The Law Office of Kurt H King

November 18, 2013

Worker’s Dependents Entitled to His Workers’ Compensation for Their Lifetimes

This post dovetails prior posts regarding Missouri Workers’ Compensation law involving death by other causes of a Permanently Totally Disabled (PTD) worker and the “Schoemehl window.”

The Southern District of the Missouri Court of Appeals recently addressed an appeal by the Second Injury Fund in a case where the PTD employee with a claim within the Schoemehl window died from causes not related to the injury.   The case is Spradling v. Treasurer of the State of Missouri as Custodian of the Second Injury Fund, Slip Opinion SD31907 (November 5, 2013), and holds specifically for cases within these parameters that the dependents of the deceased PTD worker whose claim was pending and not finally determined as of June 26, 2008 are entitled to the PTD compensation payments FOR THE LIFETIME OF THE DEPENDENT(S).

Note that the employee died from causes unrelated to his injury in November 2005 after having been injured in 1998 and having filed his claim in 1998.  On the date of injury, he was the non-custodial father of two young children who were “conclusively presumed” under 287.240(4) to be his dependents.

Note too that this case falls within the “Schoemehl Window” opened by the Missouri Supreme Court in Schoemehl on January 9, 2007, and continuing until June 26, 2008, when Missouri lawmakers closed the window by revising Missouri workers’ compensation law so that PTD in such a case terminates upon the death of the injured employee.

The bottom line is that in Schoemehl window cases the employer has to pay PTD so long as a dependent lives, but if the claim falls after that window closed the employer only has to pay only so long as the employee lives.

Kurt H. King

Law Office of Kurt H. King, 20 E. Franklin, Liberty, Clay County, Missouri 64068


Workers’ Compensation, Personal Injury

Chapter 7 Bankruptcy for Debtors, General Matters

Family Law–Dissolution of Marriage, Modification, Paternity, Child Custody, Support, & Visitation

January 31, 2013

The “State” of the Insolvent Second Injury Fund in Missouri–Skirvin v. Treasurer of the State of Missouri

Missouri’s Second Injury Fund pays part of the disability of injured workers who suffer re-injury.  The theory being that otherwise employers would be far less likely to hire workers that have already been hurt.  Since employers presumably pay less on work comp claims than they would if injured workers could sue for their injuries in circuit courts with jury trials, punitive damages and the whole nine yards, lawmakers have saddled employers with the cost of funding the Fund so it can pay the “load factor” part of permanent partial work comp awards, as well as on permanent total disability awards.

A few years ago, in an effort to reduce the costs of work comp insurance for Missouri businesses, lawmakers capped the “surcharge” at 3%–thus the most a business would have to pay into the State for the Fund each year would be no more than 3% of the total amount of its net work comp insurance premiums.  This effort to appease business backfired as that amount of surcharge falls far short of an adequate supply of money to the Fund for payment of the continuous flow of work comp awards against the Fund.

By and large, due to lack of funding, the Fund has not paid any Permanent Total Disability awards dated after March 6, 2011.  There are said to be at least sixty cases on file in courts throughout Missouri seeking orders that the Fund pay the injured worker the amount awarded that worker by the Division of Workers Compensation.  One of those cases recently reached the Western District of the Missouri Court Appeals, where it was decided by Judges Ahuja, Howard, and Martin.  The case is Skirvin v. Treasurer of the State of Missouri, WD75541 (opinion filed 01.22.2013).  At the trial which led to this appeal, Skirvin won an order (on a writ of mandamus) that the Fund pay the money awarded by the Division of Workers Compensation on his permanent total disability claim where the “last” part of the disability combined with  disability from previous injuries to cause the employee to be totally disabled.  The last employer picks up the tab for the “last” disability but the Fund is charged with payment for the remainder of the workers’ disability.

Having lost  at trial, the Fund appealed to the Western District.  In doing so, the Fund admitted that it is insolvent–bankrupt–and so it stopped paying permanent total injury awards as of March 6, 2011.  Evidence at trial showed that the Fund then owed $21 million but had only $6.5 million with which to pay.   Thus, the Fund was upside down $15 million.   The Fund also testified to annual income of $43 million, of which $40 million was paid out within six months, leaving only $3 million for the remaining six months.  This has been going on for nearly two years now and the hole yawns blacker and deeper.

No way the Fund can pay the past due awards pro rata as there are significant differences in how the claims affect employee Social Security, the number and amount of claims constantly fluctuates, and it simply would not be fair.  The alternate, to pay on a “first come, first serve” basis, would quickly break the bank.  Missouri’s lawmakers should have raised the legal limit on the surcharge or provided additional funding but they have not.  The economic times of late have not led to surpluses, and who wants to vote for representatives who pass laws which increase your work comp costs and cut your thin profits?

