ADAM WEINER, Petitioner–Respondent, v. ELIZABETH BOARD OF EDUCATION, Respondent–Appellant.
Respondent Elizabeth Board of Education (Board) appeals from the August 29, 2012 order of the workers' compensation judge denying the Board's motion for reimbursement from Adam Weiner for overpayment of workers' compensation. We reverse and remand to the workers' compensation judge for further proceedings.
The record discloses the following facts and procedural history leading to the administrative determination under review.
On October 18, 2000, Weiner received an award of total disability which entitled him to payments of $480 per week for 450 weeks. The award was subsequently amended on January 9, 2001, to $340.98 per week to reflect the social security offset rate. On April 1, 2002, Weiner qualified for and began receiving ordinary disability pension benefits in addition to his workers' compensation benefits. Weiner did not disclose his receipt of ordinary disability pension benefits to the Board. On April 29, 2010, the Board requested authorization for access to Weiner's pension records to determine if an offset was applicable. When the records were provided, the Board for the first time became aware that Weiner had been receiving ordinary disability pension benefits. On August 10, 2011, Weiner and the Board entered into a consent agreement reducing Weiner's disability rate to $222.39 prospectively.
The Board then sought reimbursement of the excess disability benefits Weiner received from April 1, 2002, through August 10, 2011. A hearing was held before a workers' compensation judge on August 1, 2012. In an August 29, 2012 order the judge denied the Board's motion for reimbursement of overpayment of workers' compensation. It is from that decision that the Board appeals.
Our standard of review is well-settled. We are bound by the compensation judge's fact-findings that are supported by substantial credible evidence in the record. Sager v. O.A. Peterson Constr. Co., 182 N.J. 156, 163–64 (2004); Close v. Kordulak Bros., 44 N.J. 589, 599 (1965). We must give due regard to the compensation judge's expertise when that is a factor. Ibid. “Deference must be accorded the factual findings and legal determinations made by the compensation judge unless they are manifestly unsupported by or inconsistent with competent relevant and reasonably credible evidence as to offend the interests of justice.” Lindquist v. City of Jersey City Fire Dep't, 175 N.J. 244, 262 (2003) (internal quotation marks and citations omitted). Petitioner bears the burden to establish the compensability of the claim being made. Id. at 279; Perez v. Monmouth Cable Vision, 278 N.J.Super. 275, 282 (App.Div.1994), certif. denied, 140 N.J. 277 (1995). However, it is well-established that our review of a trial judge's conclusions of law is de novo. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995) (“A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference.”). The same standard applies with respect to the legal rulings of a judge of compensation. Sexton v. Cnty. of Cumberland, 404 N.J.Super. 542, 548 (App.Div.2009).
On appeal, the Board argues it is entitled to recover because Weiner was unjustly enriched and because he cannot establish a defense of equitable estoppel.
In Hajnas v. Engelhard Mineral & Chemical Co., 231 N.J.Super. 353, 363 (App.Div.1989), this court authorized a two-step process for recovering overpayments. First, the Workers' Compensation Division is to determine if petitioner was unjustly enriched under “settled principles of unjust enrichment,” an issue for which the respondent employer has the burden of proof. Id. at 363–64. If respondent succeeds, it may then “institute enforcement proceedings in the Law Division ․ which may be treated as a summary proceeding.” Id. at 364. Hajnas has been characterized as “outlining a method whereby defendant could recover in a faultless overpayment situation” which it found to be beneficial since “an underlying theme of the workers' compensation law is that there should not be duplicative payments for the same disability.” Montgomery v. Abex Corp., 253 N.J.Super. 480, 483 (App.Div.1992) (internal quotation marks omitted).
