|
[Federal Register: December 20, 2000 (Volume 65, Number 245)]
[Rules and Regulations]
[Page 80069-80107]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20de00-19]
[[pp. 80069-80107]] Regulations Implementing the Federal Coal Mine Health and Safety
Act of 1969, as Amended
[[Continued from page 80068]]
[[Page 80069]]
under paragraph (a) shall be subject to collection or offset under
subpart H of this part.
Sec. 725.311 Communications with respect to claims; time computations.
(a) Unless otherwise specified by this part, all requests,
responses, notices, decisions, orders, or other communications required
or permitted by this part shall be in writing.
(b) If required by this part, any document, brief, or other
statement submitted in connection with the adjudication of a claim
under this part shall be sent to each party to the claim by the
submitting party. If proof of service is required with respect to any
communication, such proof of service shall be submitted to the
appropriate adjudication officer and filed as part of the claim record.
(c) In computing any period of time described in this part, by any
applicable statute, or by the order of any adjudication officer, the
day of the act or event from which the designated period of time begins
to run shall not be included. The last day of the period shall be
included unless it is a Saturday, Sunday, or legal holiday, in which
event the period extends until the next day which is not a Saturday,
Sunday, or legal holiday. ``Legal holiday'' includes New Year's Day,
Birthday of Martin Luther King, Jr., Washington's Birthday, Memorial
Day, Independence Day, Labor Day, Columbus Day, Veterans Day,
Thanksgiving Day, Christmas Day and any other day appointed as a
holiday by the President or the Congress of the United States.
(d) In computing any period of time described in this part in which
the period within which to file a response commences upon receipt of a
document, it shall be presumed, in the absence of evidence to the
contrary, that the document was received on the seventh day after it
was mailed. In any case in which a provision of this part requires a
document to be sent to a person or party by certified mail, and the
document is not sent by certified mail, but the person or party
actually received the document, the document shall be deemed to have
been sent in compliance with the provisions of this part. In such a
case, any time period which commences upon the service of the document
shall commence on the date the document was received.
Subpart D--Adjudication Officers; Parties and Representatives
Sec. 725.350 Who are the adjudication officers?
(a) General. The persons authorized by the Secretary of Labor to
accept evidence and decide claims on the basis of such evidence are
called ``adjudication officers.'' This section describes the status of
black lung claims adjudication officers.
(b) District Director. The district director is that official of
the DCMWC or his designee who is authorized to perform functions with
respect to the development, processing, and adjudication of claims in
accordance with this part.
(c) Administrative law judge. An administrative law judge is that
official appointed pursuant to 5 U.S.C. 3105 (or Public Law 94-504) who
is qualified to preside at hearings under 5 U.S.C. 557 and is empowered
by the Secretary to conduct formal hearings with respect to, and
adjudicate, claims in accordance with this part. A person appointed
under Public Law 94-504 shall not be considered an administrative law
judge for purposes of this part for any period after March 1, 1979.
Sec. 725.351 Powers of adjudication officers.
(a) District Director. The district director is authorized to:
(1) Make determinations with respect to claims as is provided in
this part;
(2) Conduct conferences and informal discovery proceedings as
provided in this part;
(3) Compel the production of documents by the issuance of a
subpoena;
(4) Prepare documents for the signature of parties;
(5) Issue appropriate orders as provided in this part; and
(6) Do all other things necessary to enable him or her to discharge
the duties of the office.
(b) Administrative Law Judge. An administrative law judge is
authorized to:
(1) Conduct formal hearings in accordance with the provisions of
this part;
(2) Administer oaths and examine witnesses;
(3) Compel the production of documents and appearance of witnesses
by the issuance of subpoenas;
(4) Issue decisions and orders with respect to claims as provided
in this part; and
(5) Do all other things necessary to enable him or her to discharge
the duties of the office.
(c) If any person in proceedings before an adjudication officer
disobeys or resists any lawful order or process, or misbehaves during a
hearing or so near the place thereof as to obstruct the same, or
neglects to produce, after having been ordered to do so, any pertinent
book, paper or document, or refuses to appear after having been
subpoenaed, or upon appearing refuses to take the oath as a witness, or
after having taken the oath refuses to be examined according to law,
the district director, or the administrative law judge responsible for
the adjudication of the claim, shall certify the facts to the Federal
district court having jurisdiction in the place in which he or she is
sitting (or to the U.S. District Court for the District of Columbia if
he or she is sitting in the District) which shall thereupon in a
summary manner hear the evidence as to the acts complained of, and, if
the evidence so warrants, punish such person in the same manner and to
the same extent as for a contempt committed before the court, or commit
such person upon the same condition as if the doing of the forbidden
act had occurred with reference to the process or in the presence of
the court.
Sec. 725.352 Disqualification of adjudication officer.
(a) No adjudication officer shall conduct any proceedings in a
claim in which he or she is prejudiced or partial, or where he or she
has any interest in the matter pending for decision. A decision to
withdraw from the consideration of a claim shall be within the
discretion of the adjudication officer. If that adjudication officer
withdraws, another officer shall be designated by the Director or the
Chief Administrative Law Judge, as the case may be, to complete the
adjudication of the claim.
(b) No adjudication officer shall be permitted to appear or act as
a representative of a party under this part while such individual is
employed as an adjudication officer. No adjudication officer shall be
permitted at any time to appear or act as a representative in
connection with any case or claim in which he or she was personally
involved. No fee or reimbursement shall be awarded under this part to
an individual who acts in violation of this paragraph.
(c) No adjudication officer shall act in any claim involving a
party which employed such adjudication officer within one year before
the adjudication of such claim.
(d) Notwithstanding paragraph (a) of this section, no adjudication
officer shall be permitted to act in any claim involving a party who is
related to the adjudication officer by consanguinity or affinity within
the third degree as determined by the law of the place where such party
is domiciled. Any action taken by an adjudication officer in knowing
violation of this paragraph shall be void.
[[Page 80070]]
Sec. 725.360 Parties to proceedings.
(a) Except as provided in Sec. 725.361, no person other than the
Secretary of Labor and authorized personnel of the Department of Labor
shall participate at any stage in the adjudication of a claim for
benefits under this part, unless such person is determined by the
appropriate adjudication officer to qualify under the provisions of
this section as a party to the claim. The following persons shall be
parties:
(1) The claimant;
(2) A person other than a claimant, authorized to execute a claim
on such claimant's behalf under Sec. 725.301;
(3) Any coal mine operator notified under Sec. 725.407 of its
possible liability for the claim;
(4) Any insurance carrier of such operator; and
(5) The Director in all proceedings relating to a claim for
benefits under this part.
(b) A widow, child, parent, brother, or sister, or the
representative of a decedent's estate, who makes a showing in writing
that his or her rights with respect to benefits may be prejudiced by a
decision of an adjudication officer, may be made a party.
(c) Any coal mine operator or prior operator or insurance carrier
which has not been notified under Sec. 725.407 and which makes a
showing in writing that its rights may be prejudiced by a decision of
an adjudication officer may be made a party.
(d) Any other individual may be made a party if that individual's
rights with respect to benefits may be prejudiced by a decision to be
made.
Sec. 725.361 Party amicus curiae.
At the discretion of the Chief Administrative Law Judge or the
administrative law judge assigned to the case, a person or entity which
is not a party may be allowed to participate amicus curiae in a formal
hearing only as to an issue of law. A person may participate amicus
curiae in a formal hearing upon written request submitted with
supporting arguments prior to the hearing. If the request is granted,
the administrative law judge hearing the case will inform the party of
the extent to which participation will be permitted. The request may,
however, be denied summarily and without explanation.
Sec. 725.362 Representation of parties.
(a) Except for the Secretary of Labor, whose interests shall be
represented by the Solicitor of Labor or his or her designee, each of
the parties may appoint an individual to represent his or her interest
in any proceeding for determination of a claim under this part. Such
appointment shall be made in writing or on the record at the hearing.
An attorney qualified in accordance with Sec. 725.363(a) shall file a
written declaration that he or she is authorized to represent a party,
or declare his or her representation on the record at a formal hearing.
Any other person (see Sec. 725.363(b)) shall file a written notice of
appointment signed by the party or his or her legal guardian, or enter
his or her appearance on the record at a formal hearing if the party he
or she seeks to represent is present and consents to the
representation. Any written declaration or notice required by this
section shall include the OWCP number assigned by the Office and shall
be sent to the Office or, for representation at a formal hearing, to
the Chief Administrative Law Judge. In any case, such representative
must be qualified under Sec. 725.363. No authorization for
representation or agreement between a claimant and representative as to
the amount of a fee, filed with the Social Security Administration in
connection with a claim under part B of title IV of the Act, shall be
valid under this part. A claimant who has previously authorized a
person to represent him or her in connection with a claim originally
filed under part B of title IV may renew such authorization by filing a
statement to such effect with the Office or appropriate adjudication
officer.
(b) Any party may waive his or her right to be represented in the
adjudication of a claim. If an adjudication officer determines, after
an appropriate inquiry has been made, that a claimant who has been
informed of his or her right to representation does not wish to obtain
the services of a representative, such adjudication officer shall
proceed to consider the claim in accordance with this part, unless it
is apparent that the claimant is, for any reason, unable to continue
without the help of a representative. However, it shall not be
necessary for an adjudication officer to inquire as to the ability of a
claimant to proceed without representation in any adjudication taking
place without a hearing. The failure of a claimant to obtain
representation in an adjudication taking place without a hearing shall
be considered a waiver of the claimant's right to representation.
However, at any time during the processing or adjudication of a claim,
any claimant may revoke such waiver and obtain a representative.
Sec. 725.363 Qualification of representative.
(a) Attorney. Any attorney in good standing who is admitted to
practice before a court of a State, territory, district, or insular
possession, or before the Supreme Court of the United States or other
Federal court and is not, pursuant to any provision of law, prohibited
from acting as a representative, may be appointed as a representative.
(b) Other person. With the approval of the adjudication officer,
any other person may be appointed as a representative so long as that
person is not, pursuant to any provision of law, prohibited from acting
as a representative.
Sec. 725.364 Authority of representative.
A representative, appointed and qualified as provided in
Secs. 725.362 and 725.363, may make or give on behalf of the party he
or she represents, any request or notice relative to any proceeding
before an adjudication officer, including formal hearing and review,
except that such representative may not execute a claim for benefits,
unless he or she is a person designated in Sec. 725.301 as authorized
to execute a claim. A representative shall be entitled to present or
elicit evidence and make allegations as to facts and law in any
proceeding affecting the party represented and to obtain information
with respect to the claim of such party to the same extent as such
party. Notice given to any party of any administrative action,
determination, or decision, or request to any party for the production
of evidence shall be sent to the representative of such party and such
notice or request shall have the same force and effect as if it had
been sent to the party represented.
Sec. 725.365 Approval of representative's fees; lien against benefits.
No fee charged for representation services rendered to a claimant
with respect to any claim under this part shall be valid unless
approved under this subpart. No contract or prior agreement for a fee
shall be valid. In cases where the obligation to pay the attorney's fee
is upon the claimant, the amount of the fee awarded may be made a lien
upon the benefits due under an award and the adjudication officer shall
fix, in the award approving the fee, such lien and the manner of
payment of the fee. Any representative who is not an attorney may be
awarded a fee for services under this subpart, except that no lien may
be imposed with respect to such representative's fee.
[[Page 80071]]
Sec. 725.366 Fees for representatives.
(a) A representative seeking a fee for services performed on behalf
of a claimant shall make application therefor to the district director,
administrative law judge, or appropriate appellate tribunal, as the
case may be, before whom the services were performed. The application
shall be filed and served upon the claimant and all other parties
within the time limits allowed by the district director, administrative
law judge, or appropriate appellate tribunal. The application shall be
supported by a complete statement of the extent and character of the
necessary work done, and shall indicate the professional status (e.g.,
attorney, paralegal, law clerk, lay representative or clerical) of the
person performing such work, and the customary billing rate for each
such person. The application shall also include a listing of reasonable
unreimbursed expenses, including those for travel, incurred by the
representative or an employee of a representative in establishing the
claimant's case. Any fee requested under this paragraph shall also
contain a description of any fee requested, charged, or received for
services rendered to the claimant before any State or Federal court or
agency in connection with a related matter.
(b) Any fee approved under paragraph (a) of this section shall be
reasonably commensurate with the necessary work done and shall take
into account the quality of the representation, the qualifications of
the representative, the complexity of the legal issues involved, the
level of proceedings to which the claim was raised, the level at which
the representative entered the proceedings, and any other information
which may be relevant to the amount of fee requested. No fee approved
shall include payment for time spent in preparation of a fee
application. No fee shall be approved for work done on claims filed
between December 30, 1969, and June 30, 1973, under part B of title IV
of the Act, except for services rendered on behalf of the claimant in
regard to the review of the claim under section 435 of the Act and part
727 of this subchapter (see Sec. 725.4(d)).
(c) In awarding a fee, the appropriate adjudication officer shall
consider, and shall add to the fee, the amount of reasonable and
unreimbursed expenses incurred in establishing the claimant's case.
Reimbursement for travel expenses incurred by an attorney shall be
determined in accordance with the provisions of Sec. 725.459(a). No
reimbursement shall be permitted for expenses incurred in obtaining
medical or other evidence which has previously been submitted to the
Office in connection with the claim.
(d) Upon receipt of a request for approval of a fee, such request
shall be reviewed and evaluated by the appropriate adjudication officer
and a fee award issued. Any party may request reconsideration of a fee
awarded by the adjudication officer. A revised or modified fee award
may then be issued, if appropriate.
(e) Each request for reconsideration or review of a fee award shall
be in writing and shall contain supporting statements or information
pertinent to any increase or decrease requested. If a fee awarded by a
district director is disputed, such award shall be appealable directly
to the Benefits Review Board. In such a fee dispute case, the record
before the Board shall consist of the order of the district director
awarding or denying the fee, the application for a fee, any written
statement in opposition to the fee and the documentary evidence
contained in the file which verifies or refutes any item claimed in the
fee application.
Sec. 725.367 Payment of a claimant's attorney's fee by responsible
operator or fund.
(a) An attorney who represents a claimant in the successful
prosecution of a claim for benefits may be entitled to collect a
reasonable attorney's fee from the responsible operator that is
ultimately found liable for the payment of benefits, or, in a case in
which there is no operator who is liable for the payment of benefits,
from the fund. Generally, the operator or fund liable for the payment
of benefits shall be liable for the payment of the claimant's
attorney's fees where the operator or fund, as appropriate, took
action, or acquiesced in action, that created an adversarial
relationship between itself and the claimant. The fees payable under
this section shall include reasonable fees for necessary services
performed prior to the creation of the adversarial relationship.
Circumstances in which a successful attorney's fees shall be payable by
the responsible operator or the fund include, but are not limited to,
the following:
(1) The responsible operator designated by the district director
(see Sec. 725.410(a)(3)) fails to accept the claimant's entitlement to
benefits within the 30-day period provided by Sec. 725.412(b) and is
ultimately determined to be liable for benefits. The operator shall be
liable for an attorney's fee with respect to all necessary services
performed by the claimant's attorney;
(2) There is no operator that may be held liable for the payment of
benefits, and the district director issues a schedule for the
submission of additional evidence under Sec. 725.410. The fund shall be
liable for an attorney's fee with respect to all necessary services
performed by the claimant's attorney;
(3) The claimant submits a bill for medical treatment, and the
party liable for the payment of benefits declines to pay the bill on
the grounds that the treatment is unreasonable, or is for a condition
that is not compensable. The responsible operator or fund, as
appropriate, shall be liable for an attorney's fee with respect to all
necessary services performed by the claimant's attorney;
(4) A beneficiary seeks an increase in the amount of benefits
payable, and the responsible operator or fund contests the claimant's
right to that increase. If the beneficiary is successful in securing an
increase in the amount of benefits payable, the operator or fund shall
be liable for an attorney's fee with respect to all necessary services
performed by the beneficiary's attorney;
(5) The responsible operator or fund seeks a decrease in the amount
of benefits payable. If the beneficiary is successful in resisting the
request for a decrease in the amount of benefits payable, the operator
or fund shall be liable for an attorney's fee with respect to all
necessary services performed by the beneficiary's attorney. A request
for information clarifying the amount of benefits payable shall not be
considered a request to decrease that amount.
(b) Any fee awarded under this section shall be in addition to the
award of benefits, and shall be awarded, in an order, by the district
director, administrative law judge, Board or court, before whom the
work was performed. The operator or fund shall pay such fee promptly
and directly to the claimant's attorney in a lump sum after the award
of benefits becomes final.
(c) Section 205(a) of the Black Lung Benefits Amendments of 1981,
Public Law 97-119, amended section 422 of the Act and relieved
operators and carriers from liability for the payment of benefits on
certain claims. Payment of benefits on those claims was made the
responsibility of the fund. The claims subject to this transfer of
liability are described in Sec. 725.496. On claims subject to the
transfer of liability described in this paragraph the fund will pay all
fees and costs which have been or will be awarded to claimant's
attorneys which were or would have become the liability of an operator
or carrier but for the enactment of the 1981 Amendments and which have
not already been paid by such operator or carrier. Section 9501(d)(7)
of the
[[Page 80072]]
Internal Revenue Code (26 U.S.C.), which was also enacted as a part of
the 1981 Amendments to the Act, expressly prohibits the fund from
reimbursing an operator or carrier for any attorney fees or costs which
it has paid on cases subject to the transfer of liability provisions.
Subpart E--Adjudication of Claims by the District Director
Sec. 725.401 Claims development--general.
After a claim has been received by the district director, the
district director shall take such action as is necessary to develop,
process, and make determinations with respect to the claim as provided
in this subpart.
Sec. 725.402 Approved State workers' compensation law.
If a district director determines that any claim filed under this
part is one subject to adjudication under a workers' compensation law
approved under part 722 of this subchapter, he or she shall advise the
claimant of this determination and of the Act's requirement that the
claim must be filed under the applicable State workers' compensation
law. The district director shall then prepare a proposed decision and
order dismissing the claim for lack of jurisdiction pursuant to
Sec. 725.418 and proceed as appropriate.
Sec. 725.403 [Reserved]
Sec. 725.404 Development of evidence--general.
(a) Employment history. Each claimant shall furnish the district
director with a complete and detailed history of the coal miner's
employment and, upon request, supporting documentation.
(b) Matters of record. Where it is necessary to obtain proof of
age, marriage or termination of marriage, death, family relationship,
dependency (see subpart B of this part), or any other fact which may be
proven as a matter of public record, the claimant shall furnish such
proof to the district director upon request.
(c) Documentary evidence. If a claimant is required to submit
documents to the district director, the claimant shall submit either
the original, a certified copy or a clear readable copy thereof. The
district director or administrative law judge may require the
submission of an original document or certified copy thereof, if
necessary.
(d) Submission of insufficient evidence. In the event a claimant
submits insufficient evidence regarding any matter, the district
director shall inform the claimant of what further evidence is
necessary and request that such evidence be submitted within a
specified reasonable time which may, upon request, be extended for good
cause.
Sec. 725.405 Development of medical evidence; scheduling of medical
examinations and tests.
(a) Upon receipt of a claim, the district director shall ascertain
whether the claim was filed by or on account of a miner as defined in
Sec. 725.202, and in the case of a claim filed on account of a deceased
miner, whether the claim was filed by an eligible survivor of such
miner as defined in subpart B of this part.
(b) In the case of a claim filed by or on behalf of a miner, the
district director shall, where necessary, schedule the miner for a
medical examination and testing under Sec. 725.406.
(c) In the case of a claim filed by or on behalf of a survivor of a
miner, the district director shall obtain whatever medical evidence is
necessary and available for the development and evaluation of the
claim.
(d) The district director shall, where appropriate, collect other
evidence necessary to establish:
(1) The nature and duration of the miner's employment; and
(2) All other matters relevant to the determination of the claim.
(e) If at any time during the processing of the claim by the
district director, the evidence establishes that the claimant is not
entitled to benefits under the Act, the district director may terminate
evidentiary development of the claim and proceed as appropriate.
Sec. 725.406 Medical examinations and tests.
(a) The Act requires the Department to provide each miner who
applies for benefits with the opportunity to undergo a complete
pulmonary evaluation at no expense to the miner. A complete pulmonary
evaluation includes a report of physical examination, a pulmonary
function study, a chest roentgenogram and, unless medically
contraindicated, a blood gas study.
(b) As soon as possible after a miner files an application for
benefits, the district director will provide the miner with a list of
medical facilities and physicians in the state of the miner's residence
and states contiguous to the state of the miner's residence that the
Office has authorized to perform complete pulmonary evaluations. The
miner shall select one of the facilities or physicians on the list,
provided that the miner may not select any physician to whom the miner
or the miner's spouse is related to the fourth degree of consanguinity,
and the miner may not select any physician who has examined or provided
medical treatment to the miner within the twelve months preceding the
date of the miner's application. The district director will make
arrangements for the miner to be given a complete pulmonary evaluation
by that facility or physician. The results of the complete pulmonary
evaluation shall not be counted as evidence submitted by the miner
under Sec. 725.414.
(c) If any medical examination or test conducted under paragraph
(a) of this section is not administered or reported in substantial
compliance with the provisions of part 718 of this subchapter, or does
not provide sufficient information to allow the district director to
decide whether the miner is eligible for benefits, the district
director shall schedule the miner for further examination and testing.
Where the deficiencies in the report are the result of a lack of effort
on the part of the miner, the miner will be afforded one additional
opportunity to produce a satisfactory result. In order to determine
whether any medical examination or test was administered and reported
in substantial compliance with the provisions of part 718 of this
subchapter, the district director may have any component of such
examination or test reviewed by a physician selected by the district
director.
(d) After the physician completes the report authorized by
paragraph (a), the district director will inform the miner that he may
elect to have the results of the objective testing sent to his treating
physician for use in preparing a medical opinion. The district director
will also inform the claimant that any medical opinion submitted by his
treating physician will count as one of the two medical opinions that
the miner may submit under Sec. 725.414 of this part.
(e) The cost of any medical examination or test authorized under
this section, including the cost of travel to and from the examination,
shall be paid by the fund. No reimbursement for overnight
accommodations shall be authorized unless the district director
determines that an adequate testing facility is unavailable within one
day's round trip travel by automobile from the miner's residence. The
fund shall be reimbursed for such payments by an operator, if any,
found liable for the payment of benefits to the claimant. If an
operator fails to repay such expenses, with interest, upon request of
the Office, the entire amount may be collected in
[[Page 80073]]
an action brought under section 424 of the Act and Sec. 725.603 of this
part.
Sec. 725.407 Identification and notification of responsible operator.
(a) Upon receipt of the miner's employment history, the district
director shall investigate whether any operator may be held liable for
the payment of benefits as a responsible operator in accordance with
the criteria contained in Subpart G of this part.
(b) The district director may identify one or more operators
potentially liable for the payment of benefits in accordance with the
criteria set forth in Sec. 725.495 of this part. The district director
shall notify each such operator of the existence of the claim. Where
the records maintained by the Office pursuant to part 726 of this
subchapter indicate that the operator had obtained a policy of
insurance, and the claim falls within such policy, the notice provided
pursuant to this section shall also be sent to the operator's carrier.
Any operator or carrier notified of the claim shall thereafter be
considered a party to the claim in accordance with Sec. 725.360 of this
part unless it is dismissed by an adjudication officer and is not
thereafter notified again of its potential liability.
(c) The notification issued pursuant to this section shall include
a copy of the claimant's application and a copy of all evidence
obtained by the district director relating to the miner's employment.
The district director may request the operator to answer specific
questions, including, but not limited to, questions related to the
nature of its operations, its relationship with the miner, its
financial status, including any insurance obtained to secure its
obligations under the Act, and its relationship with other potentially
liable operators. A copy of any notification issued pursuant to this
section shall be sent to the claimant by regular mail.
(d) If at any time before a case is referred to the Office of
Administrative Law Judges, the district director determines that an
operator which may be liable for the payment of benefits has not been
notified under this section or has been incorrectly dismissed pursuant
to Sec. 725.410(a)(3), the district director shall give such operator
notice of its potential liability in accordance with this section. The
adjudication officer shall then take such further action on the claim
as may be appropriate. There shall be no time limit applicable to a
later identification of an operator under this paragraph if the
operator fraudulently concealed its identity as an employer of the
miner. The district director may not notify additional operators of
their potential liability after a case has been referred to the Office
of Administrative Law Judges, unless the case was referred for a
hearing to determine whether the claim was properly denied as abandoned
pursuant to Sec. 725.409.
Sec. 725.408 Operator's response to notification.
(a)(1) An operator which receives notification under Sec. 725.407
shall, within 30 days of receipt, file a response indicating its intent
to accept or contest its identification as a potentially liable
operator. The operator's response shall also be sent to the claimant by
regular mail.
(2) If the operator contests its identification, it shall, on a
form supplied by the district director, state the precise nature of its
disagreement by admitting or denying each of the following assertions.
In answering these assertions, the term ``operator'' shall include any
operator for which the identified operator may be considered a
successor operator pursuant to Sec. 725.492.
(i) That the named operator was an operator for any period after
June 30, 1973;
(ii) That the operator employed the miner as a miner for a
cumulative period of not less than one year;
(iii) That the miner was exposed to coal mine dust while working
for the operator;
(iv) That the miner's employment with the operator included at
least one working day after December 31, 1969; and
(v) That the operator is capable of assuming liability for the
payment of benefits.
(3) An operator which receives notification under Sec. 725.407, and
which fails to file a response within the time limit provided by this
section, shall not be allowed to contest its liability for the payment
of benefits on any of the grounds set forth in paragraph (a)(2).
(b)(1) Within 90 days of the date on which it receives notification
under Sec. 725.407, an operator may submit documentary evidence in
support of its position.
(2) No documentary evidence relevant to the grounds set forth in
paragraph (a)(2) may be admitted in any further proceedings unless it
is submitted within the time limits set forth in this section.
Sec. 725.409 Denial of a claim by reason of abandonment.
(a) A claim may be denied at any time by the district director by
reason of abandonment where the claimant fails:
(1) To undergo a required medical examination without good cause;
or,
(2) To submit evidence sufficient to make a determination of the
claim; or,
(3) To pursue the claim with reasonable diligence; or,
(4) To attend an informal conference without good cause.
(b)(1) If the district director determines that a denial by reason
of abandonment under paragraphs (a)(1) through (3) of this section is
appropriate, he or she shall notify the claimant of the reasons for
such denial and of the action which must be taken to avoid a denial by
reason of abandonment. If the claimant completes the action requested
within the time allowed, the claim shall be developed, processed and
adjudicated as specified in this part. If the claimant does not fully
comply with the action requested by the district director, the district
director shall notify the claimant that the claim has been denied by
reason of abandonment. Such notification shall be served on the
claimant and all other parties to the claim by certified mail.
(2) In any case in which a claimant has failed to attend an
informal conference and has not provided the district director with his
reasons for failing to attend, the district director shall ask the
claimant to explain his absence. In considering whether the claimant
had good cause for his failure to attend the conference, the district
director shall consider all relevant circumstances, including the age,
education, and health of the claimant, as well as the distance between
the claimant's residence and the location of the conference. If the
district director concludes that the claimant had good cause for
failing to attend the conference, he may continue processing the claim,
including, where appropriate under Sec. 725.416, the scheduling of an
informal conference. If the claimant does not supply the district
director with his reasons for failing to attend the conference within
30 days of the date of the district director's request, or the district
director concludes that the reasons supplied by the claimant do not
establish good cause, the district director shall notify the claimant
that the claim has been denied by reason of abandonment. Such
notification shall be served on the claimant and all other parties to
the claim by certified mail.
