Salisbury v. Illinois Workers' Compensation Comm'n

2017 IL App (3d) 160138WC

• Court: Appellate Court of Illinois
• Decided: January 5, 2017
• Docket: 3-16-0138WC
• Status: Unpublished

Opinion

2017 IL App (3d) 160138WC No. 3-16-0138WC Opinion filed January 4, 2017

_____________________________________________________________________________

IN THE

APPELLATE COURT OF ILLINOIS

THIRD DISTRICT

WORKERS’ COMPENSATION COMMISSION DIVISION ____________________________________________________________________________

MARIE SALISBURY, widow of Charles ) Appeal from the Circuit Court Salisbury, Deceased, ) of Henry County. ) Appellant, ) ) v. ) No. 13-MR-95 ) ILLINOIS WORKERS’ COMPENSATION ) COMMISSION, et al. ) Honorable ) Terence M. Patton, (Frank’s Flying Service, Inc., Appellee). ) Judge, Presiding. _____________________________________________________________________________

JUSTICE HUDSON delivered the judgment of the court, with opinion. Presiding Justice Holdridge and Justices Hoffman, Harris, and Moore concurred in the judgment and opinion.

OPINION

¶1 I. INTRODUCTION

¶2 Claimant, Marie Salisbury, widow of Charles Salisbury, appeals an order of the circuit

court of Henry County confirming a decision of the Illinois Workers’ Compensation

Commission (Commission) denying her motion for a lump-sum payout of benefits awarded in

accordance with the Illinois Workers’ Compensation Act (Act) (820 ILCS 305/1 et seq. (West

2008)). Claimant also contends that respondent, Frank’s Flying Service, Inc., is not entitled to a 2016 IL App (3d) 160138WC

credit against the award based on its overpayment of benefits prior to the arbitration hearing. For

the reasons that follow, we affirm.

¶3 II. BACKGROUND

¶4 Claimant’s decedent died in a work-related accident on June 12, 2009, when the crop-

duster he was piloting crashed. He was in respondent’s employ at the time. Following the

accident, respondent began paying claimant $1,231.41 per week. An arbitration hearing was

held on May 8, 2012. Claimant was awarded “death benefits, commencing 6/13/09, of

$461.78/week to the surviving spouse, Marie Salisbury, on his or her own behalf and on behalf

of the children.” Based on this ruling, respondent’s initial payment of $1,231.41 per week

resulted in an overpayment of $769.83 per week. Based on this overpayment, respondent was

“given a credit of $00.00 for TTD, $00.00 for TPD, and $192,594.22 for other benefits.”

¶5 Claimant filed a petition for a lump-sum payout. A hearing on that petition was heard

before a commissioner on November 1, 2013. Claimant testified at the hearing. She testified

that respondent began paying benefits shortly after her husband’s death on June 12, 2009. She

stated that she understood that she had the option of taking a $500,000 lump-sum payment or

payments for 25 years, and she wished to take the “present commuted value of the 25-year

payments.” So far, respondent had paid her about $187,000, which she had mostly saved. She

testified that she used some of it for living expenses. Claimant explained that she wanted a

lump-sum payout because she did “not want to chance the loss of benefits in the future.” She

would be “more comfortable” having “control of the those benefits” rather than having them be

contingent on “changes in the law or *** the benefits schedule.” Moreover, if she passed away

during the 25-year period, her benefits would cease and her “children would be deprived of the

benefits from this award.” On cross-examination, she agreed that $197,930.33 was “probably

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close” to the amount she had so far received. She stated that she was not claiming any financial

hardship as the basis of seeking a lump-sum payout. She has no minor children. On redirect-

examination, she testified that she was employed at an ethanol plant and her income was

sufficient to meet her needs.

¶6 The Commission denied claimant’s petition. It first acknowledged the controlling law.

Lump-sum settlements are the exception rather than the rule. See Skaggs v. Industrial Comm’n,

371 Ill. 535, 539 (1939). Such a settlement is appropriate only if it is in the best interests of both

parties, not simply the claimant. Bagwell v. Industrial Comm’n, 94 Ill. 2d 101, 105 (1983); see

also Illinois Zinc Co. v. Industrial Comm’n, 366 Ill. 480, 482 (1937). The Commission then

noted that since the award to claimant was not a definite sum and could, in certain circumstances,

be terminated, it was clearly not in respondent’s best interests to commute the ongoing payments

to a lump sum. It then found that claimant “had not indicated a basis for finding that a lump sum

settlement would be in her own best interests.” She has been able to save some of the proceeds

of the payments, and her income is sufficient to meet her needs. Any reliance on a possible

change of benefits in the future, the Commission stated, was “speculative.” Moreover, claimant

would lose any future increases in benefits. The circuit court of Henry County confirmed the

Commission’s decision, and this appeal followed.

