‘Credit’ due to the Employer/Insurer differs in the context of Reopenings and Appeals

First, let us start with the Court of Appeals of Maryland’s decision in Del Marr v. Montgomery County, 397 Md. 308 (2007).  The issue before the Court was whether, upon a modification pursuant to a reopening for worsening condition, an employer/insurer (hereinafter “employer”) should be credited for the total number of weeks paid, or alternatively, the total dollar amount paid.  Preliminarily, the Court explained:

For our purposes here, awards made by the Commission may be disturbed in two ways: (1) when a court, in an action for judicial review of the award, decides that the Commission erred in some manner and remands for the calculation of a new award based on the court’s finding, and (2) when, as the result of a worsening, improvement, or termination of the employee’s disability, the Commission reopens the case and enters a new award to reflect the change in the employee’s condition. LE § 9-736. In each of those situations, the question has arisen of whether or how the new award affects the compensation that was paid prior to entry of the new award in accordance with the award that was modified.  We have dealt with that question before, and we are called upon in this case to deal with it again. Our answer in this case will be consistent with those given previously.

Del Marr, 397 Md. at 311-12.

What the Court was referring to was two earlier cases that dealt with crediting employers following a modification upon appeal to the circuit court; namely, Philip Electronics v. Wright, 348 Md. 209 (1997) and Ametek Inc. v. O’Connor, 364 Md. 143 (2001).  Both cases held that the proper approach was based on the total number of weeks paid, rather than the total dollar amount.  In Philip Electronics, this resulted in an increased award for the employee because the original award had been reduced at the circuit court level.  In Ametek, this resulted in a decreased award for the employee because the original award had been increased at the circuit court level.  See Del Marr, 397 Md. at 315-17.

In Del Marr, the Claimant sought “to distinguish Ametek and Philip Electronics on the basis that they involved modifications to an award by a court, on judicial review, rather than by the Commission on a reopening due to a worsening condition.”  Id. at 317.  However, the Court was not persuaded, and viewed such an argument as resting upon “a distinction without a difference.”  Id. at 318.  Accordingly, in the context of both appeals and reopenings, Del Marr opined that employers are credited “for compensation previously paid calculated on a weekly basis.”  Id. at 320 (emphasis added).

Seven years later, in W.R. Grace & Co., et al. v. Swedo, et al., 439 Md. 441 (2014), the Court of Appeals consolidated three different cases for purposes of defining the word “compensation” within the meaning of L&E § 9-633.  The issues in all three cases arose following a modification of the WCC’s award by the circuit court.  The Court phrased the pertinent question as follows:

When crediting an Employer/Insurer for payments made under a workers’ compensation award that is subsequently amended, should credit be given for the number of weeks paid under the initial award, or should credit be given for the total dollar amount paid under the initial award?

Swedo, 439 Md. at 448-49.

It is important to note that the statute at issue—L&E § 9-633—was enacted by the Maryland General Assembly subsequent to the Court’s decisions in Ametek and Philip Electronics, but prior to Del Marr.  L&E § 9-633 pertains to judicial review of the WCC in the circuit court and states that where “an award of permanent partial disability compensation is reversed or modified by a court on appeal, the payment of any new compensation awarded shall be subject to a credit for compensation previously awarded and paid.”

In Swedo, the employers argued that credit should be given for the total number of weeks paid, rather than the total dollar amount.  In support, they argued that the Act was designed to provide compensation in terms of weeks, and construing L&E § 9-633 any differently would lead to “illogical” results.  Id. at 450-51.  The employers also pointed to Philip Electronics, Ametek and Del Marr as evidence that “previous case law explicitly and consistently upholds a crediting for the number of weeks paid when considering changes in workers’ compensation awards.”  Id. at 449.

In contrast, the injured workers argued, and the Court ultimately agreed, “that L&E § 9-633 is clear and unambiguous in providing that credit for payments made under an amended award should be done in reference to total dollars paid.”  This was so in light of L&E § 9-101(e)(1), which “defines ‘compensation’ as ‘the money payable under this title to a covered employee or the dependents of a covered employee.’”  Id. at 451 (emphasis added).

We have explained that when the statute provides definitions of a particular term, we use the statutory definition in determining the scope of the specific words used . . . . Here, the Legislature has defined “compensation” in the Workers’ Compensation statute, rendering the term, as employed in LE § 9–633, unambiguous. It is clear that the General Assembly intended LE § 9–633 to employ terminology in concert with the definitional provisions laid out in LE § 9–101 . . . . Because the Legislature intended “compensation” to mean “money” in LE § 9–633, the statute requires a total dollars-paid crediting system.