To establish unjust enrichment, a plaintiff must show both that defendant received a benefit and that retention of that benefit without payment would be unjust. Assocs. Commercial Corp. v. Wallia, 211 N.J.Super. 231, 243 (App.Div.1986); Russell–Stanley Corp. v. Plant Indus., Inc., 250 N.J.Super. 478, 510 (Ch. Div.1991). “It is considered unjust enrichment to permit the recipient of money paid under mistake of fact to keep it, unless the circumstances are such that it would be inequitable to require its return.” PaineWebber, Inc. v. Levy, 293 N.J.Super. 325, 327 (Law Div.1995) (citing Great American Ins. Co. v. Yellen, 58 N.J.Super. 240, 246 (App.Div.1959)).
It is a general rule that a payment of money under a mistake of fact may be recovered, provided that such recovery will not prejudice the payee. This rule is grounded upon considerations of equity and fair dealing. It is considered unjust enrichment to permit a recipient to retain money paid because of a mistake, unless the circumstances are such that it would be inequitable to require its return.
[Winslow, Cohu, & Stetson, Inc. v. Skowronek, 136 N.J.Super. 97, 104 (Law Div.1975) (citing Yellen, supra, 58 N.J.Super. at 246).]
In this case, the workers' compensation judge concluded:
To determine whether this Petitioner has been unjustly enriched, this court must consider the Petitioner's ability to repay these funds. The Petitioner has asked this court to consider that he is totally and permanent[ly] disabled having suffered severe head injuries that resulted in nerve damage to his brainstem. He has also provided several years of his Individual Income Tax Returns, the most recent of which shows an annual salary of $17,295 for 2010. The definition of unjust enrichment as recounted above does permit this court to consider the Petitioner's circumstances and to determine whether it would be inequitable to require him to repay this debt.
Given this Petitioner's inability to work and his limited income, I find that to compel him to repay this debt would be inequitable. I disagree with the Respondent's position that the mere retention of the overpayment of benefits would qualify as unjust enrichment. Indeed, it would appear that this exception in the law was included precisely to allow reviewing courts to consider circumstances that are unique to each case and to make such a determination. Unlike the Hajnas case, there is no allegation that this Petitioner intentionally misled the Respondent or sought to keep the overpayment of benefits beyond the time that the issue was brought to his attention. The Respondent concedes that it was unaware of his eligibility to receive a pension until approximately eight years after the entry of the award and the Petitioner himself was equally oblivious to this error. However, upon discovering the overpayment, both parties sought to amend the award and to date the Petitioner is receiving the correct benefits. To further reduce his award by requiring him to repay the $57,753.33 overpayment given his limited resources and his inability to work would be inequitable. Consequently, the Respondent's Motion is hereby denied.
No evidential hearing was held. The compensation judge's finding that Weiner was unable to repay the money, and therefore, it would be inequitable to order reimbursement, was supported solely by “several years of his Individual Income Tax Returns, the most recent of which shows an annual salary of $17,295 for 2010.” No statement of assets and liabilities evincing Weiner's net worth was produced. Further, no statement of income and expenses was considered by the judge of compensation.
We are guided by the principle that “an underlying theme of the workers' compensation law is that there should not be duplicative payments for the same disability.” Young v. Western Elec. Co., 96 N.J. 220, 231 (1984). Given the paucity of evidence, there was no reasonable basis for the judge of compensation's factual finding that Weiner had “limited resources” and therefore it “would be inequitable” to require him to repay the “duplicative payments for the same disability.” The finding of “limited resources” is so “manifestly unsupported by ․ competent relevant and reasonably credible evidence as to offend the interests of justice.” Lindquist, supra, 175 N.J. at 262.
We will not indulge in hypothetical speculation of a net worth which would support the immediate return of the payments, which all parties agree, should never have been made to Weiner. Nor will we reach a conclusion based on incomplete facts concerning whether, after considering Weiner's income and expenses, a payment plan would be appropriate. These determinations must be made by the workers' compensation judge after an evidentiary hearing and a more complete record is established.
Reversed and remanded for further proceedings. We do not retain jurisdiction.