]he arbitration molded award of $60,000.00 is to be
deposited with the Prothonotary pending the resolution of the [WC] lien.” Trial Ct.
Order (emphasis added).
               Section 319 of the Act provides, in relevant part:

               Where the compensable injury is caused in whole or in
               part by the act or omission of a third party, the
               employer shall be subrogated to the right of the
               employe, his personal representative, his estate or his
               dependents, against such third party to the extent of the
               compensation payable under this article by the
               employer; reasonable attorney’s fees and other proper
               disbursements incurred in obtaining a recovery or in
               effecting a compromise settlement shall be prorated
               between the employer and employe, his personal
               representative, his estate or his dependents. The employer
               shall pay that proportion of the attorney’s fees and other
               proper disbursements that the amount of compensation paid
               or payable at the time of recovery or settlement bears to the
               total recovery or settlement. Any recovery against such
               third person in excess of the compensation theretofore paid
               by the employer shall be paid forthwith to the employe, his
               personal representative, his estate or his dependents, and
               shall be treated as an advance payment by the employer on
               account of any future instalments of compensation.

77 P.S. § 671 (emphasis added). “Moreover, a determination of whether an employer
or its insurer is entitled to subrogation falls within the exclusive jurisdiction of the
[WC] authorities. Common pleas courts lack jurisdiction to adjudicate the right of

      4
          Liberty Mutual petitioned to intervene and join McGregor Industries, Inc. in the Motion.
                                                  4
subrogation.” Stout v. Workers’ Comp. Appeal Bd. (Pennsbury Excavating, Inc.), 948
A.2d 926, 931 (Pa. Cmwlth. 2008) (citation omitted; emphasis added).
               Because the subrogation issue was within the WCJ’s exclusive
jurisdiction, the WCJ’s order directing the Prothonotary to release the funds to
Employer was harmless error,5 especially here where Liberty Mutual had already
filed a motion with the trial court for release of the funds based on the WCJ’s
decision.6    Accordingly, the Board did not err in affirming the WCJ’s decision
granting Employer’s Offset Petition.


                                             ___________________________
                                             ANNE E. COVEY, Judge

Judge Cosgrove dissents.




       5
          “[H]armless error is a technique of appellate review designed to advance judicial economy
by obviating the necessity for a retrial where the appellate court is convinced that a trial error was
harmless beyond a reasonable doubt.” Commonwealth v. Noel, 53 A.3d 848, 864 (Pa. Super. 2012)
(quoting Commonwealth v. Allshouse, 36 A.3d 163, 182 (Pa. 2012)).
        6
          The WCJ issued her order on July 17, 2015. Thereafter, on or about August 15, 2015,
Liberty Mutual filed a Motion to Release Funds with the trial court, clearly recognizing the trial
court’s jurisdiction in this matter. By September 16, 2015 order, the trial court, acknowledging the
WCJ’s exclusive jurisdiction, denied the motion “without prejudice” stating: “[T]he said motion
may be refiled upon exhaustion of any and all appeals of the July 30, 2015 [WCJ decision].” Trial
Ct. September 16, 2015 Order.
                                                  5
            IN THE COMMONWEALTH COURT OF PENNSYLVANIA


Jason Lewis,                             :
                        Petitioner       :
                                         :
                  v.                     :
                                         :
Workers’ Compensation Appeal             :
Board (Fastrack Construction, Inc.),     :   No. 416 C.D. 2016
                        Respondent       :


                                       ORDER


            AND NOW, this 19th day of December, 2016, the Workers’
Compensation Appeal Board’s March 4, 2016 order is affirmed.


                                       ___________________________
                                       ANNE E. COVEY, Judge
