Keefe, Campbell & Associates, LLC

Editor’s comment: We wonder if our highest Court has noticed all the empty homes that no one is buying and all the cars that are sitting rusting on dealer lots that are closing and all the jobs that may be leaving our state. Outside the halls of the Illinois Supreme Court, we see labor’s political forces amassed to include the Illinois Trial Lawyers Ass’n and union representatives apparently devoted to making Illinois a graveyard for U.S. business. Their bent seems to be a goal to make our workers’ compensation benefits as painful and as expensive as possible. We assure all of you this ruling will add a significant level of confusion and uncertainty to the supposedly structured workers’ compensation benefit process. When all is said and done, the ruling may also affect only about one-two hundred Illinois citizens annually—with the awful anti-business message it sends, why did they bother?

The Illinois Workers’ Compensation Act was initially passed by the Illinois legislature one hundred years ago in 1909 following a disaster at the Cherry Mine in central Illinois. We assert Illinois now has the highest total and permanent disability maximum and minimum rates in the world. Right now, an injured Illinois worker making $50 a week who is adjudicated T&P gets $461.78 per week or $24,012.56 per year! The maximum is a hefty $1,231.41 or $64,033.32 per year. An Illinois worker doesn’t hit the max until they make $96,049.98 unless Illinois’ wacky method of calculating the average weekly wage under Sylvester is used. For a 30-year-old worker who has a 45-year life expectancy, the full undiscounted value of a total and permanent disability is $2,881,499.40. While we don’t want anyone to suffer a catastrophic injury, if it happens, we consider that amount more than satisfactory when one understands the worker also gets get unlimited on-demand medical attention, home and auto improvements to adjust to their disability and favorable public parking places.

Until last week, the highest benefit payable under our Workers’ Compensation Act for a single injury was the lifetime weekly benefits outlined above for a total and permanent disability. Three years ago, our friends in Illinois labor demanded and got funding from Illinois business for COLA increases guaranteed to keep such benefits consistent over the entire life of an injured claimant. Again, while some states do and some states don’t, it is hard to fight over COLA benefits for statutory T&P claimants.

So what happened last week? Well, the Supreme Court may have arguably doubled this already gigantic benefit. If they didn’t double it, they increased it greatly. In Beelman Trucking v. Workers’ Compensation Commission, claimant suffered a very serious injury involving paralysis to both legs and one arm along with amputation of the other arm at the elbow. We join with the employer in extending our concerns for this severely injured worker. There is no question he is entitled to lifetime statutory total and permanent disability benefits at the appropriate rate—he had already received $274,000 from his employer at the time of the hearing. We don’t understand why such a claim needed to be litigated in any way. An attorney taking such a claim gets a statutory $100 fee pursuant to Illinois law. It would appear obvious he found a zealot to represent him who then took the matter through five different levels of litigation over 15 years, probably costing the employer tens of thousands of dollars fighting over this mess.

What the Arbitrator and Commission did, for the first and only time in Illinois history is not only allow him to prove-up his right to statutory total and permanent weekly benefits for a single injury, they awarded additional or double weekly benefits on top of lifetime benefits!! As our system provides for weekly benefits only, one has to wonder when the benefits following lifetime benefits might be due. Do they have bank accounts that take weekly deposits in heaven?

What the Arbitrator and Commission panel did instead was to “deform” the weekly benefit system in an unprecedented fashion—they doubled the weekly benefit, requiring the employer to now pay “permanency” twice. The method used was to look at the statute that provides weekly lifetime total and permanent benefits to anyone losing the use of two limbs and confirm that is one benefit under the Act. They then ruled, if someone loses more than two limbs they get additional weekly benefits for the other lost limbs without any “credit” for the T&P weekly benefit already clearly due.

In this case, they provided a lifetime weekly total and permanent benefit for the undisputed loss of the legs along with another 100% loss of use of each arm or 253 weeks of additional benefits consistent with amputation losses for each lost limb. The additional amount awarded could be as high as $1,231.41 per week times 506 weeks or $623,093.46. The additional amount can be no less than the minimum amputation value of $233,660.68. Ouch.