(c) The denial of a claim by reason of abandonment shall become
effective and final unless, within 30 days after the denial is issued,
the claimant requests a hearing. Following the expiration of the 30-day
period, a new claim may be filed at any time pursuant to Sec. 725.309.
For purposes of Sec. 725.309,
[[Page 80074]]
a denial by reason of abandonment shall be deemed a finding that the
claimant has not established any applicable condition of entitlement.
If the claimant timely requests a hearing, the district director shall
refer the case to the Office of Administrative Law Judges in accordance
with Sec. 725.421. Except upon the motion or written agreement of the
Director, the hearing will be limited to the issue of whether the claim
was properly denied by reason of abandonment. If the hearing is limited
to the issue of abandonment and the administrative law judge determines
that the claim was not properly denied by reason of abandonment, he
shall remand the claim to the district director for the completion of
administrative processing.
Sec. 725.410 Submission of additional evidence.
(a) After the district director completes the development of
medical evidence under Sec. 725.405 of this part, including the
complete pulmonary evaluation authorized by Sec. 725.406, and receives
the responses and evidence submitted pursuant to Sec. 725.408, he shall
issue a schedule for the submission of additional evidence. The
schedule shall contain the following information:
(1) If the claim was filed by, or on behalf of, a miner, the
schedule shall contain a summary of the complete pulmonary evaluation
administered pursuant to Sec. 725.406. If the claim was filed by, or on
behalf of, a survivor, the schedule shall contain a summary of any
medical evidence developed by the district director pursuant to
Sec. 725.405(c).
(2) The schedule shall contain the district director's preliminary
analysis of the medical evidence. If the district director believes
that the evidence fails to establish any necessary element of
entitlement, he shall inform the claimant of the element of entitlement
not established and the reasons for his conclusions and advise the
claimant that, unless he submits additional evidence, the district
director will issue a proposed decision and order denying the claim.
(3) The schedule shall contain the district director's designation
of a responsible operator liable for the payment of benefits. In the
event that the district director has designated as the responsible
operator an employer other than the employer who last employed the
claimant as a miner, the district director shall include, with the
schedule, a copy of the statements required by Sec. 725.495(d) of this
part. The district director may, in his discretion, dismiss as parties
any of the operators notified of their potential liability pursuant to
Sec. 725.407. If the district director thereafter determines that the
participation of a party dismissed pursuant to this section is
required, he may once again notify the operator in accordance with
Sec. 725.407(d).
(4) The schedule shall notify the claimant and the designated
responsible operator that they have the right to obtain further
adjudication of the claim in accordance with this subpart, and that
they have the right to submit additional evidence in accordance with
this subpart. The schedule shall also notify the claimant that he has
the right to obtain representation, under the terms set forth in
subpart D, in order to assist him. In a case in which the district
director has designated a responsible operator pursuant to paragraph
(a)(3), the schedule shall further notify the claimant that if the
operator fails to accept the claimant's entitlement to benefits within
the time limit provided by Sec. 725.412, the cost of obtaining
additional medical and other necessary evidence, along with a
reasonable attorney's fee, shall be reimbursed by the responsible
operator in the event that the claimant establishes his entitlement to
benefits payable by that operator. In a case in which there is no
operator liable for the payment of benefits, the schedule shall notify
the claimant that the cost of obtaining additional medical and other
necessary evidence, along with a reasonable attorney's fee, shall be
reimbursed by the fund.
(b) The schedule shall allow all parties not less than 60 days
within which to submit additional evidence, including evidence relevant
to the claimant's eligibility for benefits and evidence relevant to the
liability of the designated responsible operator, and shall provide not
less than an additional 30 days within which the parties may respond to
evidence submitted by other parties. Any such evidence must meet the
requirements set forth in Sec. 725.414 in order to be admitted into the
record.
(c) The district director shall serve a copy of the schedule,
together with a copy of all of the evidence developed, on the claimant,
the designated responsible operator, and all other operators which
received notification pursuant to Sec. 725.407. The schedule shall be
served on each party by certified mail.
Sec. 725.411 Initial adjudication in Trust Fund cases.
Notwithstanding the requirements of Sec. 725.410 of this part, if
the district director concludes that the results of the complete
pulmonary evaluation support a finding of eligibility, and that there
is no operator responsible for the payment of benefits, the district
director shall issue a proposed decision and order in accordance with
Sec. 725.418 of this part.
Sec. 725.412 Operator's response.
(a)(1) Within 30 days after the district director issues a schedule
pursuant to Sec. 725.410 of this part containing a designation of the
responsible operator liable for the payment of benefits, that operator
shall file a response with regard to its liability. The response shall
specifically indicate whether the operator agrees or disagrees with the
district director's designation.
(2) If the responsible operator designated by the district director
does not file a timely response, it shall be deemed to have accepted
the district director's designation with respect to its liability, and
to have waived its right to contest its liability in any further
proceeding conducted with respect to the claim.
(b) The responsible operator designated by the district director
may also file a statement accepting claimant's entitlement to benefits.
If that operator fails to file a timely response to the district
director's designation, the district director shall, upon receipt of
such a statement, issue a proposed decision and order in accordance
with Sec. 725.418 of this part. If the operator fails to file a
statement accepting the claimant's entitlement to benefits within 30
days after the district director issues a schedule pursuant to
Sec. 725.410 of this part, the operator shall be deemed to have
contested the claimant's entitlement.
Sec. 725.413 [Reserved].
Sec. 725.414 Development of evidence.
(a) Medical evidence.
(1) For purposes of this section, a medical report shall consist of
a physician's written assessment of the miner's respiratory or
pulmonary condition. A medical report may be prepared by a physician
who examined the miner and/or reviewed the available admissible
evidence. A physician's written assessment of a single objective test,
such as a chest X-ray or a pulmonary function test, shall not be
considered a medical report for purposes of this section.
(2)(i) The claimant shall be entitled to submit, in support of his
affirmative case, no more than two chest X-ray interpretations, the
results of no more than two pulmonary function tests, the results of no
more than two arterial
[[Page 80075]]
blood gas studies, no more than one report of an autopsy, no more than
one report of each biopsy, and no more than two medical reports. Any
chest X-ray interpretations, pulmonary function test results, blood gas
studies, autopsy report, biopsy report, and physicians' opinions that
appear in a medical report must each be admissible under this paragraph
or paragraph (a)(4) of this section.
(ii) The claimant shall be entitled to submit, in rebuttal of the
case presented by the party opposing entitlement, no more than one
physician's interpretation of each chest X-ray, pulmonary function
test, arterial blood gas study, autopsy or biopsy submitted by the
designated responsible operator or the fund, as appropriate, under
paragraph (a)(3)(i) or (a)(3)(iii) of this section and by the Director
pursuant to Sec. 725.406. In any case in which the party opposing
entitlement has submitted the results of other testing pursuant to
Sec. 718.107, the claimant shall be entitled to submit one physician's
assessment of each piece of such evidence in rebuttal. In addition,
where the responsible operator or fund has submitted rebuttal evidence
under paragraph (a)(3)(ii) or (a)(3)(iii) of this section with respect
to medical testing submitted by the claimant, the claimant shall be
entitled to submit an additional statement from the physician who
originally interpreted the chest X-ray or administered the objective
testing. Where the rebuttal evidence tends to undermine the conclusion
of a physician who prepared a medical report submitted by the claimant,
the claimant shall be entitled to submit an additional statement from
the physician who prepared the medical report explaining his conclusion
in light of the rebuttal evidence.
(3)(i) The responsible operator designated pursuant to Sec. 725.410
shall be entitled to obtain and submit, in support of its affirmative
case, no more than two chest X-ray interpretations, the results of no
more than two pulmonary function tests, the results of no more than two
arterial blood gas studies, no more than one report of an autopsy, no
more than one report of each biopsy, and no more than two medical
reports. Any chest X-ray interpretations, pulmonary function test
results, blood gas studies, autopsy report, biopsy report, and
physicians' opinions that appear in a medical report must each be
admissible under this paragraph or paragraph (a)(4) of this section. In
obtaining such evidence, the responsible operator may not require the
miner to travel more than 100 miles from his or her place of residence,
or the distance traveled by the miner in obtaining the complete
pulmonary evaluation provided by Sec. 725.406 of this part, whichever
is greater, unless a trip of greater distance is authorized in writing
by the district director. If a miner unreasonably refuses--
(A) To provide the Office or the designated responsible operator
with a complete statement of his or her medical history and/or to
authorize access to his or her medical records, or
(B) To submit to an evaluation or test requested by the district
director or the designated responsible operator, the miner's claim may
be denied by reason of abandonment. (See Sec. 725.409 of this part).
(ii) The responsible operator shall be entitled to submit, in
rebuttal of the case presented by the claimant, no more than one
physician's interpretation of each chest X-ray, pulmonary function
test, arterial blood gas study, autopsy or biopsy submitted by the
claimant under paragraph (a)(2)(i) of this section and by the Director
pursuant to Sec. 725.406. In any case in which the claimant has
submitted the results of other testing pursuant to Sec. 718.107, the
responsible operator shall be entitled to submit one physician's
assessment of each piece of such evidence in rebuttal. In addition,
where the claimant has submitted rebuttal evidence under paragraph
(a)(2)(ii) of this section, the responsible operator shall be entitled
to submit an additional statement from the physician who originally
interpreted the chest X-ray or administered the objective testing.
Where the rebuttal evidence tends to undermine the conclusion of a
physician who prepared a medical report submitted by the responsible
operator, the responsible operator shall be entitled to submit an
additional statement from the physician who prepared the medical report
explaining his conclusion in light of the rebuttal evidence.
(iii) In a case in which the district director has not identified
any potentially liable operators, or has dismissed all potentially
liable operators under Sec. 725.410(a)(3), the district director shall
be entitled to exercise the rights of a responsible operator under this
section, except that the evidence obtained in connection with the
complete pulmonary evaluation performed pursuant to Sec. 725.406 shall
be considered evidence obtained and submitted by the Director, OWCP,
for purposes of paragraph (a)(3)(i) of this section. In a case
involving a dispute concerning medical benefits under Sec. 725.708 of
this part, the district director shall be entitled to develop medical
evidence to determine whether the medical bill is compensable under the
standard set forth in Sec. 725.701 of this part.
(4) Notwithstanding the limitations in paragraphs (a)(2) and (a)(3)
of this section, any record of a miner's hospitalization for a
respiratory or pulmonary or related disease, or medical treatment for a
respiratory or pulmonary or related disease, may be received into
evidence.
(5) A copy of any documentary evidence submitted by a party must be
served on all other parties to the claim. If the claimant is not
represented by an attorney, the district director shall mail a copy of
all documentary evidence submitted by the claimant to all other parties
to the claim. Following the development and submission of affirmative
medical evidence, the parties may submit rebuttal evidence in
accordance with the schedule issued by the district director.
(b) Evidence pertaining to liability. (1) Except as provided by
Sec. 725.408(b)(2), the designated responsible operator may submit
evidence to demonstrate that it is not the potentially liable operator
that most recently employed the claimant.
(2) Any other party may submit evidence regarding the liability of
the designated responsible operator or any other operator.
(3) A copy of any documentary evidence submitted under this
paragraph must be mailed to all other parties to the claim. Following
the submission of affirmative evidence, the parties may submit rebuttal
evidence in accordance with the schedule issued by the district
director.
(c) Testimony. A physician who prepared a medical report admitted
under this section may testify with respect to the claim at any formal
hearing conducted in accordance with subpart F of this part, or by
deposition. If a party has submitted fewer than two medical reports as
part of that party's affirmative case under this section, a physician
who did not prepare a medical report may testify in lieu of such a
medical report. The testimony of such a physician shall be considered a
medical report for purposes of the limitations provided by this
section. A party may offer the testimony of no more than two physicians
under the provisions of this section unless the adjudication officer
finds good cause under paragraph (b)(1) of Sec. 725.456 of this part.
In accordance with the schedule issued by the district director, all
parties shall notify the district director of the name and current
address of any potential witness whose testimony pertains to the
liability of a potentially liable operator or the
[[Page 80076]]
designated responsible operator. Absent such notice, the testimony of a
witness relevant to the liability of a potentially liable operator or
the designated responsible operator shall not be admitted in any
hearing conducted with respect to the claim unless the administrative
law judge finds that the lack of notice should be excused due to
extraordinary circumstances.
(d) Except to the extent permitted by Sec. 725.456 and
Sec. 725.310(b), the limitations set forth in this section shall apply
to all proceedings conducted with respect to a claim, and no
documentary evidence pertaining to liability shall be admitted in any
further proceeding conducted with respect to a claim unless it is
submitted to the district director in accordance with this section.
Sec. 725.415 Action by the district director after development of
evidence.
(a) At the end of the period permitted under Sec. 725.410(b) for
the submission of evidence, the district director shall review the
claim on the basis of all evidence submitted in accordance with
Sec. 725.414.
(b) After review of all evidence submitted, the district director
may issue another schedule for the submission of additional evidence
pursuant to Sec. 725.410, identifying another potentially liable
operator as the responsible operator liable for the payment of
benefits. In such a case, the district director shall not permit the
development or submission of any additional medical evidence until
after he has made a final determination of the identity of the
responsible operator liable for the payment of benefits. If the
operator who is finally determined to be the responsible operator has
not had the opportunity to submit medical evidence pursuant to
Sec. 725.410, the district director shall allow the designated
responsible operator and the claimant not less than 60 days within
which to submit evidence relevant to the claimant's eligibility for
benefits. The designated responsible operator may elect to adopt any
medical evidence previously submitted by another operator as its own
evidence, subject to the limitations of Sec. 725.414. The district
director may also schedule a conference in accordance with
Sec. 725.416, issue a proposed decision and order in accordance with
Sec. 725.418, or take such other action as the district director
considers appropriate.
Sec. 725.416 Conferences.
(a) At the conclusion of the period permitted by Sec. 725.410(b) of
this part for the submission of evidence, the district director may
conduct an informal conference in any claim where it appears that such
conference will assist in the voluntary resolution of any issue raised
with respect to the claim. The conference proceedings shall not be
stenographically reported and sworn testimony shall not be taken. Any
conference conducted pursuant to this paragraph shall be held no later
than 90 days after the conclusion of the period permitted by
Sec. 725.410(b) of this part for the submission of evidence, unless one
of the parties requests that the time period be extended for good cause
shown. If the district director is unable to hold the conference within
the time period permitted by this paragraph, he shall proceed to issue
a proposed decision and order under Sec. 725.418 of this part.
(b) The district director shall notify the parties of a definite
time and place for the conference. The district director shall advise
the parties that they have a right to representation at the conference,
by an attorney or a lay representative, and that no conference shall
take place unless the parties are represented. A coal mine operator
which is self-insured, or which is covered by a policy of insurance for
the claim for which a conference is scheduled, shall be deemed to be
represented. The notification shall set forth the specific reasons why
the district director believes that a conference will assist in the
voluntary resolution of any issue raised with respect to the claim. No
sanction may be imposed under paragraph (c) of this section unless the
record contains a notification that meets the requirements of this
section. The district director may in his or her discretion, or on the
motion of any party, cancel a conference or allow any or all of the
parties to participate by telephone.
(c) The unexcused failure of any party to appear at an informal
conference shall be grounds for the imposition of sanctions. If the
claimant fails to appear, the district director may take such steps as
are authorized by Sec. 725.409(b)(2) to deny the claim by reason of
abandonment. If the responsible operator fails to appear, it shall be
deemed to have waived its right to contest its potential liability for
an award of benefits and, in the discretion of the district director,
its right to contest any issue related to the claimant's eligibility.
(d) Any representative of an operator, of an operator's insurance
carrier, or of a claimant, authorized to represent such party in
accordance with paragraph (b), shall be deemed to have sufficient
authority to stipulate facts or issues or agree to a final disposition
of the claim.
(e) Procedures to be followed at a conference shall be within the
discretion of the district director.
Sec. 725.417 Action at the conclusion of conference.
(a) At the conclusion of a conference, the district director shall
prepare a stipulation of contested and uncontested issues which shall
be signed by the parties and the district director. If a hearing is
conducted with respect to the claim, this stipulation shall be
submitted to the Office of Administrative Law Judges and placed in the
claim record.
(b) In appropriate cases, the district director may permit a
reasonable time for the submission of additional evidence following a
conference, provided that such evidence does not exceed the limits set
forth in Sec. 725.414. The district director may also notify additional
operators of their potential liability pursuant to Sec. 725.407, or
issue another schedule for the submission of additional evidence
pursuant to Sec. 725.410, designating another potentially liable
operator as the responsible operator liable for the payment of
benefits, in order to allow that operator an opportunity to submit
evidence relevant to its liability for benefits as well as the
claimant's eligibility for benefits.
(c) Within 20 days after the termination of all conference
proceedings, the district director shall prepare and send to the
parties a proposed decision and order pursuant to Sec. 725.418 of this
part.
Sec. 725.418 Proposed decision and order.
(a) Within 20 days after the termination of all informal conference
proceedings, or, if no informal conference is held, at the conclusion
of the period permitted by Sec. 725.410(b) for the submission of
evidence, the district director shall issue a proposed decision and
order. A proposed decision and order is a document, issued by the
district director after the evidentiary development of the claim is
completed and all contested issues, if any, are joined, which purports
to resolve a claim on the basis of the evidence submitted to or
obtained by the district director. A proposed decision and order shall
be considered a final adjudication of a claim only as provided in
Sec. 725.419. A proposed decision and order may be issued by the
district director at any time during the adjudication of any claim if:
(1) Issuance is authorized or required by this part; or,
[[Page 80077]]
(2) The district director determines that its issuance will
expedite the adjudication of the claim.
(b) A proposed decision and order shall contain findings of fact
and conclusions of law. It shall be served on all parties to the claim
by certified mail.
(c) The proposed decision and order shall contain a notice of the
right of any interested party to request a formal hearing before the
Office of Administrative Law Judges. If the proposed decision and order
is a denial of benefits, and the claimant has previously filed a
request for a hearing, the proposed decision and order shall notify the
claimant that the case will be referred for a hearing pursuant to the
previous request unless the claimant notifies the district director
that he no longer desires a hearing. If the proposed decision and order
is an award of benefits, and the designated responsible operator has
previously filed a request for a hearing, the proposed decision and
order shall notify the operator that the case will be referred for a
hearing pursuant to the previous request unless the operator notifies
the district director that it no longer desires a hearing.
(d) The proposed decision and order shall reflect the district
director's final designation of the responsible operator liable for the
payment of benefits. No operator may be finally designated as the
responsible operator unless it has received notification of its
potential liability pursuant to Sec. 725.407, and the opportunity to
submit additional evidence pursuant to Sec. 725.410. The district
director shall dismiss, as parties to the claim, all other potentially
liable operators that received notification pursuant to Sec. 725.407
and that were not previously dismissed pursuant to Sec. 725.410(a)(3).
Sec. 725.419 Response to proposed decision and order.
(a) Within 30 days after the date of issuance of a proposed
decision and order, any party may, in writing, request a revision of
the proposed decision and order or a hearing. If a hearing is
requested, the district director shall refer the claim to the Office of
Administrative Law Judges (see Sec. 725.421).
(b) Any response made by a party to a proposed decision and order
shall specify the findings and conclusions with which the responding
party disagrees, and shall be served on the district director and all
other parties to the claim.
(c) If a timely request for revision of a proposed decision and
order is made, the district director may amend the proposed decision
and order, as circumstances require, and serve the revised proposed
decision and order on all parties or take such other action as is
appropriate. If a revised proposed decision and order is issued, each
party to the claim shall have 30 days from the date of issuance of that
revised proposed decision and order within which to request a hearing.
(d) If no response to a proposed decision and order is sent to the
district director within the period described in paragraph (a) of this
section, or if no response to a revised proposed decision and order is
sent to the district director within the period described in paragraph
(c) of this section, the proposed decision and order shall become a
final decision and order, which is effective upon the expiration of the
applicable 30-day period. Once a proposed decision and order or revised
proposed decision and order becomes final and effective, all rights to
further proceedings with respect to the claim shall be considered
waived, except as provided in Sec. 725.310.
Sec. 725.420 Initial determinations.
(a) Section 9501(d)(1)(A)(1) of the Internal Revenue Code (26
U.S.C.) provides that the Black Lung Disability Trust Fund shall begin
the payment of benefits on behalf of an operator in any case in which
the operator liable for such payments has not commenced payment of such
benefits within 30 days after the date of an initial determination of
eligibility by the Secretary. For claims filed on or after January 1,
1982, the payment of such interim benefits from the fund is limited to
benefits accruing after the date of such initial determination.
(b) Except as provided in Sec. 725.415, after the district director
has determined that a claimant is eligible for benefits, on the basis
of all evidence submitted by a claimant and operator, and has
determined that a hearing will be necessary to resolve the claim, the
district director shall in writing so inform the parties and direct the
operator to begin the payment of benefits to the claimant in accordance
with Sec. 725.522. The date on which this writing is sent to the
parties shall be considered the date of initial determination of the
claim.
(c) If a notified operator refuses to commence payment of a claim
within 30 days from the date on which an initial determination is made
under this section, benefits shall be paid by the fund to the claimant
in accordance with Sec. 725.522, and the operator shall be liable to
the fund, if such operator is determined liable for the claim, for all
benefits paid by the fund on behalf of such operator, and, in addition,
such penalties and interest as are appropriate.
Sec. 725.421 Referral of a claim to the Office of Administrative Law
Judges.
(a) In any claim for which a formal hearing is requested or
ordered, and with respect to which the district director has completed
evidentiary development and adjudication without having resolved all
contested issues, the district director shall refer the claim to the
Office of Administrative Law Judges for a hearing.
(b) In any case referred to the Office of Administrative Law Judges
under this section, the district director shall transmit to that office
the following documents, which shall be placed in the record at the
hearing subject to the objection of any party:
(1) Copies of the claim form or forms;
(2) Any statement, document, or pleading submitted by a party to
the claim;
(3) A copy of the notification to an operator of its possible
liability for the claim, and any schedule for the submission of
additional evidence issued pursuant to Sec. 725.410 designating a
potentially liable operator as the responsible operator;
(4) All medical evidence submitted to the district director under
this part by the claimant and the potentially liable operator
designated as the responsible operator in the proposed decision and
order issued pursuant to Sec. 725.418, or the fund, as appropriate,
subject to the limitations of Sec. 725.414 of this part; this evidence
shall include the results of any medical examination or test conducted
pursuant to Sec. 725.406, and all evidence relevant to the liability of
the responsible operator submitted to the district director under this
part;
(5) Any written stipulation of law or fact or stipulation of
contested and uncontested issues entered into by the parties;
(6) Any pertinent forms submitted to the district director;
(7) The statement by the district director of contested and
uncontested issues in the claim; and
(8) The district director's initial determination of eligibility or
other documents necessary to establish the right of the fund to
reimbursement, if appropriate. Copies of the transmittal notice shall
also be sent to all parties to the claim by regular mail.
(c) A party may at any time request and obtain from the district
director copies of documents transmitted to the Office of
Administrative Law Judges under paragraph (b) of this section. If the
party has previously been provided with such documents, additional
copies
[[Page 80078]]
may be sent to the party upon the payment of a copying fee to be
determined by the district director.
Sec. 725.422 Legal assistance.
The Secretary or his or her designee may, upon request, provide a
claimant with legal assistance in processing a claim under the Act.
Such assistance may be made available to a claimant in the discretion
of the Solicitor of Labor or his or her designee at any time prior to
or during the time in which the claim is being adjudicated and shall be
furnished without charge to the claimant. Representation of a claimant
in adjudicatory proceedings shall not be provided by the Department of
Labor unless it is determined by the Solicitor of Labor that such
representation is in the best interests of the black lung benefits
program. In no event shall representation be provided to a claimant in
a claim with respect to which the claimant's interests are adverse to
those of the Secretary of Labor or the fund.
Sec. 725.423 Extensions of time.
Except for the 30-day time limit set forth in Sec. 725.419, any of
the time periods set forth in this subpart may be extended, for good
cause shown, by filing a request for an extension with the district
director prior to the expiration of the time period.
Subpart F--Hearings
Sec. 725.450 Right to a hearing.
Any party to a claim (see Sec. 725.360) shall have a right to a
hearing concerning any contested issue of fact or law unresolved by the
district director. There shall be no right to a hearing until the
processing and adjudication of the claim by the district director has
been completed. There shall be no right to a hearing in a claim with
respect to which a determination of the claim made by the district
director has become final and effective in accordance with this part.
Sec. 725.451 Request for hearing.
After the completion of proceedings before the district director,
or as is otherwise indicated in this part, any party may in writing
request a hearing on any contested issue of fact or law (see
Sec. 725.419). A district director may on his or her own initiative
refer a case for hearing. If a hearing is requested, or if a district
director determines that a hearing is necessary to the resolution of
any issue, the claim shall be referred to the Chief Administrative Law
Judge for a hearing under Sec. 725.421.
Sec. 725.452 Type of hearing; parties.
(a) A hearing held under this part shall be conducted by an
administrative law judge designated by the Chief Administrative Law
Judge. Except as otherwise provided by this part, all hearings shall be
conducted in accordance with the provisions of 5 U.S.C. 554 et seq.
(b) All parties to a claim shall be permitted to participate fully
at a hearing held in connection with such claim.
(c) A full evidentiary hearing need not be conducted if a party
moves for summary judgment and the administrative law judge determines
that there is no genuine issue as to any material fact and that the
moving party is entitled to the relief requested as a matter of law.
All parties shall be entitled to respond to the motion for summary
judgment prior to decision thereon.
(d) If the administrative law judge believes that an oral hearing
is not necessary (for any reason other than on motion for summary
judgment), the judge shall notify the parties by written order and
allow at least 30 days for the parties to respond. The administrative
law judge shall hold the oral hearing if any party makes a timely
request in response to the order.
Sec. 725.453 Notice of hearing.
All parties shall be given at least 30 days written notice of the
date and place of a hearing and the issues to be resolved at the
hearing. Such notice shall be sent to each party or representative by
certified mail.
Sec. 725.454 Time and place of hearing; transfer of cases.
(a) The Chief Administrative Law Judge shall assign a definite time
and place for a formal hearing, and shall, where possible, schedule the
hearing to be held at a place within 75 miles of the claimant's
residence unless an alternate location is requested by the claimant.
(b) If the claimant's residence is not in any State, the Chief
Administrative Law Judge may, in his or her discretion, schedule the
hearing in the country of the claimant's residence.
(c) The Chief Administrative Law Judge or the administrative law
judge assigned the case may in his or her discretion direct that a
hearing with respect to a claim shall begin at one location and then
later be reconvened at another date and place.
(d) The Chief Administrative Law Judge or administrative law judge
assigned the case may change the time and place for a hearing, either
on his or her own motion or for good cause shown by a party. The
administrative law judge may adjourn or postpone the hearing for good
cause shown, at any time prior to the mailing to the parties of the
decision in the case. Unless otherwise agreed, at least 10 days notice
shall be given to the parties of any change in the time or place of
hearing.
(e) The Chief Administrative Law Judge may for good cause shown
transfer a case from one administrative law judge to another.
Sec. 725.455 Hearing procedures; generally.
(a) General. The purpose of any hearing conducted under this
subpart shall be to resolve contested issues of fact or law. Except as
provided in Sec. 725.421(b)(8), any findings or determinations made
with respect to a claim by a district director shall not be considered
by the administrative law judge.