What the court of appeals decided in the main opinion by Judge Martin is that the trial court erred in ordering the Fund to pay Skirvin as the Fund lacks the money to pay him and the other claims like his.  Skirvin did not request a pro rata payment of his and similar claims and that would be nearly impossible to accomplish.  But while the court of appeals could not help Skirvin, they could send his case to the Missouri Supreme Court and so they ordered it transferred.  If that high court hears this case, it may do so expeditiously.  Meanwhile, Missouri lawmakers may realize that they must act now or the supreme court may fix things in a way that they do not like.

Judge Ahuja agreed with the transfer to the supreme court, although he would simply have reversed the trial court for the reasons that, (1) the Fund is insolvent and cannot pay all the judgments outstanding against it, and (2) Skirvin did not request  a pro rata payment.  [Maybe a request to put the Fund into receivorship is another option.]

Finally, Judge Howard in his dissent makes several good points, including that the Fund is just an account of the State of Missouri, and the State has the money or can raise it to pay the outstanding claims against the Fund.  The State also has full power to increase the surcharge or otherwise fund the Fund so that it has sufficient money to pay its debts.  So, affirm the trial court and uphold Skirvin’s order that the Fund/State of Missouri pay him what it owes him by law.

Embarrassing for a STATE to say to an injured employee, in effect–

“Hey, here is your work comp judgment and by the way the Fund is not going to pay you.  Sorry you may starve.  Hope you find a good homeless shelter or maybe your spouse can float all the bills by herself.”  Does the state let tax debt ride indefinitely when a taxpayer says, “Can’t pay you, I’m almost clear broke?”

Perhaps the Missouri Supreme Court will decide this case and turn up  the heat on our lawmakers who knew, or should have known, they were drowning the Fund and injured employees when they capped the surcharge at 3%.

Kurt H. King

Law Office of Kurt H. King, 20 E. Franklin, Liberty, Clay County, Missouri 64068


Workers’ Compensation, Personal Injury, Bankruptcy, General Litigation and other matters

June 26, 2012

Permanent Total Disability Depends On Whether The Worker Can Compete In the Open Labor Market

When is an injured Missouri worker Permanently Totally Disabled?  While not breaking new ground, the June 14, 2012, decision of the Southern District of the Missouri Court of Appeals in Larry Underwood v. High Road Industries, LLC (Opinion SD31731), illustrates Missouri law on the test used to determine if the worker is Totally or just Partially disabled.

The court of appeals stated the test as follows on page 12 of its decision, quoting the Western District’s words in an older case:

     “The test for permanent total disability is whether the worker is able to compete in the open labor market.  The critical question is whether, in the ordinary

     course of business, any employer reasonably would be expected to hire the injured worker, given his present physical condition.”

What this means is that the injured worker need not be 100% disabled to be found Permanently Totally Disabled (PTD).  In this case, the worker (Underwood) was rated at 40% disabled by his independent exam doctor, while the treating doctor selected by the employer found only 13% disability.  Both ratings seem low in view of the chronic back and right side pain from a fall on concrete due to ladder failure while installing a radiator in a truck as part of his job as a diesel mechanic.  The fall left Underwood in severe and chronic pain to the point where the employer/insurer paid for surgery to implant a spinal cord stimulator.  Even though the stimulator relieved 40% of the pain, Underwood still suffered constant throbbing pain and some numbness, such that sleep was difficult and he could only stand or sit for 30 minutes at a time.  And, he could only drive 10 miles at a time.  Even this amount of driving contradicted the advice of the stimulator company that he should not drive when the stimulator was active because it could send false signals down his right leg.  But with the stimulator off, the pain was nearly unbearable.   With the pain, the hydrocodone and Tramadol pain medication every 4-6 hours, his 10th grade education and below-average intelligence scores, Underwood would be unable to retrain academically or otherwise. 

Even the employer/insurer’s treating doctor restricted Underwood to no more than 1 hour sitting or standing at a time.  The employee’s vocational expert testified that this restriction demoted Underwood into a category of “less than sedentary work capacity.”  The expert explained that “anybody that can’t do sedentary work is unemployable.”   The court of appeals agreed and affirmed the Labor and Industrial Relations Commision’s award in favor of Underwood finding him to be Permanently Totally Disabled.

What may lie behind the scenes in this case is the employee’s refusal to accept a lump-sum settlement offer from the employer/insurer.  Apparently, the employer/insurer declined to offer Underwood the amount of money he thought he should receive.  Without settlement, the case proceeded to trial.  Unfortunately, even though Underwood won at trial, all the judge can award him under Missouri law is that the employer/insurer pay a small weekly sum to him for life, and also pay his medical expenses related to the injury.  The employer/insurer may in the future refuse to pay some medical expenses sought by Underwood which will result in more litigation to force payment.  Too, the small weekly compensation amount tends not to be a great burden upon the employer/insurer.  So while Underwood won his case for PTD,  the result may end up a draw or even a victory for the employer/insurer due to small weekly amounts of money they  will have to pay to Underwood.

