Section 14(f) Waivers Allowed in Longshore Settlements

A Section 14(f) waiver may be included in a Section 8(i) settlement agreement. In a new unpublished decision, the Benefits Review Board ("BRB") addressed the claimant's request for a Section 14(f) assessment due to the late payment of settlement proceeds. After the underlying settlement agreement, which contained a Section 14(f) waiver, was approved by the District Director, the employer and carrier sent a wire transfer to the claimant's Canadian bank account, but the transfer was rejected because the bank account did not exist. The claimant had provided incorrect wire transfer information that prevented delivery. Nonetheless, the claimant requested a 20% assessment against the employer and carrier for late payment of the settlement funds. After an informal conference, the District Director recommended payment of the assessment. The employer and carrier requested referral to the Office of Administrative Law Judges, but the claimant requested a default order against the employer and carrier. When the District Director refused to grant the default order, the claimant appealed to the BRB. A prior published decision from the BRB held that a claimant may waive his entitlement to a Section 14(f) assessment in a clause to a Section 8(i) settlement agreement. D.G. [Graham] v. Cascade General, Inc., 42 BRBS 77 (2008). In Graham, the claimant confirmed his street address but failed to provide a proper mailing address at which the settlement checks could be delivered. The settlement agreement in Graham, however, contained a Section 14(f) waiver that would take effect if the postal information in the settlement was incorrect. The existence of the waiver was not objectionable to the BRB because a Section 14(f) assessment represents "additional compensation" that can be waived by a claimant. Whether the waiver applied to the case, however, was a matter for the administrative law judge ("ALJ") to determine. Here, the BRB determined that factual issues existed which required remand, and which prevented the entry of a default judgment by the District Director. The ALJ had to interpret the settlement waiver clause and resolve the factual issues before the Director could fully address the claimant's entitlement to a default order and penalty assessment. Attwood v. Armor Group, Inc., BRB No. 11-0333 (Apr. 26, 2011). Note: the Graham decision also makes clear that the terms of a waiver are subject to administrative approval. Based on the facts of Graham, a waiver that becomes applicable only when the claimant warrants incorrect information for funds delivery is not overreaching.

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