Court Opinion

ID: 9632751
Source: CourtListenerOpinion
Date Created: 2023-08-22 11:24:06.214148+00
Date Added: 2024-06-11T12:58:58.343864
License: Public Domain

DURHAM, J.,
concurring in part, dissenting in part.
I agree with the majority that the board did not err in calculating the present value of future benefits that it authorized Liberty to accept. However, I disagree with the majority’s construction of ORS 656.593.
ORS 656.593 provides, in part:
“(1) If the worker or the beneficiaries of the worker elect to recover damages from the employer or third person, notice of such election shall be given the paying agency by personal service or by registered or certified mail. The paying agency likewise shall be given notice of the name of the court in which such action is brought, and a return showing service of such notice on the paying agency shall be filed with the clerk of the court but shall not be a part of the record except to give notice to the defendant of the lien of the paying agency, as provided in this section. The proceeds of any damages recovered from an employer or third person by the worker or beneficiaries shall be subject to a lien of the paying agency for its share of the proceeds as set forth in this section and the total proceeds shall be distributed as follows:
“ (a) Costs and attorney fees incurred shall be paid, such attorney fees in no event to exceed the advisory schedule of fees established by the board for such actions.
‘ ‘ (b) The worker or the beneficiaries of the worker shall receive at least 33-1/3 percent of the balance of such recovery.
*70“(c) The paying agency shall be paid and retain the balance of the recovery, but only to the extent that it is compensated for its expenditures for compensation, first aid or other medical, surgical or hospital service, and for the present value of its reasonably to be expected future expenditures for compensation and other costs of the worker’s claim under this chapter. Such other costs include assessments for reserves in the Insurance and Finance Fund, but do not include any compensation which may become payable under ORS 656.273 or 656.278.
“(d) The balance of the recovery shall be paid to the worker or the beneficiaries of the worker forthwith. Any conflict as to the amount of the balance which may be retained by the paying agency shall be resolved by the board.
“ (2) The amount retained by the worker or the beneficiaries of the worker shall be in addition to the compensation or other benefits to which such worker or beneficiaries are entitled under this chapter.
“(3) A claimant may settle any third party case with the approval of the paying agency, in which event the paying agency is authorized to accept such a share of the proceeds as may be just and proper and the worker or the beneficiaries of the worker shall receive the amount to which the worker would be entitled for a recovery under subsections (1) and (2) of this section. Any conflict as to what may be a just and proper distribution shall be resolved by the board.” (Emphasis supplied.)
The statute establishes the procedure for determining the extent to which a “payingagency,” ORS 656.576, may receive a share of any sum recovered if a worker or the worker’s beneficiary elects under ORS 656.578 to seek damages from the employer or a third person who has caused a compensable injury or death. Under ORS 656.580, “[t]he paying agency has a lien against the cause of action as provided by ORS 656.591 or 656.593 * * ” If the worker or a beneficiary sues and receives a damage award, subsection (1) grants the paying agency a lien against the award and designates the amount that it can recover. However, if the worker or the beneficiary settles the claim with the paying agency’s consent, subsection (3) governs the paying agency’s recovery. That section creates no lien on settlement proceeds. Instead, it authorizes the paying agency to “accept” a ‘ ‘just and proper share” of the settlement.
*71The majority disregards the significance of that terminology. The settlement of the third party action, with the paying agency’s consent, extinguishes the cause of action and the lien. Thereafter, the paying agency must rely for its recovery either on an agreement that it may have reached with the claimant at the time of the settlement or, absent an agreement, on the Board’s determination of a just and proper share. Neither potential source of recovery is a lien.
The majority analyzes this case as if it involves a paying agency’s lien under ORS 656.593(1). That is incorrect. Respondent, with Liberty’s concurrence,1 settled the claim and invoked the Board’s authority under ORS 656.593(3) to resolve a conflict as to what would be a just and proper distribution. The Board correctly determined that, in resolving the conflict, it is not required to calculate the paying agency’s just and proper share as if it had a lien.2
The text of ORS 656.593(3) supports the Board’s construction. The statute entitles the worker or the beneficiary to receive those sums that would he paid to a worker under the lien described in ORS 656.593(1) and (2). However, the statute makes no reference to a paying agency’s statutory lien rights and entitles the agency only to a “just and proper” share. If the legislature had intended the result that Liberty *72seeks, it would have drafted subsection (3) to grant the paying agency a lien on settlement proceeds or to entitle it to receive the same amount that it would receive through an ORS 656.593(l)(c) lien, just as it did for the worker or beneficiary. Its failure to do so demonstrates that the legislature did not intend to require the Board to calculate the agency’s share as if it had a lien against the settlement.3
The majority’s view that the Board reached its decision in the wrong legal framework is incorrect, because it assumes that the paying agency has a lien against the settlement proceeds. The error is not eliminated by the majority’s acknowledgement that “[t]he Board has some discretion to determine what is just and proper for the paying agency to receive.” 116 Or App at 68. The Board considered Liberty’s contention that it should be reimbursed for all of its claim costs, including those related to husband, and rejected the claim. It designated a just and proper share and supported its decision with adequate findings and conclusions. Liberty received all that it is entitled under ORS 656.593(3).
I would affirm the Board’s order in all respects.

 Liberty does not dispute the Board’s finding that, as the paying agency, it approved the settlement. The majority correctly observes that Liberty makes no contention that the settlement approval is invalid because it is not in writing. 116 Or App at 66 n 1.

 The Board relied on the probate court hearing, reports from and interviews with family members, coworkers, mental health counsellors and a babysitter and testimony by an attorney about the anticipated damage recovery and concluded:
“[A] distribution of settlement proceeds in equal portions to the two minor children with the surviving spouse receiving nothing represents an appropriate and reasonable apportionment commensurate with their respective financial and emotional losses resulting from decedent’s death.”
The Board explained why it confined Liberty’s recovery of claim costs to the specific beneficiaries who shared in the third party settlement:
“To do otherwise would permit the paying agency to receive reimbursement for claim expenditures related to a particular beneficiary (surviving spouse) from other beneficiaries’ (children) portions of a third party settlement. Since those other beneficiaries have not and will not realize any benefits from those claim costs, we would not consider such a proposed distribution to be just and proper. ’ ’
The Board ruled out “gamesmanship” on respondent’s part and followed the distribution approved by the probate court. The Board’s conclusions are supported by findings that Liberty does not challenge.

 The premise of the legislature’s distinction is that ajudgment awards all of the damages to which the claimant or beneficiary is entitled and, for that reason, the paying agency should be entitled to recover all expenditures for which it has a lien. ORS 656.593(l)(c). However, a settlement may represent a compromise of the third party claim and, for that reason, the Board may require a paying agency to accept a reduced sum as its just and proper share under ORS 656.593(3).