(b) Evidence. The administrative law judge shall at the hearing
inquire fully into all matters at issue, and shall not be bound by
common law or statutory rules of evidence, or by technical or formal
rules of procedure, except as provided by 5 U.S.C. 554 and this
subpart. The administrative law judge shall receive into evidence the
testimony of the witnesses and parties, the evidence submitted to the
Office of Administrative Law Judges by the district director under
Sec. 725.421, and such additional evidence as may be submitted in
accordance with the provisions of this subpart. The administrative law
judge may entertain the objections of any party to the evidence
submitted under this section.
(c) Procedure. The conduct of the hearing and the order in which
allegations and evidence shall be presented shall be within the
discretion of the administrative law judge and shall afford the parties
an opportunity for a fair hearing.
(d) Oral argument and written allegations. The parties, upon
request, may be allowed a reasonable time for the presentation of oral
argument at the hearing. Briefs or other written statements or
allegations as to facts or law may be filed by any party with the
permission of the administrative law judge. Copies of any brief or
other written statement shall be filed with the administrative law
judge and served on all parties by the submitting party.
Sec. 725.456 Introduction of documentary evidence.
(a) All documents transmitted to the Office of Administrative Law
Judges under Sec. 725.421 shall be placed into evidence by the
administrative law judge, subject to objection by any party.
[[Page 80079]]
(b)(1) Documentary evidence pertaining to the liability of a
potentially liable operator and/or the identification of a responsible
operator which was not submitted to the district director shall not be
admitted into the hearing record in the absence of extraordinary
circumstances. Medical evidence in excess of the limitations contained
in Sec. 725.414 shall not be admitted into the hearing record in the
absence of good cause.
(2) Subject to the limitations in paragraph (b)(1) of this section,
any other documentary material, including medical reports, which was
not submitted to the district director, may be received in evidence
subject to the objection of any party, if such evidence is sent to all
other parties at least 20 days before a hearing is held in connection
with the claim.
(3) Documentary evidence, which is not exchanged with the parties
in accordance with this paragraph, may be admitted at the hearing with
the written consent of the parties or on the record at the hearing, or
upon a showing of good cause why such evidence was not exchanged in
accordance with this paragraph. If documentary evidence is not
exchanged in accordance with paragraph (b)(2) of this section and the
parties do not waive the 20-day requirement or good cause is not shown,
the administrative law judge shall either exclude the late evidence
from the record or remand the claim to the district director for
consideration of such evidence.
(4) A medical report which is not made available to the parties in
accordance with paragraph (b)(2) of this section shall not be admitted
into evidence in any case unless the hearing record is kept open for at
least 30 days after the hearing to permit the parties to take such
action as each considers appropriate in response to such evidence. If,
in the opinion of the administrative law judge, evidence is withheld
from the parties for the purpose of delaying the adjudication of the
claim, the administrative law judge may exclude such evidence from the
hearing record and close the record at the conclusion of the hearing.
(c) Subject to paragraph (b) of this section, documentary evidence
which the district director excludes from the record, and the
objections to such evidence, may be submitted by the parties to the
administrative law judge, who shall independently determine whether the
evidence shall be admitted.
(1) If the evidence is admitted, the administrative law judge may,
in his or her discretion, remand the claim to the district director for
further consideration.
(2) If the evidence is admitted, the administrative law judge shall
afford the opposing party or parties the opportunity to develop such
additional documentary evidence as is necessary to protect the right of
cross-examination.
(d) All medical records and reports submitted by any party shall be
considered by the administrative law judge in accordance with the
quality standards contained in part 718 of this subchapter.
(e) If the administrative law judge concludes that the complete
pulmonary evaluation provided pursuant to Sec. 725.406, or any part
thereof, fails to comply with the applicable quality standards, or
fails to address the relevant conditions of entitlement (see
Sec. 725.202(d)(2)(i) through (iv)) in a manner which permits
resolution of the claim, the administrative law judge shall, in his or
her discretion, remand the claim to the district director with
instructions to develop only such additional evidence as is required,
or allow the parties a reasonable time to obtain and submit such
evidence, before the termination of the hearing.
Sec. 725.457 Witnesses.
(a) Witnesses at the hearing shall testify under oath or
affirmation. The administrative law judge and the parties may question
witnesses with respect to any matters relevant and material to any
contested issue. Any party who intends to present the testimony of an
expert witness at a hearing, including any physician, regardless of
whether the physician has previously prepared a medical report, shall
so notify all other parties to the claim at least 10 days before the
hearing. The failure to give notice of the appearance of an expert
witness in accordance with this paragraph, unless notice is waived by
all parties, shall preclude the presentation of testimony by such
expert witness.
(b) No person shall be required to appear as a witness in any
proceeding before an administrative law judge at a place more than 100
miles from his or her place of residence, unless the lawful mileage and
witness fee for 1 day's attendance is paid in advance of the hearing
date.
(c) No person shall be permitted to testify as a witness at the
hearing, or pursuant to deposition or interrogatory under Sec. 725.458,
unless that person meets the requirements of Sec. 725.414(c).
(1) In the case of a witness offering testimony relevant to the
liability of the responsible operator, in the absence of extraordinary
circumstances, the witness must have been identified as a potential
hearing witness while the claim was pending before the district
director.
(2) In the case of a physician offering testimony relevant to the
physical condition of the miner, such physician must have prepared a
medical report. Alternatively, in the absence of a showing of good
cause under Sec. 725.456(b)(1) of this part, a physician may offer
testimony relevant to the physical condition of the miner only to the
extent that the party offering the physician's testimony has submitted
fewer medical reports than permitted by Sec. 725.414. Such physician's
opinion shall be considered a medical report subject to the limitations
of Sec. 725.414.
(d) A physician whose testimony is permitted under this section may
testify as to any other medical evidence of record, but shall not be
permitted to testify as to any medical evidence relevant to the miner's
condition that is not admissible.
Sec. 725.458 Depositions; interrogatories.
The testimony of any witness or party may be taken by deposition or
interrogatory according to the rules of practice of the Federal
district court for the judicial district in which the case is pending
(or of the U.S. District Court for the District of Columbia if the case
is pending in the District or outside the United States), except that
at least 30 days prior notice of any deposition shall be given to all
parties unless such notice is waived. No post-hearing deposition or
interrogatory shall be permitted unless authorized by the
administrative law judge upon the motion of a party to the claim. The
testimony of any physician which is taken by deposition shall be
subject to the limitations on the scope of the testimony contained in
Sec. 725.457(d).
Sec. 725.459 Witness fees.
(a) A witness testifying at a hearing before an administrative law
judge, or whose deposition is taken, shall receive the same fees and
mileage as witnesses in courts of the United States. If the witness is
an expert, he or she shall be entitled to an expert witness fee. Except
as provided in paragraphs (b) and (c) of this section, such fees shall
be paid by the proponent of the witness.
(b) If the witness' proponent does not intend to call the witness
to appear at a hearing or deposition, any other party may subpoena the
witness for cross-examination. The administrative law judge shall
authorize the least intrusive and expensive means of cross-examination
as he deems appropriate and necessary to the full and true
[[Page 80080]]
disclosure of facts. If such witness is required to attend the hearing,
give a deposition or respond to interrogatories for cross-examination
purposes, the proponent of the witness shall pay the witness' fee. If
the claimant is the proponent of the witness whose cross-examination is
sought, and demonstrates, within time limits established by the
administrative law judge, that he would be deprived of ordinary and
necessary living expenses if required to pay the witness fee and
mileage necessary to produce that witness for cross-examination, the
administrative law judge shall apportion the costs of such cross-
examination among the parties to the case. The administrative law judge
shall not apportion any costs against the fund in a case in which the
district director has designated a responsible operator, except that
the fund shall remain liable for any costs associated with the cross-
examination of the physician who performed the complete pulmonary
evaluation pursuant to Sec. 725.406.
(c) If a claimant is determined entitled to benefits, there may be
assessed as costs against a responsible operator, if any, or the fund,
fees and mileage for necessary witnesses attending the hearing at the
request of the claimant. Both the necessity for the witness and the
reasonableness of the fees of any expert witness shall be approved by
the administrative law judge. The amounts awarded against a responsible
operator or the fund as attorney's fees, or costs, fees and mileage for
witnesses, shall not in any respect affect or diminish benefits payable
under the Act.
(d) A claimant shall be considered to be deprived of funds required
for ordinary and necessary living expenses for purposes of paragraph
(b) of this section where payment of the projected fee and mileage
would meet the standards set forth at 20 CFR 404.508.
Sec. 725.460 Consolidated hearings.
When two or more hearings are to be held, and the same or
substantially similar evidence is relevant and material to the matters
at issue at each such hearing, the Chief Administrative Law Judge may,
upon motion by any party or on his or her own motion, order that a
consolidated hearing be conducted. Where consolidated hearings are
held, a single record of the proceedings shall be made and the evidence
introduced in one claim may be considered as introduced in the others,
and a separate or joint decision shall be made, as appropriate.
Sec. 725.461 Waiver of right to appear and present evidence.
(a) If all parties waive their right to appear before the
administrative law judge, it shall not be necessary for the
administrative law judge to give notice of, or conduct, an oral
hearing. A waiver of the right to appear shall be made in writing and
filed with the Chief Administrative Law Judge or the administrative law
judge assigned to hear the case. Such waiver may be withdrawn by a
party for good cause shown at any time prior to the mailing of the
decision in the claim. Even though all of the parties have filed a
waiver of the right to appear, the administrative law judge may,
nevertheless, after giving notice of the time and place, conduct a
hearing if he or she believes that the personal appearance and
testimony of the party or parties would assist in ascertaining the
facts in issue in the claim. Where a waiver has been filed by all
parties, and they do not appear before the administrative law judge
personally or by representative, the administrative law judge shall
make a record of the relevant documentary evidence submitted in
accordance with this part and any further written stipulations of the
parties. Such documents and stipulations shall be considered the
evidence of record in the case and the decision shall be based upon
such evidence.
(b) Except as provided in Sec. 725.456(a), the unexcused failure of
any party to attend a hearing shall constitute a waiver of such party's
right to present evidence at the hearing, and may result in a dismissal
of the claim (see Sec. 725.465).
Sec. 725.462 Withdrawal of controversion of issues set for formal
hearing; effect.
A party may, on the record, withdraw his or her controversion of
any or all issues set for hearing. If a party withdraws his or her
controversion of all issues, the administrative law judge shall remand
the case to the district director for the issuance of an appropriate
order.
Sec. 725.463 Issues to be resolved at hearing; new issues.
(a) Except as otherwise provided in this section, the hearing shall
be confined to those contested issues which have been identified by the
district director (see Sec. 725.421) or any other issue raised in
writing before the district director.
(b) An administrative law judge may consider a new issue only if
such issue was not reasonably ascertainable by the parties at the time
the claim was before the district director. Such new issue may be
raised upon application of any party, or upon an administrative law
judge's own motion, with notice to all parties, at any time after a
claim has been transmitted by the district director to the Office of
Administrative Law Judges and prior to decision by an administrative
law judge. If a new issue is raised, the administrative law judge may,
in his or her discretion, either remand the case to the district
director with instructions for further proceedings, hear and resolve
the new issue, or refuse to consider such new issue.
(c) If a new issue is to be considered by the administrative law
judge, a party may, upon request, be granted an appropriate
continuance.
Sec. 725.464 Record of hearing.
All hearings shall be open to the public and shall be mechanically
or stenographically reported. All evidence upon which the
administrative law judge relies for decision shall be contained in the
transcript of testimony, either directly or by appropriate reference.
All medical reports, exhibits, and any other pertinent document or
record, either in whole or in material part, introduced as evidence,
shall be marked for identification and incorporated into the record.
Sec. 725.465 Dismissals for cause.
(a) The administrative law judge may, at the request of any party,
or on his or her own motion, dismiss a claim:
(1) Upon the failure of the claimant or his or her representative
to attend a hearing without good cause;
(2) Upon the failure of the claimant to comply with a lawful order
of the administrative law judge; or
(3) Where there has been a prior final adjudication of the claim or
defense to the claim under the provisions of this subchapter and no new
evidence is submitted (except as provided in part 727 of this
subchapter; see Sec. 725.4(d)).
(b) A party who is not a proper party to the claim (see
Sec. 725.360) shall be dismissed by the administrative law judge. The
administrative law judge shall not dismiss the operator designated as
the responsible operator by the district director, except upon the
motion or written agreement of the Director.
(c) In any case where a dismissal of a claim, defense, or party is
sought, the administrative law judge shall issue an order to show cause
why the dismissal should not be granted and afford all parties a
reasonable time to respond to such order. After the time for response
has expired, the administrative law
[[Page 80081]]
judge shall take such action as is appropriate to rule on the
dismissal, which may include an order dismissing the claim, defense or
party.
(d) No claim shall be dismissed in a case with respect to which
payments prior to final adjudication have been made to the claimant in
accordance with Sec. 725.522, except upon the motion or written
agreement of the Director.
Sec. 725.466 Order of dismissal.
(a) An order dismissing a claim shall be served on the parties in
accordance with Sec. 725.478. The dismissal of a claim shall have the
same effect as a decision and order disposing of the claim on its
merits, except as provided in paragraph (b) of this section. Such order
shall advise the parties of their right to request review by the
Benefits Review Board.
(b) Where the Chief Administrative Law Judge or the presiding
administrative law judge issues a decision and order dismissing the
claim after a show cause proceeding, the district director shall
terminate any payments being made to the claimant under Sec. 725.522,
and the order of dismissal shall, if appropriate, order the claimant to
reimburse the fund for all benefits paid to the claimant.
Sec. 725.475 Termination of hearings.
Hearings are officially terminated when all the evidence has been
received, witnesses heard, pleadings and briefs submitted to the
administrative law judge, and the transcript of the proceedings has
been printed and delivered to the administrative law judge.
Sec. 725.476 Issuance of decision and order.
Within 20 days after the official termination of the hearing (see
Sec. 725.475), the administrative law judge shall issue a decision and
order with respect to the claim making an award to the claimant,
rejecting the claim, or taking such other action as is appropriate.
Sec. 725.477 Form and contents of decision and order.
(a) Orders adjudicating claims for benefits shall be designated by
the term ``decision and order'' or ``supplemental decision and order''
as appropriate, followed by a descriptive phrase designating the
particular type of order, such as ``award of benefits,'' ``rejection of
claim,'' ``suspension of benefits,'' ``modification of award.''
(b) A decision and order shall contain a statement of the basis of
the order, the names of the parties, findings of fact, conclusions of
law, and an award, rejection or other appropriate paragraph containing
the action of the administrative law judge, his or her signature and
the date of issuance. A decision and order shall be based upon the
record made before the administrative law judge.
Sec. 725.478 Filing and service of decision and order.
On the date of issuance of a decision and order under Sec. 725.477,
the administrative law judge shall serve the decision and order on all
parties to the claim by certified mail. On the same date, the original
record of the claim shall be sent to the DCMWC in Washington, D.C. Upon
receipt by the DCMWC, the decision and order shall be considered to be
filed in the office of the district director, and shall become
effective on that date.
Sec. 725.479 Finality of decisions and orders.
(a) A decision and order shall become effective when filed in the
office of the district director (see Sec. 725.478), and unless
proceedings for suspension or setting aside of such order are
instituted within 30 days of such filing, the order shall become final
at the expiration of the 30th day after such filing (see Sec. 725.481).
(b) Any party may, within 30 days after the filing of a decision
and order under Sec. 725.478, request a reconsideration of such
decision and order by the administrative law judge. The procedures to
be followed in the reconsideration of a decision and order shall be
determined by the administrative law judge.
(c) The time for appeal to the Benefits Review Board shall be
suspended during the consideration of a request for reconsideration.
After the administrative law judge has issued and filed a denial of the
request for reconsideration, or a revised decision and order in
accordance with this part, any dissatisfied party shall have 30 days
within which to institute proceedings to set aside the decision and
order on reconsideration.
(d) Regardless of any defect in service, actual receipt of the
decision is sufficient to commence the 30-day period for requesting
reconsideration or appealing the decision.
Sec. 725.480 Modification of decisions and orders.
A party who is dissatisfied with a decision and order which has
become final in accordance with Sec. 725.479 may request a modification
of the decision and order if the conditions set forth in Sec. 725.310
are met.
Sec. 725.481 Right to appeal to the Benefits Review Board.
Any party dissatisfied with a decision and order issued by an
administrative law judge may, before the decision and order becomes
final (see Sec. 725.479), appeal the decision and order to the Benefits
Review Board. A notice of appeal shall be filed with the Board.
Proceedings before the Board shall be conducted in accordance with part
802 of this title.
Sec. 725.482 Judicial review.
(a) Any person adversely affected or aggrieved by a final order of
the Benefits Review Board may obtain a review of that order in the U.S.
court of appeals for the circuit in which the injury occurred by filing
in such court within 60 days following the issuance of such Board order
a written petition praying that the order be modified or set aside. The
payment of the amounts required by an award shall not be stayed pending
final decision in any such proceeding unless ordered by the court. No
stay shall be issued unless the court finds that irreparable injury
would otherwise ensue to an operator or carrier.
(b) The Director, Office of Workers' Compensation Program, as
designee of the Secretary of Labor responsible for the administration
and enforcement of the Act, shall be considered the proper party to
appear and present argument on behalf of the Secretary of Labor in all
review proceedings conducted pursuant to this part and the Act, either
as petitioner or respondent.
Sec. 725.483 Costs in proceedings brought without reasonable grounds.
If a United States court having jurisdiction of proceedings
regarding any claim or final decision and order, determines that the
proceedings have been instituted or continued before such court without
reasonable ground, the costs of such proceedings shall be assessed
against the party who has so instituted or continued such proceedings.
Subpart G--Responsible Coal Mine Operators
Sec. 725.490 Statutory provisions and scope.
(a) One of the major purposes of the black lung benefits amendments
of 1977 was to provide a more effective means of transferring the
responsibility for the payment of benefits from the Federal government
to the coal industry with respect to claims filed under this part. In
furtherance of this goal, a Black Lung Disability Trust Fund financed
by the coal industry was established by the Black Lung Benefits Revenue
Act of 1977. The primary purpose of the Fund
[[Page 80082]]
is to pay benefits with respect to all claims in which the last coal
mine employment of the miner on whose account the claim was filed
occurred before January 1, 1970. With respect to most claims in which
the miner's last coal mine employment occurred after January 1, 1970,
individual coal mine operators will be liable for the payment of
benefits. The 1981 amendments to the Act relieved individual coal mine
operators from the liability for payment of certain special claims
involving coal mine employment on or after January 1, 1970, where the
claim was previously denied and subsequently approved under section 435
of the Act. See Sec. 725.496 for a detailed description of these
special claims. Where no such operator exists or the operator
determined to be liable is in default in any case, the fund shall pay
the benefits due and seek reimbursement as is appropriate. See also
Sec. 725.420 for the fund's role in the payment of interim benefits in
certain contested cases. In addition, the Black Lung Benefits Reform
Act of 1977 amended certain provisions affecting the scope of coverage
under the Act and describing the effects of particular corporate
transactions on the liability of operators.
(b) The provisions of this subpart define the term ``operator'' and
prescribe the manner in which the identity of an operator which may be
liable for the payment of benefits--referred to herein as a
``responsible operator''--will be determined.
Sec. 725.491 Operator defined.
(a) For purposes of this part, the term ``operator'' shall include:
(1) Any owner, lessee, or other person who operates, controls, or
supervises a coal mine, or any independent contractor performing
services or construction at such mine; or
(2) Any other person who:
(i) Employs an individual in the transportation of coal or in coal
mine construction in or around a coal mine, to the extent such
individual was exposed to coal mine dust as a result of such employment
(see Sec. 725.202);
(ii) In accordance with the provisions of Sec. 725.492, may be
considered a successor operator; or
(iii) Paid wages or a salary, or provided other benefits, to an
individual in exchange for work as a miner (see Sec. 725.202).
(b) The terms ``owner,'' ``lessee,'' and ``person'' shall include
any individual, partnership, association, corporation, firm, subsidiary
of a corporation, or other organization, as appropriate, except that an
officer of a corporation shall not be considered an ``operator'' for
purposes of this part. Following the issuance of an order awarding
benefits against a corporation that has not secured its liability for
benefits in accordance with section 423 of the Act and Sec. 726.4, such
order may be enforced against the president, secretary, or treasurer of
the corporation in accordance with subpart I of this part.
(c) The term ``independent contractor'' shall include any person
who contracts to perform services. Such contractor's status as an
operator shall not be contingent upon the amount or percentage of its
work or business related to activities in or around a mine, nor upon
the number or percentage of its employees engaged in such activities.
(d) For the purposes of determining whether a person is or was an
operator that may be found liable for the payment of benefits under
this part, there shall be a rebuttable presumption that during the
course of an individual's employment with such employer, such
individual was regularly and continuously exposed to coal mine dust
during the course of employment. The presumption may be rebutted by a
showing that the employee was not exposed to coal mine dust for
significant periods during such employment.
(e) The operation, control, or supervision referred to in paragraph
(a)(1) of this section may be exercised directly or indirectly. Thus,
for example, where a coal mine is leased, and the lease empowers the
lessor to make decisions with respect to the terms and conditions under
which coal is to be extracted or prepared, such as, but not limited to,
the manner of extraction or preparation or the amount of coal to be
produced, the lessor may be considered an operator. Similarly, any
parent entity or other controlling business entity may be considered an
operator for purposes of this part, regardless of the nature of its
business activities.
(f) Neither the United States, nor any State, nor any
instrumentality or agency of the United States or any State, shall be
considered an operator.
Sec. 725.492 Successor operator defined.
(a) Any person who, on or after January 1, 1970, acquired a mine or
mines, or substantially all of the assets thereof, from a prior
operator, or acquired the coal mining business of such prior operator,
or substantially all of the assets thereof, shall be considered a
``successor operator'' with respect to any miners previously employed
by such prior operator.
(b) The following transactions shall also be deemed to create
successor operator liability:
(1) If an operator ceases to exist by reason of a reorganization
which involves a change in identity, form, or place of business or
organization, however effected;
(2) If an operator ceases to exist by reason of a liquidation into
a parent or successor corporation; or
(3) If an operator ceases to exist by reason of a sale of
substantially all its assets, or as a result of merger, consolidation,
or division.
(c) In any case in which a transaction specified in paragraph (b),
or substantially similar to a transaction specified in paragraph (b),
took place, the resulting entity shall be considered a ``successor
operator'' with respect to any miners previously employed by such prior
operator.
(d) This section shall not be construed to relieve a prior operator
of any liability if such prior operator meets the conditions set forth
in Sec. 725.494. If the prior operator does not meet the conditions set
forth in Sec. 725.494, the following provisions shall apply:
(1) In any case in which a prior operator transferred a mine or
mines, or substantially all of the assets thereof, to a successor
operator, or sold its coal mining business or substantially all of the
assets thereof, to a successor operator, and then ceased to exist
within the terms of paragraph (b), the successor operator as identified
in paragraph (a) shall be primarily liable for the payment of benefits
to any miners previously employed by such prior operator.
(2) In any case in which a prior operator transferred mines, or
substantially all of the assets thereof, to more than one successor
operator, the successor operator that most recently acquired a mine or
mines or assets from the prior operator shall be primarily liable for
the payment of benefits to any miners previously employed by such prior
operator.
(3) In any case in which a mine or mines, or substantially all the
assets thereof, have been transferred more than once, the successor
operator that most recently acquired such mine or mines or assets shall
be primarily liable for the payment of benefits to any miners
previously employed by the original prior operator. If the most recent
successor operator does not meet the criteria for a potentially liable
operator set forth in Sec. 725.494, the next most recent successor
operator shall be liable.
(e) An ``acquisition,'' for purposes of this section, shall include
any transaction by which title to the mine or mines, or substantially
all of the assets thereof, or the right to extract or prepare coal at
such mine or mines, becomes
[[Page 80083]]
vested in a person other than the prior operator.
725.493 Employment relationship defined.
(a)(1) In determining the identity of a responsible operator under
this part, the terms ``employ'' and ``employment'' shall be construed
as broadly as possible, and shall include any relationship under which
an operator retains the right to direct, control, or supervise the work
performed by a miner, or any other relationship under which an operator
derives a benefit from the work performed by a miner. Any individuals
who participate with one or more persons in the mining of coal, such as
owners, proprietors, partners, and joint venturers, whether they are
compensated by wages, salaries, piece rates, shares, profits, or by any
other means, shall be deemed employees. It is the specific intention of
this paragraph to disregard any financial arrangement or business
entity devised by the actual owners or operators of a coal mine or coal
mine-related enterprise to avoid the payment of benefits to miners who,
based upon the economic reality of their relationship to this
enterprise, are, in fact, employees of the enterprise.
(2) The payment of wages or salary shall be prima facie evidence of
the right to direct, control, or supervise an individual's work. The
Department intends that where the operator who paid a miner's wages or
salary meets the criteria for a potentially liable operator set forth
in Sec. 725.494, that operator shall be primarily liable for the
payment of any benefits due the miner as a result of such employment.
The absence of such payment, however, will not negate the existence of
an employment relationship. Thus, the Department also intends that
where the person who paid a miner's wages may not be considered a
potentially liable operator, any other operator who retained the right
to direct, control or supervise the work performed by the miner, or who
benefitted from such work, may be considered a potentially liable
operator.
(b) This paragraph contains examples of relationships that shall be
considered employment relationships for purposes of this part. The list
is not intended to be exclusive.
(1) In any case in which an operator may be considered a successor
operator, as determined in accordance with Sec. 725.492, any employment
with a prior operator shall also be deemed to be employment with the
successor operator. In a case in which the miner was not independently
employed by the successor operator, the prior operator shall remain
primarily liable for the payment of any benefits based on the miner's
employment with the prior operator. In a case in which the miner was
independently employed by the successor operator after the transaction
giving rise to successor operator liability, the successor operator
shall be primarily liable for the payment of any benefits.
(2) In any case in which the operator which directed, controlled or
supervised the miner is no longer in business and such operator was a
subsidiary of a parent company, a member of a joint venture, a partner
in a partnership, or was substantially owned or controlled by another
business entity, such parent entity or other member of a joint venture
or partner or controlling business entity may be considered the
employer of any employees of such operator.
(3) In any claim in which the operator which directed, controlled
or supervised the miner is a lessee, the lessee shall be considered
primarily liable for the claim. The liability of the lessor may be
established only after it has been determined that the lessee is unable
to provide for the payment of benefits to a successful claimant. In any
case involving the liability of a lessor for a claim arising out of
employment with a lessee, any determination of lessor liability shall
be made on the basis of the facts present in the case in accordance
with the following considerations:
(i) Where a coal mine is leased, and the lease empowers the lessor
to make decisions with respect to the terms and conditions under which
coal is to be extracted or prepared, such as, but not limited to, the
manner of extraction or preparation or the amount of coal to be
produced, the lessor shall be considered the employer of any employees
of the lessee.
(ii) Where a coal mine is leased to a self-employed operator, the
lessor shall be considered the employer of such self-employed operator
and its employees if the lease or agreement is executed or renewed
after August 18, 1978 and such lease or agreement does not require the
lessee to guarantee the payment of benefits which may be required under
this part and part 726 of this subchapter.
(iii) Where a lessor previously operated a coal mine, it may be
considered an operator with respect to employees of any lessee of such
mine, particularly where the leasing arrangement was executed or
renewed after August 18, 1978 and does not require the lessee to secure
benefits provided by the Act.
(4) A self-employed operator, depending upon the facts of the case,
may be considered an employee of any other operator, person, or
business entity which substantially controls, supervises, or is
financially responsible for the activities of the self-employed
operator.
Sec. 725.494 Potentially liable operators.
An operator may be considered a ``potentially liable operator''
with respect to a claim for benefits under this part if each of the
following conditions is met:
(a) The miner's disability or death arose at least in part out of
employment in or around a mine or other facility during a period when
the mine or facility was operated by such operator, or by a person with
respect to which the operator may be considered a successor operator.
