Death, Be Not Proud: Benefits Continue

Saturday, March 24, 2007 | 0

By Jessica l. Julian

The Delaware Supreme Court recently addressed whether certain permanency and death benefits survive when the deceased employee's spouse dies. In Estate of Charles Watts, and Estate of Verna Watts v. Blue Hen Insulation, 902 A.2d 1079 (Del.2006), the Court provided a liberal interpretation of two sections of the Act that set forth the benefit entitlement of dependents or the estate of the deceased employee.

Charles Watts worked for Blue Hen Insulation as an insulator for more than 30 years. He eventually developed asbestos-related lung cancer and died in May 2002. The Industrial Accident Board held that Watts died from a compensable occupational disease. His estate was paid medical expenses and burial expenses. His surviving spouse, Verna, began receiving death benefits pursuant to 19 Del. C. Section 2330. His estate filed a petition post mortem seeking permanency benefits for impairments to his lung, heart and adrenal glands. Before the hearing, Verna died and Blue Hen stopped paying the ordered death benefits. His estate continued to pursue the petition for permanency, and two legal issues were presented to the Industrial Accident Board: (1) whether Verna's estate is entitled to receive death benefits; and (2) whether Watts' estate is entitled to a permanency award when there are no surviving dependents. The Industrial Accident denied both requests for benefits and the Superior Court affirmed.

The Court reviewed 19 Del. C. Section 2330 which reads, in relevant part, as follows:

(b) ... Subject to Section 2332 of this title, this compensation shall be paid during 400 weeks and in case of children entitled to compensation under this section, the compensation of each child shall continue after such period of 400 weeks until such child reaches the age of 18 years, or if enrolled as a full time student in an accredited educational institution, until such child ceases to be so enrolled or reaches the age of 25 years, and in the case of a surviving spouse entitled to compensation under this section the compensation shall continue after such period of 400 weeks until the surviving spouse dies or remarries ...

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(g) Should any dependent of a deceased employee die, or should the surviving spouse remarry, the right of such dependent or such surviving spouse to compensation under this section shall cease. However, two years indemnity benefits in one lump sum shall be payable to a surviving spouse upon remarriage.

In reviewing this matter on appeal, the Delaware Supreme Court reiterated that the Act is to be construed liberally. Since worker's compensation benefits are the exclusive remedy of the employee against his employer, the courts should "resolve any reasonable doubts in favor of the worker." Applying this principle, the Supreme Court reversed on both issues and remanded the matter.

Despite what appears to be unambiguous language in 19 De. C. 2330 (g), benefits do not cease when the surviving spouse dies. Rather, the Court held that this provision applies to the death of a beneficiary other than a spouse, such as a parent or sibling. To determine what is owed to a surviving spouse, the Court focused on subsection (b), stating that when the surviving spouse dies, the compensation (death benefits) "shall continue after such period of 400 weeks until the surviving spouse dies ...." Thus, the 400 weeks becomes the minimum amount of death benefits due to the surviving spouse, even if he or she dies before the expiration of the 400 weeks. Any of the remaining 400 weeks must be paid to the estate of that spouse.

It is arguable then that the same holds true for children receiving death benefits if there is no surviving spouse and that child dies before he or she has received the 400 weeks. Of course, this assumes that the child was under the age of 18, or no longer enrolled in school at the time of death.

The second issue addressed by the Supreme Court resulted in an award of permanency benefits in Watts despite the fact that there is no longer a living dependent to collect those benefits. On its face, 19 De. C. Section 2332 differentiates between employees who die as a result of the work injury and those employees who die from unrelated causes:

Should the employee die as a result of the injury, no reduction shall be made for the amount paid for medical, surgical ... burial as provided in this chapter. Should the employee die from some other cause than the injury as herein defined, the claim for compensation may be substituted for the employee and prosecute the claim for the benefit of the deceased's dependent or dependents only, but in the event an agreement for compensation or an award had theretofore been made, the full amount unpaid thereof shall be payable to the deceased employee's nearest dependent as indicated by Section 2330 of this title, provided, however, that no payment or award under Section 2324 [partial disability benefits] or Section 2325 [total disability benefits] shall continue or be ordered beyond the date of such injured employee's death.

However, after examining the history of legislative intent changing this clause, the Supreme Court determined that the statute never abrogated the rights of workers who die from their injuries. Over the last 65 years, the Legislature has increased the rights of workers who die from work-related injuries. Furthermore, since the statute does not expressly restrict persons from making a post-death claim for permanency under Section 2326, the Court held that such action survives.

The Court harmonizes this section of the statute by allowing a deceased employee's estate to prosecute a claim for permanency regardless of whether or not the claimant died as a result of the accident. Had the question of law been whether a claim for permanency abates if the employee dies from a work-related injury, the analysis would be complete. However, the Court does not answer the issue as to whether or not the estate can bring the claim without a living dependent of the employee. Unfortunately, the Court also does not address the second clause of this section of the statute, which indicates that the estate is to prosecute the claim, in this case permanency, on behalf of the deceased's dependent or dependents only. The facts presented in the case do not provide an indication that Watts had any additional dependents other than his wife at the time of his death.

While determining that Watts' death did not terminate his right to permanency, by the time of the hearing, Watts' only dependent, his wife, Verna, passed away. By allowing the estate to pursue the claim under 10 Del. C. Section 3707 ("A statutory right of action or remedy against any officer or person, in favor of any person, shall survive to, or against the executor, unless it be specially restricted in the statute.") it seems that, unless there is a dependent, the estate will be restricted from prosecuting the claim under Section 2332.

In fact, despite the absence of this analysis in Watts, the Delaware Superior Court focuses on this specific issue in Witt v. Georgia-Pacific Corporation, No. 95A-08-002, 1996 Del. Super. WL 30250 (Del. Super. Ct. Jan. 24, 1996). In Witt, the facts were clear; the claimant died with no dependents as defined in Section 2330. He had no wife or child, and the parent who brought the claim as personal representative of his estate was not dependent on Witt for 50 percent of their support at the time of his death as required under Section 2330(a)(8).

The issue presented was not whether Witt's father fit the definition of "dependent" but whether Section 2332 creates a dependency threshold. The court held that the Act carved out a category of beneficiaries who may receive compensation when the claimant dies and found that the petition was correctly denied. In doing so, it determined that Section 2332 expressly refers to Section 2330 and a dependency requirement does exist.

Although Witt argued that a personal representative was included under the definition of dependent in Section 2301(8), it was evident by the court that the representative still must be a dependent as required under the elective schedule set forth in Section 2330. The definition of dependents in Section 2330 reflects the purpose of the statute, which is to compensate those who suffer economically from the claimant's death. Accordingly, the dependent must show a reliance upon the employee's earning for support.

While Witt limits benefit entitlement, Watts is another reminder that the courts will liberally construe the Act in finding in favor of the employee and, despite the finality of death, workers' compensation benefits may continue, even after the death of the surviving spouse or qualifying dependent.

Jessica l. Julian is an associate in the Wilmington, Del., office of Marshall, Dennehey, Warner, Coleman & Goggin. She can be reached at (302) 552-4309 or jljulian@mdwcg.com. This column first appeared in the law firm's Defense Digest. Their Web site is http://www.marshalldennehey.com.

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