¶7 III. ANALYSIS

¶8 On appeal, claimant raises two issues. First, she contends that the Commission lacked

the authority to allow respondent a credit against the ultimate award due to its initial

overpayment of benefits to claimant. Second, she contends that the Commission erred in

denying her request for a lump-sum payout. We disagree with both contentions.

¶9 A. The Credit

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¶ 10 Claimant first argues that the credit given respondent for its overpayment of benefits

prior to the arbitration hearing is void because the Commission has no authority to give a credit

against the subsequent award of death benefits. Resolution of this issue requires us to consider

whether the Commission has authority to recognize such a credit under the provisions of the Act,

so a question of law subject to de novo review is presented (see Emerald Performance Materials,

LLC v. Illinois Pollution Control Board, 2016 IL App (3d) 150526, ¶ 25; see also Outboard

Marine Corp. v. Industrial Comm’n, 309 Ill. App. 3d 1026, 1029 (2000)). Claimant points out

that the Commission, a creature of statute, has only the powers granted it by the legislature.

Daniels v. Industrial Comm’n, 201 Ill. 2d 160, 165 (2002). Any action taken outside its statutory

authority is void. Id. According to claimant, the granting of a credit for excessive sums

voluntarily paid by an employer is not specifically contemplated by statute, so the Commission

has no authority to grant such a credit. Claimant concludes that the portion of the order granting

that credit is void. We disagree as to the manner in which claimant frames this issue.

¶ 11 Quite simply, what is happening here is that the Commission is merely recognizing that

an employer has already made a partial payment that goes to satisfying its obligation. There is

no award in the sense that the Commission is not ordering the transfer of any obligations,

benefits, or funds from claimant to respondent. Claimant is not being deprived of something she

otherwise would have received but-for the action of the Commission. Instead, respondent has

voluntarily elected to satisfy part of its obligation prior to a formal order being entered—

something which accrued to claimant’s benefit. In other words, the Commission did not award

respondent anything, it simply factored respondent’s payments into its final order.

¶ 12 In World Color Press v. Industrial Comm’n, 125 Ill. App. 3d 469, 471-72 (1984), this

court held that in the absence of a statutory bar, an employer could receive a credit for the

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overpayment of benefits. Discussing World Color Press in Messamore v. Industrial Comm’n,

302 Ill. App. 3d 351, 358-59 (1999), we stated:

“World Color Press does not explicitly state the overpayment of TTD benefits is being

set off against a permanent award, but instead speaks only in vague terms of credit

against ‘future compensation payments’ and the ‘total award.’ However, we apply the

reasoning of World Color Press regardless of whether the credit is sought against a

permanent disability award or some other benefit paid after the TTD overpayment.”

Similarly, here, the reasoning of World Color Press is relevant though we are confronted with

the overpayment of a death benefit rather than TTD. Absent a statutory prohibition, there is no

reason why the Commission cannot take into account respondent’s payments that occurred prior

to the arbitration hearing.

¶ 13 Indeed, we note that section 7(e) of the Act (section 7 covers the amount of compensation

in cases involving a fatality) states, in pertinent part, “The payments of compensation by the

employer in accordance with the order or award of the Commission discharges such employer

from all further obligation as to such compensation.” 820 ILCS 305/7(e) (West 2008)). It is

axiomatic that we may not read into a statute any exceptions or limitations not contained in its

plain language. Isaacs v. Industrial Comm’n, 138 Ill. App. 3d 392, 396 (1985). Nothing in the

plain language of this provision indicates that an employer should only be given credit for

payments made subsequent to a formal award. Clearly, the payments respondent made leading

up to the arbitration hearing were made in contemplation of an award.

¶ 14 Moreover, deep policy concerns are at issue here. Encouraging employers to make

prompt and voluntary payments of benefits furthers the purpose of the Act. Messamore, 302 Ill.

App. 3d at 359. It is obvious that “[d]enying credits for errors such as the one in this case would

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encourage administrative delays as employers attempt to resolve every ambiguity before paying

benefits.” Id. The primary purpose of the Act is to “provide employees with prompt and definite

compensation.” (Emphasis added.) Mattern v. Industrial Comm’n, 216 Ill. App. 3d 653, 654

(1991). Thus, claimant’s position runs counter to the beneficent purposes of the Act.