For purposes of this section, there shall be a rebuttable presumption
that the miner's disability or death arose in whole or in part out of
his or her employment with such operator. Unless this presumption is
rebutted, the responsible operator shall be liable to pay benefits to
the claimant on account of the disability or death of the miner in
accordance with this part. A miner's pneumoconiosis, or disability or
death therefrom, shall be considered to have arisen in whole or in part
out of work in or around a mine if such work caused, contributed to or
aggravated the progression or advancement of a miner's loss of ability
to perform his or her regular coal mine employment or comparable
employment.
(b) The operator, or any person with respect to which the operator
may be considered a successor operator, was an operator for any period
after June 30, 1973.
(c) The miner was employed by the operator, or any person with
respect to which the operator may be considered a successor operator,
for a cumulative period of not less than one year
(Sec. 725.101(a)(32)).
(d) The miner's employment with the operator, or any person with
respect to which the operator may be considered a successor operator,
included at least one working day (Sec. 725.101(a)(32)) after December
31, 1969.
(e) The operator is capable of assuming its liability for the
payment of continuing benefits under this part. An operator will be
deemed capable of assuming its liability for a claim if one of the
following three conditions is met:
(1) The operator obtained a policy or contract of insurance under
section 423 of the Act and part 726 of this subchapter that covers the
claim, except that such policy shall not be considered sufficient to
establish the operator's capability of assuming liability if the
insurance company has been declared
[[Page 80084]]
insolvent and its obligations for the claim are not otherwise
guaranteed;
(2) The operator qualified as a self-insurer under section 423 of
the Act and part 726 of this subchapter during the period in which the
miner was last employed by the operator, provided that the operator
still qualifies as a self-insurer or the security given by the operator
pursuant to Sec. 726.104(b) is sufficient to secure the payment of
benefits in the event the claim is awarded; or
(3) The operator possesses sufficient assets to secure the payment
of benefits in the event the claim is awarded in accordance with
Sec. 725.606.
Sec. 725.495 Criteria for determining a responsible operator.
(a)(1) The operator responsible for the payment of benefits in a
claim adjudicated under this part (the ``responsible operator'') shall
be the potentially liable operator, as determined in accordance with
Sec. 725.494, that most recently employed the miner.
(2) If more than one potentially liable operator may be deemed to
have employed the miner most recently, then the liability for any
benefits payable as a result of such employment shall be assigned as
follows:
(i) First, to the potentially liable operator that directed,
controlled, or supervised the miner;
(ii) Second, to any potentially liable operator that may be
considered a successor operator with respect to miners employed by the
operator identified in paragraph (a)(2)(i) of this section; and
(iii) Third, to any other potentially liable operator which may be
deemed to have been the miner's most recent employer pursuant to
Sec. 725.493.
(3) If the operator that most recently employed the miner may not
be considered a potentially liable operator, as determined in
accordance with Sec. 725.494, the responsible operator shall be the
potentially liable operator that next most recently employed the miner.
Any potentially liable operator that employed the miner for at least
one day after December 31, 1969 may be deemed the responsible operator
if no more recent employer may be considered a potentially liable
operator.
(4) If the miner's most recent employment by an operator ended
while the operator was authorized to self-insure its liability under
part 726 of this title, and that operator no longer possesses
sufficient assets to secure the payment of benefits, the provisions of
paragraph (a)(3) shall be inapplicable with respect to any operator
that employed the miner only before he was employed by such self-
insured operator. If no operator that employed the miner after his
employment with the self-insured operator meets the conditions of
Sec. 725.494, the claim of the miner or his survivor shall be the
responsibility of the Black Lung Disability Trust Fund.
(b) Except as provided in this section and Sec. 725.408(a)(3), with
respect to the adjudication of the identity of a responsible operator,
the Director shall bear the burden of proving that the responsible
operator initially found liable for the payment of benefits pursuant to
Sec. 725.410 (the ``designated responsible operator'') is a potentially
liable operator. It shall be presumed, in the absence of evidence to
the contrary, that the designated responsible operator is capable of
assuming liability for the payment of benefits in accordance with
Sec. 725.494(e).
(c) The designated responsible operator shall bear the burden of
proving either:
(1) That it does not possess sufficient assets to secure the
payment of benefits in accordance with Sec. 725.606; or
(2) That it is not the potentially liable operator that most
recently employed the miner. Such proof must include evidence that the
miner was employed as a miner after he or she stopped working for the
designated responsible operator and that the person by whom he or she
was employed is a potentially liable operator within the meaning of
Sec. 725.494. In order to establish that a more recent employer is a
potentially liable operator, the designated responsible operator must
demonstrate that the more recent employer possesses sufficient assets
to secure the payment of benefits in accordance with Sec. 725.606. The
designated responsible operator may satisfy its burden by presenting
evidence that the owner, if the more recent employer is a sole
proprietorship; the partners, if the more recent employer is a
partnership; or the president, secretary, and treasurer, if the more
recent employer is a corporation that failed to secure the payment of
benefits pursuant to part 726 of this subchapter, possess assets
sufficient to secure the payment of benefits, provided such assets may
be reached in a proceeding brought under subpart I of this part.
(d) In any case referred to the Office of Administrative Law Judges
pursuant to Sec. 725.421 in which the operator finally designated as
responsible pursuant to Sec. 725.418(d) is not the operator that most
recently employed the miner, the record shall contain a statement from
the district director explaining the reasons for such designation. If
the reasons include the most recent employer's failure to meet the
conditions of Sec. 725.494(e), the record shall also contain a
statement that the Office has searched the files it maintains pursuant
to part 726, and that the Office has no record of insurance coverage
for that employer, or of authorization to self-insure, that meets the
conditions of Sec. 725.494(e)(1) or (e)(2). Such a statement shall be
prima facie evidence that the most recent employer is not financially
capable of assuming its liability for a claim. In the absence of such a
statement, it shall be presumed that the most recent employer is
financially capable of assuming its liability for a claim.
Sec. 725.496 Special claims transferred to the fund.
(a) The 1981 amendments to the Act amended section 422 of the Act
and transferred liability for payment of certain special claims from
operators and carriers to the fund. These provisions apply to claims
which were denied before March 1, 1978, and which have been or will be
approved in accordance with section 435 of the Act.
(b) Section 402(i) of the Act defines three classes of denied
claims subject to the transfer provisions:
(1) Claims filed with and denied by the Social Security
Administration before March 1, 1978;
(2) Claims filed with the Department of Labor in which the claimant
was notified by the Department of an administrative or informal denial
before March 1, 1977, and in which the claimant did not within one year
of such notification either:
(i) Request a hearing; or
(ii) Present additional evidence; or
(iii) Indicate an intention to present additional evidence; or
(iv) Request a modification or reconsideration of the denial on the
ground of a change in conditions or because of a mistake in a
determination of fact;
(3) Claims filed with the Department of Labor and denied under the
law in effect prior to the enactment of the Black Lung Benefits Reform
Act of 1977, that is, before March 1, 1978, following a formal hearing
before an administrative law judge or administrative review before the
Benefits Review Board or review before a United States Court of
Appeals.
(c) Where more than one claim was filed with the Social Security
Administration and/or the Department of Labor prior to March 1, 1978,
by or on behalf of a miner or a surviving dependent of a miner, unless
such claims were required to be merged by
[[Page 80085]]
the agency's regulations, the procedural history of each such claim
must be considered separately to determine whether the claim is subject
to the transfer of liability provisions.
(d) For a claim filed with and denied by the Social Security
Administration prior to March 1, 1978, to come within the transfer
provisions, such claim must have been or must be approved under the
provisions of section 435 of the Act. No claim filed with and denied by
the Social Security Administration is subject to the transfer of
liability provisions unless a request was made by or on behalf of the
claimant for review of such denied claim under section 435. Such review
must have been requested by the filing of a valid election card or
other equivalent document with the Social Security Administration in
accordance with section 435(a) and its implementing regulations at 20
CFR 410.700 through 410.707.
(e) Where a claim filed with the Department of Labor prior to March
1, 1977, was subjected to repeated administrative or informal denials,
the last such denial issued during the pendency of the claim determines
whether the claim is subject to the transfer of liability provisions.
(f) Where a miner's claim comes within the transfer of liability
provisions of the 1981 amendments the fund is also liable for the
payment of any benefits to which the miner's dependent survivors are
entitled after the miner's death. However, if the survivor's
entitlement was established on a separate claim not subject to the
transfer of liability provisions prior to approval of the miner's claim
under section 435, the party responsible for the payment of such
survivors' benefits shall not be relieved of that responsibility
because the miner's claim was ultimately approved and found subject to
the transfer of liability provisions.
Sec. 725.497 Procedures in special claims transferred to the fund.
(a) General. It is the purpose of this section to define procedures
to expedite the handling and disposition of claims affected by the
benefit liability transfer provisions of Section 205 of the Black Lung
Benefits Amendments of 1981.
(b) Action by the Department. The OWCP shall, in accordance with
the criteria contained in Sec. 725.496, review each claim which is or
may be affected by the provisions of Section 205 of the Black Lung
Benefits Amendments of 1981. Any party to a claim, adjudication
officer, or adjudicative body may request that such a review be
conducted and that the record be supplemented with any additional
documentation necessary for an informed consideration of the
transferability of the claim. Where the issue of the transferability of
the claim can not be resolved by agreement of the parties and the
evidence of record is not sufficient for a resolution of the issue, the
hearing record may be reopened or the case remanded for the development
of the additional evidence concerning the procedural history of the
claim necessary to such resolution. Such determinations shall be made
on an expedited basis.
(c) Dismissal of operators. If it is determined that a coal mine
operator or insurance carrier which previously participated in the
consideration or adjudication of any claim, may no longer be found
liable for the payment of benefits to the claimant by reason of section
205 of the Black Lung Benefits Amendments of 1981, such operator or
carrier shall be promptly dismissed as a party to the claim. The
dismissal of an operator or carrier shall be concluded at the earliest
possible time and in no event shall an operator or carrier participate
as a necessary party in any claim for which only the fund may be
liable.
(d) Procedure following dismissal of an operator. After it has been
determined that an operator or carrier must be dismissed as a party in
any claim in accordance with this section, the Director shall take such
action as is authorized by the Act to bring about the proper and
expeditious resolution of the claim in light of all relevant medical
and other evidence. Action to be taken in this regard by the Director
may include, but is not limited to, the assignment of the claim to the
Black Lung Disability Trust Fund for the payment of benefits, the
reimbursement of benefits previously paid by an operator or carrier if
appropriate, the defense of the claim on behalf of the fund, or
proceedings authorized by Sec. 725.310.
(e) Any claimant whose claim has been subsequently denied in a
modification proceeding will be entitled to expedited review of the
modification decision. Where a formal hearing was previously held, the
claimant may waive his right to a further hearing and ask that a
decision be made on the record of the prior hearing, as supplemented by
any additional documentary evidence which the parties wish to introduce
and briefs of the parties, if desired. In any case in which the
claimant waives his right to a second hearing, a decision and order
must be issued within 30 days of the date upon which the parties agree
the record has been completed.
Subpart H--Payment of Benefits General Provisions
Sec. 725.501 Payment provisions generally.
The provisions of this subpart govern the payment of benefits to
claimants whose claims are approved for payment under section 415 and
part C of title IV of the Act or approved after review under section
435 of the Act and part 727 of this subchapter (see Sec. 725.4(d)).
Sec. 725.502 When benefit payments are due; manner of payment.
(a)(1) Except with respect to benefits paid by the fund pursuant to
an initial determination issued in accordance with Sec. 725.418 (see
Sec. 725.522), benefits under the Act shall be paid when they become
due. Benefits shall be considered due after the issuance of an
effective order requiring the payment of benefits by a district
director, administrative law judge, Benefits Review Board, or court,
notwithstanding the pendency of a motion for reconsideration before an
administrative law judge or an appeal to the Board or court, except
that benefits shall not be considered due where the payment of such
benefits has been stayed by the Benefits Review Board or appropriate
court. An effective order shall remain in effect unless it is vacated
by an administrative law judge on reconsideration, or, upon review
under section 21 of the LHWCA, by the Benefits Review Board or an
appropriate court, or is superseded by an effective order issued
pursuant to Sec. 725.310.
(2) A proposed order issued by a district director pursuant to
Sec. 725.418 becomes effective at the expiration of the thirtieth day
thereafter if no party timely requests revision of the proposed
decision and order or a hearing (see Sec. 725.419). An order issued by
an administrative law judge becomes effective when it is filed in the
office of the district director (see Sec. 725.479). An order issued by
the Benefits Review Board shall become effective when it is issued. An
order issued by a court shall become effective in accordance with the
rules of the court.
(b)(1) While an effective order requiring the payment of benefits
remains in effect, monthly benefits, at the rates set forth in
Sec. 725.520, shall be due on the fifteenth day of the month following
the month for which the benefits are payable. For example, benefits
payable for the month of January shall be due on the fifteenth day of
February.
(2) Within 30 days after the issuance of an effective order
requiring the payment of benefits, the district director shall compute
the amount of benefits
[[Page 80086]]
payable for periods prior to the effective date of the order, in
addition to any interest payable for such periods (see Sec. 725.608),
and shall so notify the parties. Any computation made by the district
director under this paragraph shall strictly observe the terms of the
order. Benefits and interest payable for such periods shall be due on
the thirtieth day following issuance of the district director's
computation. A copy of the current table of applicable interest rates
shall be attached to the computation.
(c) Benefits are payable for monthly periods and shall be paid
directly to an eligible claimant or his or her representative payee
(see Sec. 725.510) beginning with the month during which eligibility
begins. Benefit payments shall terminate with the month before the
month during which eligibility terminates. If a claimant dies in the
first month during which all requirements for eligibility are met,
benefits shall be paid for that month.
Sec. 725.503 Date from which benefits are payable.
(a) In accordance with the provisions of section 6(a) of the
Longshore Act as incorporated by section 422(a) of the Act, and except
as provided in Sec. 725.504, the provisions of this section shall be
applicable in determining the date from which benefits are payable to
an eligible claimant for any claim filed after March 31, 1980. Except
as provided in paragraph (d) of this section, the date from which
benefits are payable for any claim approved under part 727 shall be
determined in accordance with Sec. 727.302 (see Sec. 725.4(d)).
(b) Miner's claim. Benefits are payable to a miner who is entitled
beginning with the month of onset of total disability due to
pneumoconiosis arising out of coal mine employment. Where the evidence
does not establish the month of onset, benefits shall be payable to
such miner beginning with the month during which the claim was filed.
In the case of a miner who filed a claim before January 1, 1982,
benefits shall be payable to the miner's eligible survivor (if any)
beginning with the month in which the miner died.
(c) Survivor's claim. Benefits are payable to a survivor who is
entitled beginning with the month of the miner's death, or January 1,
1974, whichever is later.
(d) If a claim is awarded pursuant to section 22 of the Longshore
Act and Sec. 725.310, then the date from which benefits are payable
shall be determined as follows:
(1) Mistake in fact. The provisions of paragraphs (b) or (c) of
this section, as applicable, shall govern the determination of the date
from which benefits are payable.
(2) Change in conditions. Benefits are payable to a miner beginning
with the month of onset of total disability due to pneumoconiosis
arising out of coal mine employment, provided that no benefits shall be
payable for any month prior to the effective date of the most recent
denial of the claim by a district director or administrative law judge.
Where the evidence does not establish the month of onset, benefits
shall be payable to such miner from the month in which the claimant
requested modification.
(e) In the case of a claim filed between July 1, 1973, and December
31, 1973, benefits shall be payable as provided by this section, except
to the extent prohibited by Sec. 727.303 (see Sec. 725.4(d)).
(f) No benefits shall be payable with respect to a claim filed
after December 31, 1973 (a part C claim), for any period of eligibility
occurring before January 1, 1974.
(g) Each decision and order awarding benefits shall indicate the
month from which benefits are payable to the eligible claimant.
Sec. 725.504 Payments to a claimant employed as a miner.
(a) In the case of a claimant who is employed as a miner (see
Sec. 725.202) at the time of a final determination of such miner's
eligibility for benefits, no benefits shall be payable unless:
(1) The miner's eligibility is established under section 411(c)(3)
of the Act; or
(2) the miner terminates his or her coal mine employment within 1
year from the date of the final determination of the claim.
(b) If the eligibility of a working miner is established under
section 411(c)(3) of the Act, benefits shall be payable as is otherwise
provided in this part. If eligibility cannot be established under
section 411(c)(3), and the miner continues to be employed as a miner in
any capacity for a period of less than 1 year after a final
determination of the claim, benefits shall be payable beginning with
the month during which the miner ends his or her coal mine employment.
If the miner's employment continues for more than 1 year after a final
determination of eligibility, such determination shall be considered a
denial of benefits on the basis of the miner's continued employment,
and the miner may seek benefits only as provided in Sec. 725.310, if
applicable, or by filing a new claim under this part. The provisions of
Subparts E and F of this part shall be applicable to claims considered
under this section as is appropriate.
(c) In any case where the miner returns to coal mine or comparable
and gainful work, the payments to such miner shall be suspended and no
benefits shall be payable (except as provided in section 411(c)(3) of
the Act) for the period during which the miner continues to work. If
the miner again terminates employment, the district director may
require the miner to submit to further medical examination before
authorizing the payment of benefits.
Sec. 725.505 Payees.
Benefits may be paid, as appropriate, to a beneficiary, to a
qualified dependent, or to a representative authorized under this
subpart to receive payments on behalf of such beneficiary or dependent.
Sec. 725.506 Payment on behalf of another; ``legal guardian'' defined.
Benefits are paid only to the beneficiary, his or her
representative payee (see Sec. 725.510) or his or her legal guardian.
As used in this section, ``legal guardian'' means an individual who has
been appointed by a court of competent jurisdiction or otherwise
appointed pursuant to law to assume control of and responsibility for
the care of the beneficiary, the management of his or her estate, or
both.
Sec. 725.507 Guardian for minor or incompetent.
An adjudication officer may require that a legal guardian or
representative be appointed to receive benefit payments payable to any
person who is mentally incompetent or a minor and to exercise the
powers granted to, or to perform the duties otherwise required of such
person under the Act.
Sec. 725.510 Representative payee.
(a) If the district director determines that the best interests of
a beneficiary are served thereby, the district director may certify the
payment of such beneficiary's benefits to a representative payee.
(b) Before any amount shall be certified for payment to any
representative payee for or on behalf of a beneficiary, such
representative payee shall submit to the district director such
evidence as may be required of his or her relationship to, or his or
her responsibility for the care of, the beneficiary on whose behalf
payment is to be made, or of his or her authority to receive such a
payment. The district director may, at any time thereafter, require
evidence of the continued
[[Page 80087]]
existence of such relationship, responsibility, or authority. If a
person requesting representative payee status fails to submit the
required evidence within a reasonable period of time after it is
requested, no further payments shall be certified to him or her on
behalf of the beneficiary unless the required evidence is thereafter
submitted.
(c) All benefit payments made to a representative payee shall be
available only for the use and benefit of the beneficiary, as defined
in Sec. 725.511.
Sec. 725.511 Use and benefit defined.
(a) Payments certified to a representative payee shall be
considered as having been applied for the use and benefit of the
beneficiary when they are used for the beneficiary's current
maintenance--i.e., to replace current income lost because of the
disability of the beneficiary. Where a beneficiary is receiving care in
an institution, current maintenance shall include the customary charges
made by the institution and charges made for the current and
foreseeable needs of the beneficiary which are not met by the
institution.
(b) Payments certified to a representative payee which are not
needed for the current maintenance of the beneficiary, except as they
may be used under Sec. 725.512, shall be conserved or invested on the
beneficiary's behalf. Preferred investments are U.S. savings bonds
which shall be purchased in accordance with applicable regulations of
the U.S. Treasury Department (31 CFR part 315). Surplus funds may also
be invested in accordance with the rules applicable to investment of
trust estates by trustees. For example, surplus funds may be deposited
in an interest or dividend bearing account in a bank or trust company
or in a savings and loan association if the account is either federally
insured or is otherwise insured in accordance with State law
requirements. Surplus funds deposited in an interest or dividend
bearing account in a bank or trust company or in a savings and loan
association must be in a form of account which clearly shows that the
representative payee has only a fiduciary, and not a personal, interest
in the funds. The preferred forms of such accounts are as follows:
Name of beneficiary----------------------------------------------------
by (Name of representative payee) representative payee,
or (Name of beneficiary)
by (Name of representative payee) trustee,
U.S. savings bonds purchased with surplus funds by a
representative payee for an incapacitated adult beneficiary should
be registered as follows: (Name of beneficiary) (Social Security
No.), for whom (Name of payee) is representative payee for black
lung benefits.
Sec. 725.512 Support of legally dependent spouse, child, or parent.
If current maintenance needs of a beneficiary are being reasonably
met, a relative or other person to whom payments are certified as
representative payee on behalf of the beneficiary may use part of the
payments so certified for the support of the legally dependent spouse,
a legally dependent child, or a legally dependent parent of the
beneficiary.
Sec. 725.513 Accountability; transfer.
(a) The district director may require a representative payee to
submit periodic reports including a full accounting of the use of all
benefit payments certified to a representative payee. If a requested
report or accounting is not submitted within the time allowed, the
district director shall terminate the certification of the
representative payee and thereafter payments shall be made directly to
the beneficiary. A certification which is terminated under this section
may be reinstated for good cause, provided that all required reports
are supplied to the district director.
(b) A representative payee who has conserved or invested funds from
payments under this part shall, upon the direction of the district
director, transfer any such funds (including interest) to a successor
payee appointed by the district director or, at the option of the
district director, shall transfer such funds to the Office for
recertification to a successor payee or the beneficiary.
Sec. 725.514 Certification to dependent of augmentation portion of
benefit.
(a) If the basic benefit of a miner or of a surviving spouse is
augmented because of one or more dependents, and it appears to the
district director that the best interests of such dependent would be
served thereby, or that the augmented benefit is not being used for the
use and benefit (as defined in this subpart) of the augmentee, the
district director may certify payment of the amount of such
augmentation (to the extent attributable to such dependent) to such
dependent directly, or to a legal guardian or a representative payee
for the use and benefit of such dependent.
(b) Any request to the district director to certify separate
payment of the amount of an augmentation in accordance with paragraph
(a) of this section shall be in writing on such form and in accordance
with such instructions as are prescribed by the Office.
(c) The district director shall specify the terms and conditions of
any certification authorized under this section and may terminate any
such certification where appropriate.
(d) Any payment made under this section, if otherwise valid under
the Act, is a complete settlement and satisfaction of all claims,
rights, and interests in and to such payment, except that such payment
shall not be construed to abridge the rights of any party to recoup any
overpayment made.
Sec. 725.515 Assignment and exemption from claims of creditors.
(a) Except as provided by the Act and this part, no assignment,
release, or commutation of benefits due or payable under this part by a
responsible operator shall be valid, and all benefits shall be exempt
from claims of creditors and from levy, execution, and attachment or
other remedy or recovery or collection of a debt, which exemption may
not be waived.
(b) Notwithstanding any other provision of law, benefits due from,
or payable by, the Black Lung Disability Trust Fund under the Act and
this part to a claimant shall be subject to legal process brought for
the enforcement against the claimant of his or her legal obligations to
provide child support or make alimony payments to the same extent as if
the fund was a private person.
Benefit Rates
Sec. 725.520 Computation of benefits.
(a) Basic rate. The amount of benefits payable to a beneficiary for
a month is determined, in the first instance, by computing the ``basic
rate.'' The basic rate is equal to 37\1/2\ percent of the monthly pay
rate for Federal employees in GS-2, step 1. That rate for a month is
determined by:
(1) Ascertaining the lowest annual rate of pay (step 1) for Grade
GS-2 of the General Schedule applicable to such month (see 5 U.S.C.
5332);
(2) Ascertaining the monthly rate thereof by dividing the amount
determined in paragraph (a)(1) of this section by 12; and
(3) Ascertaining the basic rate under the Act by multiplying the
amount determined in paragraph (a)(2) of this section by 0.375 (that
is, by 37\1/2\ percent).
(b) Basic benefit. When a miner or surviving spouse is entitled to
benefits for a month for which he or she has no dependents who qualify
under this part and when a surviving child of a miner or spouse, or a
parent, brother, or sister of a miner, is entitled to benefits for a
month for which he or she is the only
[[Page 80088]]
beneficiary entitled to benefits, the amount of benefits to which such
beneficiary is entitled is equal to the basic rate as computed in
accordance with this section (raised, if not a multiple of 10 cents, to
the next high multiple of 10 cents). This amount is referred to as the
``basic benefit.''
(c) Augmented benefit. (1) When a miner or surviving spouse is
entitled to benefits for a month for which he or she has one or more
dependents who qualify under this part, the amount of benefits to which
such miner or surviving spouse is entitled is increased. This increase
is referred to as an ``augmentation.''
(2) The benefits of a miner or surviving spouse are augmented to
take account of a particular dependent beginning with the first month
in which such dependent satisfies the conditions set forth in this
part, and continues to be augmented through the month before the month
in which such dependent ceases to satisfy the conditions set forth in
this part, except in the case of a child who qualifies as a dependent
because he or she is a student. In the latter case, such benefits
continue to be augmented through the month before the first month
during no part of which he or she qualifies as a student.
(3) The basic rate is augmented by 50 percent for one such
dependent, 75 percent for two such dependents, and 100 percent for
three or more such dependents.
(d) Survivor benefits. As used in this section, ``survivor'' means
a surviving child of a miner or surviving spouse, or a surviving
parent, brother, or sister of a miner, who establishes entitlement to
benefits under this part.
(e) Computation and rounding. (1) Any computation prescribed by
this section is made to the third decimal place.
(2) Monthly benefits are payable in multiples of 10 cents.
Therefore, a monthly payment of amounts derived under paragraph (c)(3)
of this section which is not a multiple of 10 cents is increased to the
next higher multiple of 10 cents.
(3) Since a fraction of a cent is not a multiple of 10 cents, such
an amount which contains a fraction in the third decimal place is
raised to the next higher multiple of 10 cents.
(f) Eligibility based on the coal mine employment of more than one
miner. Where an individual, for any month, is entitled (and/or
qualifies as a dependent for purposes of augmentation of benefits)
based on the disability or death due to pneumoconiosis arising out of
the coal mine employment of more than one miner, the benefit payable to
or on behalf of such individual shall be at a rate equal to the highest
rate of benefits for which entitlement is established by reason of
eligibility as a beneficiary, or by reason of his or her qualification
as a dependent for augmentation of benefit purposes.
Sec. 725.521 Commutation of payments; lump sum awards.
(a) Whenever the district director determines that it is in the
interest of justice, the liability for benefits or any part thereof as
determined by a final adjudication, may, with the approval of the
Director, be discharged by the payment of a lump sum equal to the
present value of future benefit payments commuted, computed at 4
percent true discount compounded annually.
(b) Applications for commutation of future payments of benefits
shall be made to the district director in the manner prescribed by the
district director. If the district director determines that an award of
a lump sum payment of such benefits would be in the interest of
justice, he or she shall refer such application, together with the
reasons in support of such determination, to the Director for
consideration.
(c) The Director shall, in his or her discretion, grant or deny the
application for commutation of payments. Such decision may be appealed
to the Benefits Review Board.
(d) The computation of all commutations of such benefits shall be
made by the OWCP. For this purpose the file shall contain the date of
birth of the person on whose behalf commutation is sought, as well as
the date upon which such commutation shall be effective.
