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South Dakota Subsequent Injury Fund v. Heritage Mutual Insurance3/6/2002
South Dakota Supreme Court Appeal from the Circuit Court of The Sixth Judicial Circuit Hughes County, South Dakota Hon. Steven L. Zinter, Judge
Considered on Briefs October 1, 2001
[ .] South Dakota Subsequent Injury Fund (SIF) appeals the circuit court's judgment affirming Department of Labor's (Department) determination that Heritage Mutual Insurance Company (Heritage), was entitled to full compensation from SIF for the subsequent injuries of William Belt and Edward McGee, based on the conclusion that the 1984 version of SDCL 62-4-34 governs the rights and duties of the parties based upon the date of injury. We affirm.
SUBSEQUENT INJURY FUND
[ .] A brief review of the history of SIF would be helpful before we turn to the facts of each claim. SIF is a fund created under South Dakota workers' compensation laws to encourage employers to hire or retain disabled or handicapped workers. Sioux Falls Sch. Dist. v. South Dakota Subsequent Injury Fund, 504 NW2d 107, 107 (SD 1993) (citing 2 Larson, Workers' Compensation Law, § 59.30 (1992)). When a previously injured employee sustains additional injury, an employer may receive reimbursement from SIF for excess compensation paid to the employee which would not have been necessary had the employee not had a pre-existing injury. Id. (citing SDCL 62-4-34). The fund is financed by assessments of workers' compensation insurance carriers and self-insurers. Id. (citing SDCL 62-4-35). "To be eligible for recovery from the fund, an employer must be able to establish by written record that it had knowledge of the pre-existing disability at the time of hiring the injured employee." Oesterreich v. Canton-Inwood Hosp., 511 NW2d 824, 827 (SD 1994).
[ .] In 1978 the legislature adopted SDCL 62-4-34.1 as procedural guidelines and as the statute of limitations for the implementation of the fund. The 1978 version provided:
Any claim against the subsequent injury fund must be filed with the department of labor within two years from the date of the subsequent injury. The department shall conduct an investigation and make a determination on the claim within thirty days.
In 1992 the legislature amended SDCL 62-4-34.1 to provide:
Any claim against the subsequent injury fund shall be filed with the division of insurance within ninety days from the date of the final decision by the department that a compensable injury exists resulting in additional permanent partial or permanent total disability, or approval by the department of settlement between the parties. No claim may be filed prior to a decision or approval of settlement from the department. The division shall conduct an investigation and make a decision on the claim within thirty days of the filing of a complete claim as set forth in § 62-4-34.4 or within a time agreed upon between the claimant and the department.
[ .] Before the 1992 amendment of SDCL 62-4-34.1, a claim had to be filed with the SIF within two years from the date of injury and had to be resolved within thirty days of submission. This created a procedural quagmire because often a claim had to be submitted to SIF and decided before Department even acted on the underlying workers' compensation claim. The purpose of the 1992 amendment to SDCL 62-4-34.1 was to avoid the filing of SIF claims until the workers' compensation system had resolved the essential issues.
[ .] In 1995 the legislature significantly amended SDCL 62-4-34. The 1984 version of 62-4-34 allowed the employer to be reimbursed fully from SIF. In 1995 the amended version of 62-4-34 changed the compensation amount to two-thirds.
[ .] Finally in 1999 the legislature e
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