Estate of Baker

• Decision Date: 09 April 1977
• Docket Number: No. 48401,48401
• Citation: 563 P.2d 431,222 Kan. 127
• Parties: ESTATE of Dennis Raymond BAKER, Deceased. Pamela K. BAKER, Appellant, v. LIST AND CLARK CONSTRUCTION COMPANY, and Travelers Insurance Company, Appellees.
• Court: Kansas Supreme Court

Page 431

563 P.2d 431

222 Kan. 127

ESTATE of Dennis Raymond BAKER, Deceased.

Pamela K. BAKER, Appellant, v. LIST AND CLARK CONSTRUCTION COMPANY, and Travelers Insurance

Company, Appellees.

No. 48401.

Supreme Court of Kansas.

April 9, 1977.

Syllabus by the Court

The record in an appeal from a Workmen's Compensation proceeding is examined, and as more fully set forth in the opinion it is held: (1) K.S.A. 1975 Supp. 44-510b(j) as applied to the appellant does not deny her right to due process and equal protection under the law as guaranteed by the Constitutions of the United States and the State of Kansas; (2) the Legislature's passage of K.S.A.1975 Supp. 44-510b(j) did not abrogate the deceased's contractual rights in violation of Article I, Section 10, of the United States Constitution; (3) the district court did not err in failing to assess attorney's fees against the appellee.

Richmond M. Enochs, of Wallace, Saunders, Austin, Brown & Enochs, Overland Park, argued the cause and was on the brief for appellant.

Kenneth J. Reilly, of Boddington, Brown & Unverferth, Kansas City, argued the cause and was on the brief for appellees.

FATZER, Chief Justice:

This is a Workmen's Compensation proceeding commenced by the dependents of the deceased workman, Dennis Raymond Baker, against his employer, List and Clark Construction Company, and its insurance carrier, Travelers Insurance Company. For reasons hereafter stated, we affirm.

On October 29, 1974, Dennis Raymond Baker sustained personal injury by accident resulting in his death while employed by appellee, List and Clark Construction Company, at the construction site of the Clinton Reservoir in Douglas County. He was survived by his wife and two children, ages six and eight.

A hearing on this matter was had before a Workmen's Compensation Examiner, on September 15, 1975. All required stipulations under the Kansas Workmen's Compensation Act were made in the affirmative by the appellees. Only two issues remained to be decided: (1) the constitutionality of K.S.A.1975 Supp. 44-510b(j); (2) appellant's right to attorneys fees to be assessed against the appellees.

On November 14, 1975, the Workmen's Compensation Director rendered his findings and award. He found the constitutional question raised by the appellant could not be decided at the administrative level; hence, an award for the maximum allowable benefits under K.S.A.1975 Supp. 44-510b, subject to the credit provisions of (j) thereof, was made in favor of the dependents of the deceased worker. The appellant's request for attorney fees to be assessed to the appellees was denied. The appellant's contract of employment with her attorney as read into the record at the hearing on September 15, 1975, was approved.

The Director's award was appealed to the district court of Douglas County. That court ruled K.S.A.1975 Supp. 44-510b(j) was constitutional and affirmed the award in all respects. This appeal followed.

K.S.A.1975 Supp. 44-510b(j) provides:

'When any benefits are being paid under the federal social security act because of the death of an employee whose dependents are entitled to compensation under this section, the amount of compensation due under this section shall be reduced by an amount equal to one-half ( 1/2) of the amount of such social security payments during the time such social security payments are being made to the workman's dependents. The employer shall receive credit on the payment of future compensation otherwise due under the workmen's compensation act for an amount equal to one-half ( 1/2) of the total amount of social security payments made subsequent to a period during which compensation payments were made by the employer, but which are attributable to such period.'

The statute under attack is a 'set-off' provision which provides that workmen's compensation benefits due the dependents of a deceased employee shall be reduced by a specified formula if such dependents are also being paid under the Social Security Act because of the death of the employee. The set-off provision in the Kansas Act applies only to death benefits. A workman's disability benefits under the Kansas Act are not reduced if the workman is also receiving disability benefits under the Social Security Act. However, the Social Security Act has a 'set-off' provision which applies to disability benefits. Under 42 U.S.C.A., Sec. 424a, Social Security disability benefits are reduced by a specified formula if the individual entitled to such benefits is also entitled to disability benefits under a state workmen's compensation law.

