Pickands Mather & Co. v. Newberg

895 S.W.2d 3, 1995 Ky. LEXIS 40, 1995 WL 124094
CourtKentucky Supreme Court
DecidedMarch 23, 1995
DocketNo. 94-SC-618-WC
StatusPublished
Cited by5 cases

This text of 895 S.W.2d 3 (Pickands Mather & Co. v. Newberg) is published on Counsel Stack Legal Research, covering Kentucky Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pickands Mather & Co. v. Newberg, 895 S.W.2d 3, 1995 Ky. LEXIS 40, 1995 WL 124094 (Ky. 1995).

Opinion

OPINION OF

THE COURT

Claimant was injured as well as exposed to the hazards of coal workers’ pneumoconiosis. The date of the injury and last exposure was June 9, 1989. The Administrative Law Judge (ALJ) determined that claimant was 100% occupationally disabled due to coal workers’ pneumoconiosis and 25% occupationally disabled due to an injury. Benefits were awarded for life in accordance with Teledyne-Wirz v. Willhite, Ky.App., 710 S.W.2d 858 (1986). On remand, pursuant to an appeal to the Workers’ Compensation Board (Board), the liabilities of the employer and the Special Fund were corrected in order to conform to this Court’s decision in Beale v. Shepherd, Ky., 809 S.W.2d 845 (1991). Subsequently, a petition for reconsideration was filed by the Special Fund concerning whether the Special Fund was liable for the payment of all benefits if the worker outlived his anticipated life expectancy or whether the employer and the Special Fund each would be required to pay their proportionate share of the award for the balance of the worker’s life. The ALJ determined that, pursuant to KRS 342.120(5) [presently KRS 342.120(7)], the Special Fund was required to pay the entire weekly benefit for so long as claimant remained disabled.

On appeal to the Board, however, the ALJ’s decision was reversed. The Board concluded that, if claimant outlived his life expectancy, Beale v. Shepherd, supra, and Newberg v. Chumley, Ky., 824 S.W.2d 413 (1992), supported requiring the Special Fund to pay no more than its proportionate share of the weekly award. In so deciding, the Board chose to disregard, as dicta, language in Pennwalt Corporation v. Beale, Ky.App., 840 S.W.2d 830 (1992), which indicated that the Special Fund could be required to pay more than its proportionate share of the award in those instances where an injured worker outlived the anticipated life expectancy.

[4]*4The Court of Appeals affirmed the decision of the Board in an opinion which cited as additional authority the decisions in Newberg v. Weaver, Ky., 866 S.W.2d 435 (1993), and Stovall v. Williams, Ky.App., 675 S.W.2d 6 (1984). The court noted that the present payment scheme resulted from the 1982 amendments to KRS 342.120 which sought to minimize the increase in Special Fund assessments that was necessary in order to meet the unfunded obligations of the Special Fund. In view thereof, the court found it “inconceivable that our legislature intended the Special Fund to bear the ‘risk’ of paying more than its proportionate share should a claimant fortuitously outlive his projected life span.”

The employer again appeals to this Court and asserts that the Special Fund is liable for all payments on a lifetime award after the expiration of the employer’s payment period. We agree; hence, we reverse.

In Stovall v. Williams, supra, the court rejected an argument that a permanent, total, occupational disability award was payable only for the injured worker’s life expectancy and determined that occupational life was synonymous with physical life. Accordingly, the court determined that, where an injured worker outlived the period calculated for the commutation of the attorney’s fee, the payment of income benefits must resume thereafter. Id. at 7.

Contrary to the view taken below, Beale v. Shepherd, supra, provides no authority concerning the payment of an award after the worker’s projected life expectancy has been reached. That case concerned the relative priority of an occupational disease award for permanent, total, occupational disability and an injury award for permanent, partial, occupational disability. The case concerned only the proper computation of the amount to be paid by each defendant during the worker’s projected life expectancy. No party raised the issue of payment after that period; therefore, that issue was not addressed in the opinion.

In Newberg v. Chumley, supra, the employer had settled its liability to the injured worker for a lump sum based on 25% of a permanent, total, occupational disability award for the worker’s life. The Special Fund’s liability was litigated, after which the AL J determined that the worker was entitled to a lifetime award which was apportioned 25% to the employer and 75% to the Special Fund. Because payment of the agreed-upon sum extinguished the employer’s liability, the Special Fund’s payment period was accelerated, but the amount of benefits payable during the worker’s projected life expectancy was not affected. Payment of the agreed-upon sum by the employer compensated the worker for life for the 25% portion of his disability. Therefore, if the worker outlived his projected life expectancy, the Special Fund would again be liable only for 75% of a permanent, total, occupational disability for so long as the worker lived.

Newberg v. Weaver, supra, involved a structured settlement, the terms of which extended payment of the employer’s share of the award throughout the worker’s life. We determined that such a payment period was contrary to public policy because the employer’s liability would not be extinguished during the worker’s life, and the Special Fund’s liability would never become due. In Newberg v. Weaver, we observed that, although KRS 342.120 set forth directions for apportioning the number of weeks in a worker’s life expectancy between the employer and the Special Fund, the statute did not address the procedure to be followed where a worker outlived the projected life expectancy. In deciding the instant case, the Court of Appeals appeared to rely upon that observation as authority for the proposition that both the employer and the Special Fund should pay income benefits after the worker’s life expectancy is exceeded. That reliance was misplaced.

On the date relevant to this claim KRS 342.120 provided, in pertinent part, as follows:

(4) If it is found that the employe is a person mentioned in paragraphs (a) or (b) of subsection (2) of this section and a subsequent compensable injury or occupational disease has resulted in additional permanent disability so that the degree of disability caused by the combined disabilities is greater than that which would have re-[5]

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Bluebook (online)
895 S.W.2d 3, 1995 Ky. LEXIS 40, 1995 WL 124094, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pickands-mather-co-v-newberg-ky-1995.