The Attorney General of Texas 

March 24, 1983 

JIM MATTOX 

Attorney General 

Supreme Court Building 

P. 0. BOY 12546 

Austin. TX. 76711.2548 

5121475-2501 

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5121225.4191 

An Equal Opportunity/ 

Affirmative Action Employer 

Mr. H. S. Harris, Jr. 

Chairman 

Texas Industrial Accident Board 

200 East Riverside Drive 

Austin, Texas 78704 

Opinion No. JM-21 

Re: Workers' Compensation 

statutes pertaining to payment 

of lump sum benefits in cases 

involving fatality 

Dear Mr. Harris: 

You have asked us to construe sections of the workers' 

compensation laws providing for lump sum payment of death benefits in 

certain cases involving fatality. 

of section 8(d), 

You suggest that the requirements 

article 8306, V.T.C.S., are inconsistent with those 

of sections 15 and 17 of the same article. 

Section 15 states that in cases where death or incapacity results 

from an injury, e lump sum payment of benefits may be made. It also 

provides that in cases where manifest hardship and injury would 

otherwise result, the board may compel payment of its award in a lump 

sum. Section 17 provides for lump sum payment of benefits to 

non-resident alien beneficiaries when certain requirements are met. 

Both sections 15 and 17 were enacted in 1917. Acts 1917, 35th Leg., 

ch. 103, 1615, 17, at 280-81. 

Article 8306, section 8 was amended in 1973. Acts 1973, 63rd 

Leg., ch. 88, 84. at 187-88. Section 8(d) currently reads in part: 

The benefits payable to a widow, widower, or 

children under this section shall not be paid in e 

lump sum except in events of remarriage or in case 

of bona fide disputes as to the liability of the 

association for the death. (Emphasis added). 

Thus, section 8 appears to bar lump sum payment under circumstances 

where sections 15 and 17 would permit it. 

You first ask: 

1. May the Industrial Accident Board award 

lump sum benefits to a surviving spouse or child 

where there is no bona fide dispute as to the 

liability of the insurance carrier? 

p. 94 
.? _ 

Mr. H. S. Harris, Jr. - Page 2 (JM-21) 

The Texas Supreme Court discussed article 8306, section 8 in Twin 

City Fire Insurance Company v. Cortez. 576 S.W.2d 786 (Tex. 1979). 

The court stated that article 8306, section 8 restricts lump sum death 

benefits to the two situations listed in section 8(d). Id. at 789. 

Accord, Walters v. Fidelity & Casualty Company of New York. 611 S.W.2d 

934, 937 (Tex. Civ. App. - Eastland 1981, writ ref'd n.r.e.); Walden 

v. Royal Globe Insurance Company, 577 S.W.2d 296, 299-300 (Tex. Civ. 

APP. - Beaumont 1979, writ ref'd n.r.e.). Thus, where payments are 

made to a widow, widower, or children as a result of the death of the 

insured, lump sums may be paid in only two circumstances: (1) to a 

widow or widower upon remarriage, or (2) in case of bona fide disputes 

as to the liability of the association. The 1973 amendment to section 

8 was intended to change the prior practice of paying death benefits 

in a lump sum. Walters v. Fidelity 8 Casualty Company of New York, 

supra; Walden v. Royal Globe Insurance Company, s. 

Your first question is answered in the negative because neither 

of the conditions requisite to payment of a lump sum is present. 

Your second question is as follows: 

2. May the Industrial Accident Board approve a 

lump sum settlement agreement by a s"rviving 

spouse or a child and the insurance carrier, in a 

fatal case, where there is no bone fide dispute as 

to the liability of the insurance carrier, but 

only a dispute as to the proper beneficiary or 

beneficiaries? 

