Triste v. Industrial Commission

• Decision Date: 15 January 1976
• Docket Number: No. 1,CA-IC,1
• Citation: Triste v. Industrial Commission, 544 P.2d 706, 25 Ariz.App. 489 (Ariz. App. 1976)
• Parties: Josephine V. TRISTE, widow, Calistro M. Triste, deceased, Petitioner, v. The INDUSTRIAL COMMISSION of Arizona, Respondent, Arizona Hide & Metal Co., Respondent Employer, State Compensation Fund, Respondent Carrier. 1230.
• Court: Arizona Court of Appeals

Page 706

544 P.2d 706

25 Ariz.App. 489

Josephine V. TRISTE, widow, Calistro M. Triste, deceased, Petitioner, v. The INDUSTRIAL COMMISSION of Arizona, Respondent Arizona Hide & Metal Co., Respondent Employer State Compensation Fund, Respondent Carrier.

No. 1 CA-IC 1230.

Court of Appeals of Arizona, Division 1, Department C.

Jan. 15, 1976.

Rehearing Denied Feb. 23, 1976.

Review Denied March 23, 1976.

Lawrence Ollason, Tucson, for petitioner.

Greg L. Folger, Chief Counsel, The Industrial Commission of Ariz., Phoenix, for respondent.

Robert K. Park, Chief Counsel, State Compensation Fund, by J. Victor Stoffa, Phoenix, for respondent Carrier and respondent Employer.

OPINION

SCHROEDER, Judge.

This petition for review of an Industrial Commission award presents several issues relating to death benefits under our Arizona Workmen's Compensation Act. The issues pertain to the extent of the carrier's lien upon proceeds of a settlement in a third party action; whether benefits may be awarded with respect to a child conceived after the industrial injury; and the proper amount of burial allowance.

The case arises out of tragic circumstances. Calistro M. Triste, the deceased, was employed by respondent employer, Arizona Hide & Metal Co., on December 20, 1968, when he suffered an industrial injury to his back. In July of 1969, while being prepared for back surgery, he suffered a cardiac arrest after administration of anesthesia. The arrest resulted in massive brain damage, and Mr. Triste remained in a comatose condition until February 14, 1973, when he died. Mr. Triste was survived by his wife and three minor children. It is not disputed that the death was sufficiently causally related to the industrial injury so as to warrant death benefits pursuant to A.R.S. § 23--1046.

Prior to Mr. Triste's death, a medical malpractice action was filed against the anesthesiologist. The action was maintained by petitioner, Josephine Triste, as guardian of her husband's person and estate, and also, at least purportedly, as next best friend of their minor children. That action was settled for $400,000.00, in return for a general release of all present and future claims. The settlement agreement was executed by Josephine Triste, individually and as guardian of her husband's estate and person, and as next best friend of the children.

Petitioner then filed for workmen's compensation death benefits. The respondent carrier accepted the claim for benefits on behalf of the wife and two children but claimed a right to set off the net amount of the settlement proceeds against its total survivor benefit obligations for the wife and children.* In addition, the carrier denied benefits for the third minor child, born after the industrial accident. After a hearing, the Commission entered its award finding in favor of the carrier on these matters.

The initial question before us is whether the Commission correctly decided that the carrier, given the circumstances of the settlement with the anesthesiologist, was entitled to set off the settlement proceeds against the death benefits due for the children.

A.R.S. § 23--1023(C) provides that where there is an action against a third party tortfeasor, the insurance carrier has a lien in the amount actually collectible from the other person to the extent of the carrier's obligation for compensation benefits. That section further provides that where there is a settlement of a third party action for an amount less than the compensation benefits, that settlement must be approved by the carrier. This is to prevent acceptance of too small an amount and avoid prejudice to the carrier's subrogation rights. Hornback v. Industrial Commission of Arizona, 106 Ariz. 216, 474 P.2d 807 (1970).

The parties here do not dispute that if the settlement was a valid compromise of the potential claims of the children, then the carrier would be entitled to set off the net amount of the settlement proceeds after deducting the expenditures for the deceased against its obligations for payment of death benefits. The carrier did approve the settlement after petitioner, in a request prepared by prior counsel, represented to the Commission and the carrier that the settlement was a settlement of all claims of Mr. Triste 'and his family.'

The petitioner here contends that the carrier is not entitled to such an offset because 'the children were not duly and legally represented in the settlement.' She contends, relying on Rule 17(g) of the Rules of Civil Procedure, that before the children's potential claims could be settled, a guardian ad litem had to be appointed by the Court.

We disagree with petitioner's reading of Rule 17(g). Rule 17(g) provides that where rights of infants are involved, '(t)he court shall appoint a guardian ad litem for an infant or incompetent person not otherwise represented in an action Or shall make such other order as it deems proper for the protection of the infant or incompetent person' (emphasis supplied). This Court has previously stated that the use of the word 'or' in the underscored portion means that appointment of a guardian ad litem is not mandatory. Nesbitt v. Nesbitt, 1 Ariz.App. 293, 402 P.2d 228 (1965). Petitioner's own brief acknowledges that 'there was judicial authorization for this execution' as 'next best friend.' We believe that Rule 17(g) has, therefore, been fully complied with.

Petitioner also argues that the settlement was deficient in that no bond was posted by Mrs. Triste pursuant to Rule 17(h). However, Rule 17(h) does not require that a bond be posted before an action is filed and settlement entered into; it merely provides that a bond must be filed before there is a distribution of proceeds to a minor. The record in this case does not reflect that there has ever been any actual distribution of assets to the minors; it reflects only that the remaining proceeds of the settlement are in the estate of the decedent. The settlement agreement itself provided that a guardian ad litem would be appointed to represent the minor children in any subsequent allocation. We see no procedural defect with respect to the settlement.

Even if we assume that there was some technical deficiency in Mrs. Triste's representation of her children in the settlement, we cannot conclude in the circumstances of this case that the carrier must be denied the setoff which the Commission awarded it. There is no suggestion that petitioner, or anyone else with an interest in this matter, wishes to undo the settlement which was made, and upon which proceeds have already been paid. This settlement was approved by the carrier on the petitioner's representation that it was a valid settlement of the family's rights. Under ordinary...