As you may be able to tell from the tenor of this article, we consider that outcome preposterous under the law as it has evolved. As workers’ compensation law professors, such a ruling is a paradigm shift away from the clear language, intent and scope of the legislation that has been in place for 100 years. We also point out the clear alarm for all Illinois employers that chaos appears to be afoot—we have no idea where these folks are going to drive such a concept and what new claims may ensue. We pray calmer heads will prevail and our hearing officers, judges and justices return to a more traditional reading and interpretation of the “plain language” of the Act.

Although the Arbitrator and Commission ruling was rubber-stamped by the Circuit Court, the Appellate Court, Workers’ Compensation Commission Division should be applauded for reversing it with a very solid ruling confirming how obtuse the legal theory was. Although we do not always agree with their rulings, these justices continue to be a gateway for common sense and tradition in their management of our workers’ compensation legal system. We like to characterize them as liberal yet careful jurists. Again, one would have thought this case would have ended with this Appellate Court reversal. However, the Supreme Court agreed to take the case for reasons known only to the members of that court.

In Beelman Trucking, the Supreme Court came up with a theory to allow double weekly benefits for a single accident for the first time in Illinois history. It is worth noting the Illinois Trial Lawyers Association’s amicus brief was mentioned in this ruling. At no point do they mention the fact all permanency benefits arising from a single accident for the last hundred years have been paid weekly and now will have to be double-paid. And try to imagine how happy Sam Beelman, the president of Beelman Trucking had to be to learn the Illinois Trial Lawyers Ass’n had lined up to file a brief and thereby advocate against his company. We don’t feel any single business entity has any chance against ITLA’s political clout and campaign largesse; certainly not a modest-sized southern Illinois trucking concern. If ITLA writes a brief to the Court, you can bet the Court will listen more than carefully—at this level of the judicial spectrum, whatever ITLA wants, ITLA gets. Again, as the future legal fees on such claims should be capped at $100, why did ITLA care?

The Court reaches the conclusion that loss of use of two limbs does entitle a worker to lifetime weekly total and permanent disability benefits—this aspect of the award was proper and undisputed. However, the Court then finds the right to permanency doesn’t end there and any other injuries suffered in the same event now entitle the injured worker to double their weekly recovery. So, we ask all of our readers the obvious question, why isn’t this claim a “double” total and permanent disability? If the answer is that wouldn’t make sense, we don’t think any of this makes any sense. The Court interprets statutory total and permanent disability to arise from a loss of use of two members. This guy sadly lost 100 per cent of all four members—why doesn’t he get lifetime benefits twice? The statute doesn’t provide “credit” for the first T&P award, does it?

We read our highest court’s ruling as somewhat blurring—they break down the word “case” and note Respondent’s brief outlined “case” meant “proceeding” and the court’s majority felt “case” means “incident” or “example.” It is unclear why the court went to such great lengths to analyze these terms since it is something only a lawyer could struggle to make sense of. From the perspective of John Q. Public, the bigger and more important point is for the last 100 years, Illinois employers have been taking full care of any injured worker to pay unlimited on-demand medical for life along with a very generous tax-free weekly T&P benefit with cost-of-living increases. However one dices and slices the word “case,” do we really have to throw literally hundreds of thousands of dollars on top of that? Can and should Illinois business have to afford it?

So what do we have to do now? Well, we figure there are three things. One, you have to understand there is blood in the water and sharks swimming all around looking for fresh meat. Where is the next launching place for ITLA to sink its teeth into? These folks have to be emboldened by this victory and looking for new prey to shoot, field-dress and bring back to their membership. We assure you they are going to be advertising for this new business as rapidly as possible. We are also sure that finding new paths to stack benefits will be the next trend at the IWCC–if an Illinois worker is injured and gets a “lazy lot” total and permanent award, can they now go back to the Commission and ask for specific loss for body parts that were injured but did not cause the restrictions that led to total and permanent disability? Is this a new method to stack double weekly benefits? If you can think of any other way benefits could be stacked in this fashion, please send it along and we will share with our readers.

