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Virginia S. Gautier, Wise Carter Child & Caraway, PA
All settlements of workers’ compensation claims in Mississippi must be submitted to the Mississippi Workers’ Compensation Commission for approval. Typically, if the claimant is represented by counsel and both the employer/carrier and the claimant mutually agreed to the terms of the settlement, the Commission will approve the settlement, absent unusual circumstances. However, in the recent case of Himeliz v. Hog Slat, Inc. and Ace American Ins. Co., 322 So. 3d 956 (Miss. Ct. App. 2021), the Commission refused to approve a settlement reached by the represented claimant with the employer/carrier on the grounds that the settlement amount was insufficient to adequately compensate the claimant for his future medical care and was not in the claimant’s best interest.
In Himeliz, the claimant, legally working in the United States on a work visa, “sustained a compensable injury that rendered him a quadriplegic during the course and scope of his employment.” The injuries resulted in Himeliz’s permanent and total disability, as well as the need for lifetime medical treatment. He was paid the maximum amount of disability benefits, via a lump sum, to which he was entitled under Mississippi law, but the medical claim remained open. Thereafter, through a mediation between the parties, Himeliz and his employer reached a structured settlement to close out his future medical. Through a joint petition, the parties sought approval of the settlement from the Mississippi Workers’ Compensation Commission as required by the procedural rules of the Commission. When submitted to the Commission, Commissioner Beth Aldridge reviewed the proposed settlement and would not approve it. The Commission expressed concerns that (1) the life care plan “provided only ‘the best case scenario for [Himeliz]’”; (2) Himeliz’s family would actually be available to provide care for him at all times for the remainder of his life; and (3) the life care plan did not provide for an interpreter for claimant’s life expectancy.
Following denial of the settlement, counsel for the claimant then sought a review by the full Commission (consisting of three Commissioners), but learned from the Commission’s staff attorney that neither Mississippi statute nor the Commission’s rules allowed for a request for review of a denied settlement by the full Commission. As a result, “[t]he parties filed a joint emergency petition for review of proposed settlement” which was denied since there were no procedures allowing for such review under Mississippi law. The claimant then filed an appeal with the Mississippi Court of Appeals on the grounds that he was not afforded a hearing before the full Commission upon the denial and that Commissioner Aldridge’s denial of the settlement was not based upon the substantial evidence, resulting in error.
Upon appeal, Himeliz argued that his settlement should have been approved as he was represented by counsel and determined competent by an independent doctor. In considering Himeliz’s arguments, the Mississippi Court of Appeals reviewed the rules of the Commission, as well as the statute governing workers’ compensation settlements, noting that
In every case of compromise settlement, the proposed settlement will be explored
and medical reports will be examined to determine if the amount of the proposed
settlement appears fair and reasonable. The Commission or Administrative Judge
shall not approve the settlement if it is:
a. not accurately reported,
b. not completely understood by the claimant, or
c. not in the best interest of the claimant.
The Commission or Administrative Judge will approve the settlement if:
a. the underlying facts, terms, and amount of the settlement are accurately
b. claimant understands the settlement's import and effect, and
c. the settlement is in claimant’s best interest.
See Rule 2.15 of the Rules of the Mississippi Workers’ Compensation Commission. The Court of Appeals noted that neither Rule 2.15 of the Commission’s rules nor Miss. Code Ann.§ 71-3-29 required a hearing for a settlement presented to the Commission when the claimant is represented. The Court further noted that Himeliz cited no legal authority for requiring a hearing to review a settlement. Finding that the “denial of the settlement was based on substantial evidence” and that the Court is required to give the Commission deference upon judicial review due to the Commission’s experience in administrative matters, the Court of Appeals upheld the Commission’s denial of approval of the settlement.
The Himilez case has made clear that even if both the represented claimant and the employer/carrier agree to the terms of the settlement of the workers’ compensation claim, the Mississippi Workers’ Compensation Commission may deny approval of the settlement if the settlement does not appear to be in the best interest of the injured worker. Of particular interest was the Court of Appeal’s statement that Himeliz set forth in his Petition to the Commission that the settlement was in his best interest, yet he did not list specific facts to support his assertion. This statement by the Court is instructive in that settlements presented in the future by the parties in cases with significant injuries such as those sustained by Himeliz, should include facts to support the claimant’s averment that the settlement is in his or her best interest. To help reduce the likelihood that a settlement will be denied by the Commission, the parties should further consider language barriers faced by the claimant and provide a realistic assessment of future medical costs, taking into account all facts known at the time of settlement.