Id. at 454-55 (internal citations omitted) (emphasis added).

At first glance, the holding in Swedo appears to directly conflict with the holding in Del Marr.  In fact, the employers in Swedo referred the Court to its opinion in Del Marr to support their position that “the weekly credit approach is fully consistent with the legislative scheme” embodied in the Workers’ Compensation Act.  Id. at 458. This was because, in Del Marr, the Court of Appeals previously opined:

We first note that neither § 9–630(d) nor § 9–633 state anything inconsistent with our holdings in Philip Electronics or Ametek. Indeed, they are entirely consistent with the view expressed in those holdings that a modification that serves to increase or decrease compensation, whether occasioned by a judgment emanating from a judicial review action or a reopening, may have prospective effect only, achieved by allowing a credit for compensation previously paid calculated on a weekly basis.

Swedo, 439 Md. at 458 (quoting Del Marr, supra, 397 Md. at 319-20) (emphasis added).

To arrive at and support this conclusion, the Del Marr Court implied that appeals under L&E § 9-633 are analogous to reopenings.  Again, Del Marr addressed modifications in the context of a reopening, whereas Philip Electronics and Ametek dealt with appeals.  Thus, by analogizing appeals and reopenings, the Del Marr Court was able to support its holding by relying on Philip Electronics and Ametek.

Subsequently, and in direct contrast to its 2007 holding in Del Marr, the 2014 Court of Appeals declared in Swedo that the Maryland General Assembly’s enactment of “L&E § 9-633 does expressly override the rule we announced in Philip Electronics and Ametek.”  Swedo, 439 Md. at 457 (emphasis added).  However, despite this blatant contradiction, the Swedo Court did not completely overturn its earlier decision in Del Marr.

How can the holding in Swedo be reconciledwith Del Marr

It’s simple—dicta does not have precedential authority and therefore can be easily disregarded by subsequent case law.  In other words, in Del Marr, the issue before the Court pertained solely to reopenings.  As such, the Court’s holding likewise applies solely to reopenings.  Although Del Marr explicitly related reopenings to appeals, the Court’s discussion of appeals, and more particularly its conclusions with respect to the implications of L&E § 9-633 on Philip Electronics and Ametek, constitute mere dicta.

The question of the meaning of “compensation” under § 9–633 was not before us in Del Marr, and our observation regarding § 9–633 was made in the context of responding to Del Marr’s argument that a dollars approach was appropriate in that reopening case. As the above language makes clear, we were only faced with the question of whether “the weekly credit approach is impermissible in a modification arising from a reopening.” Del Marr, 397 Md. at 320, 916 A.2d at 1008 [(emphasis added)].

In sum, Del Marr is inapposite and under the plain meaning of LE § 9–633, the employer shall be credited with “compensation previously awarded and paid.”  The word “compensation” means “money payable” as defined in LE § 9–101. Therefore, we hold that when crediting an Employer/Insurer for payments made under an award after the award is modified on appeal, credit should be given for the total dollars paid, not the total weeks paid.

Swedo, 439 Md. at 459.

Del Marr remains good law.

Despite the Swedo Court’s express rejection of the dicta in Del Marr, the Court of Appeals left its earlier decision in place.

Del Marr is distinguishable from these cases because, unlike the modification on appeal here, it involved a reopening of the case due to a worsening of Del Marr’s condition after the award had been set . . . . Where there is a worsening of condition, as in Del Marr, giving credit for weeks paid accomplishes just that—the payments were appropriate for the period before Del Marr’s condition worsened. But here, where there was error in the initial award, the payments were never sufficient and so a dollar adjustment is necessary.

Swedo, 439 Md. at 458 (internal citations omitted) (emphasis added).


What at times can appear as a reaffirmation of Del Marr, in effect, Swedo severely limits its predecessor’s reach.  Although Del Marr’s narrow holding remains good law to this day, the rationale therein has, in large part, been overruled.  Accordingly, it is important for Maryland practitioners to understand the dynamics between the high court’s opinions in both cases.

Prior to 2014, the credit that was due to employer/insurer’s following a modification of disability was calculated the same regardless of whether the modification was the subject of an appeal or reopening.  However, in the wake of the Court of Appeals decision in Swedo, modifications on appeal and the resulting credit due to the employer/insurer should now “be given for the total dollars paid, not the total weeks paid.”  That said, the previous standard remains in effect solely with respect to reopenings, and thus employer/insurer credits in that context are still calculated in terms of weeks.