(e) For purposes of determining the amount of any lump sum award,
the probability of the death of the disabled miner and/or other persons
entitled to benefits before the expiration of the period during which
he or she is entitled to benefits, shall be determined in accordance
with the most current United States Life Tables, as developed by the
Department of Health, Education, and Welfare, and the probability of
the remarriage of a surviving spouse shall be determined in accordance
with the remarriage tables of the Dutch Royal Insurance Institution.
The probability of the happening of any other contingency affecting the
amount or duration of the compensation shall be disregarded.
(f) In the event that an operator or carrier is adjudicated liable
for the payment of benefits, such operator or carrier shall be notified
of and given an opportunity to participate in the proceedings to
determine whether a lump sum award shall be made. Such operator or
carrier shall, in the event a lump sum award is made, tender full and
prompt payment of such award to the claimant as though such award were
a final payment of monthly benefits. Except as provided in paragraph
(g) of this section, such lump sum award shall forever discharge such
operator or carrier from its responsibility to make monthly benefit
payments under the Act to the person who has requested such lump-sum
award. In the event that an operator or carrier is adjudicated liable
for the payment of benefits, such operator or carrier shall not be
liable for any portion of a commuted or lump sum award predicated upon
benefits due any claimant prior to January 1, 1974.
(g) In the event a lump-sum award is approved under this section,
such award shall not operate to discharge an operator carrier, or the
fund from any responsibility imposed by the Act for the payment of
medical benefits to an eligible miner.
Sec. 725.522 Payments prior to final adjudication.
(a) If an operator or carrier fails or refuses to commence the
payment of benefits within 30 days of issuance of an initial
determination of eligibility by the district director (see
Sec. 725.420), or fails or refuses to commence the payment of any
benefits due pursuant to an effective order by a district director,
administrative law judge, Benefits Review Board, or court, the fund
shall commence the payment of such benefits and shall continue such
payments as appropriate. In the event that the fund undertakes the
payment of benefits on behalf of an operator or carrier, the provisions
of Secs. 725.601 through 725.609 shall be applicable to such operator
or carrier.
(b) If benefit payments are commenced prior to the final
adjudication of the claim and it is later determined by an
administrative law judge, the Board, or court that the claimant was
ineligible to receive such payments, such payments shall be considered
overpayments pursuant to Sec. 725.540 and may be recovered in
accordance with the provisions of this subpart.
Special Provisions for Operator Payments
Sec. 725.530 Operator payments; generally.
(a) Benefits payable by an operator or carrier pursuant to an
effective order issued by a district director, administrative law
judge, Benefits Review Board, or court, or by an operator that has
agreed that it is liable for the payment of benefits to a
[[Page 80089]]
claimant, shall be paid by the operator or carrier immediately when
they become due (see Sec. 725.502(b)). An operator that fails to pay
any benefits that are due, with interest, shall be considered in
default with respect to those benefits, and the provisions of
Sec. 725.605 of this part shall be applicable. In addition, a claimant
who does not receive any benefits within 10 days of the date they
become due is entitled to additional compensation equal to twenty
percent of those benefits (see Sec. 725.607). Arrangements for the
payment of medical costs shall be made by such operator or carrier in
accordance with the provisions of subpart J of this part.
(b) Benefit payments made by an operator or carrier shall be made
directly to the person entitled thereto or a representative payee if
authorized by the district director. The payment of a claimant's
attorney's fee, if any is awarded, shall be made directly to such
attorney. Reimbursement of the fund, including interest, shall be paid
directly to the Secretary on behalf of the fund.
Sec. 725.531 Receipt for payment.
Any individual receiving benefits under the Act in his or her own
right, or as a representative payee, or as the duly appointed agent for
the estate of a deceased beneficiary, shall execute receipts for
benefits paid by any operator which shall be produced by such operator
for inspection whenever the district director requires. A canceled
check shall be considered adequate receipt of payment for purposes of
this section. No operator or carrier shall be required to retain
receipts for payments made for more than 5 years after the date on
which such receipt was executed.
Sec. 725.532 Suspension, reduction, or termination of payments.
(a) No suspension, reduction, or termination in the payment of
benefits is permitted unless authorized by the district director,
administrative law judge, Board, or court. No suspension, reduction, or
termination shall be authorized except upon the occurrence of an event
which terminates a claimant's eligibility for benefits (see subpart B
of this part) or as is otherwise provided in subpart C of this part,
Secs. 725.306 and 725.310, or this subpart (see also Secs. 725.533
through 725.546).
(b) Any unauthorized suspension in the payment of benefits by an
operator or carrier shall be treated as provided in subpart I.
(c) Unless suspension, reduction, or termination of benefits
payments is required by an administrative law judge, the Benefits
Review Board or a court, the district director, after receiving
notification of the occurrence of an event that would require the
suspension, reduction, or termination of benefits, shall follow the
procedures for the determination of claims set forth in subparts E and
F.
Increases and Reductions of Benefits
Sec. 725.533 Modification of benefits amounts; general.
(a) Under certain circumstances, the amount of monthly benefits as
computed in Sec. 725.520 or lump-sum award (Sec. 725.521) shall be
modified to determine the amount actually to be paid to a beneficiary.
With respect to any benefits payable for all periods of eligibility
after January 1, 1974, a reduction of the amount of benefits payable
shall be required on account of:
(1) Any compensation or benefits received under any State workers'
compensation law because of death or partial or total disability due to
pneumoconiosis; or
(2) Any compensation or benefits received under or pursuant to any
Federal law including part B of title IV of the Act because of death or
partial or total disability due to pneumoconiosis; or
(3) In the case of benefits to a parent, brother, or sister as a
result of a claim filed at any time or benefits payable on a miner's
claim which was filed on or after January 1, 1982, the excess earnings
from wages and from net earnings from self-employment (see Sec. 410.530
of this title) of such parent, brother, sister, or miner, respectively;
or
(4) The fact that a claim for benefits from an additional
beneficiary is filed, or that such claim is effective for a payment
during the month of filing, or a dependent qualifies under this part
for an augmentation portion of a benefit of a miner or widow for a
period in which another dependent has previously qualified for an
augmentation.
(b) An adjustment in a beneficiary's monthly benefit may be
required because an overpayment or underpayment has been made to such
beneficiary (see Secs. 725.540-725.546).
(c) A suspension of a beneficiary's monthly benefits may be
required when the Office has information indicating that reductions on
account of excess earnings may reasonably be expected.
(d) Monthly benefit rates are payable in multiples of 10 cents. Any
monthly benefit rate which, after the applicable computations,
augmentations, and reductions is not a multiple of 10 cents, is
increased to the next higher multiple of 10 cents. Since a fraction of
a cent is not a multiple of 10 cents, a benefit rate which contains
such a fraction in the third decimal is raised to the next higher
multiple of 10 cents.
(e) Any individual entitled to a benefit, who is aware of any
circumstances which could affect entitlement to benefits, eligibility
for payment, or the amount of benefits, or result in the termination,
suspension, or reduction of benefits, shall promptly report these
circumstances to the Office. The Office may at any time require an
individual receiving, or claiming entitlement to, benefits, either on
his or her own behalf or on behalf of another, to submit a written
statement giving pertinent information bearing upon the issue of
whether or not an event has occurred which would cause such benefit to
be terminated, or which would subject such benefit to reductions or
suspension under the provisions of the Act. The failure of an
individual to submit any such report or statement, properly executed,
to the Office shall subject such benefit to reductions, suspension, or
termination as the case may be.
Sec. 725.534 Reduction of State benefits.
No benefits under section 415 of part B of title IV of the Act
shall be payable to the residents of a State which, after December 31,
1969, reduces the benefits payable to persons eligible to receive
benefits under section 415 of the Act under State laws applicable to
its general work force with regard to workers' compensation (including
compensation for occupational disease), unemployment compensation, or
disability insurance benefits which are funded in whole or in part out
of employer contributions.
Sec. 725.535 Reductions; receipt of State or Federal benefit.
(a) As used in this section the term ``State or Federal benefit''
means a payment to an individual on account of total or partial
disability or death due to pneumoconiosis only under State or Federal
laws relating to workers' compensation. With respect to a claim for
which benefits are payable for any month between July 1 and December
31, 1973, ``State benefit'' means a payment to a beneficiary made on
account of disability or death due to pneumoconiosis under State laws
relating to workers' compensation (including compensation for
occupational disease), unemployment compensation, or disability
insurance.
(b) Benefit payments to a beneficiary for any month are reduced
(but not below zero) by an amount equal to any payments of State or
Federal benefits
[[Page 80090]]
received by such beneficiary for such month.
(c) Where a State or Federal benefit is paid periodically but not
monthly, or in a lump sum as a commutation of or a substitution for
periodic benefits, the reduction under this section is made at such
time or times and in such amounts as the Office determines will
approximate as nearly as practicable the reduction required under
paragraph (b) of this section. In making such a determination, a weekly
State or Federal benefit is multiplied by 4\1/3\ and a biweekly benefit
is multiplied by 2\1/6\ to ascertain the monthly equivalent for
reduction purposes.
(d) Amounts paid or incurred or to be incurred by the individual
for medical, legal, or related expenses in connection with this claim
for State or Federal benefits (defined in paragraph (a) of this
section) are excluded in computing the reduction under paragraph (b) of
this section, to the extent that they are consistent with State or
Federal Law. Such medical, legal, or related expenses may be evidenced
by the State or Federal benefit awards, compromise agreement, or court
order in the State or Federal benefit proceedings, or by such other
evidence as the Office may require. Such other evidence may consist of:
(1) A detailed statement by the individual's attorney, physician,
or the employer's insurance carrier; or
(2) Bills, receipts, or canceled checks; or
(3) Other evidence indicating the amount of such expenses; or
(4) Any combination of the foregoing evidence from which the amount
of such expenses may be determinable. Such expenses shall not be
excluded unless established by evidence as required by the Office.
Sec. 725.536 Reductions; excess earnings.
In the case of a surviving parent, brother, or sister, whose claim
was filed at any time, or of a miner whose claim was filed on or after
January 1, 1982, benefit payments are reduced as appropriate by an
amount equal to the deduction which would be made with respect to
excess earnings under the provisions of sections 203 (b), (f), (g),
(h), (j), and (l) of the Social Security Act (42 U.S.C. 403 (b), (f),
(g), (h), (j), and (l)), as if such benefit payments were benefits
payable under section 202 of the Social Security Act (42 U.S.C. 402)
(see Secs. 404.428 through 404.456 of this title).
Sec. 725.537 Reductions; retroactive effect of an additional claim for
benefits.
Except as provided in Sec. 725.212(b), beginning with the month in
which a person other than a miner files a claim and becomes entitled to
benefits, the benefits of other persons entitled to benefits with
respect to the same miner, are adjusted downward, if necessary, so that
no more than the permissible amount of benefits (the maximum amount for
the number of beneficiaries involved) will be paid.
Sec. 725.538 Reductions; effect of augmentation of benefits based on
subsequent qualification of individual.
(a) Ordinarily, a written request that the benefits of a miner or
surviving spouse be augmented on account of a qualified dependent is
made as part of the claim for benefits. However, it may also be made
thereafter.
(b) In the latter case, beginning with the month in which such a
request is filed on account of a particular dependent and in which such
dependent qualifies for augmentation purposes under this part, the
augmented benefits attributable to other qualified dependents (with
respect to the same miner or surviving spouse), if any, are adjusted
downward, if necessary, so that the permissible amount of augmented
benefits (the maximum amount for the number of dependents involved)
will not be exceeded.
(c) Where, based on the entitlement to benefits of a miner or
surviving spouse, a dependent would have qualified for augmentation
purposes for a prior month of such miner's or surviving spouse's
entitlement had such request been filed in such prior month, such
request is effective for such prior month. For any month before the
month of filing such request, however, otherwise correct benefits
previously certified by the Office may not be changed. Rather the
amount of the augmented benefit attributable to the dependent filing
such request in the later month is reduced for each month of the
retroactive period to the extent that may be necessary. This means that
for each month of the retroactive period, the amount payable to the
dependent filing the later augmentation request is the difference, if
any, between:
(1) The total amount of augmented benefits certified for payment
for other dependents for that month, and
(2) The permissible amount of augmented benefits (the maximum
amount for the number of dependents involved) payable for the month for
all dependents, including the dependent filing later.
Sec. 725.539 More than one reduction event.
If a reduction for receipt of State or Federal benefits and a
reduction on account of excess earnings are chargeable to the same
month, the benefit for such month is first reduced (but not below zero)
by the amount of the State or Federal benefits, and the remainder of
the benefit for such month, if any, is then reduced (but not below
zero) by the amount of excess earnings chargeable to such month.
Overpayments; Underpayments
Sec. 725.540 Overpayments.
(a) General. As used in this subpart, the term ``overpayment''
includes:
(1) Payment where no amount is payable under this part;
(2) Payment in excess of the amount payable under this part;
(3) A payment under this part which has not been reduced by the
amounts required by the Act (see Sec. 725.533);
(4) A payment under this part made to a resident of a State whose
residents are not entitled to benefits (see Secs. 725.402 and 725.403);
(5) Payment resulting from failure to terminate benefits to an
individual no longer entitled thereto;
(6) Duplicate benefits paid to a claimant on account of concurrent
eligibility under this part and parts 410 or 727 (see Sec. 725.4(d)) of
this title or as provided in Sec. 725.309.
(b) Overpaid beneficiary is living. If the beneficiary to whom an
overpayment was made is living at the time of a determination of such
overpayment, is entitled to benefits at the time of the overpayment, or
at any time thereafter becomes so entitled, no benefit for any month is
payable to such individual, except as provided in paragraph (c) of this
section, until an amount equal to the amount of the overpayment has
been withheld or refunded.
(c) Adjustment by withholding part of a monthly benefit. Adjustment
under paragraph (b) of this section may be effected by withholding a
part of the monthly benefit payable to a beneficiary where it is
determined that:
(1) Withholding the full amount each month would deprive the
beneficiary of income required for ordinary and necessary living
expenses;
(2) The overpayment was not caused by the beneficiary's
intentionally false statement or representation, or willful concealment
of, or deliberate failure to furnish, material information; and
(3) Recoupment can be effected in an amount of not less than $ 10 a
month and at a rate which would not unreasonably extend the period of
adjustment.
[[Page 80091]]
(d) Overpaid beneficiary dies before adjustment. If an overpaid
beneficiary dies before adjustment is completed under the provisions of
paragraph (b) of this section, recovery of the overpayment shall be
effected through repayment by the estate of the deceased overpaid
beneficiary, or by withholding of amounts due the estate of such
deceased beneficiary, or both.
Sec. 725.541 Notice of waiver of adjustment or recovery of
overpayment.
Whenever a determination is made that more than the correct amount
of payment has been made, notice of the provisions of section 204(b) of
the Social Security Act regarding waiver of adjustment or recovery
shall be sent to the overpaid individual, to any other individual
against whom adjustment or recovery of the overpayment is to be
effected, and to any operator or carrier which may be liable to such
overpaid individual.
Sec. 725.542 When waiver of adjustment or recovery may be applied.
There shall be no adjustment or recovery of an overpayment in any
case where an incorrect payment has been made with respect to an
individual:
(a) Who is without fault, and where
(b) Adjustment or recovery would either:
(1) Defeat the purpose of title IV of the Act, or
(2) Be against equity and good conscience.
Sec. 725.543 Standards for waiver of adjustment or recovery.
The standards for determining the applicability of the criteria
listed in Sec. 725.542 shall be the same as those applied by the Social
Security Administration under Secs. 404.506 through 404.512 of this
title.
Sec. 725.544 Collection and compromise of claims for overpayment.
(a) General effect of 31 U.S.C. 3711. In accordance with 31 U.S.C.
3711 and applicable regulations, claims by the Office against an
individual for recovery of an overpayment under this part not exceeding
the sum of $100,000, exclusive of interest, may be compromised, or
collection suspended or terminated, where such individual or his or her
estate does not have the present or prospective ability to pay the full
amount of the claim within a reasonable time (see paragraph (c) of this
section), or the cost of collection is likely to exceed the amount of
recovery (see paragraph (d) of this section), except as provided under
paragraph (b) of this section.
(b) When there will be no compromise, suspension, or termination of
collection of a claim for overpayment. (1) In any case where the
overpaid individual is alive, a claim for overpayment will not be
compromised, nor will there be suspension or termination of collection
of the claim by the Office, if there is an indication of fraud, the
filing of a false claim, or misrepresentation on the part of such
individual or on the part of any other party having any interest in the
claim.
(2) In any case where the overpaid individual is deceased:
(i) A claim for overpayment in excess of $ 5,000 will not be
compromised, nor will there be suspension or termination of collection
of the claim by the Office if there is an indication of fraud, the
filing of a false claim, or misrepresentation on the part of such
deceased individual; and
(ii) A claim for overpayment, regardless of the amount, will not be
compromised, nor will there be suspension or termination of collection
of the claim by the Office if there is an indication that any person
other than the deceased overpaid individual had a part in the
fraudulent action which resulted in the overpayment.
(c) Inability to pay claim for recovery of overpayment. In
determining whether the overpaid individual is unable to pay a claim
for recovery of an overpayment under this part, the Office shall
consider the individual's age, health, present and potential income
(including inheritance prospects), assets (e.g., real property, savings
account), possible concealment or improper transfer of assets, and
assets or income of such individual which may be available in enforced
collection proceedings. The Office will also consider exemptions
available to such individual under the pertinent State or Federal law
in such proceedings. In the event the overpaid individual is deceased,
the Office shall consider the available assets of the estate, taking
into account any liens or superior claims against the estate.
(d) Cost of collection or litigative probabilities. Where the
probable costs of recovering an overpayment under this part would not
justify enforced collection proceedings for the full amount of the
claim, or where there is doubt concerning the Office's ability to
establish its claim as well as the time which it will take to effect
such collection, a compromise or settlement for less than the full
amount may be considered.
(e) Amount of compromise. The amount to be accepted in compromise
of a claim for overpayment under this part shall bear a reasonable
relationship to the amount which can be recovered by enforced
collection proceedings, giving due consideration to the exemption
available to the overpaid individual under State or Federal law and the
time which collection will take.
(f) Payment. Payment of the amount the Office has agreed to accept
as a compromise in full settlement of a claim for recovery of an
overpayment under this part shall be made within the time and in the
manner set by the Office. A claim for the overpayment shall not be
considered compromised or settled until the full payment of the
compromised amount has been made within the time and manner set by the
Office. Failure of the overpaid individual or his or her estate to make
such payment as provided shall result in reinstatement of the full
amount of the overpayment less any amounts paid prior to such default.
Sec. 725.545 Underpayments.
(a) General. As used in this subpart, the term ``underpayment''
includes a payment in an amount less than the amount of the benefit due
for such month, and nonpayment where some amount of such benefits is
payable.
(b) Underpaid individual is living. If an individual to whom an
underpayment was made is living, the deficit represented by such
underpayment shall be paid to such individual either in a single
payment (if he or she is not entitled to a monthly benefit or if a
single payment is requested by the claimant in writing) or by
increasing one or more monthly benefit payments to which such
individual becomes entitled.
(c) Underpaid individual dies before adjustment of underpayment. If
an individual to whom an underpayment was made dies before receiving
payment of the deficit or negotiating the check or checks representing
payment of the deficit, such payment shall be distributed to the living
person (or persons) in the highest order of priority as follows:
(1) The deceased individual's surviving spouse who was either:
(i) Living in the same household with the deceased individual at
the time of such individual's death; or
(ii) In the case of a deceased miner, entitled for the month of
death to black lung benefits as his or her surviving spouse or
surviving divorced spouse.
(2) In the case of a deceased miner or spouse his or her child
entitled to benefits as the surviving child of such miner or surviving
spouse for the month in which such miner or spouse died (if more than
one such child, in equal shares to each such child).
[[Page 80092]]
(3) In the case of a deceased miner, his parent entitled to
benefits as the surviving parent of such miner for the month in which
such miner died (if more than one such parent, in equal shares to each
such parent).
(4) The surviving spouse of the deceased individual who does not
qualify under paragraph (c)(1) of this section.
(5) The child or children of the deceased individual who do not
qualify under paragraph (c)(2) of this section (if more than one such
child, in equal shares to each such child).
(6) The parent or parents of the deceased individual who do not
qualify under paragraph (c)(3) of this section (if more than one such
parent, in equal shares to each such parent).
(7) The legal representative of the estate of the deceased
individual as defined in paragraph (e) of this section.
(d) Deceased beneficiary. In the event that a person, who is
otherwise qualified to receive payments as the result of a deficit
caused by an underpayment under the provisions of paragraph (c) of this
section, dies before receiving payment or before negotiating the check
or checks representing such payment, his or her share of the
underpayment shall be divided among the remaining living person(s) in
the same order or priority. In the event that there is (are) no other
such person(s), the underpayment shall be paid to the living person(s)
in the next lower order of priority under paragraph (c) of this
section.
(e) Definition of legal representative. The term ``legal
representative,'' for the purpose of qualifying for receipt of an
underpayment, generally means the executor or the administrator of the
estate of the deceased beneficiary. However, it may also include an
individual, institution or organization acting on behalf of an
unadministered estate, provided the person can give the Office good
acquittance (as defined in paragraph (f) of this section). The
following persons may qualify as legal representative for purposes of
this section, provided they can give the Office good acquittance:
(1) A person who qualifies under a State's ``small estate''
statute; or
(2) A person resident in a foreign country who under the laws and
customs of that country, has the right to receive assets of the estate;
or
(3) A public administrator; or
(4) A person who has the authority under applicable law to collect
the assets of the estate of the deceased beneficiary.
(f) Definition of ``good acquittance.'' A person is considered to
give the Office ``good acquittance'' when payment to that person will
release the Office from further liability for such payment.
Sec. 725.546 Relation to provisions for reductions or increases.
The amount of an overpayment or an underpayment is the difference
between the amount to which the beneficiary was actually entitled and
the amount paid. Overpayment and underpayment simultaneously
outstanding against the same beneficiary shall first be adjusted
against one another before adjustment pursuant to the other provisions
of this subpart.
Sec. 725.547 Applicability of overpayment and underpayment provisions
to operator or carrier.
(a) The provisions of this subpart relating to overpayments and
underpayments shall be applicable to overpayments and underpayments
made by responsible operators or their insurance carriers, as
appropriate.
(b) No operator or carrier may recover, or make an adjustment of,
an overpayment without prior application to, and approval by, the
Office which shall exercise full supervisory authority over the
recovery or adjustment of all overpayments.
Sec. 725.548 Procedures applicable to overpayments and underpayments.
(a) In any case involving either overpayments or underpayments, the
Office may take any necessary action, and district directors may issue
appropriate orders to protect the rights of the parties.
(b) Disputes arising out of orders so issued shall be resolved by
the procedures set out in subpart F of this part.
Subpart I--Enforcement of Liability; Reports
Sec. 725.601 Enforcement generally.
(a) The Act, together with certain incorporated provisions from the
Longshoremen's and Harbor Workers' Compensation Act, contains a number
of provisions which subject an operator or other employer, claimants
and others to penalties for failure to comply with certain provisions
of the Act, or failure to commence and continue prompt periodic
payments to a beneficiary.
(b) It is the policy and intent of the Department to vigorously
enforce the provisions of this part through the use of the remedies
provided by the Act. Accordingly, if an operator refuses to pay
benefits with respect to a claim for which the operator has been
adjudicated liable, the Director shall invoke and execute the lien on
the property of the operator as described in Sec. 725.603. Enforcement
of this lien shall be pursued in an appropriate U.S. district court. If
the Director determines that the remedy provided by Sec. 725.603 may
not be sufficient to guarantee the continued compliance with the terms
of an award or awards against the operator, the Director shall in
addition seek an injunction in the U.S. district court to prohibit
future noncompliance by the operator and such other relief as the court
considers appropriate (see Sec. 725.604). If an operator unlawfully
suspends or terminates the payment of benefits to a claimant, the
district director shall declare the award in default and proceed in
accordance with Sec. 725.605. In all cases payments in addition to
compensation (see Sec. 725.607) and interest (see Sec. 725.608) shall
be sought by the Director or awarded by the district director.
(c) In certain instances the remedies provided by the Act are
concurrent; that is, more than one remedy might be appropriate in any
given case. In such a case, the Director shall select the remedy or
remedies appropriate for the enforcement action. In making this
selection, the Director shall consider the best interests of the
claimant as well as those of the fund.
Sec. 725.602 Reimbursement of the fund.
(a) In any case in which the fund has paid benefits, including
medical benefits, on behalf of an operator or other employer which is
determined liable therefore, or liable for a part thereof, such
operator or other employer shall simultaneously with the first payment
of benefits made to the beneficiary, reimburse the fund (with interest)
for the full amount of all benefit payments made by the fund with
respect to the claim.
(b) In any case where benefit payments have been made by the fund,
the fund shall be subrogated to the rights of the beneficiary. The
Secretary of Labor may, as appropriate, exercise such subrogation
rights.
Sec. 725.603 Payments by the fund on behalf of an operator; liens.
(a) If an amount is paid out of the fund to an individual entitled
to benefits under this part or part 727 of this subchapter (see
Sec. 725.4(d)) on behalf of an operator or other employer which is or
was required to pay or secure the payment of all or a portion of such
amount (see Sec. 725.522), the operator or other employer shall be
liable to the United States for repayment to the fund of the amount of
benefits properly attributable to such operator or other employer.
[[Page 80093]]
(b) If an operator or other employer liable to the fund refuses to
pay, after demand, the amount of such liability, there shall be a lien
in favor of the United States upon all property and rights to property,
whether real or personal, belonging to such operator or other employer.
The lien arises on the date on which such liability is finally
determined, and continues until it is satisfied or becomes
unenforceable by reason of lapse of time.
(c)(1) Except as otherwise provided under this section, the
priority of the lien shall be determined in the same manner as under
section 6323 of the Internal Revenue Code (26 U.S.C.).
(2) In the case of a bankruptcy or insolvency proceeding, the lien
imposed under this section shall be treated in the same manner as a
lien for taxes due and owing to the United States for purposes of the
Bankruptcy Act or section 3466 of the Revised Statutes (31 U.S.C. 191).
(3) For purposes of applying section 6323(a) of the Internal
Revenue Code (26 U.S.C.) to determine the priority between the lien
imposed under this section and the Federal tax lien, each lien shall be
treated as a judgment lien arising as of the time notice of such lien
is filed.
(4) For purposes of the section, notice of the lien imposed
hereunder shall be filed in the same manner as under section 6323(f)
(disregarding paragraph (4) thereof) and (g) of the Internal Revenue
Code (26 U.S.C.).
(5) In any case where there has been a refusal or neglect to pay
the liability imposed under this section, the Secretary of Labor may
bring a civil action in a district court of the United States to
enforce the lien of the United States under this section with respect
to such liability or to subject any property, of whatever nature, of
the operator, or in which it has any right, title, or interest, to the
payment of such liability.
(6) The liability imposed by this paragraph may be collected at a
proceeding in court if the proceeding is commenced within 6 years after
the date upon which the liability was finally determined, or prior to
the expiration of any period for collection agreed upon in writing by
the operator and the United States before the expiration of such 6-year
period. This period of limitation shall be suspended for any period
during which the assets of the operator are in the custody or control
of any court of the United States, or of any State, or the District of
Columbia, and for 6 months thereafter, and for any period during which
the operator is outside the United States if such period of absence is
for a continuous period of at least 6 months.
Sec. 725.604 Enforcement of final awards.
