Massachusetts Court Discusses Grounds for Recission in Workers’ Compensation Cases

People who are hurt while they are working generally can recover workers’ compensation benefits pursuant to the Massachusetts Workers’ Compensation Act (the Act). In some instances, they may be able to recover accidental disability retirement (ADR) benefits as well. The receipt of ADR benefits may impact their right to workers’ compensation benefits, however, and it is important for them to understand the implications of accepting such additional benefits. As discussed in a recent Massachusetts case, rescinding agreements for ADR benefits can be challenging. If you sustained injuries at work, you could be owed benefits, and you should talk to a Massachusetts workers’ compensation lawyer as soon as possible.

History of the Case

It is alleged that the plaintiff, a correction officer, had sustained a workplace injury in September 1990 and was receiving workers’ compensation benefits from the defendant, his self-insured employer, due to a permanent disability. Subsequently, he was also granted accidental disability retirement (ADR) benefits by the State Board of Retirement. His ADR benefits were offset by the concurrent receipt of workers’ compensation benefits, resulting in a combined monthly sum of $4,340.28. However, in June 2009, a lump sum settlement was reached, terminating his workers’ compensation claim in exchange for a one-time payment of $10,000. Subsequently, the plaintiff became eligible solely for ADR benefits, which amounted to $2,417.79 per month. This substantial reduction was attributed to differences in the calculation methods employed by the workers’ compensation and ADR systems. The plaintiff’s attorney had believed the settlement to be advantageous, assuming higher ADR benefits, without considering the loss of the supplemental workers’ compensation benefit.

It is reported that the settlement necessitated approval from an administrative judge, representing that it was in the plaintiff’s best interest under the Act. Both the plaintiff’s attorney and the defendant’s attorney jointly presented the settlement as such. At the time, neither attorney realized that the plaintiff’s ADR benefits would be significantly lower than his previous workers’ compensation benefits. The plaintiff later sought rescission, alleging a mutual mistake of fact, asserting that his attorney’s misunderstanding of the benefits constituted such a mistake. Conversely, the defendant argued that rescission could only occur based on mutual mistake or fraud. The plaintiff moved for summary judgment, which the trial court granted. The defendant appealed.

Grounds for Recission in Workers’ Compensation Cases

On appeal, the court affirmed the summary judgment in favor of the plaintiff. It was noted that the plaintiff did not appeal the trial court’s determination that the mistake regarding his benefits was not mutual, rendering that decision final. The primary issue on appeal concerned whether the lump sum settlement agreement could be rescinded on a principle of equity other than fraud or mutual mistake. The defendant argued that such agreements could only be rescinded on grounds of fraud or mutual mistake. The plaintiff, however, contended that Massachusetts law allowed a judge to set aside such a settlement based on “principles of equity.” Furthermore, the Act allowed parties to file complaints to vacate or modify such agreements on grounds of law or equity without restriction. While the trial judge did not explicitly reference this provision of the Act, it supported his decision that principles of equity other than fraud or mutual mistake could support the rescission of a lump sum settlement agreement. Therefore, the court rejected the defendant’s argument that such agreements could only be set aside for fraud or mutual mistake, upholding the trial court’s ruling that the agreement could be rescinded on other equitable grounds.

 Confer with a Skilled Massachusetts Attorney

If you suffered harm at work, it is advisable to confer with an attorney regarding your rights. James K. Meehan of the Law Office of James K. Meehan is a skilled Massachusetts workers’ compensation lawyer who is adept at helping people protect their interests, and if you hire him, he will diligently pursue any benefits you may be owed. You can contact Mr. Meehan to schedule a meeting through the form online or by calling him at 508-822-6600.