Annette L. Hanna, et al. v. Federated Insurance Company

This workers' compensation appeal has been referred to the Special Workers' Compensation Appeals Panel of the Supreme Court in accordance with Tennessee Code Annotated _ 5-6-225(e)(3) for hearing and reporting to the Supreme Court of findings of fact and conclusions of law. The trial court found the plaintiff's husband was killed in the course and scope of his employment and ordered the amount to which his dependants were entitled should be paid in a lump sum. The court further ordered the money to be paid into the court and that the Clerk and Master invest the funds and pay the interest earned thereon to the widow for the benefit fo the deceased's minor children. The defendant says the death benefits cannot be paid in a lump sum and further says, even if lump sum payments is permissible, the plaintiff has failed to show she can manage the money. Further, the defendant says the trial court erroneously failed to commute the award to its present value. We affirm the judgment of the trial court. Tenn. Code Ann. _ 5-6-225(e) (1999) Appeal as of Right; Judgment of the Circuit Court is Affirmed JOHN K. BYERS, SR. J., in which FRANK F. DROWOTA, III, J. and JOSEPH C. LOSER, JR., SP. J., joined. D. Brett Burrow and Delicia R. Bryant, Nashville, Tennessee, attorneys for the appellant, Federated Insurance Company. Mark A. Rassas and Julia P. North, Clarksville, Tennessee, for the appellees, Annette L. Hanna, widow of the decedent, Darren D. Hanna, and as Guardian for the minor children, Brett Hanna and Marian Hanna, and as Administratrix of the Estate of Darren D. Hanna. OPINION On September 2, 1999, Darren H. Hanna died as a result of a vehicle accident. There was no dispute that the accident occurred within the scope and course of the decedent's occupation with the defendant. Mr. Hanna was survived by his widow, Annette L. Hanna, who was born November 25, 1972, and two minor children, Marian Ruth Hanna, born September 17, 1994, and Brett Darren Hanna, born March 3, 1997. On November 5, 1999, the widow filed this case against the defendant. On June 15, 2, the widow was appointed guardian of the estate of the two minor children to receive any workers' compensation benefits, and also in that order the Clerk of the Chancery Court was authorized to receive the proceeds of any compensation benefits, invest them and pay the interest to Annette K, Hanna for the care and maintenance of the two minor children. On June 27, 2, the widow filed a sworn statement renouncing any benefits from the proceeds of any workers' compensation award conditional on the money being paid into the court and invested and distributed as subsequently ordered by the trial court. On June 3, 2, the trial judge ordered the defendant to pay a lump sum of $174,416. into the court less any credits for sums previously paid, and that the Clerk and Master have control of the funds for the purpose of investment and for payments of the interest earned thereon to the widow for the benefit of the minor children. Discussion Did the trial court have authority to order a lump sum payment_yes. In Jones v. General Accident Ins. Co., 856 S.W.2d 133 (Tenn. 1993), the court held "(i)n any event, we hold today that death benefits awarded under Tennessee Code Annotated. _ 5-6-21 can be commuted to a lump sum." In Clayton v. Cookeville Energy Inc., 824 S.W.2d 167 (Tenn. 1992), the court approved a lump sum settlement to the widow, and in Ponder v. Manchester Housing Authority, 87 S.W.2d 282 (Tenn. 1994) the court approved a lump sum payment to the widow and an arrangement for the minor children's share to be paid to the clerk, invested and the interest therefrom paid to the children. The arrangement in this case is similar to the arrangement in Ponder except in this case the widow will not receive a share of the proceeds.1 Perhaps a more substantial argument is made by the defendant on the premise that the evidence does not support a lump sum award because the widow has demonstrated an inability to wisely manage a lump sum award. 1 The defendant's argument that the widow might remarry is not important because the defendant would still be liable for two-thirds of the benefit because of the two remaining children. -2-