Opinion ID: 1058465
Heading Depth: 1
Heading Rank: 6

Heading: Lump Sum

Text: The final issue is whether the trial court erred in commuting 180 weeks of benefits to a lump sum. Cullom argues that the trial court erred because a lump-sum payment cannot exceed 100 weeks under Tennessee Code Annotated section 50-6-207(4)(A)(ii) (Supp.2004). Cullom also argues that the trial court improperly accelerated the payment of Gray's remaining benefits by refusing to reduce the weekly rate at which they were to be paid. Gray maintains that the lump sum was appropriate because it included amounts for attorney's fees and Gray's pre-injury debt which was in arrears. This issue requires an examination of Tennessee Code Annotated section 50-6-207(4)(A)(ii) (Supp.2004), which states in part that permanent total disability payments shall not be commuted to a lump sum except in accordance with the following: (a) Benefits may be commuted to a lump sum to pay only the employee's attorney's fees and litigation expenses and to pay pre-injury obligations in arrears; (b) The commuted portion of an award shall not exceed the value of one hundred (100) weeks of the employee's benefits; (c) After the total amount of the commuted lump sum is determined, the amount of the weekly disability benefit shall be recalculated to distribute the total remaining permanent total benefits in equal weekly installments beginning with the date of entry of the order and terminating on the date the employee's disability benefits terminate.... Tenn.Code Ann. § 50-6-207(4)(A)(ii) (Supp.2004). Because lump sum awards are an exception to the general purpose of providing injured workers with periodic payments that substitute for wages, this Court has emphasized that commutation should occur only in exceptional circumstances, and not as a matter of course. Henson v. City of Lawrenceburg, 851 S.W.2d 809, 814 (Tenn.1993). Although the record reflects that the trial court properly considered attorney's fees and Gray's arrearages for pre-injury obligations in awarding lump sum benefits, the trial court erred in the extent of its award which totaled 180 weeks. The plain language of the statute provides that the commuted portion of an award shall not exceed the value of one hundred (100) weeks of the employee's benefits.... Tenn.Code Ann. § 50-6-207(4)(A)(ii)(b) (Supp.2004). Given that the term shall is mandatory, the statutory language is unambiguous and must be applied as written. See Limbaugh v. Coffee Med. Ctr., 59 S.W.3d 73, 83 (Tenn.2001). Accordingly, this case must be remanded to the trial court for a redetermination of lump sum benefits, which may not exceed 100 weeks. In addition, the record shows that after awarding lump sum benefits, the trial court erred in refusing to reduce the weekly rate at which the remaining payments were to be made. See Tenn.Code Ann. § 50-6-207(4)(ii)(c) (Supp.2004) (After the total amount of the commuted lump sum is determined, the amount of the weekly disability benefit shall be recalculated to distribute the total remaining permanent total benefits in equal weekly installments....). In our view, reducing the weekly rate ensures that the employee will receive payments throughout the entire period of disability, serves as a more effective substitute for regular wages, and avoids forcing employers to make payments on an accelerated schedule. Accordingly, on remand, the trial court shall make a determination as to the lump sum benefits and shall then calculate the weekly rate at which Cullom shall pay the remaining benefits by using the full period of Gray's disability.