State ex rel. Shively v. Murphy Motor Freight - Ohio Supreme Court Opinion - Ohio Supreme Court Decision

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The State ex rel. Shively, Appellant, v. Murphy Motor Freight,
Bankrupt; Industrial Commission of Ohio, Appellee.
[Cite as State ex rel. Shively v. Murphy Motor Freight
(1994), Ohio St.3d .]
Workers' compensation -- Death benefits -- Reapportionment of
award to widow after stepchildren lose their benefit
eligibility -- Industrial Commission abuses its discretion in
denying request for adjustment of reapportioned amount, when.
(No. 93-1949 -- Submitted October 11, 1994 -- Decided
December 7, 1994.)
Appeal from the Court of Appeals for Franklin County, No.
92AP-914.
Decedent, George L. Shively, was killed on August 30, 1982,
in the course of and arising from his employment with Murphy Motor
Freight ("Murphy"), a formerly self-insured employer that is now
bankrupt. He was survived by his widow, appellant Margaret
Shively, and two children from an earlier marriage. His survivors
filed an application for death benefits on his behalf with
appellee, Industrial Commission of Ohio.
The commission on March 9, 1983 awarded the death benefit
maximum of $298 per week, assigning $218 per week to appellant and
$40 per week to each child. Shortly thereafter, the children, who
did not share their stepmother's attorney, moved, through their
guardian, that the commission authorize a lump sum advancement to
pay for their own attorney fees. The commission granted the
motion on September 15, 1983.
Murphy advanced $5,000 to the children for attorney fees and
reduced the weekly benefit amount by $3 per week per child to
recoup the advancement. It is not known how Murphy calculated the
recoupment amount.
After Murphy declared bankruptcy, the Bureau of Workers'
Compensation assumed payment at the rate of $218 per week to
appellant and $37 per week to each stepchild. After one of the
children reached majority and the other child discontinued her
education following majority, appellant successfully petitioned
the commission to reapportion the children's benefits to her.
Appellant, however, objected to the reapportionment amount of only
$37 per week per child instead of the originally assigned $40 per

week per child. The commission denied appellant's request for
adjustment, writing:
"These fees were paid on behalf of the minor children of the
decedent on September 15, 1983. These are not the children of the
widow claimant, but the reduction must continue against the
decedent's claim."
Appellant filed a complaint in mandamus in the Court of
Appeals for Franklin County, alleging that the commission abused
its discretion in denying her adjustment request. Finding that
appellant failed to sustain her burden of establishing that the
apportionment was not "just and equitable," the appellate court
denied the writ.
This cause is now before this court upon an appeal as of
right.

Lancione Law Offices and David Lancione, for appellant.
Lee Fisher, Attorney General, and William J. McDonald,
Assistant Attorney General, for appellee.

Per Curiam. Loss of dependency dictates redistribution of
the former dependents' death benefits among the remaining
dependents. See State ex rel. Columbus & S. Ohio Elec. v. Indus.
Comm. (1979), 65 Ohio App. 2d 83, 14 O.O.3d 85, 416 N.E.2d 629.
No statutory formula directs how these funds are to be
reapportioned. Instead:
"* * * The commission has final discretion to award death
benefits solely to those who are wholly dependent or to apportion
such benefits among wholly dependent persons and other dependent
persons as the commission deems equitable in the circumstances of
each particular case." (Emphasis added.) Former R.C.
4123.59(D)(2).
Similarly, former R.C. 4123.60 providesd:
"Benefits in case of death shall be paid to such one or more
of the dependents of the decedent, for the benefit of all the
dependents as may be determined by the industrial commission,
which may apportion the benefits among the dependents in such a
manner as it deems just and equitable." (Emphasis added.)
Appellant contests the commission's decision to increase her
weekly compensation by only $74 instead of the $80 per week
originally awarded to her two stepchildren. The commission
defends its apportionment by arguing that the $3 week per child
reduction had been insufficient to pay off the $5,000 advancement
by the time the stepchildren lost their benefit eligibility.
Continued reduced benefits were necessary, therefore, to ensure
that the obligation was repaid. The commission further argues
that the stepchildren did not lose their dependency status because
of age (both were under age twenty-five [R.C. 4123.59(D)(2)]), but
because they were no longer continuing their schooling. The
commission claimed that the reduced rate was appropriate, since it
reflected the amount which either one of the stepchildren would be
entitled to receive if they would reinstate their dependency by
enrolling in college. The commission's position is unpersuasive.
The commission unquestionably may authorize attorney-fee
advancements and recoup them via compensation offset. Former R.C.
4123.06, 4123.64, 4121.131. Moreover, once the advancement has
been recovered, the commission is not required to restore the
amount of weekly compensation to its previous level. State ex

rel. Funtash v. Indus. Comm. (1951), 154 Ohio St. 497, 43 O.O.
431, 96 N.E.2d 593. In this case, however, it is not appellant
who requested the attorney fee advancement nor is she the one who
benefited from it. The commission does not challenge appellant's
assertion that she is effectively being forced to pay for another
party's attorney fees.
The commission's claim that appellant lacks the "clean hands"
to assert any additional entitlement to benefits lacks merit. The
commission's claim that appellant was at fault for failing to
notify Murphy or the commission that the stepchildren's recoupment
offset was too low is untenable. It was not appellant's
responsibility to do so, nor was she even in a position to know of
the potential shortfall.
The commission has broad discretion in apportionment
matters. However, there is nothing to suggest that
reapportionment at the reduced instead of full rate is either just
or equitable to appellant.
Accordingly, the judgment of the court of appeals is reversed
and the writ is allowed.
Judgment reversed
and writ allowed.
Moyer, C.J., A.W. Sweeney, Douglas, Wright, Resnick, F.E.
Sweeney and Pfeifer, JJ., concur.