Sorenson v. Six Companies, Inc., Civil 4001

• Decision Date: 03 January 1939
• Docket Number: Civil 4001
• Citation: 85 P.2d 980,53 Ariz. 83
• Parties: GEORGE SORENSON, Administrator De Bonis Non of the Estate of JAMES T. WHALEN (Also Known as J. T. WHALEN), Deceased, Appellant, v. SIX COMPANIES, INC., a Corporation, and THE INDUSTRIAL COMMISSION OF ARIZONA, a Department of the State of Arizona, Appellees
• Court: Arizona Supreme Court

85 P.2d 980

53 Ariz. 83

GEORGE SORENSON, Administrator De Bonis Non of the Estate of JAMES T. WHALEN (Also Known as J. T. WHALEN), Deceased, Appellant, v. SIX COMPANIES, INC., a Corporation, and THE INDUSTRIAL COMMISSION OF ARIZONA, a Department of the State of Arizona, Appellees

Civil No. 4001

Supreme Court of Arizona

January 3, 1939

APPEAL from a judgment of the Superior Court of the County of Maricopa. J. C. Niles, Judge. Judgment affirmed.

Messrs Moeur & Moeur, for Appellant.

Mr Blaine B. Shimmel and Mr. Laurens L. Henderson, for Appellee Six Companies.

Mr Howard A. Twitty, for Appellee Industrial Commission of Arizona.

OPINION

LOCKWOOD, J.

George Sorenson, as administrator de bonis non of the estate of James T. Whalen, deceased, hereinafter called plaintiff, brought suit in the superior court of Maricopa County against Six Companies, Inc., a corporation hereinafter called the company, and the Industrial Commission of Arizona, hereinafter called the commission. The substantial allegations of the complaint were as follows:

James T. Whalen on October 8, 1931, while employed by the company, sustained injuries by reason of an accident arising out of and in the due course of his employment. As a result of said injuries the commission assumed jurisdiction in the case and made findings and an award prior to the death of Whalen which, so far as material, read as follows:

"Findings.

"1. That the above-named applicant, while employed in the State of Arizona by the above-named defendant employer, who was insured against liability for compensation under said law by the above-named defendant insurance carrier, sustained an injury by accident arising out of and in the course of his said employment on October 8, 1931, which injury caused temporary disability entitling said applicant to compensation therefor in the total sum of $5,181.23, all of which has been paid.

"2. Said injury caused also a permanent partial disability equal to 65 per cent. loss of function of the left leg, entitling said applicant to compensation therefor in the sum of $84.00 monthly for a period of 32 1/2 months.

"3. That it appears to the best interests of said applicant that said compensation for said permanent partial disability be commuted to its fair present value and paid in the lump sum of $2,514.15.

"Award.

"Award is hereby made payable to said applicant by the above-named defendant insurance carrier as follows:

"1. The sum of $2,514.15 payable forthwith."

After said award, but before its payment, Whalen died, and plaintiff was appointed administrator de bonis non of his estate, and made demand for the payment of the lump sum award, which payment was refused.

The company and the commission both appeared and demurred on the ground that the complaint was insufficient to state a cause of action against either of them. The company further answered, alleging that it insured employees with the commission under the Workmen's Compensation Act, Revised Code 1928, section 1391 et seq., and claimed that since the death of Whalen it was the proper party to whom said award should be paid, rather than to plaintiff. The court sustained both demurrers, and plaintiff electing to stand on his complaint, judgment was rendered that the complaint be dismissed as against both the company and the commission, whereupon this appeal was taken by plaintiff.

There are five assignments of error but they raise but one question of law for the consideration of the court, which may be stated as follows: May a lump sum award to an injured employee, which represents the commuted value of future compensation for an injury, be recovered by the administrator of the estate of the employee when the latter dies after an award is made, but before payment of the award by the commission?

It is the position of the plaintiff that the moment the award of a lump sum is made it becomes a vested right in the injured employee in the same manner as would a judgment of a court of competent jurisdiction in an action on contract or tort, and that upon the death of the employee from any cause whatever before the award is collected, such right passes to his legal representative, and may be collected in the same manner as any other asset of the estate. It is the contention of the company and the commission that an award under the Workmen's Compensation Act to an injured employee on account of a compensable injury is a purely personal non-assignable right, which lapses upon the death of the employee, and cannot be collected after such death, whether the award be for monthly compensation or is a commuted lump sum. In this case no question arises as to the rights of the dependents of the injured employee, as those rights are covered by other and independent provisions of the act.

The question is one of first impression in this state, although it has arisen in a number of other jurisdictions. The commission urges that the payment of the award in question is prohibited by two things: First, the express provisions of section 1442, Revised Code 1928, and second, the general purpose and policy of the Workmen's Compensation Act, as shown by all of its provisions. We consider these two objections separately.

Section 1442, supra, reads, so far as material, as follows:

"Compensation not assignable; exempt from levy; payment to non-residents. Compensation, whether determined or not, shall not, prior to the delivery of the warrant therefor, be assignable; it shall be exempt from attachment, garnishment and execution, and shall not pass to another person by operation of law." (Italics ours.)

There are three limitations placed by the section upon the payment of compensation, (a) it is not assignable prior to the delivery of the warrant; (b) it is exempt from attachment, garnishment and execution; and (c) it shall not pass to another person by operation of law. We have construed this section in the case of Vukovich v. Ossic, 50 Ariz. 194, 199, 70 P.2d 324, 326, and, strange as it may seem, plaintiff and defendants each seem to consider that decision as being decisive in their favor. The specific question involved in the case was whether certain money, which had been paid to Ossic on account of compensation and deposited by him in a bank, was subject to garnishment. The plaintiff cites the following language as showing that the court held, in substance, that the only effect of the section was to prohibit attachment, garnishment and execution and similar legal remedies from being levied upon the compensation after it had passed into the possession of the injured employee:

"If a study of section 1442 left its meaning doubtful, a consideration of the Workmen's Compensation Law (Rev. Code 1928, § 1391 et seq., as amended) itself would aid in solving it. Keeping in mind that the purpose of that act is to compel industry to take care of those injured in its service, during their incapacity, and thus lift that burden from the shoulders of relatives, friends and the public, it would appear plain that it was not the intention that the funds paid him or them to meet this need should be taken from either and applied to other purposes...."

The commission, on the other hand, insists that the controlling language is:

"... Plainly the purpose here was to exempt compensation from attachment, garnishment and execution, and the possibility of its passing to another by operation of law,..."

Since the specific question involved was one of garnishment, anything said in regard to any other method of passing the title to compensation funds from an injured employee would be obiter, and it is obvious, on an examination of the entire case, that the question involved herein was in no manner considered by the court. We think upon reading the decision as a whole that the true solution of the present case is in no manner foreclosed nor even indicated therein.

So far as we are able to ascertain by an examination of the cases cited by both plaintiff and the commission, the states with statutes most nearly like section 1442, supra, are Washington and Wyoming. The...