Notwithstanding the provisions of Sec. 725.603, if an operator or
other employer or its officers or agents fails to comply with an order
awarding benefits that has become final, any beneficiary of such award
or the district director may apply for the enforcement of the order to
the Federal district court for the judicial district in which the
injury occurred (or to the U.S. District Court for the District of
Columbia if the injury occurred in the District). If the court
determines that the order was made and served in accordance with law,
and that such operator or other employer or its officers or agents have
failed to comply therewith, the court shall enforce obedience to the
order by writ of injunction or by other proper process, mandatory or
otherwise, to enjoin upon such operator or other employer and its
officers or agents compliance with the order.
Sec. 725.605 Defaults.
(a) Except as is otherwise provided in this part, no suspension,
termination or other failure to pay benefits awarded to a claimant is
permitted. If an employer found liable for the payment of such benefits
fails to make such payments within 30 days after any date on which such
benefits are due and payable, the person to whom such benefits are
payable may, within one year after such default, make application to
the district director for a supplementary order declaring the amount of
the default.
(b) If after investigation, notice and hearing as provided in
subparts E and F of this part, a default is found, the district
director or the administrative law judge, if a hearing is requested,
shall issue a supplementary order declaring the amount of the default,
if any. In cases where a lump-sum award has been made, if the payment
in default is an installment, the district director or administrative
law judge, may, in his or her discretion, declare the whole of the
award as the amount in default. The applicant may file a certified copy
of such supplementary order with the clerk of the Federal district
court for the judicial district in which the operator has its principal
place of business or maintains an office or for the judicial district
in which the injury occurred. In case such principal place of business
or office is in the District of Columbia, a copy of such supplementary
order may be filed with the clerk of the U.S. District Court for the
District of Columbia. Such supplementary order shall be final and the
court shall, upon the filing of the copy, enter judgment for the amount
declared in default by the supplementary order if such supplementary
order is in accordance with law. Review of the judgment may be had as
in civil suits for damages at common law. Final proceedings to execute
the judgment may be had by writ of execution in the form used by the
court in suits at common law in actions of assumpsit. No fee shall be
required for filing the supplementary order nor for entry of judgment
thereon, and the applicant shall not be liable for costs in a
proceeding for review of the judgment unless the court shall otherwise
direct. The court shall modify such judgment to conform to any later
benefits order upon presentation of a certified copy thereof to the
court.
(c) In cases where judgment cannot be satisfied by reason of the
employer's insolvency or other circumstances precluding payment, the
district director shall make payment from the fund, and in addition,
provide any necessary medical, surgical, and other treatment required
by subpart J of this part. A defaulting employer shall be liable to the
fund for payment of the amounts paid by the fund under this section;
and for the purpose of enforcing this liability, the fund shall be
subrogated to all the rights of the person receiving such payments or
benefits.
Sec. 725.606 Security for the payment of benefits.
(a) Following the issuance of an effective order by a district
director (see Sec. 725.418), administrative law judge (see
Sec. 725.479), Benefits Review Board, or court that requires the
payment of benefits by an operator that has failed to secure the
payment of benefits in accordance with section 423 of the Act and
Sec. 726.4 of this subchapter, or by a coal mine construction or
transportation employer, the Director may request that the operator
secure the payment of all benefits ultimately payable on the claim.
Such operator or other employer shall thereafter immediately secure the
payment of benefits in accordance with the provisions of this section,
and provide proof of such security to the Director. Such security may
take the form of an indemnity bond, a deposit of cash or negotiable
securities in compliance with Secs. 726.106(c) and 726.107 of this
subchapter, or any other form acceptable to the Director.
(b) The amount of security initially required by this section shall
be determined as follows:
(1) In a case involving an operator subject to section 423 of the
Act and Sec. 726.4 of this subchapter, the amount of the security shall
not be less than $175,000, and may be a higher amount as determined by
the Director, taking
[[Page 80094]]
into account the life expectancies of the claimant and any dependents
using the most recent life expectancy tables published by the Social
Security Administration; or
(2) In a case involving a coal mine construction or transportation
employer, the amount of the security shall be determined by the
Director, taking into account the life expectancies of the claimant and
any dependents using the most recent life expectancy tables published
by the Social Security Administration.
(c) If the operator or other employer fails to provide proof of
such security to the Director within 30 days of its receipt of the
Director's request to secure the payment of benefits issued under
paragraph (a) of this section, the appropriate adjudication officer
shall issue an order requiring the operator or other employer to make a
deposit of negotiable securities with a Federal Reserve Bank in the
amount required by paragraph (b). Such securities shall comply with the
requirements of Secs. 726.106(c) and 726.107 of this subchapter. In a
case in which the effective order was issued by a district director,
the district director shall be considered the appropriate adjudication
officer. In any other case, the administrative law judge who issued the
most recent decision in the case, or such other administrative law
judge as the Chief Administrative Law Judge shall designate, shall be
considered the appropriate adjudication officer, and shall issue an
order under this paragraph on motion of the Director. The
administrative law judge shall have jurisdiction to issue an order
under this paragraph notwithstanding the pendency of an appeal of the
award of benefits with the Benefits Review Board or court.
(d) An order issued under this section shall be considered
effective when issued. Disputes regarding such orders shall be resolved
in accordance with subpart F of this part.
(e) Notwithstanding any further review of the order in accordance
with subpart F of this part, if an operator or other employer subject
to an order issued under this section fails to comply with such order,
the appropriate adjudication officer shall certify such non-compliance
to the appropriate United States district court in accordance with
Sec. 725.351(c).
(f) Security posted in accordance with this section may be used to
make payment of benefits that become due with respect to the claim in
accordance with Sec. 725.502. In the event that either the order
awarding compensation or the order issued under this section is vacated
or reversed, the operator or other employer may apply to the
appropriate adjudication officer for an order authorizing the return of
any amounts deposited with a Federal Reserve Bank and not yet
disbursed, and such application shall be granted. If at any time the
Director determines that additional security is required beyond that
initially required by paragraph (b) of this section, he may request the
operator or other employer to increase the amount. Such request shall
be treated as if it were issued under paragraph (a) of this section.
(g) If a coal mine construction or transportation employer fails to
comply with an order issued under paragraph (c), and such employer is a
corporation, the provisions of Sec. 725.609 shall be applicable to the
president, secretary, and treasurer of such employer.
Sec. 725.607 Payments in addition to compensation.
(a) If any benefits payable under the terms of an award by a
district director (Sec. 725.419(d)), a decision and order filed and
served by an administrative law judge (Sec. 725.478), or a decision
filed by the Board or a U.S. court of appeals, are not paid by an
operator or other employer ordered to make such payments within 10 days
after such payments become due, there shall be added to such unpaid
benefits an amount equal to 20 percent thereof, which shall be paid to
the claimant at the same time as, but in addition to, such benefits,
unless review of the order making such award is sought as provided in
section 21 of the LHWCA and an order staying payments has been issued.
(b) If, on account of an operator's or other employer's failure to
pay benefits as provided in paragraph (a) of this section, benefit
payments are made by the fund, the eligible claimant shall nevertheless
be entitled to receive such additional compensation to which he or she
may be eligible under paragraph (a) of this section, with respect to
all amounts paid by the fund on behalf of such operator or other
employer.
(c) The fund shall not be liable for payments in addition to
compensation under any circumstances.
Sec. 725.608 Interest.
(a)(1) In any case in which an operator fails to pay benefits that
are due (Sec. 725.502), the beneficiary shall also be entitled to
simple annual interest, computed from the date on which the benefits
were due. The interest shall be computed through the date on which the
operator paid the benefits, except that the beneficiary shall not be
entitled to interest for any period following the date on which the
beneficiary received payment of any benefits from the fund pursuant to
Sec. 725.522.
(2) In any case in which an operator is liable for the payment of
retroactive benefits, the beneficiary shall also be entitled to simple
annual interest on such benefits, computed from 30 days after the date
of the first determination that such an award should be made. The first
determination that such an award should be made may be a district
director's initial determination of entitlement, an award made by an
administrative law judge or a decision by the Board or a court,
whichever is the first such determination of entitlement made upon the
claim.
(3) In any case in which an operator is liable for the payment of
additional compensation (Sec. 725.607), the beneficiary shall also be
entitled to simple annual interest computed from the date upon which
the beneficiary's right to additional compensation first arose.
(4) In any case in which an operator is liable for the payment of
medical benefits, the beneficiary or medical provider to whom such
benefits are owed shall also be entitled to simple annual interest,
computed from the date upon which the services were rendered, or from
30 days after the date of the first determination that the miner is
generally entitled to medical benefits, whichever is later. The first
determination that the miner is generally entitled to medical benefits
may be a district director's initial determination of entitlement, an
award made by an administrative law judge or a decision by the Board or
a court, whichever is the first such determination of general
entitlement made upon the claim. The interest shall be computed through
the date on which the operator paid the benefits, except that the
beneficiary or medical provider shall not be entitled to interest for
any period following the date on which the beneficiary or medical
provider received payment of any benefits from the fund pursuant to
Sec. 725.522 or Subpart I of this part.
(b) If an operator or other employer fails or refuses to pay any or
all benefits due pursuant to an award of benefits or an initial
determination of eligibility made by the district director and the fund
undertakes such payments, such operator or other employer shall be
liable to the fund for simple annual interest on all payments made by
the fund for which such operator is determined liable, computed from
the first date on which such benefits are paid by the fund, in addition
to such
[[Page 80095]]
operator's liability to the fund, as is otherwise provided in this
part. Interest payments owed pursuant to this paragraph shall be paid
directly to the fund.
(c) In any case in which an operator is liable for the payment of
an attorney's fee pursuant to Sec. 725.367, and the attorney's fee is
payable because the award of benefits has become final, the attorney
shall also be entitled to simple annual interest, computed from the
date on which the attorney's fee was awarded. The interest shall be
computed through the date on which the operator paid the attorney's
fee.
(d) The rates of interest applicable to paragraphs (a), (b), and
(c) of this section shall be computed as follows:
(1) For all amounts outstanding prior to January 1, 1982, the rate
shall be 6% simple annual interest;
(2) For all amounts outstanding for any period during calendar year
1982, the rate shall be 15% simple annual interest; and
(3) For all amounts outstanding during any period after calendar
year 1982, the rate shall be simple annual interest at the rate
established by section 6621 of the Internal Revenue Code (26 U.S.C.)
which is in effect for such period.
(e) The fund shall not be liable for the payment of interest under
any circumstances, other than the payment of interest on advances from
the United States Treasury as provided by section 9501(c) of the
Internal Revenue Code (26 U.S.C.).
Sec. 725.609 Enforcement against other persons.
In any case in which an award of benefits creates obligations on
the part of an operator or insurer that may be enforced under the
provisions of this subpart, such obligations may also be enforced, in
the discretion of the Secretary or district director, as follows:
(a) In a case in which the operator is a sole proprietorship or
partnership, against any person who owned, or was a partner in, such
operator during any period commencing on or after the date on which the
miner was last employed by the operator;
(b) In a case in which the operator is a corporation that failed to
secure its liability for benefits in accordance with section 423 of the
Act and Sec. 726.4, and the operator has not secured its liability for
the claim in accordance with Sec. 725.606, against any person who
served as the president, secretary, or treasurer of such corporation
during any period commencing on or after the date on which the miner
was last employed by the operator;
(c) In a case in which the operator is no longer capable of
assuming its liability for the payment of benefits (Sec. 725.494(e)),
against any operator which became a successor operator with respect to
the liable operator (Sec. 725.492) after the date on which the claim
was filed, beginning with the most recent such successor operator;
(d) In a case in which the operator is no longer capable of
assuming its liability for the payment of benefits (Sec. 725.494(e)),
and such operator was a subsidiary of a parent company or a product of
a joint venture, or was substantially owned or controlled by another
business entity, against such parent entity, any member of such joint
venture, or such controlling business entity; or
(e) Against any other person who has assumed or succeeded to the
obligations of the operator or insurer by operation of any state or
federal law, or by any other means.
Sec. 725.620 Failure to secure benefits; other penalties.
(a) If an operator fails to discharge its insurance obligations
under the Act, the provisions of subpart D of part 726 of this
subchapter shall apply.
(b) Any employer who knowingly transfers, sells, encumbers,
assigns, or in any manner disposes of, conceals, secrets, or destroys
any property belonging to such employer, after one of its employees has
been injured within the purview of the Act, and with intent to avoid
the payment of benefits under the Act to such miner or his or her
dependents, shall be guilty of a misdemeanor and, upon conviction
thereof, shall be punished by a fine of not more than $1,000, or by
imprisonment for not more than one year, or by both. In any case where
such employer is a corporation, the president, secretary, and treasurer
thereof shall be also severally liable for such penalty or imprisonment
as well as jointly liable with such corporation for such fine.
(c) No agreement by a miner to pay any portion of a premium paid to
a carrier by such miner's employer or to contribute to a benefit fund
or department maintained by such employer for the purpose of providing
benefits or medical services and supplies as required by this part
shall be valid; and any employer who makes a deduction for such purpose
from the pay of a miner entitled to benefits under the Act shall be
guilty of a misdemeanor and upon conviction thereof shall be punished
by a fine of not more than $1,000.
(d) No agreement by a miner to waive his or her right to benefits
under the Act and the provisions of this part shall be valid.
(e) This section shall not affect any other liability of the
employer under this part.
Sec. 725.621 Reports.
(a) Upon making the first payment of benefits and upon suspension,
reduction, or increase of payments, the operator or other employer
responsible for making payments shall immediately notify the district
director of the action taken, in accordance with a form prescribed by
the Office.
(b) Within 16 days after final payment of benefits has been made by
an employer, such employer shall so notify the district director, in
accordance with a form prescribed by the Office, stating that such
final payment, has been made, the total amount of benefits paid, the
name of the beneficiary, and such other information as the Office deems
pertinent.
(c) The Director may from time to time prescribe such additional
reports to be made by operators, other employers, or carriers as the
Director may consider necessary for the efficient administration of the
Act.
(d) Any employer who fails or refuses to file any report required
of such employer under this section shall be subject to a civil penalty
not to exceed $500 for each failure or refusal, which penalty shall be
determined in accordance with the procedures set forth in subpart D of
part 726 of this subchapter, as appropriate. The maximum penalty
applicable to any violation of this paragraph that takes place after
January 19, 2001 shall be $550.
(e) No request for information or response to such request shall be
considered a report for purposes of this section or the Act, unless it
is so designated by the Director or by this section.
Subpart J--Medical Benefits and Vocational Rehabilitation
Sec. 725.701 Availability of medical benefits.
(a) A miner who is determined to be eligible for benefits under
this part or part 727 of this subchapter (see Sec. 725.4(d)) is
entitled to medical benefits as set forth in this subpart as of the
date of his or her claim, but in no event before January 1, 1974. No
medical benefits shall be provided to the survivor or dependent of a
miner under this part.
(b) A responsible operator, other employer, or where there is
neither, the fund, shall furnish a miner entitled to benefits under
this part with such
[[Page 80096]]
medical, surgical, and other attendance and treatment, nursing and
hospital services, medicine and apparatus, and any other medical
service or supply, for such periods as the nature of the miner's
pneumoconiosis and disability requires.
(c) The medical benefits referred to in paragraphs (a) and (b) of
this section shall include palliative measures useful only to prevent
pain or discomfort associated with the miner's pneumoconiosis or
attendant disability.
(d) The costs recoverable under this subpart shall include the
reasonable cost of travel necessary for medical treatment (to be
determined in accordance with prevailing United States government
mileage rates) and the reasonable documented cost to the miner or
medical provider incurred in communicating with the employer, carrier,
or district director on matters connected with medical benefits.
(e) If a miner receives a medical service or supply, as described
in this section, for any pulmonary disorder, there shall be a
rebuttable presumption that the disorder is caused or aggravated by the
miner's pneumoconiosis. The party liable for the payment of benefits
may rebut the presumption by producing credible evidence that the
medical service or supply provided was for a pulmonary disorder apart
from those previously associated with the miner's disability, or was
beyond that necessary to effectively treat a covered disorder, or was
not for a pulmonary disorder at all.
(f) Evidence that the miner does not have pneumoconiosis or is not
totally disabled by pneumoconiosis arising out of coal mine employment
is insufficient to defeat a request for coverage of any medical service
or supply under this subpart. In determining whether the treatment is
compensable, the opinion of the miner's treating physician may be
entitled to controlling weight pursuant to Sec. 718.104(d). A finding
that a medical service or supply is not covered under this subpart
shall not otherwise affect the miner's entitlement to benefits.
Sec. 725.702 Claims for medical benefits only under section 11 of the
Reform Act.
(a) Section 11 of the Reform Act directs the Secretary of Health,
Education and Welfare to notify each miner receiving benefits under
part B of title IV of the Act that he or she may file a claim for
medical treatment benefits described in this subpart. Section
725.308(b) provides that a claim for medical treatment benefits shall
be filed on or before December 31, 1980, unless the period is enlarged
for good cause shown. This section sets forth the rules governing the
processing, adjudication, and payment of claims filed under section 11.
(b)(1) A claim filed pursuant to the notice described in paragraph
(a) of this section shall be considered a claim for medical benefits
only, and shall be filed, processed, and adjudicated in accordance with
the provisions of this part, except as provided in this section. While
a claim for medical benefits must be treated as any other claim filed
under part C of title IV of the Act, the Department shall accept the
Social Security Administration's finding of entitlement as its initial
determination.
(2) In the case of a part B beneficiary whose coal mine employment
terminated before January 1, 1970, the Secretary shall make an
immediate award of medical benefits. Where the part B beneficiary's
coal mine employment terminated on or after January 1, 1970, the
Secretary shall immediately authorize the payment of medical benefits
and thereafter inform the responsible operator, if any, of the
operator's right to contest the claimant's entitlement for medical
benefits.
(c) A miner on whose behalf a claim is filed under this section
(see Sec. 725.301) must have been alive on March 1, 1978, in order for
the claim to be considered.
(d) The criteria contained in subpart C of part 727 of this
subchapter (see Sec. 725.4(d)) are applicable to claims for medical
benefits filed under this section.
(e) No determination made with respect to a claim filed under this
section shall affect any determination previously made by the Social
Security Administration. The Social Security Administration may,
however, reopen a previously approved claim if the conditions set forth
in Sec. 410.672(c) of this chapter are present. These conditions are
generally limited to fraud or concealment.
(f) If medical benefits are awarded under this section, such
benefits shall be payable by a responsible coal mine operator (see
subpart G of this part), if the miner's last employment occurred on or
after January 1, 1970, and in all other cases by the fund. An operator
which may be required to provide medical treatment benefits to a miner
under this section shall have the right to participate in the
adjudication of the claim as is otherwise provided in this part.
(g) Any miner whose coal mine employment terminated after January
1, 1970, may be required to submit to a medical examination requested
by an identified operator. The unreasonable refusal to submit to such
an examination shall have the same consequences as are provided under
Sec. 725.414.
(h) If a miner is determined eligible for medical benefits in
accordance with this section, such benefits shall be provided from the
date of filing, except that such benefits may also include payments for
any unreimbursed medical treatment costs incurred personally by such
miner during the period from January 1, 1974, to the date of filing
which are attributable to medical care required as a result of the
miner's total disability due to pneumoconiosis. No reimbursement for
health insurance premiums, taxes attributable to any public health
insurance coverage, or other deduction or payments made for the purpose
of securing third party liability for medical care costs is authorized
by this section. If a miner seeks reimbursement for medical care costs
personally incurred before the filing of a claim under this section,
the district director shall require documented proof of the nature of
the medical service provided, the identity of the medical provider, the
cost of the service, and the fact that the cost was paid by the miner,
before reimbursement for such cost may be awarded.
Sec. 725.703 Physician defined.
The term ``physician'' includes only doctors of medicine (MD) and
osteopathic practitioners within the scope of their practices as
defined by State law. No treatment or medical services performed by any
other practitioner of the healing arts is authorized by this part,
unless such treatment or service is authorized and supervised both by a
physician as defined in this section and the district director.
Sec. 725.704 Notification of right to medical benefits; authorization
of treatment.
(a) Upon notification to a miner of such miner's entitlement to
benefits, the Office shall provide the miner with a list of authorized
treating physicians and medical facilities in the area of the miner's
residence. The miner may select a physician from this list or may
select another physician with approval of the Office. Where emergency
services are necessary and appropriate, authorization by the Office
shall not be required.
(b) The Office may, on its own initiative, or at the request of a
responsible operator, order a change of physicians or facilities, but
only where it has been determined that the change is desirable or
necessary in the best interest of the miner. The miner may
[[Page 80097]]
change physicians or facilities subject to the approval of the Office.
(c) If adequate treatment cannot be obtained in the area of the
claimant's residence, the Office may authorize the use of physicians or
medical facilities outside such area as well as reimbursement for
travel expenses and overnight accommodations.
Sec. 725.705 Arrangements for medical care.
(a) Operator liability. If an operator has been determined liable
for the payment of benefits to a miner, the Office shall notify such
operator or insurer of the names, addresses, and telephone numbers of
the authorized providers of medical benefits chosen by an entitled
miner, and shall require the operator or insurer to:
(1) Notify the miner and the providers chosen that such operator
will be responsible for the cost of medical services provided to the
miner on account of the miner's total disability due to pneumoconiosis;
(2) Designate a person or persons with decisionmaking authority
with whom the Office, the miner and authorized providers may
communicate on matters involving medical benefits provided under this
subpart and notify the Office, miner and providers of such designation;
(3) Make arrangements for the direct reimbursement of providers for
their services.
(b) Fund liability. If there is no operator found liable for the
payment of benefits, the Office shall make necessary arrangements to
provide medical care to the miner, notify the miner and medical care
facility selected of the liability of the fund, designate a person or
persons with whom the miner or provider may communicate on matters
relating to medical care, and make arrangements for the direct
reimbursement of the medical provider.
Sec. 725.706 Authorization to provide medical services.
(a) Except as provided in paragraph (b) of this section, medical
services from an authorized provider which are payable under
Sec. 725.701 shall not require prior approval of the Office or the
responsible operator.
(b) Except where emergency treatment is required, prior approval of
the Office or the responsible operator shall be obtained before any
hospitalization or surgery, or before ordering an apparatus for
treatment where the purchase price exceeds $300. A request for approval
of non-emergency hospitalization or surgery shall be acted upon
expeditiously, and approval or disapproval will be given by telephone
if a written response cannot be given within 7 days following the
request. No employee of the Department of Labor, other than a district
director or the Chief, Branch of Medical Analysis and Services, DCMWC,
is authorized to approve a request for hospitalization or surgery by
telephone.
(c) Payment for medical services, treatment, or an apparatus shall
be made at no more than the rate prevailing in the community in which
the providing physician, medical facility or supplier is located.
Sec. 725.707 Reports of physicians and supervision of medical care.
(a) Within 30 days following the first medical or surgical
treatment provided under Sec. 725.701, the treating physician or
facility shall furnish to the Office and the responsible operator, if
any, a report of such treatment.
(b) In order to permit continuing supervision of the medical care
provided to the miner with respect to the necessity, character and
sufficiency of any medical care furnished or to be furnished, the
treating physician, facility, employer or carrier shall provide such
reports in addition to those required by paragraph (a) of this section
as the Office may from time to time require. Within the discretion of
the district director, payment may be refused to any medical provider
who fails to submit any report required by this section.
Sec. 725.708 Disputes concerning medical benefits.
(a) Whenever a dispute develops concerning medical services under
this part, the district director shall attempt to informally resolve
such dispute. In this regard the district director may, on his or her
own initiative or at the request of the responsible operator order the
claimant to submit to an examination by a physician selected by the
district director.
(b) If no informal resolution is accomplished, the district
director shall refer the case to the Office of Administrative Law
Judges for hearing in accordance with this part. Any such hearing shall
be scheduled at the earliest possible time and shall take precedence
over all other requests for hearing except for prior requests for
hearing arising under this section and as provided by Sec. 727.405 of
this subchapter (see Sec. 725.4(d)). During the pendency of such
adjudication, the Director may order the payment of medical benefits
prior to final adjudication under the same conditions applicable to
benefits awarded under Sec. 725.522.
(c) In the development or adjudication of a dispute over medical
benefits, the adjudication officer is authorized to take whatever
action may be necessary to protect the health of a totally disabled
miner.
(d) Any interested medical provider may, if appropriate, be made a
party to a dispute over medical benefits.
Sec. 725.710 Objective of vocational rehabilitation.
The objective of vocational rehabilitation is the return of a miner
who is totally disabled for work in or around a coal mine and who is
unable to utilize those skills which were employed in the miner's coal
mine employment to gainful employment commensurate with such miner's
physical impairment. This objective may be achieved through a program
of re-evaluation and redirection of the miner's abilities, or
retraining in another occupation, and selective job placement
assistance.
Sec. 725.711 Requests for referral to vocational rehabilitation
assistance.
Each miner who has been determined entitled to receive benefits
under part C of title IV of the Act shall be informed by the OWCP of
the availability and advisability of vocational rehabilitation
services. If such miner chooses to avail himself or herself of
vocational rehabilitation, his or her request shall be processed and
referred by OWCP vocational rehabilitation advisors pursuant to the
provisions of Secs. 702.501 through 702.508 of this chapter as is
appropriate.
5. Part 726 is revised as follows:
PART 726--BLACK LUNG BENEFITS; REQUIREMENTS FOR COAL MINE
OPERATOR'S INSURANCE
Subpart A--General
Sec.
726.1 Statutory insurance requirements for coal mine operators.
726.2 Purpose and scope of this part.
726.3 Relationship of this part to other parts in this subchapter.
726.4 Who must obtain insurance coverage.
726.5 Effective date of insurance coverage.
726.6 The Office of Workers' Compensation Programs.
726.7 Forms, submission of information.
726.8 Definitions.
Subpart B--Authorization of Self-Insurers
726.101 Who may be authorized to self-insure.
726.102 Application for authority to become a self-insurer; how
filed; information to be submitted.
726.103 Application for authority to self-insure; effect of
regulations contained in this part.
[[Page 80098]]
726.104 Action by the Office upon application of operator.
726.105 Fixing the amount of security.
726.106 Type of security.
726.107 Deposits of negotiable securities with Federal Reserve
banks or the Treasurer of the United States; authority to sell such
securities; interest thereon.
726.108 Withdrawal of negotiable securities.
726.109 Increase or reduction in the amount of security.
726.110 Filing of agreement and undertaking.
726.111 Notice of authorization to self-insure.
726.112 Reports required of self-insurer; examination of accounts
of self-insurer.
726.113 Disclosure of confidential information.
726.114 Period of authorization as self-insurer; reauthorization.
726.115 Revocation of authorization to self-insure.
Subpart C--Insurance Contracts
726.201 Insurance contracts--generally.
726.202 Who may underwrite an operator's liability.
726.203 Federal Coal Mine Health and Safety Act endorsement.
726.204 Statutory policy provisions.
726.205 Other forms of endorsement and policies.
726.206 Terms of policies.
726.207 Discharge by the carrier of obligations and duties of
operator.
Reports by Carrier
726.208 Report by carrier of issuance of policy or endorsement.
726.209 Report; by whom sent.
726.210 Agreement to be bound by report.
726.211 Name of one employer only shall be given in each report.
726.212 Notice of cancellation.
726.213 Reports by carriers concerning the payment of benefits.
Subpart D--Civil Money Penalties
726.300 Purpose and scope.
726.301 Definitions.
726.302 Determination of penalty.
726.303 Notification; investigation.
726.304 Notice of initial assessment.
726.305 Contents of notice.
726.306 Finality of administrative assessment.
726.307 Form of notice of contest and request for hearing.
726.308 Service and computation of time.
726.309 Referral to the Office of Administrative Law Judges.
726.310 Appointment of Administrative Law Judge and notification
of hearing date.