The combined effect of the set-off provisions of the Social Security Act and Kansas Workmen's Compensation Act, as they presently exist, is that if an employee or his dependents are entitled to benefits under the one act, but not the other, he or they simply receive those benefits. If they are entitled to benefits under both acts, the combined total benefits are reduced. Under the present statutory scheme, no person or persons entitled to benefits receive the maximum allowable benefits under both acts.

If K.S.A.1975 Supp. 44-510b(j) is held unconstitutional, as appellant urges it should be, the appellant and her children will receive the maximum benefits under both acts. The social security death benefits will be paid regardless of what benefits appellant receives under the Workmen's Compensation Act.

The appellant contends K.S.A.1975 Supp. 44-510b(j) is unconstitutional on three grounds. Where the statute is applied to the decedent's widow and two children, the appellant argues it is a denial of their right to due process and equal protection under the law as guaranteed by the constitutions of the United States and the State of Kansas. The appellant further contends the legislature's passage of K.S.A.1975 Supp. 44-510b(j) abrogated the deceased's contractual rights in violation of Article I, Section 10, of the United States Constitution which forbids the impairment of contracts.

Long-standing and well-established rules govern this court's review of the constitutionality of a statute. In Tri-State Hotel Co. v. Londerholm, 195 Kan. 748, 408 P.2d 877, we said:

'This court is by the Constitution not made the critic of the legislature, but rather, the guardian of the Constitution; and every legislative act comes before this court surrounded with the presumption of constitutionality. That presumption continues until the Act under review clearly appears to contravene some provision of the Constitution. All doubts of invalidity must be resolved in favor of the law. It is not in our province to weigh the desirability of social or economic policy underlying the statute or to question its wisdom; those are purely legislative matters. . . .' (Id. 760, 408 P.2d 887)

In Brown v. Wichita State University, 219 Kan. 2, Syl. 3, 547 P.2d 1015, we held:

'It is the court's duty to uphold the statute under attack, if possible, rather than defeat it, and if there is any reasonable way to construe the statute as constitutionally valid, that should be done.'

Guided by these principles, and based on the following reasoning, we have concluded the statute under attack is constitutional.

The appellant's equal protection argument is essentially that the classification created by K.S.A.1975 Supp. 44-510b(j) is arbitrary and unreasonable. She contends the 'set-off' provision which reduces payments under the Workmen's Compensation Act to widows with minor children, but not to widows without minor children or recipients of disability benefits constitutes a denial of her right to equal protection under the law.

A state may create a statutory classification of persons within the scope of its police power. Classification necessarily involves discrimination. Yet it is only invidious discrimination with no rational basis for the statutory classification that offends the equal protection guarantee. Dandridge v. Williams, 397 U.S. 471, 90 S.Ct. 1153, 25 L.Ed.2d 491.

Reed v. Reed, 404 U.S. 71, 30 L.Ed.2d 225, 92 S.Ct. 251, teaches that a classification:

'. . . 'must be reasonable, not arbitrary, and must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, so that all persons similarly circumstanced shall be treated alike. '' Id. at 76, 92 S.Ct. at 254.

Accord, Henry v. Bauder, 213 Kan. 751, 518 P.2d 362.

The statutory classification created by K.S.A.1975 Supp. 44-510b(j) includes dependents of a deceased workman who are entitled to payments under both the Workmen's Compensation Act and the Social Security Act as a result of the workmen's death. This class of persons could include the minor children (42 U.S.C.A. Sec. 402(d)), mothers or fathers of minor children (Sec. 402(g)) (see, Weinberger v. Wiesenfeld, 420 U.S. 636, 95 S.Ct. 1225, 43 L.Ed.2d 514) widows or widowers over sixty or over fifty with a disability (Sec. 402(e) (f)), and parents (Sec. 402(h)) of a deceased person covered by the Social Security Act.

As previously noted, the existing statutory scheme operates to prevent duplication of benefits under the Workmen's Compensation Act and the Social Security Act. We note in passing that the existence of other statutes may be taken into consideration in determining the constitutional validity of a particular statute. 16 Am.Jur.2d Constitutional Law, Sec. 497 (1964). This statutory scheme appears to be consistent with a leading treatise on workmen's compensation:

'Once it is recognized that workmen's compensation is one unit in an overall system of wage-loss protection, rather than something resembling a recovery in tort or on a private accident policy, the conclusion follows that duplication of benefits from different parts of the system should not ordinarily be allowed. Since most social legislation in the United States has appeared in unrelated fragments, lack of coordination resulting in cumulation of benefits is quite common; but newer legislation,...