Second, please note this ruling affects all pending claims that have not been settled or tried. One arbitrator who knew of this ruling already advised he had a total and permanent award where he is going to have to add permanent loss for a shoulder surgery on top of the T&P award. We therefore feel all underwriters have to take a fresh look at their biggest claims and reset reserves consistent with this ruling. Reserves on any pending quadriplegic claim just went up around a minimum of $230K and possibly as high as $623K. Triple amputees or paralysis victims will also see concomitant boosts. If you have questions or comments on reserving major cases following this precedent, send the inquiry.

Finally, we have to get to our legislators and try to teach them how bad things are getting in this state. We also ask you to consider joining the Illinois State Chamber and its Employers Council. They remain out on the point for Illinois business in the fight to try to bring workers’ compensation benefits back to some semblance of reasonableness. While this ruling doesn’t affect thousands of claims, it still sends a brutal message to Illinois business and prospective employers. We assure all of our readers most companies with Illinois operations are holding onto cash in their major claims; it is painful to have to tell them to boost reserves and tie up even more cash and credit while they are fighting for their survival.

The ruling is on the web at: http://www.state.il.us/court/Opinions/SupremeCourt/2009/May/106680.pdf. Please don’t hesitate to send your thoughts and comments.

Editor’s comment: With respect to the members of the Court, if our suspicions are correct, we feel this award is preliminarily confusing and potentially strains credulity. We do not feel the legislature intended this result and we feel there is nothing clearly outlined in the legislation upon which the Court relies to reach this outcome. It is also may be a matter of unnecessarily generous largesse for every widow or widower in this state for anyone related to someone injured severely while living who later passes from related conditions. We also feel it may be a business-destroying, premiums-about-to-skyrocket decision that will again push jobs away from our state. Underwriters for Illinois claims beware!

In light of this ruling, we are petrified of what to expect in the Beelman Trucking ruling currently being considered by the Illinois Supreme Court. In Beelman Trucking, claimant suffered severe injuries and lost both arms. The Arbitrator accurately ruled he was a statutory total and permanent disability and such benefits are unquestionably due for life. On top of that, she also ordered 100% loss of use of the limbs so as to require PPD to be paid weekly at the same time the total and permanent benefits were being paid—the outcome requires a number of years of “double PPD.” We are unaware of any legislative scheme in all of the U.S. workers’ compensation systems that foster such outcomes. Now, Illinois may not have one but two different scenarios where double-payment is perceived by our Courts to be the law. Defense observers note there was no compelling reason for the Supreme Court to consider the Beelman Trucking decision that overruled the double-payment scenarios. The ruling in this case we analyze today now leads us to feel the pro-plaintiff jurists on the reviewing courts may want double-payment of benefits to become the law in as many settings as possible.

In Freeman United Coal Mining Company v. Van Houten, (No. 4-07-0905WC & 4-07-0907WC September 29, 2008), an Application for exposure to coal dust was filed by a living coal miner named Kenneth Van Houten on March 10, 2000 for a February 2, 1998 exposure. He died on May 19, 2000 of what were later determined to be work-related causes. After his passing, on August 2, 2000, the widow filed a separate Application for death benefits. We consider the second Application the confuser and consider it wholly unnecessary—he died of the same cause; exposure to coal dust.

There is no dispute Decedent worked as a coal miner for 38 years and was exposed to coal dust. He developed chronic lung disease in the form of hypoxemia, chronic obstructive pulmonary disease, long-standing heart disease and chronic bronchitis. The Arbitrator found Decedent’s exposure to coal and rock dust a causative factor in the development of his maladies and eventual death. He awarded the widow benefits under Section 7 of the Act and ordered the employer to pay for decedent’s funeral expenses.

The confusion begins when the Arbitrator did not award benefits in the decedent’s claim that he filed while living, ruling the claims abated on his passing. We cannot tell if the parties sought TTD from February 2, 1998 until his passing on May 19, 2000. From our review of the ruling, the condition was work-related and claimant was disabled from February 2, 1998 until his passing, if Petitioner asked for it, we assert the Arbitrator could have awarded TTD from the date of his disablement on February 2, 1998 until death occurred in May 2000. The Commission effectively affirmed and found the condition abated at death and the widow was entitled to death benefits only.

