State Ex Rel. Estate of McKenney v. Industrial Commission

Court: Ohio Court of Appeals
Date filed: 2005-03-08
Citations: 825 N.E.2d 224, 159 Ohio App. 3d 720, 2005 Ohio 981
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Lead Opinion

{¶ 1} Relator, the estate of Nancy L. McKenney, filed this original action seeking a writ of mandamus ordering respondent Industrial Commission of Ohio to vacate its order denying payment to relator of the entire portion of deceased injured worker Patrick McKenney's permanent partial disability ("PPD") award that remained unpaid as of the date of the death of his wife Nancy McKenney.

{¶ 2} Pursuant to Civ.R. 53 and Loc.R. 12(M) of the Tenth District Court of Appeals, the matter was referred to a magistrate of this court. On April 29, 2004, the magistrate rendered a decision, including findings of fact and conclusions of law, and therein recommended that this court grant a writ of mandamus ordering the commission to vacate its order denying payment to relator of the entire unpaid portion of Mr. McKenney's PPD award (also known as a scheduled loss-of-use award) and further ordering the commission to refer the matter to the Ohio Bureau of Workers' Compensation for a determination whether the award should be paid to relator in a lump sum. Relator and respondents timely filed objections to the magistrate's decision, which are now before the court.

{¶ 3} In their objections, respondents argue that the magistrate erred in concluding that administrative delay caused Mrs. McKenney's nonreceipt of her husband's loss-of-use award, so that this case is susceptible of analysis under the cases ofState ex rel. Johnston v. Ohio Bur. of Workers' Comp. (2001),92 Ohio St.3d 463, 751 N.E.2d 974, and State ex rel. Hubbard v.Indus. Comm., 96 Ohio St.3d 336, 2002-Ohio-4795,774 N.E.2d 1206. We agree with respondents that *Page 722 administrative delay did not occur in this case and thus did not contribute to Mrs. McKenney's nonreceipt of her husband's benefits. We therefore sustain respondents' objection to the extent that the magistrate concluded that administrative delay occurred and that the delay brings this case within the framework of Johnston and Hubbard.

{¶ 4} Respondents appear to be urging us to apply Supreme Court of Ohio precedent so as to allow payment of a deceased injured worker's loss-of-use award to a surviving spouse only in the case of administrative delays. However, we believe that the plain language of R.C. 4123.57 entitles Mr. McKenney's surviving dependents (of which Mrs. McKenney was the only one while she was living) to all weekly installments to which Mr. McKenney would have been entitled had he survived, notwithstanding the fact that administrative delay played no part in the development of events in this case.

{¶ 5} R.C. 4123.57(B) provides:

When an award under this division has been made prior to the death of an employee all unpaid installments accrued or to accrue under the provisions of the award shall be payable to the surviving spouse, or if there is no surviving spouse, to the dependent children of the employee and if there are no such children, then to such dependents as the administrator determines.

(Emphasis added.)

{¶ 6} By the plain language of the statute, the surviving spouse or other eligible dependent recovers not only PPD compensation that has accrued by the date of the injured worker's death but any compensation "to accrue" or, put another way, any compensation that would have accrued but for the death of the injured worker. Accordingly, in the present case, a total of 844 weeks of Patrick McKenney's loss-of-use award remained payable at the time of his death, and his sole dependent, Nancy McKenney, was eligible to receive all 844 weeks of this compensation, pursuant to R.C. 4123.57(B). However, this is true only so long as she was eligible to participate in the Ohio workers' compensation system. Contrary to the conclusion of the magistrate, we believe that Mrs. McKenney ceased to be an eligible dependent once she passed away.

{¶ 7} The magistrate relies in part upon the cases of State exrel. Nossal v. Terex Div. of I.B.H. (1999), 86 Ohio St.3d 175,712 N.E.2d 747, and State ex rel. Liposchak v. Indus. Comm. (2000), 90 Ohio St.3d 276, 737 N.E.2d 519, to conclude that all 844 unpaid installments of Patrick McKenney's PPD award must be paid to Mrs. McKenney's estate. Nossal and Liposchak are readily distinguishable from this case and do not support the magistrate's conclusion.

{¶ 8} The syllabus of Nossal states only that "accrued benefits for the period between the deceased employee's death and the spouse's death shall be paid to *Page 723 the spouse's estate." In Nossal, the administrator of the surviving spouse's estate never sought any benefits that would have accrued after the surviving spouse's death. Thus, the issue with which we are presented was not before the court in that case. Nossal concerned benefits that accrued for a period during which the claimant (the surviving spouse) was alive and thus eligible to participate in the workers' compensation system. In the case at bar, the benefits at issue would not have accrued until after Nancy McKenney's death, an event that fundamentally altered her eligibility to receive benefits as a dependent.

{¶ 9} In Liposchak, the court simply held that the estate of the deceased injured worker was entitled to all accrued permanent partial and permanent total disability benefits that remained unpaid as of his death. Liposchak did not involve the specific issue whether benefits that would have accrued afterthe injured worker's death would have been payable to his estate, nor did it address which benefits the estate of adeceased dependent may recover. Liposchak does not justify an award to the surviving spouse's estate of PPD benefits that had not accrued as of the date of her death.