¶ 15 In short, claimant has identified no statutory provision prohibiting the Commission from

recognizing a credit in circumstances such as this. Allowing the Commission to do so is

consistent with the policies underlying the Act. Accordingly, we hold that that the Commission

did not err by taking into account respondent’s prior overpayment of benefits in fashioning an

award.

¶ 16 B. The Lump-Sum Payout

¶ 17 Claimant also contests the Commission’s decision to deny her request for a lump-sum

payout. Section 9 of the Act (820 ILCS 305/9 (West 2008)) sets forth the circumstances under

which a lump-sum payout is appropriate. We review the Commission’s decision to grant or deny

such a request using the manifest-weight standard of review. Bagwell, 94 Ill. 2d at 106.

Therefore, we will reverse only if an opposite conclusion to the Commission’s is clearly

apparent. Teska v. Industrial Comm’n, 266 Ill. App. 3d 740, 741-42 (1994).

¶ 18 Our supreme court has held that “[l]ump-sum awards are the exception and not the rule.”

Bagwell, 94 Ill. 2d at 106. A lump-sum payout will be awarded only if it is in the best interests

of both parties. Id. at 105. As the proponent of the motion, the burden was on claimant to show

that a lump-sum payout was warranted. Skaggs, 371 Ill. at 540.

¶ 19 The Commission found that claimant failed to carry that burden. Essentially, the

Commission based its decision on a lack of evidence concerning either parties’ best interests.

The evidence available showed that claimant was suffering no economic hardship and had saved

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most of respondent’s periodic payments. Claimant sets forth three reasons she believes indicated

that a lump-sum payout would be appropriate in this case. First, she states that “[r]eplacement of

[i]ncome lost to the family unit by absence of decedent’s income” justifies a payout. However,

she does not explain why periodic payments do not ameliorate this concern. As noted, the

evidence in the record shows no economic hardship. Second, she sets forth as another reason,

“Replacement of the expectancy of an inheritance from the deceased person from lifetime efforts

that would accrue to the family.” Given that claimant is able to save most of the periodic

payments she receives, we do not see this as compelling support for a lump-sum payout.

Moreover, this factor would be present in virtually every case such as this, so it does not serve to

distinguish this case from others and explain why this case should be an exception to the rule that

lump-sum payouts are not favored. See Bagwell, 94 Ill. 2d at 106. Third, claimant states that the

“[a]vailability of immediate financial resources to the family from invested funds if ready funds

were needed” warrants a lump-sum payout. However, the evidence shows no such need, and,

again, this consideration does not distinguish this case from other similar cases.

¶ 20 Furthermore, claimant does not even attempt to establish that terminating periodic

payments in favor of a lump-sum payout would not be in respondent’s best interests. Instead,

she argues, “It is difficult to imagine any set of facts in any case involving periodic payments

that could terminate by future unknown events to be in the best interest of both parties.” Later,

she reiterates that “it seems impossible to envision or conjure a fact situation in a death case,

where the best interests of both surviving spouse and family surviving [sic] and the employer can

be served at the same time.” (Emphasis in original.) Perhaps so—however, that simply is

consistent with the supreme court’s admonition that lump-sum payouts are the exception rather

than the rule. Bagwell, 94 Ill. 2d at 106. Section 9 clearly states that both parties interests are to

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be considered: “If, upon proper notice to the interested parties and a proper showing made before

such Commission or any member thereof, it appears to the best interest of the parties that such

compensation be so paid, the Commission may order the commutation of the compensation to an

equivalent lump sum.” 820 ILCS 305/9 (West 2008). Ironically, claimant charges that the

Commission has assumed the role of a “super-legislature” by “making its own determination of

the wisdom of lump sum settlements” when, in fact, it is claimant who asks us to ignore a portion

of the Section 9 and disregard respondent’s best interests.

¶ 21 In sum, claimant has shown no particular need or compelling reason on her or her

family’s behalf for a lump-sum payout. Similarly, nothing indicates a lump-sum payout is in

respondent’s best interests. Under such circumstances, we cannot say that an opposite

conclusion to the Commission’s is clearly apparent and that a lump-sum payout clearly would be

in the parties’ best interests. As such, the Commission’s decision on this issue is not against the

manifest weight of the evidence. Claimant raises a number of additional points regarding the

proper valuation of the lump-sum payout; however, given claimant’s failure to establish that the

payout would be in the parties’ best interests, we need not address those arguments.

¶ 22 IV. CONCLUSION

¶ 23 In light of the foregoing, the order of the circuit court of Henry County confirming the

decision of the Commission is affirmed.

¶ 24 Affirmed.

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