Schwartz v. Department of Industry, Labor and Human Relations, Workmen's Compensation Division, 751

• Decision Date: 02 March 1976
• Docket Number: No. 751,751
• Citation: 72 Wis.2d 217,240 N.W.2d 173
• Court: Wisconsin Supreme Court
• Parties: Mary Lou SCHWARTZ, widow of Robert L. Schwartz (Deceased), et al., Appellants, v. DEPARTMENT OF INDUSTRY, LABOR & HUMAN RELATIONS, WORKMEN'S COMPENSATION DIVISION, et al., Respondents. (1974). . Oral Argument

Page 173

240 N.W.2d 173

72 Wis.2d 217

Mary Lou SCHWARTZ, widow of Robert L. Schwartz (Deceased) et al., Appellants, v. DEPARTMENT OF INDUSTRY, LABOR & HUMAN RELATIONS, WORKMEN'S COMPENSATION DIVISION, et al., Respondents.

No. 751 (1974).

Supreme Court of Wisconsin.

Oral Argument March 2, 1976.

Decided April 7, 1976.

Michael L. Wagner, Fond du Lac, and G. L. MacKenzie, Oshkosh, for appellants.

Gordon Samuelsen, Asst. Atty. Gen., with whom on the brief was Bronson C. La Follette, Atty. Gen., for respondent Dept. of Industry, Labor & Human Relations.

CONNOR T. HANSEN, Justice.

The facts are not in dispute. Robert L. Schwartz, the deceased, was employed by J. F. Ahern Company. In the course of his employment, he sustained a fatal compensable injury. He was survived by his wife and four minor children.

The employer conceded that circumstances surrounding the death included its violation of a lawful order issued by the Department of Industry, Labor & Human Relations (hereinafter department). Therefore, the employer was liable for payment of increased benefits under the provisions of sec. 102.57, Stats.:

'. . . Where injury is caused by the failure of the employer to comply with any statute or any lawful order of the department, compensation and death benefits as provided in this chapter shall be increased 15% but not more than a total increase of $7,500. Failure of an employer reasonably to enforce compliance by employes with such statute or order of the department shall constitute failure by the employer to comply with such statute or order.'

The widow thereby became eligible for a 15 percent increase in the benefits payable to her under sec. 102.46, Stats.

Sec. 102.49, Stats., creates a state fund for payment of death benefits to dependent children of a person who receives benefits under sec. 102.46. The four minor children of the deceased became entitled to payments from that fund. The department determined benefits payable to dependent children from the state fund are not subject to the increased percentage provided in sec. 102.57.

The dispositive issue of this appeal is:

When an employee's death results from violation of a lawful order of the department, does sec. 102.57, Stats., require the employer to pay 15 percent increased death benefits upon sums the department ordered paid by the state treasurer from the state fund for dependent children as established by sec. 102.49?

Sec. 102.57, Stats., in part, provides: '. . . compensation and death benefits as provided in this chapter shall be increased 15% . . ..'

Sec. 102.01, Stats., sets forth statutory definitions of various terms and phrases used in the Workmen's Compensation Act. Sec. 102.01(2)(c) recites the following definition:

'(c) 'Primary compensation and death benefit' means compensation or indemnity for disability or death benefit, other than increased, double or treble compensation or death benefit.' (Emphasis added.) ¹

Under the provisions of sec. 102.57, Stats., the additional 15 percent payment required for failure to comply with any statute or lawful order of the department is specifically identified as an increased death benefit. Sec. 102.62 places the primary responsibility for the payment of this increased death benefit upon the employer. The insurer's liability for payment of the increased death benefit is secondary.

The state fund to provide additional death benefits to dependents of deceased employees was created by ch. 328, Laws of 1923, then sec. 102.09(4m), Stats. Now sec. 102.49. The employer is not a party to proceedings before the department to determine eligibility for benefits from this fund. In addition to children under sixteen years of age born of the marriage to the decedent, the department may determine others are entitled to certain death benefits. The department shall make an allowance for children over sixteen years of age who are physically and mentally handicapped not greater than a certain amount but in such amount 'as the equities and the necessities of the case merit . . .' The department is also required to make a determination whether a child not his by birth or adoption was living with him as a member of the family at the time of injury, in which case such child shall be entitled to the benefits provided by the state fund. The department is also required to make certain determinations in regard to children of a prior marriage of the injured employee.

The amount the employer pays to the state treasury is specifically established by sec. 102.49(5), Stats. It has no relation to the number of dependent children of the deceased employee. It provides for a larger payment in the event the deceased employee leaves no person dependent on him for support. It further provides a formula whereby, if there is a certain balance in the fund, an employer shall not be required to make a payment into the fund.

The foregoing facts become important in determining whether the agency interpretation of the statute is reasonable. In B. F. Sturtevant Co. v. Industrial Comm. (1925) 186 Wis. 10, 202 N.W. 324, this court was called upon to pass upon the constitutionality of the statute creating the state fund to provide the additional benefits from children. In declaring the statute constitutional, this...