{¶ 10} The magistrate also relied upon the immediately quantifiable character of PPD compensation (as distinct from other types of compensation such as temporary total disability compensation, to which an injured worker must prove continued entitlement) for the proposition that PPD compensation is payable to the estate of an injured worker's dependent. But this rationale does not overweigh the fact that payment to the estate of a dependant, of PPD compensation that would have accrued after the dependent's death, is impermissible under the Ohio Constitution.

{¶ 11} Section 35, Article II of the Ohio Constitution provides for payment of compensation to only two classes of persons-injured workers and their dependents. It provides that laws may be passed "[f]or the purpose of providing compensation toworkmen and their dependents, for death, injuries or occupational disease, occasioned in the course of such workmen's employment." (Emphasis added.)

{¶ 12} So long as Nancy McKenney was living, and notwithstanding the fact that the commission had not yet made an award of compensation to her, there still existed a dependent of Patrick McKenney eligible to receive the installments of his PPD award that had not yet been paid as of his death. But from the moment of Nancy McKenney's unfortunate passing, no person remained who was intended to benefit from the workers' compensation laws with respect to Mr. McKenney's PPD award. Thus, though Mrs. McKenney had a right to participate in the workers' compensation system while she was living, this right was extinguished once she died, and any payment to her estate for benefits that had not accrued by her date of death would be unconstitutional. *Page 724

{¶ 13} This principle is the precise one upon which the Supreme Court of Ohio based its holding, over 80 years ago, in State exrel. Crawford v. Indus. Comm. (1924), 110 Ohio St. 271, 2 Ohio Law Abs. 308, 143 N.E. 574. In Crawford, the issue was whether an order awarding death benefits to the surviving spouse of an injured worker was irrevocable, so that upon the surviving spouse's death, her estate would be entitled to all unpaid installments of the award. The court answered this question in the negative and denied the requested writ of mandamus. The court relied upon the clear constitutional language providing for compensation to only two classes of beneficiaries, and also on the fact that the workers' compensation law is "founded upon the principle of insurance" and "is in no sense a pension, or bounty, or gratuity." Id. at 274, 2 Ohio Law Abs. 308, 143 N.E. 574.

{¶ 14} Noting that many vested rights in American jurisprudence may be divested upon the occurrence of certain conditions, the court held that the commission's continuing jurisdiction could be invoked to support a revocation of the surviving spouse's right to participate in the workers' compensation system once she was no longer living. The court explained:

We feel that in construing all of the sections of the Industrial Commission Act in pari materia, and in seeking to harmonize and give effect to all, the seemingly imperative language of section 1465-82 [now R.C. 4123.59] must yield to the more important constitutional provisions limiting disbursements to employe[e]s or dependents, to the provisions of other statutes making the same limitations, to the statute denying rights of creditors in disbursement of the fund, and to the statute giving to the Commission continuing jurisdiction over all its orders.

(Emphasis added.) Crawford, 110 Ohio St. at 285, 143 N.E. 574.

{¶ 15} The Crawford court relied upon Indus. Comm. of Ohiov. Dell (1922), 104 Ohio St. 389, 135 N.E. 669, decided two years earlier. In that case, the court held that the estate of an injured worker's surviving spouse is entitled to death benefits for which the surviving spouse was eligible from the time of the injured worker's death, even though the surviving spouse died before the commission had made an award to her. But the court limited the estate's right of recovery to benefits for the period during which the surviving spouse was eligible to participate as a dependent — that is, the period during which she was alive, and disallowed any recovery for the widow's estate for the period following her death. The court held:

By authority of the continuing jurisdiction conferred by Section 1465-86, General Code [now R.C. 4123.52], the industrial commission may revoke an award theretofore made, upon ascertainment of any facts going to the basis of the claimant's right, whenever in its opinion such revocation is justified.

*Page 725

Id. at paragraph one of the syllabus. The "basis of the claimant's right" to receive benefits was the fact that she was a living surviving spouse, and the court treated her death as the event that rendered her no longer eligible to participate in the workers' compensation system. Thus, it denied recovery to her estate for any payments that would have accrued after her death.

{¶ 16} Likewise, though Nancy McKenney was an eligible dependent for the purpose of collecting all payments of her husband's PPD award that were "accrued or to accrue" after his death, she became ineligible for further participation when she passed away. Thus, her estate is not lawfully entitled to any portion of the PPD award covering the period following her death.

{¶ 17} When the commission reached this very conclusion, ordered the staff hearing officer's order vacated, and denied payment to relator of any of Patrick McKenney's PPD award that was "to accrue" after Nancy McKenney's death, it correctly determined the legal question at issue. To the extent that the magistrate's conclusions differ therefrom, we reject them and sustain respondents' objections.

{¶ 18} Relator argues that the magistrate erred in determining that the matter should be remanded to the bureau for a determination as to whether the loss-of-use award should be paid in a lump sum. Because our resolution of respondents' objections renders moot the issue of whether payment should be made in a lump sum, we decline to address relator's objection.

{¶ 19} For all of the foregoing reasons, we adopt the magistrate's findings of fact but reject the magistrate's conclusions of law and replace them with our own as set forth in this decision. We sustain respondents' objections to the extent set forth herein, overrule relator's objections as moot, and deny the requested writ of mandamus.

Respondents' objections sustained, relator's objections overruled as moot, and writ of mandamus denied.

PETREE, J., concurs.

LAZARUS, J., dissents.