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Foreman v. Security Insurance Company of Hartford3/9/2000
This is an appeal from a judgment of the district court affirming a decision of the Workers' Compensation Commission appeals panel refusing Denise Foreman's request to redistribute workers' compensation benefits. We affirm the judgment.
John H. Foreman, a pipefitter for Northwestern Steel and Wire Company, was killed in a work-related accident on April 30, 1995. Northwestern carried workers' compensation insurance with Security Insurance Company of Hartford. Security paid benefits to Foreman's wife, children, and stepchildren for $2,500.00 funeral expenses and a weekly payment of $472.00, with one-half going to Foreman's wife, Denise K. Foreman, and one-half divided equally among Foreman's natural children, Whitney Foreman and John Nicholas Foreman, and his two stepchildren, Brandon Fromme and Clayton Fromme. After Foreman died, a natural child, John H. Foreman II, was born, who also became eligible for workers' compensation benefits. Thus, the five children each received one-fifth of one-half of the weekly benefits.
Denise Foreman filed a wrongful death suit against Northwestern and others. Included as plaintiffs in that case were all of John Foreman's natural children. Because Brandon and Clayton, the stepchildren, were not statutory beneficiaries under the Wrongful Death Act, they were not parties to the suit. On October 3, 1997, the suit was settled for $3,950,000.00. After attorneys' fees and expenses, Denise Foreman received $1,553,745.92, and each child who was a plaintiff received $326,079.61. As a part of this settlement, the plaintiffs and Security, which had intervened, entered into an agreement pursuant to Tex. R. Civ. P. 11, by which Security was reimbursed for all of its compensation payments to the Foremans, and in which it was declared that payments in the settlement of the third-party action were "of such size that Security Insurance will not be obligated to pay any[ ]more benefits to Denise K. Foreman [and other named minor children]."
Denise Foreman's position is that as a result of the third-party settlement, she and the named minor children have become "ineligible" for workers' compensation benefits and, therefore, Brandon and Clayton Fromme are now entitled to receive the entire amount of compensation payments from Security, pursuant to the redistribution provided in Section 408.184 of the Texas Labor Code.
The applicable statutes are as follows: Tex. Lab. Code Ann. § 408.181 (Vernon Supp. 2000):
(a) An insurance carrier shall pay death benefits to the legal beneficiary if a compensable injury to the employee results in death. . . . .
Tex. Lab. Code Ann. § 408.182 (Vernon 1996):
(a) If there is an eligible child or grandchild and an eligible spouse, half of the death benefits shall be paid to the eligible spouse and half shall be paid in equal shares to the eligible children. . . . .
(f) In this section:
(1) "Eligible child" means a child of a deceased employee if the child is:
(A) a minor;
(B) enrolled as a full-time student in an accredited educational institution and is less than 25 years of age; or
(C) a dependent of the deceased employee at the time of the employee's death.
(3) "Eligible spouse" means the surviving spouse of a deceased employee unless the spouse abandoned the employee for longer than the year immediately preceding the death without good cause, as determined by the commission.
Tex. Lab. Code Ann. § 408.184 (Vernon 1996):
(a) If a legal beneficiary dies or otherwise becomes ineligible for death benefits, benefits shall be redistributed to the remaining leg
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