Farmers Insurance Group of Companies/Truck Insurance Exchange v. Workers' Compensation Appeals Board

Introduction

Michael Sanchez has been receiving workers’ compensation benefits pursuant to an ongoing award for medical treatment and life pension. He was convicted in superior court of fraudulent misrepresentation in the acquisition of medically required special footwear in the amount of $84,527.56 pursuant to Insurance Code sections 1871.4, subdivision (a)(1) and 1871.5. 1 The superior court ordered restitution of that sum at the rate of $100 per month. *687 Sanchez has paid no restitution. His employer’s insurer, Farmers Insurance Group of Companies/Truck Insurance Exchange, seeks a credit against the life pension in the workers’ compensation action in order to satisfy the restitution order. We hold that the Workers’ Compensation Appeals Board has jurisdiction to bar receipt of that portion of the benefit obtained by fraud, the special footwear. We further hold that the employer has no right to a credit against any species of benefit, in whole or part. We therefore annul the board’s decision and remand the matter for further consideration based on our opinion.

Background

On January 27, 1978, Michael Sanchez (Sanchez) injured his right lower extremity and psyche…