ADJ13831424 · December 19, 2022

Good cause existed to set aside the Order Approving the Compromise and Release because the applicant was a Spanish-speaking individual who executed the settlement without a certified interpreter, which was not disclosed to the WCJ at the time of approval, rendering the original order inequitable.

The WCJ found the applicant credible in testifying that she no longer had the settlement funds and ruled that she is not required to reimburse the defendant any of the previous funds paid, as the defendant did not present evidence to the contrary.

The Compromise and Release did not settle the claim for serious and willful misconduct benefits, which are separate and distinct from ordinary compensation benefits. The employer remains personally liable for any potential serious and willful claim despite the settlement of the death benefit with the insurer.

From the decision · page 9Compensation for an employer's serious and willful misconduct "is clearly separate and distinct from the ordinary compensation benefits provided for under Section 3700" of the Labor Code and a compromise and release of these normal benefits cannot defeat and does not settle the claim for serious and willful misconduct benefits. (Rodgers v. Real Prop. Mgmt. Co. (1984) 49 Cal.Comp.Cases 561, 564-565, quoting Ray v. IAC (Wolgamott) (1956) 146 Cal. App.2d 393 [21 Cal.Comp.Cases 327].) Here, the value of the settlement is roughly equivalent to the present value of the statutory death benefit allowable to one total dependent. There is no evidence of consideration paid in exchange for settling a claim for increased benefits contemplated by sections 4553 and 4702. (Lab. Code, § 4553, 4702.) The insurer assumed liability for compensation and thus stepped into the shoes of the employer with respect to settling the statutory death benefit. (Lab. Code, § 3753, et seq.) The insurer does not cover S&W claims (MOH/SOE, August 18, 2022, trial, p. 11; see also Ins. Code, § 11661) and the only parties to the C&R were applicant and the insurer. Thus, while the employer may rely on the insurer to settle the death benefit, the employer remains personally liable for any potential S&W claim.

Favours Applicant prevailed

This fact was unknown to the WCJ at the time of the original order and rendered the original Order Approving the Compromise and Release inequitable, justifying setting it aside.

The claims examiner, Laura Nunez, had limited experience with death cases and serious and willful misconduct claims and did not provide a certified interpreter for the settlement documents.

Favours Applicant prevailed

This supported the finding of good cause to set aside the Order Approving the Compromise and Release, favoring the applicant.

Favours Applicant prevailed

This supported the ruling that the applicant is not required to reimburse the defendant any of the previous funds paid, favoring the applicant.

Labor Code section 5803

The appeals board has continuing jurisdiction to rescind, alter, or amend any order, decision, or award for good cause upon notice and opportunity to be heard.

Good cause includes mutual mistake of fact, duress, fraud, undue influence, and procedural irregularities, and any factor unknown at the time of the original order that renders it inequitable justifies reopening.

From the decision · page 6Subject to the limitations of Labor Code2 section 5804, "[t]he appeals board has continuing jurisdiction over all its orders, decisions, and awards made and entered under the provisions of [Division 4]... At any time, upon notice and after the opportunity to be heard is given to the parties in interest, the appeals board may rescind, alter, or amend any order, decision, or award, good cause appearing therefor." (Lab. Code, § 5803.)

Rodgers v. Real Prop. Mgmt. Co. (1984) 49 Cal.Comp.Cases 561

Compensation for serious and willful misconduct is separate and distinct from ordinary compensation benefits and cannot be settled by a compromise and release of normal benefits.

The employer remains personally liable for any potential serious and willful claim despite the settlement of the death benefit with the insurer.

From the decision · page 9Compensation for an employer's serious and willful misconduct "is clearly separate and distinct from the ordinary compensation benefits provided for under Section 3700" of the Labor Code and a compromise and release of these normal benefits cannot defeat and does not settle the claim for serious and willful misconduct benefits. (Rodgers v. Real Prop. Mgmt. Co. (1984) 49 Cal.Comp.Cases 561, 564-565, quoting Ray v. IAC (Wolgamott) (1956) 146 Cal. App.2d 393 [21 Cal.Comp.Cases 327].) Here, the value of the settlement is roughly equivalent to the present value of the statutory death benefit allowable to one total dependent. There is no evidence of consideration paid in exchange for settling a claim for increased benefits contemplated by sections 4553 and 4702. (Lab. Code, § 4553, 4702.) The insurer assumed liability for compensation and thus stepped into the shoes of the employer with respect to settling the statutory death benefit. (Lab. Code, § 3753, et seq.) The insurer does not cover S&W claims (MOH/SOE, August 18, 2022, trial, p. 11; see also Ins. Code, § 11661) and the only parties to the C&R were applicant and the insurer. Thus, while the employer may rely on the insurer to settle the death benefit, the employer remains personally liable for any potential S&W claim.

Claims examiner Laura Nunez's limited experience with death cases and serious and willful misconduct claims, and failure to provide a certified Spanish interpreter for the settlement documents.