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Amantiad v. Odum5/20/1999
suant to HRS § 386-72 (1993). The rule corresponding to HRS § 386-8 is Hawaii Administrative Rule (HAR) § 12-10-31 (1995), which provides:
"Liability of third person. (a) Should any action be filed, arbitration commenced, or claim be made to recover damages pursuant to section 386-8, HRS, the party or parties in interest shall within ten calendar days notify the director in writing and all other parties of interest with pertinent details as the action, arbitration, or claim continues. "(b) The party or parties of interest shall obtain written consent of both employer and employee and file with the director within thirty calendar days of execution a final copy of the claim-dispositive document, release, settlement, court order, waiver, dismissal, arbitration award, or judgment. "(c) The director may hold a hearing at the director's discretion or on application of a party of interest to determine whether or not the employer has an obligation to make further compensation payments including reimbursements and credits against sums recovered from any third party." (Emphasis added.)
Pursuant to HAR § 12-10-31, the Director of Labor retains the discretion, and necessarily the jurisdiction, to determine whether or not the employer has an obligation to make further or future compensation payments to the employee. In light of this provision, it necessarily follows that a compromise or settlement of "further" or future workers' compensation benefits may be nullified or voided by the Director of Labor, irrespective of what the parties have agreed. Therefore, in construing HRS §§ 386-8 and 386-73 with HAR § 12-10-31, we hold that it would be illogical and absurd to permit parties to compromise such future obligations, without the Director of Labor's prior consent or approval.
Our Conclusion today finds further support in HRS § 386-151 (1993), which bestows upon the Director of Labor the fiduciary obligation of administering and maintaining the special compensation fund. For example, the instant record reveals that Amantiad's injury has been deemed a permanent partial disability (in light of OTS's payment of $24,873.60 in permanent partial disability benefits), implicating a potential need for future reliance upon the special compensation fund under HRS § 386-33.
In light of the Director of Labor's original jurisdiction under HRS § 386-73, the Director's discretion under HAR § 12-10-31, and the Director's fiduciary obligations under various provisions of Chapter 386, we hold that a settlement or compromise of future workers' compensation benefits constitutes a controversy or dispute within the original jurisdiction of the Director of Labor, under section 386-73. Furthermore, we hold that a settlement or compromise of future workers' compensation benefits cannot be valid or binding without the consent or approval of the Director of Labor. Therefore, assuming that the circuit court otherwise has jurisdiction to enforce the terms of a settlement agreement, the circuit court lacks jurisdiction to enforce a compromise or settlement of future workers' compensation benefits, absent the prior consent or approval of the Director of Labor.
III. CONCLUSION
Because the circuit court lacked subject matter jurisdiction to hear OTS's motion to enforce settlement, we reverse (1) the circuit court's December 16, 1997 order denying Amantiad's motion to vacate the order enforcing settlement and (2) the circuit court's August 26, 1997 order granting OTS's motion to enforce settlement. We also hold that a settlement or compromise of future workers' compensation benefits constitutes a controversy or dispute within the original jurisdiction of the Director of Labor, pursuant to H
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