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Aug 5, 2019

Maryland Widow’s Death Benefits Claim Not Barred by Husband’s Broad Release Before His Death

A worker’s claim for workers’ compensation benefits and a dependent’s claim for death benefits are separate and independent claims, such that the dependent’s claim is not derivate of the worker’s, held a Maryland appellate court. [In re Collins, 2019 Md. App. LEXIS 640 (Aug. 2, 2019)]. Accordingly, where an employee filed a contested occupational disease claim that was settled by means of a settlement agreement and release, signed only by the worker, and the worker died two years later—allegedly from the occupational disease—his spouse could pursue a claim for death benefits. Citing Larson’s Workers’ Compensation Law, § 98.01[2], the court held the widow’s claim was not barred by the worker’s execution of the broad release.

Background

Collins, then age 67, a volunteer firefighter for the Huntingtown Volunteer Fire Department (“Huntington”), filed a claim alleging that his heart disease and hypertension were an occupational disease. Huntingtown disputed the claim, but eventually settled with Collins pursuant to a settlement agreement providing for a lump sum payment, plus the creation of a Medicare Set Aside annuity and other miscellaneous payments.

Collins signed a release with broad language, purporting to settle any claims that he, his personal representative, dependents, spouse and children (or any other parties) had against the employer and its insurers. It was signed by Collins, his attorney, and various representatives on behalf of the employer and insurers. The agreement was subsequently approved by the Commission.

Just over two years later, Collins died from a cardiac arrest secondary to his heart disease and hypertension. His widow filed a claim for dependent’s death benefits. Following a hearing, the Commission ruled that she had no claim due to the execution of the release by her husband. The circuit court agreed and the widow appealed.

Appellate Court Decision

Examining several earlier decisions, the court said the state’s workers’ compensation law clearly created two separate classes of compensation benefits:

  1. Disability, medical, and vocational rehabilitation benefits that belong to the worker, and
  2. Death benefits that belong to the dependents of the injured worker and compensate them for his or her death.

The court acknowledged that while the latter form of benefits did arise from a compensable injury or disease suffered by the worker during his or her lifetime, they were, nevertheless, not derivative of the injured worker’s claim for benefits. The court continued:

When a covered worker suffers a compensable accidental injury or develops an occupational disease, his dependents’ entitlement to death benefits is inchoate, as it is not certain ever to accrue. If the injured worker dies of a cause unrelated to the workplace injury or disease, the potential claim for death benefits is extinguished, although a dependent of the worker may be entitled to unpaid disability benefits under the survival provisions of the Act. (Likewise, a dependent of the worker may die before the worker dies). If the worker dies from the compensable injury or disease and leaves a dependent, however, the death benefits claim becomes choate.

One Claimant in the Case That Was Settled

The court stressed that there was but one claimant in the case that was settled: Collins. He was the only person who signed the release. His wife was not a party and did not sign. The court concluded that the language of Md. Labor and Employment Code Ann. § 9-683.3 was unambiguous and did not make the liability of an employer or insurer to pay death benefits to dependents of a covered worker who died from a compensable injury contingent upon the covered worker having not released his separate claim for disability benefits during his lifetime.

Practitioners should note that this decision is in line with the majority of other jurisdictions [see Larson, § 98.01].