726.311 Evidence.
726.312 Burdens of proof.
726.313 Decision and Order of Administrative Law Judge.
726.314 Review by the Secretary.
726.315 Contents.
726.316 Filing and service.
726.317 Discretionary review.
726.318 Final decision of the Secretary.
726.319 Retention of official record.
726.320 Collection and recovery of penalty.
Authority: 5 U.S.C. 301, Reorganization Plan No. 6 of 1950, 15
FR 3174, 30 U.S.C. 901 et seq., 902(f), 925, 932, 933, 934, 936,
945; 33 U.S.C. 901 et seq., Secretary's Order 7-87, 52 FR 48466,
Employment Standards Order No. 90-02.
Subpart A--General
Sec. 726.1 Statutory insurance requirements for coal mine operators.
Section 423 of title IV of the Federal Coal Mine Health and Safety
Act as amended (hereinafter the Act) requires each coal mine operator
who is operating or has operated a coal mine in a State which is not
included in the list published by the Secretary (see part 722 of this
subchapter) to secure the payment of benefits for which he may be found
liable under section 422 of the Act and the provisions of this
subchapter by either:
(a) Qualifying as a self-insurer, or
(b) By subscribing to and maintaining in force a commercial
insurance contract (including a policy or contract procured from a
State agency).
Sec. 726.2 Purpose and scope of this part.
(a) This part provides rules directing and controlling the
circumstances under which a coal mine operator shall fulfill his
insurance obligations under the Act.
(b) This Subpart A sets forth the scope and purpose of this part
and generally describes the statutory framework within which this part
is operative.
(c) Subpart B of this part sets forth the criteria a coal mine
operator must meet in order to qualify as a self-insurer.
(d) Subpart C of this part sets forth the rules and regulations of
the Secretary governing contracts of insurance entered into by coal
mine operators and commercial insurance sources for the payment of
black lung benefits under part C of the Act.
(e) Subpart D of this part sets forth the rules governing the
imposition of civil money penalties on coal mine operators that fail to
secure their liability under the Act.
Sec. 726.3 Relationship of this part to other parts in this
subchapter.
(a) This part 726 implements and effectuates responsibilities for
the payment of black lung benefits placed upon coal mine operators by
sections 415 and 422 of the Act and the regulations of the Secretary in
this subchapter, particularly those set forth in part 725 of this
subchapter. All definitions, usages, procedures, and other rules
affecting the responsibilities of coal mine operators prescribed in
part 725 of this subchapter are hereby made applicable, as appropriate,
to this part 726.
(b) If the provisions of this part appear to conflict with any
provision of any other part in this subchapter, the apparently
conflicting provisions should be read harmoniously to the fullest
extent possible. If a harmonious interpretation is not possible, the
provisions of this part should be applied to govern the
responsibilities and obligations of coal mine operators to secure the
payment of black lung benefits as prescribed by the Act. The provisions
of this part do not apply to matters falling outside the scope of this
part.
Sec. 726.4 Who must obtain insurance coverage.
(a) Section 423 of part C of title IV of the Act requires each
operator of a coal mine or former operator in any State which does meet
the requirements prescribed by the Secretary pursuant to section 411 of
part C of title IV of the Act to self-insure or obtain a policy or
contract of insurance to guarantee the payment of benefits for which
such operator may be adjudicated liable under section 422 of the Act.
In enacting sections 422 and 423 of the Act Congress has unambiguously
expressed its intent that coal mine operators bear the cost of
providing the benefits established by part C of title IV of the Act.
Section 3 of the Act defines an ``operator'' as any owner, lessee, or
other person who operates, controls, or supervises a coal mine.
(b) Section 422(i) of the Act clearly recognizes that any
individual or business entity who is or was a coal mine operator may be
found liable for the payment of pneumoconiosis benefits after December
31, 1973. Within this framework it is clear that the Secretary has wide
latitude for determining which operator shall be liable for the payment
of part C benefits. Comprehensive standards have been promulgated in
subpart G of part 725 of this subchapter for the purpose of guiding the
Secretary in making such determination. It must be noted that pursuant
to these standards any parent or subsidiary corporation, any individual
or corporate partner, or partnership, any lessee or lessor of a coal
mine, any joint venture or participant in a joint venture, any
transferee or transferor of a corporation or other business entity, any
former, current, or future operator or any other form of business
entity which has had or will have a substantial and reasonably direct
interest in the operation of a coal mine may be determined liable for
the payment of pneumoconiosis benefits after December 31, 1973. The
failure of any such business entity to self-insure or obtain a
[[Page 80099]]
policy or contract of insurance shall in no way relieve such business
entity of its obligation to pay pneumoconiosis benefits in respect of
any case in which such business entity's responsibility for such
payments has been properly adjudicated. Any business entity described
in this section shall take appropriate steps to insure that any
liability imposed by part C of the Act on such business entity shall be
dischargeable.
Sec. 726.5 Effective date of insurance coverage.
Pursuant to section 422(c) of part C of title IV of the Act, no
coal mine operator shall be responsible for the payment of any benefits
whatsoever for any period prior to January 1, 1974. However, coal mine
operators shall be liable as of January 1, 1974, for the payment of
benefits in respect of claims which were filed under section 415 of
part B of title IV of the Act after July 1, 1973. Section 415(a)(3)
requires the Secretary to notify any operator who may be liable for the
payment of benefits under part C of title IV beginning on January 1,
1974, of the pendency of a section 415 claim. Section 415(a)(5)
declares that any operator who has been notified of the pendency of a
section 415 claim shall be bound by the determination of the Secretary
as to such operator's liability and as to the claimant's entitlement to
benefits as if the claim were filed under part C of title IV of the Act
and section 422 thereof had been applicable to such operator.
Therefore, even though no benefit payments shall be required of an
operator prior to January 1, 1974, the liability for these payments may
be finally adjudicated at any time after July 1, 1973. Neither the
failure of an operator to exercise his right to participate in the
adjudication of such a claim nor the failure of an operator to obtain
insurance coverage in respect of claims filed after June 30, 1973, but
before January 1, 1974, shall excuse such operator from his liability
for the payment of benefits to such claimants under part C of title IV
of the Act.
Sec. 726.6 The Office of Workers' Compensation Programs.
The Office of Workers' Compensation Programs (hereinafter the
Office or OWCP) is that subdivision of the Employment Standards
Administration of the U.S. Department of Labor which has been empowered
by the Secretary of Labor to carry out his functions under section 415
and part C of title IV of the Act. As noted throughout this part 726
the Office shall perform a number of functions with respect to the
regulation of both the self-insurance and commercial insurance
programs. All correspondence with or submissions to the Office should
be addressed as follows:
Division of Coal Mine Workers' Compensation, Office of Workers'
Compensation Programs, Employment Standards Administration, U.S.
Department of Labor, Washington, D.C. 20210
Sec. 726.7 Forms, submission of information.
Any information required by this part 726 to be submitted to the
Office of Workmen's Compensation Programs or any other office or
official of the Department of Labor, shall be submitted on such forms
or in such manner as the Secretary deems appropriate and has authorized
from time to time for such purposes.
Sec. 726.8 Definitions.
In addition to the definitions provided in part 725 of this
subchapter, the following definitions apply to this part:
(a) Director means the Director, Office of Workers' Compensation
Programs, and includes any official of the Office of Workers'
Compensation Programs authorized by the Director to perform any of the
functions of the Director under this part and part 725 of this
subchapter.
(b) Person includes any individual, partnership, corporation,
association, business trust, legal representative, or organized group
of persons.
(c) Secretary means the Secretary of Labor or such other official
as the Secretary shall designate to carry out any responsibility under
this part.
(d) The terms employ and employment shall be construed as broadly
as possible, and shall include any relationship under which an operator
retains the right to direct, control, or supervise the work performed
by a miner, or any other relationship under which an operator derives a
benefit from the work performed by a miner. Any individuals who
participate with one or more persons in the mining of coal, such as
owners, proprietors, partners, and joint venturers, whether they are
compensated by wages, salaries, piece rates, shares, profits, or by any
other means, shall be deemed employees. It is the specific intention of
this paragraph to disregard any financial arrangement or business
entity devised by the actual owners or operators of a coal mine or coal
mine-related enterprise to avoid the payment of benefits to miners who,
based upon the economic reality of their relationship to this
enterprise, are, in fact, employees of the enterprise.
Subpart B--Authorization of Self-Insurers
Sec. 726.101 Who may be authorized to self-insure.
(a) Pursuant to section 423 of part C of title IV of the Act,
authorization to self-insure against liability incurred by coal mine
operators on account of the total disability or death of miners due to
pneumoconiosis may be granted or denied in the discretion of the
Secretary. The provisions of this subpart describe the minimum
requirements established by the Secretary for determining whether any
particular coal mine operator shall be authorized as a self-insurer.
(b) The minimum requirements which must be met by any operator
seeking authorization to self-insure are as follows:
(1) The operator must, at the time of application, have been in the
business of mining coal for at least the 3 consecutive years prior to
such application; and,
(2) The operator must demonstrate the administrative capacity to
fully service such claims as may be filed against him; and,
(3) The operator's average current assets over the preceding 3
years (in computing average current assets such operator shall not
include the amount of any negotiable securities which he may be
required to deposit to secure his obligations under the Act) must
exceed current liabilities by the sum of--
(i) The estimated aggregate amount of black lung benefits
(including medical benefits) which such operator may expect to be
required to pay during the ensuing year; and,
(ii) The annual premium cost for any indemnity bond purchased; and
(4) Such operator must obtain security, in a form approved by the
Office (see Sec. 726.104) and in an amount to be determined by the
Office (see Sec. 726.105); and
(5) No operator with fewer than 5 full-time employee-miners shall
be permitted to self-insure.
(c) No operator who is unable to meet the requirements of this
section should apply for authorization to self-insure and no
application for self-insurance shall be approved by the Office until
such time as the amount prescribed by the Office has been secured in
accordance with this subpart.
Sec. 726.102 Application for authority to become a self-insurer; how
filed; information to be submitted.
(a) How filed. Application for authority to become a self-insurer
shall be addressed to the Office and be made
[[Page 80100]]
on a form provided by the Office. Such application shall be signed by
the applicant over his typewritten name and if the applicant is not an
individual, by the principal officer of the applicant duly authorized
to make such application over his typewritten name and official
designation and shall be sworn to by him. If the applicant is a
corporation, the corporate seal shall be affixed. The application shall
be filed with the Office in Washington, D.C.
(b) Information to be submitted. Each application for authority to
self-insure shall contain:
(1) A statement of the employer's payroll report for each of the
preceding 3 years;
(2) A statement of the average number of employees engaged in
employment within the purview of the Act for each of the preceding 3
years;
(3) A list of the mine or mines to be covered by any particular
self-insurance agreement. Each such mine or mines listed shall be
described by name and reference shall be made to the Federal
Identification Number assigned such mine by the Bureau of Mines, U.S.
Department of the Interior;
(4) A certified itemized statement of the gross and net assets and
liabilities of the operator for each of the 3 preceding years in such
manner as prescribed by the Office;
(5) A statement demonstrating the applicant's administrative
capacity to provide or procure adequate servicing for a claim including
both medical and dollar claims; and
(6) In addition to the aforementioned, the Office may in its
discretion, require the applicant to submit such further information or
such evidence as the Office may deem necessary to have in order to
enable it to give adequate consideration to such application.
(c) Who may file. An application for authorization to self-insure
may be filed by any parent or subsidiary corporation, partner or
partnership, party to a joint venture or joint venture, individual, or
other business entity which may be determined liable for the payment of
black lung benefits under part C of title IV of the Act, regardless of
whether such applicant is directly engaged in the business of mining
coal. However, in each case for which authorization to self-insure is
granted, the agreement and undertaking filed pursuant to Sec. 726.110
and the security deposit shall be respectively filed by and deposited
in the name of the applicant only.
Sec. 726.103 Application for authority to self-insure; effect of
regulations contained in this part.
As appropriate, each of the regulations, interpretations and
requirements contained in this part 726 including those described in
subpart C of this part shall be binding upon each applicant under this
subpart, and the applicant's consent to be bound by all requirements of
the said regulations shall be deemed to be included in and a part of
the application, as fully as though written therein.
Sec. 726.104 Action by the Office upon application of operator.
(a) Upon receipt of a completed application for authorization to
self-insure, the Office shall, after examination of the information
contained in the application, either deny the request or determine the
amount of security which must be given by the applicant to guarantee
the payment of benefits and the discharge of all other obligations
which may be required of such applicant under the Act.
(b) The applicant shall thereafter be notified that he may give
security in the amount fixed by the Office (see Sec. 726.105):
(1) In the form of an indemnity bond with sureties satisfactory to
the Office;
(2) By a deposit of negotiable securities with a Federal Reserve
Bank in compliance with Secs. 726.106(c) and 726.107;
(3) In the form of a letter of credit issued by a financial
institution satisfactory to the Office (except that a letter of credit
shall not be sufficient by itself to satisfy a self-insurer's
obligations under this part); or
(4) By funding a trust pursuant to section 501(c)(21) of the
Internal Revenue Code (26 U.S.C.).
(c) Any applicant who cannot meet the security deposit requirements
imposed by the Office should proceed to obtain a commercial policy or
contract of insurance. Any applicant for authorization to self-insure
whose application has been rejected or who believes that the security
deposit requirements imposed by the Office are excessive may, in
writing, request that the Office review its determination. A request
for review should contain such information as may be necessary to
support the request that the amount of security required be reduced.
(d) Upon receipt of any such request, the Office shall review its
previous determination in light of any new or additional information
submitted and inform the applicant whether or not a reduction in the
amount of security initially required is warranted.
Sec. 726.105 Fixing the amount of security.
The Office shall require the amount of security which it deems
necessary and sufficient to secure the performance by the applicant of
all obligations imposed upon him as an operator by the Act. In
determining the amount of security required, the factors that the
Office will consider include, but are not limited to, the operator's
net worth, the existence of a guarantee by a parent corporation, and
the operator's existing liability for benefits. The Office shall also
consider such other factors as it considers relevant to any particular
case. The amount of security which shall be required may be increased
or decreased when experience or changed conditions so warrant.
Sec. 726.106 Type of security.
(a) The Office shall determine the type or types of security which
an applicant shall or may procure. (See Sec. 726.104(b).)
(b) In the event the indemnity bond option is selected, the bond
shall be in such form and contain such provisions as the Office may
prescribe: Provided, That only corporations may act as sureties on such
indemnity bonds. In each case in which the surety on any such bond is a
surety company, such company must be one approved by the U.S. Treasury
Department under the laws of the United States and the applicable rules
and regulations governing bonding companies (see Department of
Treasury's Circular--570).
(c) An applicant for authorization to self-insure based on a
deposit of negotiable securities, in the amount fixed by the Office,
shall deposit any negotiable securities acceptable as security for the
deposit of public moneys of the United States under regulations issued
by the Secretary of the Treasury. (See 31 CFR Part 225.) The approval,
valuation, acceptance, and custody of such securities is hereby
committed to the several Federal Reserve Banks and the Treasurer of the
United States.
Sec. 726.107 Deposits of negotiable securities with Federal Reserve
banks or the Treasurer of the United States; authority to sell such
securities; interest thereon.
Deposits of securities provided for by the regulations in this part
shall be made with any Federal Reserve bank or any branch of a Federal
Reserve bank designated by the Office, or the Treasurer of the United
States, and shall be held subject to the order of the Office with power
in the Office, in its
[[Page 80101]]
discretion in the event of default by the said self-insurer, to collect
the interest as it may become due, to sell the securities or any of
them as may be required to discharge the obligations of the self-
insurer under the Act and to apply the proceeds to the payment of any
benefits or medical expenses for which the self-insurer may be liable.
The Office may, however, whenever it deems it unnecessary to resort to
such securities for the payment of benefits, authorize the self-insurer
to collect interest on the securities deposited by him.
Sec. 726.108 Withdrawal of negotiable securities.
No withdrawal of negotiable securities deposited by a self-insurer,
shall be made except upon authorization by the Office. A self-insurer
discontinuing business, or discontinuing operations within the purview
of the Act, or providing security for the payment of benefits by
commercial insurance under the provisions of the Act may apply to the
Office for the withdrawal of securities deposited under the regulations
in this part. With such application shall be filed a sworn statement
setting forth:
(a) A list of all outstanding cases in which benefits are being
paid, with the names of the miners and other beneficiaries, giving a
statement of the amounts of benefits paid and the periods for which
such benefits have been paid; and
(b) A similar list of all pending cases in which no benefits have
as yet been paid. In such cases withdrawals may be authorized by the
Office of such securities as in the opinion of the Office may not be
necessary to provide adequate security for the payment of outstanding
and potential liabilities of such self-insurer under the Act.
Sec. 726.109 Increase or reduction in the amount of security.
Whenever in the opinion of the Office the amount of security given
by the self-insurer is insufficient to afford adequate security for the
payment of benefits and medical expenses under the Act, the self-
insurer shall, upon demand by the Office, file such additional security
as the Office may require. The Office may reduce the amount of security
at any time on its own initiative, or upon the application of a self-
insurer, when it believes the facts warrant a reduction. A self-insurer
seeking a reduction shall furnish such information as the Office may
request relative to his current affairs, the nature and hazard of the
work of his employees, the amount of the payroll of his employees
engaged in coal mine employment within the purview of the Act, his
financial condition, and such other evidence as may be deemed material,
including a record of benefit payments he has made.
Sec. 726.110 Filing of agreement and undertaking.
(a) In addition to the requirement that adequate security be
procured as set forth in this subpart, the applicant for the
authorization to self-insure shall, as a condition precedent to
receiving such authorization, execute and file with the Office an
agreement and undertaking in a form prescribed and provided by the
Office in which the applicant shall agree:
(1) To pay when due, as required by the Act, all benefits payable
on account of total disability or death of any of its employee-miners;
(2) To furnish medical, surgical, hospital, and other attendance,
treatment, and care as required by the Act;
(3) To provide security in a form approved by the Office (see
Sec. 726.104) and in an amount established by the Office (see
Sec. 726.105), as elected in the application;
(4) To authorize the Office to sell any negotiable securities so
deposited or any part thereof, and to pay from the proceeds thereof
such benefits, medical, and other expenses and any accrued penalties
imposed by law as the Office may find to be due and payable.
(b) When an applicant has provided the requisite security, he shall
send to the Office in Washington, D.C. a completed agreement and
undertaking, together with satisfactory proof that his obligations and
liabilities under the Act have been secured.
Sec. 726.111 Notice of authorization to self-insure.
Upon receipt of a completed agreement and undertaking and
satisfactory proof that adequate security has been provided, an
applicant for authorization to self-insure shall be notified by the
Office in writing that he is authorized to self-insure to meet the
obligations imposed upon him by section 415 and part C of title IV of
the Act.
Sec. 726.112 Reports required of self-insurer; examination of accounts
of self-insurer.
(a) Each operator who has been authorized to self-insure under this
part shall submit to the Office reports containing such information as
the Office may from time to time require or prescribe.
(b) Whenever it deems it to be necessary, the Office may inspect or
examine the books of account, records, and other papers of a self-
insurer for the purpose of verifying any financial statement submitted
to the Office by the self-insurer or verifying any information
furnished to the Office in any report required by this section, or any
other section of the regulations in this part, and such self-insurer
shall permit the Office or its duly authorized representative to make
such an inspection or examination as the Office shall require. In lieu
of this requirement the Office may in its discretion accept an adequate
report of a certified public accountant.
(c) Failure to submit or make available any report or information
requested by the Office from an authorized self-insurer pursuant to
this section may, in appropriate circumstances result in a revocation
of the authorization to self-insure.
Sec. 726.113 Disclosure of confidential information.
Any financial information or records, or other information relating
to the business of an authorized self-insurer or applicant for the
authorization of self-insurance obtained by the Office shall be exempt
from public disclosure to the extent provided in 5 U.S.C. 552(b) and
the applicable regulations of the Department of Labor promulgated
thereunder. (See 29 CFR part 70.)
Sec. 726.114 Period of authorization as self-insurer; reauthorization.
(a) No initial authorization to self-insure shall be granted for a
period in excess of 18 months. A self-insurer who has made an adequate
deposit of negotiable securities in compliance with Secs. 726.106(c)
and 726.107 will be reauthorized for the ensuing fiscal year without
additional security if the Office finds that his experience as a self-
insurer warrants such action. If the Office determines that such self-
insurer's experience indicates a need for the deposit of additional
security, no reauthorization shall be issued for the ensuing fiscal
year until the Office receives satisfactory proof that the requisite
amount of additional securities has been deposited. A self-insurer who
currently has on file an indemnity bond will receive from the Office
each year a bond form for execution in contemplation of
reauthorization, and the submission of such bond duly executed in the
amount indicated by the Office will be deemed and treated as such self-
insurer's application for reauthorization for the ensuing fiscal year.
(b) In each case for which there is an approved change in the
amount of
[[Page 80102]]
security provided, a new agreement and undertaking shall be executed.
(c) Each operator authorized to self-insure under this part shall
apply for reauthorization for any period during which it engages in the
operation of a coal mine and for additional periods after it ceases
operating a coal mine. Upon application by the operator, accompanied by
proof that the security it has posted is sufficient to secure all
benefits potentially payable to miners formerly employed by the
operator, the Office shall issue a certification that the operator is
exempt from the requirements of this part based on its prior operation
of a coal mine. The provisions of subpart D of this part shall be
applicable to any operator that fails to apply for reauthorization in
accordance with the provisions of this section.
Sec. 726.115 Revocation of authorization to self-insure.
The Office may for good cause shown suspend or revoke the
authorization of any self-insurer. Failure by a self-insurer to comply
with any provision or requirement of law or of the regulations in this
part, or with any lawful order or communication of the Office, or the
failure or insolvency of the surety on his indemnity bond, or
impairment of financial responsibility of such self-insurer, may be
deemed good cause for such suspension or revocation.
Subpart C--Insurance Contracts
Sec. 726.201 Insurance contracts--generally.
Each operator of a coal mine who has not obtained authorization as
a self-insurer shall purchase a policy or enter into a contract with a
commercial insurance carrier or State agency. Pursuant to authority
contained in sections 422(a) and 423(b) and (c) of part C of title IV
of the Act, this subpart describes a number of provisions which are
required to be incorporated in a policy or contract of insurance
obtained by a coal mine operator for the purpose of meeting the
responsibility imposed upon such operator by the Act in respect of the
total disability or death of miners due to pneumoconiosis.
Sec. 726.202 Who may underwrite an operator's liability.
Each coal mine operator who is not authorized to self-insure shall
insure and keep insured the payment of benefits as required by the Act
with any stock company or mutual company or association, or with any
other person, or fund, including any State fund while such company,
association, person, or fund is authorized under the law of any State
to insure workmen's compensation.
Sec. 726.203 Federal Coal Mine Health and Safety Act endorsement.
(a) The following form of endorsement shall be attached and
applicable to the standard workmen's compensation and employer's
liability policy prepared by the National Council on Compensation
Insurance affording coverage under the Federal Coal Mine Health and
Safety Act of 1969, as amended:
It is agreed that: (1) With respect to operations in a State
designated in item 3 of the declarations, the unqualified term
``workmen's compensation law'' includes part C of title IV of the
Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. section
931-936, and any laws amendatory thereto, or supplementary thereto,
which may be or become effective while this policy is in force, and
definition (a) of Insuring Agreement III is amended accordingly; (2)
with respect to such insurance as is afforded by this endorsement,
(a) the States, if any, named below, shall be deemed to be
designated in item 3 of the declaration; (b) Insuring Agreement
IV(2) is amended to read ``by disease caused or aggravated by
exposure of which the last day of the last exposure, in the
employment of the insured, to conditions causing the disease occurs
during the policy period, or occurred prior to (effective date) and
claim based on such disease is first filed against the insured
during the policy period.''
(b) The term ``effective date'' as used in paragraph (a) of this
section shall be construed to mean the effective date of the first
policy or contract of insurance procured by an operator for purposes of
meeting the obligations imposed on such operator by section 423 of part
C of title IV of the Act.
(c) The Act contains a number of provisions and imposes a number of
requirements on operators which differ in varying degrees from
traditional workmen's compensation concepts. To avoid unnecessary
administrative delays and expense which might be occasioned by the
drafting of an entirely new standard workmen's compensation policy
specially tailored to the Act, the Office has determined that the
existing standard workmen's compensation policy subject to the
endorsement provisions contained in paragraph (a) of this section shall
be acceptable for purposes of writing commercial insurance coverage
under the Act. However, to avoid undue disputes over the meaning of
certain policy provisions and in accordance with the authority
contained in section 423(b)(3) of the Act, the Office has determined
that the following requirements shall be applicable to all commercial
insurance policies obtained by an operator for the purpose of insuring
any liability incurred pursuant to the Act:
(1) Operator liability. (i) Section 415 and part C of title IV of
the Act provide coverage for total disability or death due to
pneumoconiosis to all claimants who meet the eligibility requirements
imposed by the Act. Section 422 of the Act and the regulations duly
promulgated thereunder (part 725 of this subchapter) set forth the
conditions under which a coal mine operator may be adjudicated liable
for the payment of benefits to an eligible claimant for any period
subsequent to December 31, 1973.
(ii) Section 422(c) of the Act prescribes that except as provided
in 422(i) (see paragraph (c)(2) of this section) an operator may be
adjudicated liable for the payment of benefits in any case if the total
disability or death due to pneumoconiosis upon which the claim is
predicated arose at least in part out of employment in a mine in any
period during which it was operated by such operator. The Act does not
require that such employment which contributed to or caused the total
disability or death due to pneumoconiosis occur subsequent to any
particular date in time. The Secretary in establishing a formula for
determining the operator liable for the payment of benefits (see
subpart D of part 725 of this subchapter) in respect of any particular
claim, must therefore, within the framework and intent of title IV of
the Act find in appropriate cases that an operator is liable for the
payment of benefits for some period after December 31, 1973, even
though the employment upon which an operator's liability is based
occurred prior to July 1, 1973, or prior to the effective date of the
Act or the effective date of any amendments thereto, or prior to the
effective date of any policy or contract of insurance obtained by such
operator. The endorsement provisions contained in paragraph (a) of this
section shall be construed to incorporate these requirements in any
policy or contract of insurance obtained by an operator to meet the
obligations imposed on such operator by section 423 of the Act.
(2) Successor liability. Section 422(i) of part C of title IV of
the Act requires that a coal mine operator who after December 30, 1969,
acquired his mine or substantially all of the assets thereof from a
person who was an operator of such mine on or after December 30, 1969,
shall be liable for and shall secure the payment of benefits which
would have been payable by the prior operator with respect to miners
previously employed in such mine if the
[[Page 80103]]
acquisition had not occurred and the prior operator had continued to
operate such mine. In the case of an operator who is determined liable
for the payment of benefits under section 422(i) of the Act and part
725 of this subchapter, such liability shall accrue to such operator
regardless of the fact that the miner on whose total disability or
death the claim is predicated was never employed by such operator in
any capacity. The endorsement provisions contained in paragraph (a) of
this section shall be construed to incorporate this requirement in any
policy or contract of insurance obtained by an operator to meet the
obligations imposed on such operator by section 423 of the Act.
(3) Medical eligibility. Pursuant to section 422(h) of part C of
title IV of the Act and the regulations described therein (see subpart
D of part 410 of this title) benefits shall be paid to eligible
claimants on account of total disability or death due to pneumoconiosis
and in cases where the miner on whose death a claim is predicated was
totally disabled by pneumoconiosis at the time of his death regardless
of the cause of such death. The endorsement provisions contained in
paragraph (a) of this section shall be construed to incorporate these
requirements in any policy or contract of insurance obtained by an
operator to meet the obligations imposed on such operator by section
423 of the Act.
