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The Colorado Court of Appeals unanimously affirmed an order in a death benefits case.
In this case, the appeals court analyzed the interaction between Colorado Revised Statute 8-42-121 which deals with the apportionment of death benefits among a deceased worker’s dependents and 8-43-406(3), which governs the lump-sum disbursement when there are multiple dependents.
The appeals court needed to determine whether the apportionment of death benefits for the dependents under 8-42-121 determines a dependent’s proportionate share of the maximum lump sum allowed under 8-43-406(3). The appeals court concluded it does.
In August 2019, Angel Batista de Jesus had a fatal injury during the course of his work with Brand X Hydrovac Services, Inc., according to court records. Batista had two dependents: his wife Sandra Amaya and their child I.R.
An administrative law judge apportioned death benefits between Amaya at 25% and I.R. at 75% under 8-42-121. The employer and carrier, Standard Fire Insurance Company, filed a General Fatal Admission of Liability, admitting weekly death benefits of $255.64 to Amaya and $766.92 to I.R.
Amaya requested a lump-sum distribution of a portion of her total death benefits equaling 50% of the maximum lump sum available for the claim. The Industrial Claim Appeals Office of the State of Colorado, Brand X Hydrovac Services, Inc. and Standard Fire Insurance Company objected, arguing 8-43-406(3) limited Amaya’s lump-sum disbursement because she is one of two dependents and I.R.’s interest wasn’t addressed.
The director of the Division of Workers’ Compensation granted Amaya’s request, awarding her 50% of the maximum lump sum allowed by statute and her weekly benefit was reduced by $86.27 to offset the benefits she would receive in the lump sum. The director determined Amaya’s right to a lump sum vested on the filing of the GFAL, so Amaya could elect to receive any or all of the compensation up to the statutory maximum.
The respondents filed a petition to review the director’s first disbursement order, arguing it was contrary to applicable law. The director dismissed the petition surmising the order wasn’t subject to review because it didn’t award or deny a benefit or penalty. The respondents then filed a petition for review with the Industrial Claim Appeals Office.
The ICAO found the director’s order was reviewable to determine whether he exceeded his authority, the ALJ had already determined Amaya’s proportionate share of the lump sum (25%) and the director’s findings were not sufficient to determine whether he correctly applied section 8-43-406(3). The ICAO put aside the director’s order and remanded the case for the director to make more findings and enter a new order.
On remand, the director again awarded Amaya 50% of the maximum lump sum, finding 8-42-121 and 8-43-406(3) are in different articles, have different methods related to apportionment and are unrelated, among other things.
The respondents filed a petition to review the second disbursement order and the director issued a supplemental order directing the respondents to comply. That supplemental order reiterated 8-43-406(3) gives the director authority to apportion lump sums among multiple dependents and this authority is a mere variation in the mechanism of payment, is distinct and not contingent upon the authority to apportion benefits.
The respondents then filed a petition for review with the ICAO, arguing the ALJ’s apportionment of death benefits under 8-42-121 applies to the proportionate share under 8-43-406(3) in cases where a dependent requests a lump-sum disbursement.
During the review, the ICAO set aside the director’s supplemental order, concluding the order was appealable, the director misapplied 8-43-406(3) and Amaya can only get 25% of the maximum lump sum allowed under statute. The ICAO reasoned, under the appealability of the order, although a lump sum order is usually not appealable, the order is appealable if the director exceeds their authority or failed to act.
The ICAO concluded the director misapplied 8-43-406(3) and exceeded his authority granting Amaya 50% of the maximum lump sum because it essentially increased the amount of benefits she was entitled to, according to court records.
Amaya appealed the final order. Amaya argued the director’s order isn’t subject to review because a lump-sum order is only procedural and ministerial and doesn’t create, eliminate or modify a party’s vested rights or liabilities; the order only addresses the manner and timing of her receipt of a portion of the death benefits; and the order that apportioned total death benefits and the order determining the proportionate share of the lump-sum amount didn’t divide the portions of the same pie. The appeals court concluded it could review the director’s order.
The appeals court concluded the apportionment of death benefits among a deceased worker’s dependents under 8-42-121 does determine a dependent’s proportionate share of the maximum lump sum allowed under 8-43-406(3). The division affirmed the ICAO’s order that set aside an order from the director, concluding Amaya was entitled to 25% of the maximum lump-sum amount of Batista’s death benefits.