Case Name: ANGELA CHAVEZ et al., Petitioners, v. INDUSTRIAL ACCIDENT COMMISSION et al., Respondents
Court: Supreme Court of California
Jurisdiction: California
Decision Date: 1958-02-14
Citations: 49 Cal. 2d 701
Docket Number: L. A. No. 24576
Parties: ANGELA CHAVEZ et al., Petitioners, v. INDUSTRIAL ACCIDENT COMMISSION et al., Respondents.
Judges: Shenk, J., Schauer, J., and McComb, J., concurred.
Reporter: California Reports
Volume: 49
Pages: 701–706

Head Matter:
[L. A. No. 24576.
In Bank.
Feb. 14, 1958.]
ANGELA CHAVEZ et al., Petitioners, v. INDUSTRIAL ACCIDENT COMMISSION et al., Respondents.
Levy, Russell & DeRoy and George DeRoy for Petitioners.
Everett A. Corten, Edward A. Sarkisian, Talbot & Thompson and George Thompson for Respondents.

Opinion:
SPENCE, J.
Petitioners, who are the surviving widow and children of Jose Chavez, seek annulment of the respondent commission's award to them of certain benefits and of the commission's order disapproving a compromise.
The employee, Jose Chavez, suffered an industrial injury in 1955. His employer furnished medical treatment and made temporary disability payments for approximately three months. Thereafter, the employee filed an application for adjustment of compensation, and the commission conducted a hearing on February 27, 1956. An oral agreement of compromise for $2,250 was reached by the employee and the employer's insurance carrier on the following day.
The insurer prepared a written compromise agreement on a form supplied by the commission and sent it to the employee, who executed it on March 10, 1956. It was received by the insurer on March 14. On March 12, however, the employee died of a nonindustrial heart condition. The carrier signed the compromise and forwarded it to the commission for approval before learning of the employee's death. The commission, through its referee, after learning of the death and at the insurer's request, disapproved the compromise. The order stated, in part, that the "Commission, having considered the entire record, now finds that it is not for the best interests of the parties to approve . . . [the] Compromise and Release and that it should be disapproved, applicant having died prior to approval thereof. ." The findings and award simply reiterated that the death was the basis for such action. The widow and dependent children were granted benefits consisting principally of unpaid compensation payments which were found to have accrued in favor of the employee prior to his death. Their petition for reconsideration was thereafter denied.
The employee's dependents contend that although the employee died, there was still adequate consideration to support the compromise. While this may be true, it is not controlling on the question of the effectiveness of the unapproved compromise or the question of the propriety of the commission's refusal to approve it in view of section 5001 of the Labor Code. That section provides: "Compensation is the measure of the responsibility which the employer has assumed for injuries or deaths which occur to employees in his employment when subject to this division. No release of liability or compromise agreement is valid unless it is approved by the commission, a panel, commissioner, or referee." (Emphasis added.)
Undoubtedly the Legislature, in enacting this section, was primarily concerned with protecting workmen who might agree to unfortunate compromises because of economic pressure or lack of competent advice. (See 1 Hanna, The Law of Employee Injuries and Workmen's Compensation, p. 154.) However, the effect of the section, by its clear wording, is to make every compromise invalid until it is approved. (Employee's Credit Co. v. Industrial Acc. Com., 177 Cal. 46 [169 P. 1001]; Massachusetts etc. Co. v. Industrial Acc. Com., 176 Cal 488 [168 P 1050].) In conformity with the section, the written compromise agreement here contained an express provision making its effectiveness dependent upon approval by the commission.
Approval of the compromise by the commission, therefore, was clearly essential to its effectiveness. At the time that the compromise was before the commission for approval or disapproval, the -commission knew of the employee's intervening death, which death would normally terminate any right to disability payments. (Lab. Code, § 4700.) Under these circumstances the ruling of the commission disapproving the compromise cannot be disturbed.
The award made by the commission and the order disapproving the compromise are affirmed.
Shenk, J., Schauer, J., and McComb, J., concurred.