(4) Payment of benefits, rates. Section 422(c) of the Act by
incorporating section 412(a) of the Act requires the payment of
benefits at a rate equal to 50 per centum of the minimum monthly
payment to which a Federal employee in grade GS-2, who is totally
disabled is entitled at the time of payment under Chapter 81 of title
5, United States Code. These benefits are augmented on account of
eligible dependents as appropriate (see section 412(a) of part B of
title IV of the Act). Since the dollar amount of benefits payable to
any beneficiary is required to be computed at the time of payment such
amounts may be expected to increase from time to time as changes in the
GS-2 grade are enacted into law. The endorsement provisions contained
in paragraph (a) of this section shall be construed to incorporate in
any policy or contract of insurance obtained by an operator to meet the
obligations imposed on such operator by section 423 of the Act, the
requirement that the payment of benefits to eligible beneficiaries
shall be made in such dollar amounts as are prescribed by section
412(a) of the Act computed at the time of payment.
(5) Compromise and waiver of benefits. Section 422(a) of part C of
title IV of the Act by incorporating sections 15(b) and 16 of the
Longshoremen's and Harbor Workers' Compensation Act (33 U.S.C. 915(b)
and 916) prohibits the compromise and/or waiver of claims for benefits
filed or benefits payable under section 415 and part C of title IV of
the Act. The endorsement provisions contained in paragraph (a) of this
section shall be construed to incorporate these prohibitions in any
policy or contract of insurance obtained by an operator to meet the
obligations imposed on such operator by section 423 of the Act.
(6) Additional requirements. In addition to the requirements
described in paragraph (c)(1) through (5) of this section, the
endorsement provisions contained in paragraph (a) of this section
shall, to the fullest extent possible, be construed to bring any policy
or contract of insurance entered into by an operator for the purpose of
insuring such operator's liability under part C of title IV of the Act
into conformity with the legal requirements placed upon such operator
by section 415 and part C of title IV of the Act and parts 720 and 725
of this subchapter.
(d) Nothing in this section shall relieve any operator or carrier
of the duty to comply with any State workmen's compensation law, except
insofar as such State law is in conflict with the provisions of this
section.
Sec. 726.204 Statutory policy provisions.
Pursuant to section 423(b) of part C of title IV of the Act each
policy or contract of insurance obtained to comply with the
requirements of section 423(a) of the Act must contain or shall be
construed to contain--
(a) A provision to pay benefits required under section 422 of the
Act, notwithstanding the provisions of the State workmen's compensation
law which may provide for lesser payments; and,
(b) A provision that insolvency or bankruptcy of the operator or
discharge therein (or both) shall not relieve the carrier from
liability for such payments.
Sec. 726.205 Other forms of endorsement and policies.
Forms of endorsement or policies other than that described in
Sec. 726.203 may be entered into by operators to insure their liability
under the Act. However, any form of endorsement or policy which
materially alters or attempts to materially alter an operator's
liability for the payment of any benefits under the Act shall be deemed
insufficient to discharge such operator's duties and responsibilities
as prescribed in part C of title IV of the Act. In any event, the
failure of an operator to obtain an adequate policy or contract of
insurance shall not affect such operator's liability for the payment of
any benefits for which he is determined liable.
Sec. 726.206 Terms of policies.
A policy or contract of insurance shall be issued for the term of 1
year from the date that it becomes effective, but if such insurance be
not needed except for a particular contract or operation, the term of
the policy may be limited to the period of such contract or operation.
Sec. 726.207 Discharge by the carrier of obligations and duties of
operator.
Every obligation and duty in respect of payment of benefits, the
providing of medical and other treatment and care, the payment or
furnishing of any other benefit required by the Act and in respect of
the carrying out of the administrative procedure required or imposed by
the Act or the regulations in this part or part 725 of this subchapter
upon an operator shall be discharged and carried out by the carrier as
appropriate. Notice to or knowledge of an operator of the occurrence of
total disability or death due to pneumoconiosis shall be notice to or
knowledge of such carrier. Jurisdiction of the operator by a district
director, administrative law judge, the Office, or appropriate
appellate authority under the Act shall be jurisdiction of such
carrier. Any requirement under any benefits order, finding, or decision
shall be binding upon such carrier in the same manner and to the same
extent as upon the operator.
Reports by Carrier
Sec. 726.208 Report by carrier of issuance of policy or endorsement.
Each carrier shall report to the Office each policy and endorsement
issued, canceled, or renewed by it to an operator. The report shall be
made in such manner and on such form as the Office may require.
Sec. 726.209 Report; by whom sent.
The report of issuance, cancellation, or renewal of a policy and
endorsement provided for in Sec. 726.208 shall be sent by the home
office of the carrier, except that any carrier may authorize its agency
or agencies to make such reports to the Office.
Sec. 726.210 Agreement to be bound by report.
Every carrier seeking to write insurance under the provisions of
the
[[Page 80104]]
Act shall be deemed to have agreed that the acceptance by the Office of
a report of the issuance or renewal of a policy of insurance, as
provided for by Sec. 726.208 shall bind the carrier to full liability
for the obligations under the Act of the operator named in said report.
It shall be no defense to this agreement that the carrier failed or
delayed to issue, cancel, or renew the policy to the operator covered
by this report.
Sec. 726.211 Name of one employer only shall be given in each report.
A separate report of the issuance or renewal of a policy and
endorsement, provided for by Sec. 726.208, shall be made for each
operator covered by a policy. If a policy is issued or renewed insuring
more than one operator, a separate report for each operator so covered
shall be sent to the Office with the name of only one operator on each
such report.
Sec. 726.212 Notice of cancellation.
Cancellation of a contract or policy of insurance issued under
authority of the Act shall not become effective otherwise than as
provided by 33 U.S.C. 936(b); and notice of a proposed cancellation
shall be given to the Office and to the operator in accordance with the
provisions of 33 U.S.C. 912(c), 30 days before such cancellation is
intended to be effective (see section 422(a) of part C of title IV of
the Act).
Sec. 726.213 Reports by carriers concerning the payment of benefits.
Pursuant to 33 U.S.C. 914(c) as incorporated by section 422(a) of
part C of title IV of the Act and Sec. 726.207 each carrier issuing a
policy or contract of insurance under the Act shall upon making the
first payment of benefits and upon the suspension of any payment in any
case, immediately notify the Office in accordance with a form
prescribed by the Office that payment of benefit has begun or has been
suspended as the case may be. In addition, each such carrier shall at
the request of the Office submit to the Office such additional
information concerning policies or contracts of insurance issued to
guarantee the payment of benefits under the Act and any benefits paid
thereunder, as the Office may from time to time require to carry out
its responsibilities under the Act.
Subpart D--Civil Money Penalties
Sec. 726.300 Purpose and scope.
Any operator which is required to secure the payment of benefits
under section 423 of the Act and Sec. 726.4 and which fails to secure
such benefits, shall be subject to a civil penalty of not more than
$1,000 for each day during which such failure occurs. If the operator
is a corporation, the president, secretary, and treasurer of the
operator shall also be severally liable for the penalty based on the
operator's failure to secure the payment of benefits. This subpart
defines those terms necessary for administration of the civil money
penalty provisions, describes the criteria for determining the amount
of penalty to be assessed, and sets forth applicable procedures for the
assessment and contest of penalties.
Sec. 726.301 Definitions.
In addition to the definitions provided in part 725 of this
subchapter and Sec. 726.8, the following definitions apply to this
subpart:
(a) Division Director means the Director, Division of Coal Mine
Workers' Compensation, Office of Workers' Compensation Programs,
Employment Standards Administration, or such other official authorized
by the Division Director to perform any of the functions of the
Division Director under this subpart.
(b) President, secretary, or treasurer means the officers of a
corporation as designated pursuant to the laws and regulations of the
state in which the corporation is incorporated or, if that state does
not require the designation of such officers, the employees of a
company who are performing the work usually performed by such officers
in the state in which the corporation's principal place of business is
located.
(c) Principal means any person who has an ownership interest in an
operator that is not a corporation, and shall include, but is not
limited to, partners, sole proprietors, and any other person who
exercises control over the operation of a coal mine.
Sec. 726.302 Determination of penalty.
(a) The following method shall be used for determining the amount
of any penalty assessed under this subpart.
(b) The penalty shall be determined by multiplying the daily base
penalty amount or amounts, determined in accordance with the formula
set forth in this section, by the number of days in the period during
which the operator is subject to the security requirements of section
423 of the Act and Sec. 726.4, and fails to secure its obligations
under the Act. The period during which an operator is subject to
liability for a penalty for failure to secure its obligations shall be
deemed to commence on the first day on which the operator met the
definition of the term ``operator'' as set forth in Sec. 725.101 of
this subchapter. The period shall be deemed to continue even where the
operator has ceased coal mining and any related activity, unless the
operator secured its liability for all previous periods through a
policy or policies of insurance obtained in accordance with subpart C
of this part or has obtained a certification of exemption in accordance
with the provisions of Sec. 726.114.
(c)(1) A daily base penalty amount shall be determined for all
periods up to and including the 10th day after the operator's receipt
of the notification sent by the Director pursuant to Sec. 726.303,
during which the operator failed to secure its obligations under
section 423 of the Act and Sec. 726.4.
(2)(i) The daily base penalty amount shall be determined based on
the number of persons employed in coal mine employment by the operator,
or engaged in coal mine employment on behalf of the operator, on each
day of the period defined by this section, and shall be computed as
follows:
------------------------------------------------------------------------
Penalty
Employees (per day)
------------------------------------------------------------------------
Less than 25.............................................. $100
25-50..................................................... 200
51-100.................................................... 300
More than 100............................................. 400
------------------------------------------------------------------------
(ii) For any period after the operator has ceased coal mining and
any related activity, the daily penalty amount shall be computed based
on the largest number of persons employed in coal mine employment by
the operator, or engaged in coal mine employment on behalf of the
operator, on any day while the operator was engaged in coal mining or
any related activity. For purposes of this section, it shall be
presumed, in the absence of evidence to the contrary, that any person
employed by an operator is employed in coal mine employment.
(3) In any case in which the operator had prior notice of the
applicability of the Black Lung Benefits Act to its operations, the
daily base penalty amounts set forth in paragraph (c)(2)(i) of this
section shall be doubled. Prior notice may be inferred where the
operator, or an entity in which the operator or any of its principals
had an ownership interest, or an entity in which the operator's
president, secretary, or treasurer were employed:
(i) Previously complied with section 423 of the Act and Sec. 726.4;
(ii) Was notified of its obligation to comply with section 423 of
the Act and Sec. 726.4; or
(iii) Was notified of its potential liability for a claim filed
under the Black Lung Benefits Act pursuant to Sec. 725.407 of this
subchapter.
(4) Commencing with the 11th day after the operator's receipt of
the
[[Page 80105]]
notification sent by the Director pursuant to Sec. 726.303, the daily
base penalty amounts set forth in paragraph (c)(2)(i) shall be
increased by $100.
(5) In any case in which the operator, or any of its principals, or
an entity in which the operator's president, secretary, or treasurer
were employed, has been the subject of a previous penalty assessment
under this part, the daily base penalty amounts shall be increased by
$300, up to a maximum daily base penalty amount of $1,000. The maximum
daily base penalty amount applicable to any violation of Sec. 726.4
that takes place after January 19, 2001 shall be $1,100.
(d) The penalty shall be subject to reduction for any period during
which the operator had a reasonable belief that it was not required to
comply with section 423 of the Act and Sec. 726.4 or a reasonable
belief that it had obtained insurance coverage to comply with section
423 of the Act and Sec. 726.4. A notice of contest filed in accordance
with Sec. 726.307 shall not be sufficient to establish a reasonable
belief that the operator was not required to comply with the Act and
regulations.
Sec. 726.303 Notification; investigation.
(a) If the Director determines that an operator has violated the
provisions of section 423 of the Act and Sec. 726.4, he or she shall
notify the operator of its violation and request that the operator
immediately secure the payment of benefits. Such notice shall be sent
by certified mail.
(b) The Director shall also direct the operator to supply
information relevant to the assessment of a penalty. Such information,
which shall be supplied within 30 days of the Director's request, may
include:
(1) The date on which the operator commenced its operation of a
coal mine;
(2) The number of persons employed by the operator since it began
operating a coal mine and the dates of their employment; and
(3) The identity and last known address:
(i) In the case of a corporation, of all persons who served as
president, secretary, and treasurer of the operator since it began
operating a coal mine; or
(ii) In the case of an operator which is not incorporated, of all
persons who were principals of the operator since it began operating a
coal mine;
(c) In conducting any investigation of an operator under this
subpart, the Division Director shall have all of the powers of a
district director, as set forth at Sec. 725.351(a) of this subchapter.
For purposes of Sec. 725.351(c), the Division Director shall be
considered to sit in the District of Columbia.
Sec. 726.304 Notice of initial assessment.
(a) After an operator receives notification under Sec. 726.303 and
fails to secure its obligations for the period defined in
Sec. 726.302(b), and following the completion of any investigation, the
Director may issue a notice of initial penalty assessment in accordance
with the criteria set forth in Sec. 726.302.
(b)(1) A copy of such notice shall be sent by certified mail to the
operator. If the operator is a corporation, a copy shall also be sent
by certified mail to each of the persons who served as president,
secretary, or treasurer of the operator during any period in which the
operator was in violation of section 423 of the Act and Sec. 726.4.
(2) Where service by certified mail is not accepted by any person,
the notice shall be deemed received by that person on the date of
attempted delivery. Where service is not accepted, the Director may
exercise discretion to serve the notice by regular mail.
Sec. 726.305 Contents of notice.
The notice required by Sec. 726.304 shall:
(a) Identify the operator against whom the penalty is assessed, as
well as the name of any other person severally liable for such penalty;
(b) Set forth the determination of the Director as to the amount of
the penalty and the reason or reasons therefor;
(c) Set forth the right of each person identified in paragraph (a)
of this section to contest the notice and request a hearing before the
Office of Administrative Law Judges;
(d) Set forth the method for each person identified in paragraph
(a) to contest the notice and request a hearing before the Office of
Administrative Law Judges; and
(e) Inform any affected person that in the absence of a timely
contest and request for hearing received within 30 days of the date of
receipt of the notice, the Director's assessment will become final and
unappealable as to that person.
Sec. 726.306 Finality of administrative assessment.
Except as provided in Sec. 726.307(c), if any person identified as
potentially liable for the assessment does not, within 30 days after
receipt of notice, contest the assessment, the Director's assessment
shall be deemed final as to that person, and collection and recovery of
the penalty may be instituted pursuant to Sec. 726.320.
Sec. 726.307 Form of notice of contest and request for hearing.
(a) Any person desiring to contest the Director's notice of initial
assessment shall request an administrative hearing pursuant to this
part. The notice of contest shall be made in writing to the Director,
Division of Coal Mine Workers' Compensation, Office of Workers'
Compensation Programs, Employment Standards Administration, United
States Department of Labor. The notice of contest must be received no
later than 30 days after the date of receipt of the notice issued under
Sec. 726.304. No additional time shall be added where service of the
notice is made by mail.
(b) The notice of contest shall:
(1) Be dated;
(2) Be typewritten or legibly written;
(3) State the specific issues to be contested. In particular, the
person must indicate his agreement or disagreement with:
(i) The Director's determination that the person against whom the
penalty is assessed is an operator subject to the requirements of
section 423 of the Act and Sec. 726.4, or is the president, secretary,
or treasurer of an operator, if the operator is a corporation.
(ii) The Director's determination that the operator violated
section 423 of the Act and Sec. 726.4 for the time period in question;
and
(iii) The Director's determination of the amount of penalty owed;
(4) Be signed by the person making the request or an authorized
representative of such person; and
(5) Include the address at which such person or authorized
representative desires to receive further communications relating
thereto.
(c) A notice of contest filed by the operator shall be deemed a
notice of contest on behalf of all other persons to the Director's
determinations that the operator is subject to section 423 of the Act
and Sec. 726.4 and that the operator violated those provisions for the
time period in question, and to the Director's determination of the
amount of penalty owed. An operator may not contest the Director's
determination that a person against whom the penalty is assessed is the
president, secretary, or treasurer of the operator.
(d) Failure to specifically identify an issue as contested pursuant
to paragraph (b)(3) of this section shall be deemed a waiver of the
right to contest that issue.
Sec. 726.308 Service and computation of time.
(a) Service of documents under this part shall be made by delivery
to the person, an officer of a corporation, or
[[Page 80106]]
attorney of record, or by mailing the document to the last known
address of the person, officer, or attorney. If service is made by
mail, it shall be considered complete upon mailing. Unless otherwise
provided in this subpart, service need not be made by certified mail.
If service is made by delivery, it shall be considered complete upon
actual receipt by the person, officer, or attorney; upon leaving it at
the person's, officer's or attorney's office with a clerk or person in
charge; upon leaving it at a conspicuous place in the office if no one
is in charge; or by leaving it at the person's or attorney's residence.
(b) If a complaint has been filed pursuant to Sec. 726.309, two
copies of all documents filed in any administrative proceeding under
this subpart shall be served on the attorneys for the Department of
Labor. One copy shall be served on the Associate Solicitor, Black Lung
Benefits Division, Room N-2117, Office of the Solicitor, U.S.
Department of Labor, 200 Constitution Ave., NW., Washington, DC 20210,
and one copy on the attorney representing the Department in the
proceeding.
(c) The time allowed a party to file any response under this
subpart shall be computed beginning with the day following the action
requiring a response, and shall include the last day of the period,
unless it is a Saturday, Sunday, or federally-observed holiday, see
Sec. 725.311 of Part 725 of this subchapter, in which case the time
period shall include the next business day.
Sec. 726.309 Referral to the Office of Administrative Law Judges.
(a) Upon receipt of a timely notice of contest filed in accordance
with Sec. 726.307, the Director, by the Associate Solicitor for Black
Lung Benefits or the Regional Solicitor for the Region in which the
violation occurred, may file a complaint with the Office of
Administrative Law Judges. The Director may, in the complaint, reduce
the total penalty amount requested. A copy of the notice of initial
assessment issued by the Director and all notices of contest filed in
accordance with Sec. 726.307 shall be attached. A notice of contest
shall be given the effect of an answer to the complaint for purposes of
the administrative proceeding, subject to any amendment that may be
permitted under this subpart and 29 CFR part 18.
(b) A copy of the complaint and attachments thereto shall be served
by counsel for the Director on the person who filed the notice of
contest.
(c) The Director, by counsel, may withdraw a complaint filed under
this section at any time prior to the date upon which the decision of
the Department becomes final by filing a motion with the Office of
Administrative Law Judges or the Secretary, as appropriate. If the
Director makes such a motion prior to the date on which an
administrative law judge renders a decision in accordance Sec. 726.313,
the dismissal shall be without prejudice to further assessment against
the operator for the period in question.
Sec. 726.310 Appointment of Administrative Law Judge and notification
of hearing date.
Upon receipt from the Director of a complaint filed pursuant to
Sec. 726.309, the Chief Administrative Law Judge shall appoint an
Administrative Law Judge to hear the case. The Administrative Law Judge
shall notify all interested parties of the time and place of the
hearing.
Sec. 726.311 Evidence.
(a) Except as specifically provided in this subpart, and to the
extent they do not conflict with the provisions of this subpart, the
Rules of Practice and Procedure for Administrative Hearings Before the
Office of Administrative Law Judges established by the Secretary at 29
CFR part 18 shall apply to administrative proceedings under this
subpart.
(b) Notwithstanding 29 CFR 18.1101(b)(2), subpart B of the Rules of
Practice and Procedure for Administrative Hearings Before the Office of
Administrative Law Judges shall apply to administrative proceedings
under this part, except that documents contained in Department of Labor
files and offered on behalf of the Director shall be admissible in
proceedings under this subpart without regard to their compliance with
the Rules of Practice and Procedure.
Sec. 726.312 Burdens of proof.
(a) The Director shall bear the burden of proving the existence of
a violation, and the time period for which the violation occurred. To
prove a violation, the Director must establish:
(1) That the person against whom the penalty is assessed is an
operator, or is the president, secretary, or treasurer of an operator,
if such operator is a corporation.
(2) That the operator violated section 423 of the Act and
Sec. 726.4. The filing of a complaint shall be considered prima facie
evidence that the Director has searched the records maintained by OWCP
and has determined that the operator was not authorized to self-insure
its liability under the Act for the time period in question, and that
no insurance carrier reported coverage of the operator for the time
period in question.
(b) The Director need not produce further evidence in support of
his burden of proof with respect to the issues set forth in paragraph
(a) if no party contested them pursuant to Sec. 726.307(b)(3).
(c) The Director shall bear the burden of proving the size of the
operator as required by Sec. 726.302, except that if the Director has
requested the operator to supply information with respect to its size
under Sec. 726.303 and the operator has not fully complied with that
request, it shall be presumed that the operator has more than 100
employees engaged in coal mine employment. The person or persons liable
for the assessment shall thereafter bear the burden of proving the
actual number of employees engaged in coal mine employment.
(d) The Director shall bear the burden of proving the operator's
receipt of the notification required by Sec. 726.303, the operator's
prior notice of the applicability of the Black Lung Benefits Act to its
operations, and the existence of any previous assessment against the
operator, the operator's principals, or the operator's officers.
(e) The person or persons liable for an assessment shall bear the
burden of proving the applicability of the mitigating factors listed in
Sec. 726.302(d).
Sec. 726.313 Decision and order of Administrative Law Judge.
(a) The Administrative Law Judge shall render a decision on the
issues referred by the Director.
(b) The decision of the Administrative Law Judge shall be limited
to determining, where such issues are properly before him or her:
(1) Whether the operator has violated section 423 of the Act and
Sec. 726.4;
(2) Whether other persons identified by the Director as potentially
severally liable for the penalty were the president, treasurer, or
secretary of the corporation during the time period in question; and
(3) The appropriateness of the penalty assessed by the Director in
light of the factors set forth in Sec. 726.302. The Administrative Law
Judge shall not render determinations on the legality of a regulatory
provision or the constitutionality of a statutory provision.
(c) The decision of the Administrative Law Judge shall include a
statement of findings and conclusions, with reasons and bases therefor,
upon each material issue presented on the record. The decision shall
also include an appropriate order which may affirm,
[[Page 80107]]
reverse, or modify, in whole or in part, the determination of the
Director.
(d) The Administrative Law Judge shall serve copies of the decision
on each of the parties by certified mail.
(e) The decision of the Administrative Law Judge shall be deemed to
have been issued on the date that it is rendered, and shall constitute
the final order of the Secretary unless there is a request for
reconsideration by the Administrative Law Judge pursuant to paragraph
(f) of this section or a petition for review filed pursuant to
Sec. 726.314.
(f) Any party may request that the Administrative Law Judge
reconsider his or her decision by filing a motion within 30 days of the
date upon which the decision of the Administrative Law Judge is issued.
A timely motion for reconsideration shall suspend the running of the
time for any party to file a petition for review pursuant to
Sec. 726.314.
(g) Following issuance of the decision and order, the Chief
Administrative Law Judge shall promptly forward the complete hearing
record to the Director.
Sec. 726.314 Review by the Secretary.
(a) The Director or any party aggrieved by a decision of the
Administrative Law Judge may petition the Secretary for review of the
decision by filing a petition within 30 days of the date on which the
decision was issued. Any other party may file a cross-petition for
review within 15 days of its receipt of a petition for review or within
30 days of the date on which the decision was issued, whichever is
later. Copies of any petition or cross-petition shall be served on all
parties and on the Chief Administrative Law Judge.
(b) A petition filed by one party shall not affect the finality of
the decision with respect to other parties.
(c) If any party files a timely motion for reconsideration, any
petition for review, whether filed prior to or subsequent to the filing
of the timely motion for reconsideration, shall be dismissed without
prejudice as premature. The 30-day time limit for filing a petition for
review by any party shall commence upon issuance of a decision on
reconsideration.
Sec. 726.315 Contents.
Any petition or cross-petition for review shall:
(a) Be dated;
(b) Be typewritten or legibly written;
(c) State the specific reason or reasons why the party petitioning
for review believes the Administrative Law Judge's decision is in
error;
(d) Be signed by the party filing the petition or an authorized
representative of such party; and
(e) Attach copies of the Administrative Law Judge's decision and
any other documents admitted into the record by the Administrative Law
Judge which would assist the Secretary in determining whether review is
warranted.
Sec. 726.316 Filing and service.
(a) Filing. All documents submitted to the Secretary shall be filed
with the Secretary of Labor, U.S. Department of Labor, 200 Constitution
Ave., N.W., Washington, DC 20210.
(b) Number of copies. An original and four copies of all documents
shall be filed.
(c) Computation of time for delivery by mail. Documents are not
deemed filed with the Secretary until actually received by the
Secretary either on or before the due date. No additional time shall be
added where service of a document requiring action within a prescribed
time was made by mail.
(d) Manner and proof of service. A copy of each document filed with
the Secretary shall be served upon all other parties involved in the
proceeding. Service under this section shall be by personal delivery or
by mail. Service by mail is deemed effected at the time of mailing to
the last known address.
Sec. 726.317 Discretionary review.
(a) Following receipt of a timely petition for review, the
Secretary shall determine whether the decision warrants review, and
shall send a notice of such determination to the parties and the Chief
Administrative Law Judge. If the Secretary declines to review the
decision, the Administrative Law Judge's decision shall be considered
the final decision of the agency. The Secretary's determination to
review a decision by an Administrative Law Judge under this subpart is
solely within the discretion of the Secretary.
(b) The Secretary's notice shall specify:
(1) The issue or issues to be reviewed; and
(2) The schedule for submitting arguments, in the form of briefs or
such other pleadings as the Secretary deems appropriate.
(c) Upon receipt of the Secretary's notice, the Director shall
forward the record to the Secretary.
Sec. 726.318 Final decision of the Secretary.
The Secretary's review shall be based upon the hearing record. The
findings of fact in the decision under review shall be conclusive if
supported by substantial evidence in the record as a whole. The
Secretary's review of conclusions of law shall be de novo. Upon review
of the decision, the Secretary may affirm, reverse, modify, or vacate
the decision, and may remand the case to the Office of Administrative
Law Judges for further proceedings. The Secretary's final decision
shall be served upon all parties and the Chief Administrative Law
Judge, in person or by mail to the last known address.
Sec. 726.319 Retention of official record.
The official record of every completed administrative hearing held
pursuant to this part shall be maintained and filed under the custody
and control of the Director.
Sec. 726.320 Collection and recovery of penalty.
(a) When the determination of the amount of any civil money penalty
provided for in this part becomes final, in accordance with the
administrative assessment thereof, or pursuant to the decision and
order of an Administrative Law Judge, or following the decision of the
Secretary, the amount of the penalty as thus determined is immediately
due and payable to the U.S. Department of Labor on behalf of the Black
Lung Disability Trust Fund. The person against whom such penalty has
been assessed or imposed shall promptly remit the amount thereof, as
finally determined, to the Secretary by certified check or by money
order, made payable to the order of U.S. Department of Labor, Black
Lung Program. Such remittance shall be delivered or mailed to the
Director.
(b) If such remittance is not received within 30 days after it
becomes due and payable, it may be recovered in a civil action brought
by the Secretary in any court of competent jurisdiction, in which
litigation the Secretary shall be represented by the Solicitor of
Labor.
PART 727--[REMOVED]
6. Under the authority of sections 422 and 426 of the Black Lung
Benefits Act, 30 U.S.C. 932, 936, part 727 is removed.
[FR Doc. 00-31166 Filed 12-19-00; 8:45 am]
BILLING CODE 4510-48-P
|
