IMPORTANT NOTICE
NOT TO BE PUBLISHED OPINION
THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED."
PURSUANT TO THE RULES OF CIVIL PROCEDURE
PROMULGATED BY THE SUPREME COURT, CR 76.28(4)(C),
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RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR
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RENDERED: AUGUST 25, 2016
NOT TO BE PUBLISHED
Suprant Court of Tfitnfurkv
2015-SC-000648-WC
FLAGSHIP TRANSPORTATION, LLC APPELLANT
ON APPEAL FROM COURT OF APPEALS
V. CASE NO. 2015-CA-000718-WC
WORKERS' COMPENSATION NO. 13-85946
ESTATE OF CORY KEELING (DECEASED),
ADMINISTRATRIX MINDY KEELING (WIFE);
HONORABLE R. ROLAND CASE,
ADMINISTRATIVE LAW JUDGE; AND
WORKERS' COMPENSATION BOARD APPELLEES
MEMORANDUM OPINION OF THE COURT
AFFIRMING
Appellant, Flagship Transportation, LLC, appeals a Court of Appeals
decision which affirmed the imposition of interest on a past due lump-sum
death benefit granted to Appellee, Estate of Cory Keeling (Deceased),
Adniinistratrix Mindy Keeling (Wife). Flagship argues that the Administrative
Law Judge ("AI,J") erred by finding that interest began accruing from the date
that Cory died instead of the date that Mindy became administratrix of the
estate. For the below stated reasons, we affirm.
Cory died as a result of a work-related motor vehicle accident in Texas on
April 19, 2013. Mindy filed a claim for workers' compensation death benefits
which was initially contested by Flagship. She was appointed administratrix of
Cory's estate on May 6, 2014. The estate consists of Mindy and two minor
children. Flagship subsequently dropped its objection to the claim and a
settlement was entered into between the parties including the payment of a
lump-sum death benefit pursuant to KRS 342.750(6). However, the parties
could not agree on what date interest should begin to accrue on the lump-sum
death benefit.' Flagship argued that interest should be paid from the date
Mindy was named administratrix of the estate, and Mindy argued it should be
from the date Cory died.
The ALJ entered an opinion, award, and order finding that, "interest
accrues from the date of death. The decedent has an estate when he dies. The
estate is not formed at the time of the appointment of a representative but at
the time of death. The lump-sum benefit became due and payable upon
death." The Workers' Compensation Board ("Board") and Court of Appeals
affirmed. This appeal followed.
This is a matter of statutory interpretation, which is a question of law,
that we review de novo. Saint Joseph Hosp. v. Frye, 415 S.W.3d 631, 632 (Ky.
2013). We are not bound by the ALJ's or Board's interpretation of a statute.
Halls Hardwood Floor Co. v. Stapleton, 16 S.W.3d 327, 329-330 (Ky. App.
2000). KRS 342.750(6), the subsection of the Act under which Cory's estate
received lump-sum death benefits, states in pertinent part:
1 Flagship has already paid the estate a lump-sum amount of $73,988.98, plus
interest of $583.37 calculated from the day Mindy was named administratrix, May 6,
2014.
2
In addition to other benefits as provided by this chapter, if death
occurs within four (4) years of the date of injury as a direct result
of a work-related injury, a lump-sum payment of fifty thousand
dollars ($50,000) shall be made to the deceased estate, from which
the cost of burial and cost of transportation of the body to the
employee's place of residence shall be paid. Annually, the
commissioner shall compute, in accordance with KRS 342.740, the
increase or decrease in the state average weekly wage, and
consistent therewith, shall adjust the amount of the lump-sum
payment due under this subsection for injuries occurring in the
succeeding year.
(Emphasis added). The lump sum benefit provided for in KRS 342.750(6) is an
"income benefit." Realty Improvement Co. v. Raley, 194 S.W.3d 818, 822 (Ky.
2006). As such, interest accrues on a lump-sum death benefit under KRS
342.040(1) in the same manner as interest accrues on past-due income
benefits awarded under the Act. Bradley v. Commonwealth, 301 S.W.3d 27, 30
(Ky. 2009).
Flagship argues that since KRS 342.730(6) states that the lump-sum
payment must be made to the "deceased's estate," it only became liable to pay
once Mindy became administratrix because that provided a representative to
receive the payment. Thus, Flagship contends that interest only began to
accrue as of May 6, 2014, instead of the date Cory died, April 19, 2013. We
disagree.
Admittedly, the plain language of KRS 342.730(6) does not state an exact
date on which the lump-sum death benefits must be paid. It only states that
the payment must be made to the "decedent's estate." The property which
constitutes a "decedent's estate" is established on the date of his death. See
KRS 394.020. Additionally, as stated in Black's Law Dictionary (10th ed.
3
2014), an estate consists of all of the property owned by the decedent on the
day he dies and not at the time an administrator is appointed. Thus, we reject
Flagship's argument that it was not responsible to pay the death benefit until
Mindy was appointed administratrix of Cory's estate. The lump-sum death
benefits became a part of the estate when Cory died and interest is due from
that date.
It also must be noted that the language of KRS 342.750(6) states that
any funeral and transportation expenses are to be paid from the lump-sum
benefit. Because many individuals do not have adequate savings, it is not
unreasonable that the General Assembly anticipated that the lump-sum
amount would be paid as soon as possible after the worker's death so that the
estate could pay for such major expenses. And finally, in Bradley, 301 S.W.3d
at 30, the AI ,J calculated the interest due on the lump-sum death benefit from
the date of the workers' death and this was affirmed. Thus, we believe that the
intent of KRS 342,750(6) was to have the lump-sum death benefit paid as of
the date of the worker's death. Accordingly, Flagship is responsible for paying
interest on the past-due death benefits owed to the Estate of Cory Keeling as of
the date of his death, April 19, 2013.
For the above stated reasons, the decision of the Court of Appeals is
affirmed.
All sitting. All concur.
COUNSEL FOR APPELLANT,
FLAGSHIP TRANSPORTATION, LLC:
Richard Christion Hutson
COUNSEL FOR APPELLEE,
ESTATE OF CORY KEELING (DECEASED),
ADMINISTRATRIX MINDY KEELING (WIFE):
Robert C. Heuke, Jr.