No provision of the workers' compensation law authorizes lump sum 

payment to settle a dispute as to the proper beneficiary. Sections 8 

and 8a of article 8306 state the persons to whom death benefits are 

payable. The lest sentence of section 8a provides that "[tlhe 

compensation provided for in this law shall be paid weekly to the 

beneficiaries herein specified, subject to the provisions of this 

law." (Emphasis added). Sections 8a end 8(d) also provide for weekly 

payments. There is no conflict between section 8a end section 8(d). 

Section 8(d) provides that lump sum payments may be made in disputes 

as to the liability of the association; section 8a provides that where 

there is no dispute es to liability. beneficiaries must be paid 

weekly. Therefore, we conclude that lump sum payments may not be made 

to beneficiaries when the only dispute is to whom payments must be 

made. 

You next ask: 

3. May the Industrial Accident Board award 

lump sum benefits to a surviving spouse or child 

or other beneficiary, where there is no bona fide 

dispute es to the lisbility of the insurance 

p. 95 
i 

Mr. H. S. Harris, Jr. - Page 3 (JM-21) 

carrier, but where the board finds 'manifest 

hardship end injury would otherwise result' as 

authorized in section 15? 

Your third question was answered by the Eastland Court of Civil 

Appeals in Walters v. Fidelity 8 Casualty Company of New York, supra 

at 937. The widow of the deceased employee attested that she had no 

income or funds, and that she was ii&g under a severe economic 

hardship. She argued that the trial court should have awarded a lump 

sum payment of death benefits. The appellate court discussed section 

8(d) and stated as follows: 

Since there is neither a remarriage nor a 

settlement, we hold that the trial court correctly 

denied lump sum payment of future death benefits 

to Mrs. Welters. 

See also Twin City Fire Insurance Company v. Cortez, supra at 789. 

Section 15 now applies only in cases where the insured's injury 

results in incapacity. not death. 

You finally ask the following question: 

4. Despite the provision of section 17, are 

the restrictions on lump sum payments described in 

section 8(d) applicable in cases involving the 

payment of fatal benefits to non-resident alien 

beneficiaries? 

Your last question concerns whether lump sum payments may be made 

to non-resident alien beneficiaries es provided in section 17. 

Section 8(d), as the latest expression of legislative intent repeals 

inconsistent provisions of section 17. See State v. Easley, 404 

S.W.2d 296, 300 (Tex. 1966); Allied Finance Company of Bay City v. 

J.M. Falkner, 397 S.W.2d 846, 847 (Tex. 1966). Thus, payments to the 

non-resident alien beneficiaries of a deceased insured may be made to 

a widow or widower only in the event of remarriage or to other 

beneficiaries in cases of bona fide disputes as to liability of the 

association. 

SUMMARY 

Article 8306, section 8(d), V.T.C.S., restricts 

lump sum payment of death benefits to two 

situations: (1) upon remarriage of the widow or 

widower or (2) in the case of bone fide disputes 

as to the liability of the association. Thus, the 

Texas Industrial Accident Board may not award lump 

sum payments to an unremarried widow or widower or 

p. 96 
Mr. H. S. Harris, Jr. - Page 4 (JM-21) 

to other beneficiaries where there is no dispute 

as to the liability of the insurance carrier. 

There is no provision in the Workers' Compensation 

Act permitting a lump *urn payment in the 

settlement of a dispute as to proper 

beneficiaries. Thus, no lump sum payment may be 

made in that circumstance. The board may award 

lump sum payments pursuant to sections 15 and 17 

of article 8306, V.T.C.S., to the insured where he 

survives but is incapacitated, but not to the 

beneficiaries of a deceased insur d. 

Very truly you Jdkh? m 

JIM MATTOX 

Attorney General of Texas 

TOM GREEN 

First Assistant Attorney General 

DAVID R. RICHARDS 

Executive Assistant Attorney General 

Prepared by Patricia Hinojosa 

Assistant Attorney General 

APPROVED: 

OPINION COMMITTEE 

Susan L. Garrison, Chairman 

Jon Bible 

Rick Gilpin 

Patricia Hinojosa 

Jim Moellinger 

p. 97