On appeal, the widow argued the Commission’s finding which ruled Decedent’s claim brought while living abated by virtue of Section 8(h) was “legal error.” The Appellate Court reviewed this issue de novo as one of statutory construction. Delivering the opinion of the court, Justice McCullough found Section 8(h) unambiguously “provides that benefits to which the employee would have been entitled but for his death are to be paid to the employee’s survivors upon his death from any cause.” The Court further held if a claimant “dies during the pendency of the claims process, the claim shall proceed as if the death had not occurred.” If the claim prevails, “all compensation that would have been awarded to the claimant shall be paid to the dependents of the deceased claimant” and “any other claims any dependent might have as a result of the claimant’s death shall proceed unaffected.”

We point out the statute doesn’t say what the Court says it does—the words “the claim shall proceed as if the death had not occurred” aren’t in Illinois law. We also point out all Illinois workers’ compensation benefits are to be paid weekly. There is no indication our legislature wanted double weekly payments to be paid at any time to widows or anyone else. One reading of this challenging decision may allow for double weekly checks to be awarded—we consider that to be anomalous and inconsistent with most U.S. workers’ compensation systems and legislative intent.

So our worry is a hypothetical claimant who smokes a “clove cigarette” at lunch and then falls from a ladder at work. During emergency care, the physicians amputate his/her arms and legs. Claimant survived but never recovered consciousness and he/she dies one week later of the injuries. In such a scenario, it would appear his/her widow(er) would be entitled to one week of TTD (less the waiting period) and then the full death benefit. To the contrary, in this unanimous decision, the Court appears to rule the widow would get the full death benefit that is a minimum in this state of at least $560K up to about $1.6 million dollars and on top of that, the widow could also file a second Application for the same accident/exposure and would also get 100% loss of use of each leg and each arm. Such a scenario would add at least an additional 936 weeks of benefits or potentially over $1 million more to the death benefit. If the Commission truly felt generous, they could dump in another 500 weeks for 100% loss of use of the “person as a whole” which would give the estate another $325K. In such a scenario, the award could exceed $3 million! We will leave all of that to your imaginations because that is where we feel this is coming from.

We feel the accurate ruling in this matter is claimant had one case for one exposure on February 2, 1998—the second filing is duplicative and unnecessary; you can’t and shouldn’t be able to file and maintain two Applications for one exposure on one day. We assert the second Application should have been dismissed and urge Respondent’s counsel to move to dismiss it right now to protect the record. We also feel it may or may not have confused the reviewing court because the plain reading of their decision is confusing us. We note the Court specifically rules “Any other claims any dependent might have as a result of the claimant’s death shall proceed unaffected.” (emphasis added; we also note the decision is referring to dependents when they appear to actually refer to the widow who isn’t necessarily a dependent). We have no idea what, why and how a widow of a deceased injured worker has “any other claim” arising out of one exposure on one day.

Under the statutory provision cited by the Court in their decision, we feel the widow(er) unquestionably takes any workers’ compensation benefits be it medical bills, TTD or PPD due to claimant while living. Upon passing, the living claim for any pending benefits would shift/abate/whatever-you-want-to-call-it to allow the widow(er) to then be entitled to the full weekly death benefit. Please note the death benefit might be dramatically higher for a lower wage individual than PPD rates for scheduled injuries. Under our view, using a “plain English language” reading of the Act, he/she would never be entitled to both weekly PPD for the claim to be paid after the passing of claimant with weekly death benefits at the same time.

If the Court simply intended to allow for an award of TTD from February 2, 1998 until May 19, 2000 and remanded the matter for that purpose, the decision should say so. As we read the ruling, it would appear the Court wants double payment of weekly benefits when they refer to “any other claims” and say “the claim shall proceed as if the death had not occurred.” We feel this is wholly inconsistent with the legislation and hope the anomaly is clarified.

We hope the legislative gurus at the Illinois State Chamber read this one carefully and put it on the list of stuff that may need to be reformed. This article was drafted by Matthew A. Wrigley, J.D. and Eugene F. Keefe, J.D. We invite your thoughts and replies.