Subsequent Injury Fund v. Chapman

Murphy, C.J., delivered the opinion of the Court. This appeal in a Workmen’s Compensation case presents the question whether an award for permanent total disability payable out of the Subsequent Injury Fund survives to a widow upon the death of her claimant husband from a cause not related to the accident which caused the total disability. The pertinent facts are these: A jury in the Court of Common Pleas of Baltimore City found that Henry Chapman, the deceased husband of Katherine Chapman, was permanently and totally disabled as a result of the combined effects of a pre-existing condition and a subsequent accidental injury sustained by him on May 4, 1967. The jury found that 35% of the permanent total disability was due to the accidental injury of May 4, 1967 and that 65% of the disability was due to a previous accident or disease in 1957.

The case was remanded to the Workmen’s Compensation Commission for the passage of an order in conformity with the jury’s verdict and the judgment of the court. On March 17, 1970, the Commis ³⁷¹ sion passed an award of compensation “not [to] exceed the sum of $30,000.00 1 in accordance with [Maryland Code] Section 36, Subsection 1, of Article 101,” directing that the employer and insurer “shall pay the sum of $10,500.00 representing the compensation payable for 35 % of the claimant’s permanent total disability, and the balance, the sum of $19,500.00 representing the compensation payable for 65 % of the claimant’s permanent total disability due to a pre-existing condition, shall not be payable from the Subsequent Injury Fund.” The Commission stated in its order that “there is no right of survivorship of permanent total disability benefits under Article 101, Section 66, Subsection 1,” but that “the rights of survivorship that exist are under Section 36, Subsection 1, and do not apply to Subsequent Injury Fund awards.” Mrs. Chapman appealed from that part of the Commission’s decision precluding recovery of compensation from the Fund. The court (Sodaro, J.) reversed the Commission’s decision. It held that awards payable out of the Fund survive to a widow upon the death of her husband from a cause not related to the accident which caused the total disability; and that Mrs. Chapman should receive from the Fund the sum of $19,500.00 for the 65% due to her deceased husband’s prior disability, subject to a credit of $9,075.00, the dollars actually awarded to her husband for his previous 1957 disability, or a net sum of $10,425.00.

The Subsequent Injury Fund appealed from this determination. We recently reviewed the statutory and judicial history of the Subsequent Injury Fund in Subsequent Injury Fund v. Howes, 11 Md. App. 325 . We there noted that the statutory precursor of the Subsequent Injury Fund— the Second Injury Fund — was created by Chapter 637 of the Acts of 1945. That Act, later codified within the “Workmen’s Compensation” article of the Maryland Code as Section 66 of Article 101, provided that where ³⁷² an employee, who had previously lost, or lost the use of a hand, arm, foot, leg or eye, lost another of those members or organs in a compensable accidental injury and thereby became permanently and totally disabled, the employee was entitled to receive additional compensation, beyond that payable by the employer for the current injury, such additional compensation to be paid, upon the written order of the Workmen’s Compensation Commission, from a special fund known as the Second Injury Fund, funded by assessments imposed upon employers and insurers.

It was the express intent of the law creating the Second Injury Fund “to make the total payments to which such employee shall become entitled equal to the compensation that would be due for permanent total disability.” 2 By Chapter 809 of the Acts of 1963, Section 66 of Article 101 was repealed and re-enacted, with amendments. One of the amendments to Section 66 abolished the Second Injury Fund and created, in its place, the Subsequent Injury Fund. As amended by the 1963 Act, Section 66 accomplished a major broadening of the original concept of the Second Injury Fund. It provided for payments of additional compensation from the Fund to an injured employee who sustained any injury in a compensable accident while previously suffering any kind of permanent impairment due to a previous accident or a disease or any congenital condition, provided that the end result was permanent total disability or permanent partial disability exceeding 50 % of the body as a whole.

It was the express intent of the Act creating the Subsequent Injury Fund “to make the total payments to which such employee shall become entitled equal to the compensation that would be due for the combined effects of the impairment and subsequent injury resulting in permanent total disability or a substantially greater permanent partial disability.” ³⁷³ In analyzing the Subsequent Injury Fund, the Court of Appeals, in Subsequent Injury Fund v. Pack, 250 Md. 306, 308 , said: “Its purpose was to persuade the employer to employ the handicapped individual by limiting the liability, which the employer may otherwise have incurred, in the event the previously disabled or injured individual sustained a subsequent occupational injury, although not of itself disabling, but which, coupled with previous impairment, rendered the individual permanently disabled, thus exposing the employer to liability for the cumulative effect of the prior and subsequent injuries. By the terms of the statute, if the employee sustained a subsequent compensable disability, but the cumulative effect of the disability and the prior disability resulted in a permanent total or permanent partial disability, the employer and his insurance carrier would only be liable for compensation payable by reason of the subsequent injury. The Subsequent Injury Fund, funded by assessments imposed upon employers and insurers, by statute, would contribute the balance of the total award, so that the sum of the two payments would equal the compensation provided by statute for the combined effects of both the previous disability and the subsequent injury.” The 1963 Act (Section 66) provided that the Subsequent Injury Fund was to assume the defense and payment of all claims made against the Second Injury Fund “for injuries which arose prior to June 1, 1963.” It was also provided, in Section 2 of the Act, that its “provisions * * * shall only be construed prospectively and shall not be applied or interpreted to have any retrospective effect.” The Act took effect June 1,1963. Neither the 1945 Act creating the Second Injury Fund nor the 1963 Act creating the Subsequent Injury Fund contained any provision for survivorship of the unpaid part of an award made against the Fund where the injured employee died from a cause not related to the accident which caused the total disability.

It is because of ³⁷⁴ the absence of any such survivorship provision that the claim is made, on behalf of the Fund, that the Legislature never intended to create any right of survivorship of awards made against the Fund; and that, consequently, the court below was in error in directing payment to Mrs. Chapman of the unpaid part of her deceased husband’s award. In support of this position it is argued that the Subsequent Injury Fund law was passed primarily for the benefit of the handicapped worker, so that if death ensues from a cause unrelated to his accidental injury he is no longer in the labor market and his claim expires with him. The Fund claims that as Chapman was previously paid for his 1957 injury, there is no reason to pay again for the same inj úry and disability. 3 In this connection, it is urged that as Section 2 of the 1963 Act requires that it be construed only prospectively, and not given any retrospective effect, it would run counter to the plain language and meaning of the Act to require the Fund to pay any part of the $19,500.00 award attributable to the 1957 injury. We find no merit in any of these arguments.

It is expressly provided in another Section of the Workmen’s Compensation Law — Maryland Code, Article 101, Section 36, Subsections (1) (c) and (4)(e), respectively, that if