Tillman v. Moody
| Decision Date | 13 December 1935 |
| Docket Number | 10647. |
| Citation | 182 S.E. 906,181 Ga. 530 |
| Parties | TILLMAN v. MOODY et al. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
1. An agreement for a lump sum settlement of an award of compensation entered by the Department of Industrial Relations is contrary to public policy and void, unless approved by the Department of Industrial Relations.
2. The Department of Industrial Relations is without jurisdiction to approve an agreement for a lump sum settlement of an award of compensation which does not conform to the terms of the Workmen's Compensation Act (Code 1933, § 114-101 et seq.). Such an agreement, even if approved by the Department of Industrial Relations, is contrary to public policy and void.
3. Equity has jurisdiction to relieve against agreements entered upon in violation of the terms of the Workmen's Compensation Act, by reason of which the beneficiary of an award of compensation is prevented from enforcing the award according to its terms.
4. The agreement sought to be canceled by the instant suit was not in conformity to the Workmen's Compensation Act, and was contrary to public policy and void. Since it appears that the beneficiary of the award was prevented by the agreement from enforcing the award, the court erred in sustaining the demurrer to the petition.
Error from Superior Court, Wayne County; J. H. Thomas, Judge.
Petition by Minnie Tillman against D. T. Moody and another. To review a judgment sustaining a general demurrer to the petition plaintiff bring error.
Reversed.
F. R Youngblood, of Waycross, for plaintiff in error.
Gibbs & Symmes, of Jesup, for defendants in error.
The husband of the plaintiff died as the result of an accident arising out of and in the course of his employment by the defendants. The Department of Industrial Relations awarded the plaintiff compensation at the rate of $5.835 per week for the statutory number of weeks. The defendants appealed to the superior court, where the award was approved. This judgment was affirmed by the Court of Appeals. Moody v. Tillman, 45 Ga.App. 84, 163 S.E. 521. Thereafter the judgment of the Court of Appeals was made the judgment of the superior court, with the recital that $813.98 had accrued on the award to that date, and that the defendants should pay to the plaintiff $5.835 per week for 160 1/2 additional weeks. The judgment also provided for recovery of attorney's fees, penalties, and interest. These items, however, are not material to the present inquiry. Some time later, and before any payment was made on the award, the plaintiff and the defendants entered into an agreement, which was thereafter executed, whereby the defendants agreed to pay $600 in full and complete settlement of the award and judgment. In accordance with the settlement, the judgment of the superior court was marked "satisfied" by the clerk. The plaintiff executed to the defendants an instrument in writing, which she alleges she is informed and believes was in the nature of a receipt and release. She brought the present suit, reciting the facts just narrated, and praying that the settlement be declared void and of no effect; that the defendants be required to surrender for cancellation the release executed upon the payment of the sum agreed upon; and that the entry of satisfaction be expunged from the records of the court. She offered to do equity by having the $600 paid by the defendants credited upon the judgment. The court sustained a general demurrer to the petition; to which judgment exception is taken.
1. The Workmen's Compensation Act created rights of action which were unknown to the common law. Bussey v. Bishop, 169 Ga. 251 (3), 150 S.E. 78, 67 A.L.R. 287. Liabilities which did not exist at common law were imposed upon employers; and employees were afforded remedies for injuries sustained by accidents arising out of and in the course of their employment, where none had existed before. The rights and liabilities of employers and employees are governed by the Workmen's Compensation Act. The ordinary rules of law do not apply to actions arising under that statute, but the act itself constitutes a complete code of laws upon the subject. Ordinarily, persons sui juris may adjust their differences upon such terms as they may be able to mutually agree upon. The policy of the law is to encourage such compromises, to the end that litigation may be avoided. This freedom of contract, however, does not exist with reference to claims for compensation arising under the Workmen's Compensation Act, since the right of employers and employees to adjust their differences is limited and restricted by the terms of the statute. The statute provides: Code 1933, § 114-106. This provision of the statute, in unmistakable terms, imposes two conditions which are essential to a valid settlement between employer and employee: First, that the time and manner of payment must be in accordance with the provisions of the Workmen's Compensation Act; and, second, that the agreement must be approved by the Department of Industrial Relations. The section just quoted manifestly refers to settlements entered upon before any award of compensation is made by the Department of Industrial Relations, but the same rule applies after such an award is made. It is provided by section 114-417: "Whenever any weekly payment has been continued for not less than 26 weeks, the liability therefor may, where the parties agree and the Department of Industrial Relations deem it to be to the best interests of the employee or his dependents, or where it will prevent undue hardships on the employer or his insurance carrier, without prejudicing the interests of the employee or his dependents, be redeemed, in whole or in part, by the payment by the employer of a lump sum which shall be fixed by the Department, but in no case to exceed the commutable value of the future installments which may be due under this law: Provided, that the lump sum to be paid shall be fixed at an amount which will equal the total sum of the probable future payments, reduced to their present value upon the basis of interest calculated at five per centum per annum." This section not only restricts the right of the parties to contract for a lump sum settlement of an award of compensation, but in express terms provides that such contracts must be approved by the Department of Industrial Relations.
The sections of the act just referred to are binding upon both employer and employee. It is provided, however, by section 114-111: "No contract or agreement, written, oral, or implied, nor any rule, regulation or other device, shall in any manner operate to relieve any employer in whole or in part from any obligation created by this Title, except as herein otherwise expressly provided." This section deprives the employer of the right to make any contract to relieve himself in whole or in part from the obligations created by the Workmen's Compensation Act. Under the provisions of section 114-404 of the Code of 1933, the employer is obligated to pay to the employee one-half of his average weekly wages during the period of total incapacity to work, subject to the limitations imposed by that section, in case an employee is injured by an accident arising out of and in the course of his employment, which results in a total incapacity to work. Under section 114-413, if death results from an injury arising out of and in the course of employment, the employer is obligated to pay to the dependents of the deceased employee 85 per cent. of the compensation provided in section 114-404 for total disability, for a period not exceeding 300 weeks from the date of the injury. The employer is prohibited by the statute from entering upon any contract for a release from the obligation thus imposed upon him. He may discharge the obligation by a contract entered upon before any award of compensation is made, and executing such contract; but under the terms of section 114-106 the amount of compensation and the time and manner of payment must be in accordance with section 114-413, a memorandum of the agreement must be filed with the Department of Industrial Relations, and the settlement is not binding until approved by the Department. Section 114-106 simply provides that the employer may voluntarily assume, and agree to meet, the obligation which the statute imposes upon him, without being ordered to do so by the Department of Industrial Relations. If the Department of Industrial Relations approves such a settlement, or if no such settlement is made and the Department of Industrial Relations enters an award against the employer, he may then contract with the employee, or the beneficiary of a deceased...
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