Kurt H. King

Law Office of Kurt H. King, 20 E. Franklin, Liberty, Clay County, Missouri 64068


Workers’ Compensation, Personal Injury, Medical Malpractice, Wrongful Death

Chapter 7 Bankruptcy for debtors

Family Law–Divorce, Modifications, Paternity, Child Custody, Support & Visitation

February 27, 2012

Employer Loses Motion for Change in Condition of Permanent Total Disabled Workers’ Compensation Claimant In Missouri

In 1996, a Smitty’s Supermarket employee fell off a pallet raised by a forklift and suffered head injuries which left him Permanently Totally Disabled (PTD), although his disability rating was 70% of the body as a whole.  However, at trial the Administrative Law Judge (ALJ) penalized the employer another 15% for failure to comply with the safety provisions of Missouri’s section 292.020.  In 2002, Missouri’s Labor and Industrial Relations Commission upped the award in favor of the employee from one of Permanent Partial Disability (PPD), determining instead that the employee was Permanently Totally Disabled (PTD). 

Later, after extensive medical treatment and rehab, the employee put his life together enough to marry, have a child, and work a string of jobs.  As a result, the employer filed in 2010 its second motion for an order of the Commission downgrading the employee’s injury from total to partial disability.  The Commission sent the motion to an ALJ for hearing.  Both sides hired doctors as experts but the employer’s doctor observed the employee only ” a single day” and failed to interview his wife, family, and others with details on how the injury continued to seriously affect the employee.

Ultimately, the Commission dismissed the employer’s motion because “although Employer had presented evidence that Claimant [Employee] had undergone numerous life changes since the original award in 2002, it ‘did not present any new MRI scans of [Claimant’s] brain or any other concrete evidence showing an actual physical change in condition of [Claimant’s] brain.’ ”   The Southern District of the Missouri Court of Appeals affirmed in Pavia v. Smitty’s Supermarket, Slip Opinion SD31275 filed  02-17-2012.

The moral of the story seems to be that an employer must bring in sufficient proof of change in the physical condition of the injured parts of the employee’s body in order to prove that that the employee is not longer Permanently Totally Disabled.  

And while this case involved an injury prior to the 2005 amendments to Missouri Workers’ Compensation laws, there seems to have been no change made to the applicable statute–287.470.  See Sachs Electric Co. v. Mapes, 254 S.W.3d 900, 902-03 (Mo. Ct. App. W.D. 2008), where the court continued to require proof of a change of physical condition even after the 2005 statutory amendments.

Kurt H. King

Law Office of Kurt H. King, 20 E. Franklin, Liberty, Clay County, Missouri 64068


Personal Injury, Workers’ Compensation

Chapter 7 Bankruptcy for debtors

Child Custody, Support, & Visitation; Divorce & Modification; Paternity

December 20, 2011

Permanent Total Disability and Death from Other Causes in Missouri Workers’ Compensation Claims/Cases

Missouri courts are making law on what happens when a Permanently Totally Disabled (PTD) worker dies from other causes before his/her claim reaches final resolution.

The key statutes are 287.020.1, 287.200, and 287.230 which Missouri lawmakers amended effective June 26, 2008, in order to change the result of Missouri Supreme Court’s January 9, 2007, decision in the case of Schoemehl v. Treasurer of the State of Missouri, 217 S.W.3d 900.

Schoemehl holds that the definition of an “employee” includes his dependents as stated in 287.020.1.  Therefore, the dependents of an PTD employee who dies from other causes shall receive the compensation due the deceased employee for as long as the DEPENDENT shall live.

However, Missouri law makers overrode Schoemehl by revising the above statutes to provide that for purposes of PTD compensation under 287.200, the term “employee” does NOT include dependents.  But this change in law has been held to be substantive and thus the changes cannot be retro-respectively applied to claims that were filed (accrued?) prior to June 26, 2008–the effective date of the lawmakers’ statutory changes.

So a PTD claim that is pending–why not include also injuries sustained or reported but no claim yet filed?–and not yet finally decided during the “Schoemehl Window”–January 9, 2007 to June 26, 2008--is entitled to much more workers’ compensation that if your claim is filed [accrued?] after June 26, 2008.  See the recent decision of the Western District of the Missouri Court of Appeals in Goad v. Treasurer of the State of Missouri, dated November 22, 2011 (WD72820).

Another thought is that it may be wise to list all the dependents on claims for PTD so that the workers’ compensation judge may make orders that in the event of the death from other causes of a PTD worker with a claim inside the Schoemehl window that the post-death PTD compensation shall be paid to the dependents for their lifetimes.  Such an order was approved in Tilly v. USF Holland Inc., 325 S.W.3d 487 (Mo. Ct. App. E.D. 2010).

It is important to keep in mind that the law is far different for workers’ compensation Death claims where the injured worker dies from his injury, or where the worker is only Permanently Partially Disabled.  So disregard the above if the work injury caused the worker’s death or permanent total disability is not present.

Kurt H. King

Law Office of Kurt H. King, 20 E. Franklin, Liberty, Clay County, Missouri 64068


Bankruptcy, Child Custody & Support, Divorce & Modification, Family Law

Personal Injury, Missouri Workers’ Compensation

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