Missouri: Children of deceased worker awarded lifetime Schoemehl benefits

Missouri: Children of deceased worker awarded lifetime Schoemehl benefits

The big fight recently in Missouri is when a surviving spouse or dependent children can still receive comp benefits after a claimant dies from unrelated causes.

The worker's comp statute provides survivor benefits when the death is work-related, and the statute provides the loss of benefits by events such as remarriage or turning 18 years old. When a death is not work related the fight is usually whether any benefits have accrued.

One exception to this rule is cases involving claims pending before June 26, 2008. This would involve cases falling within Schoemehl v Treasurer of State, 217 S.W.3d 900 (lexis.com), 217 S.W.3d 900 (Lexis Advance) (Mo. 2007), before the legislature abrogated the decision. Schoemehl was a golden goose for plaintiffs and allowed lifetime benefits for dependents even when the worker died from unrelated causes.

A recent case from the southern district applied Schoemehl to the issue when dependents could receive benefits.

In Spradling v Treasurer of the State of Missouri, SD 31907 (SD Mo. App. 2013) (November 5, 2013), 2013 Mo. App. Lexis 1322 (lexis.com), 2013 Mo. App. Lexis 1322 (Lexis Advance), a worker hurt his back in 1998, died in 2005, and in 2011 an ALJ found he was totally disabled from his back injury and prior conditions resulting in an award of total benefits against the second injury fund. When claimant was injured he had three young dependents: ages 4, 6, 11. The Fund argued that dependency is determined in 2005 at the time of death and not in 1998, and that dependent benefits should stop at age 18. Spoiler alert: the Fund loses.

Several important facts are important to know first. The case dragged on for 13 years between accident and hearing. There was scant evidence regarding how the three children of the worker who were now seeking money for life were dependent at the time of the death. The claimant died from unrelated causes. The three children who were young minors at the time of the accident are now 18 years or older at the time of this decision.

Section 287.240(4) defines dependent to mean a relative by blood or marriage of a deceased employee who is actually dependent for support, in whole or in part, upon his or her wages at the time of the injury." The Spradling case in many respects is a no-brainer as a matter of statutory interpretation. Time of injury means time of injury and not time of death. The SIF argument may have some compelling public policy justification to interpret dependency at the time of death to help survivors who are actually dependent at the time of death such as children born after the date of injury. The argument as a matter of statutory interpretation, like the emperor's new clothes, is looking for something which isn't there.

The more important aspect of the case is that life-time Schoemehl benefits mean life-time, and not just to age 18. If a cost to an employer to pay benefits to a a surviving spouse in mid-life was expensive, the exposure of life time benefits to a minor becomes much higher as it typically will involve several additional decades of benefits.

The case quickly follows a commission case Shelton v Titan Plastics Group, 2013 MO WCLR Lexis 201 (lexis.com), 2013 MO WCLR Lexis 201 (Lexis Advance) (Oct. 10, 2013), in which the Commission held a surviving spouse receiving Schoemehl benefits does not lose any lifetime benefits by remarrying. Shelton has no application to accidents after the 2008 fix.

Both cases cited White v University of Missouri, 375 S.W.3d 908 (lexis.com), 375 S.W.3d 908 (Lexis Advance) (Mo. App. 2012). In White the Commission reversed an award of survivor benefits to the spouse of a living claimant because the "the injured employee is not dead, and dependent benefits do not vest until the injured employee is dead."

The "fix" in 2008 has not stopped many cases still in the comp system. Many cases pending in 2008 may now have settled by 2013, there are clearly many still in the system. Both of these cases dragged on for a decade or longer after the accident which shows a much bigger problem with the comp system which was supposed to be a cheaper, easier and quicker alternative to civil litigation. The legislature has clearly recognized the financial folly of these types of cases awarding survivor benefits when death arises from unrelated causes. The golden goose of Schoemehl will be the gift that keeps giving for decades to come.

Source: Martin Klug, Huck, Howe & Tobin. Read Martin Klug’s Mo. Workers’ Comp Alerts.

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