Death benefits – hardly a cheerful subject, and made no less gruesome by the fact that, as the body departs, the haunting specter of dependent benefits lingers.

Take, for example, the recent writ denied case of Jamie Xelowski (Dec.)/J. Campbell v. Community Health Network.

The facts are pretty simple – Jamie Xelowski sustained an industrial injury while employed by the Community Health Network/City and County of San Francisco, and, unfortunately, passed away as a result of her injury.  Her daughter, J. Campbell (“JC”), sought benefits under Labor Code section 3501, which provides that a child of any age found by any trier of fact to be physically or mentally incapacitated from earning, shall be conclusively presumed a total dependent.

And, as Labor Code section 4703.5 provides, in additional to the total death benefit for all of applicant’s dependents, the “physically or mentally incapacitated child” is entitled to temporary disability benefits until his or her death.  In short, a defendant is better off having an injured worker be found 100% permanently disabled rather than pass away.  Yes, yes, I know – I don’t like writing about this stuff too much for the very reason that it makes your humble blogger feel dirty for calculating how to minimize liability by wishing for one death or another.

So, back to the Xelowski case – JC had sought and received social security benefits in October of 2010, after her application was initially denied on May 5, 2010.  JC had appealed the first result, and her case was reviewed by an analyst and a physician.  There was no appearance on the part of JC at any Social Security Administration Hearing.

JC argued that the finding by the Social Security Administration triggers the effects of Labor Code section 3501, in that she is “a child of any age found by any trier of fact … to be physically or mentally incapacitated from earning.”  Defendant, not wanting to be stuck with an employee’s daughter’s lifetime of temporary disability benefits (it’s like having an employee on the payroll but not getting any work out of him or her) decided it might be worth a billable hour or two to fight.

The WCJ was persuaded – what happened before the SSA was the equivalent of a Panel Qualified Medical Evaluation – there was no judicial officer involved.  So, while JC might still prove her incapacity, mentally or physically, the presumption was not there yet.  Additionally, the finding still allowed JC to earn some income, so this finding did not satisfy the requirements of 3501.

Well, the WCAB didn’t agree – the panel of commissioners found that the Social Security Administration’s finding of disability triggered section 3501.

Now, your humble blogger has a bone to pick, but not with this particular case.  The Commissioners properly  applied section 3501, as it is, and when your humble blogger has to feed the meter in San Francisco, he can explain to his visiting friends why the meter makes more per hour than he does (San Francisco is self-insured, after all).

But, the proverbial bone your humble blogger has to pick is with the language of the statute itself.  Section 3501 conclusively presumes a fact (mental or physical incapacity) without affording the defendant fair notice of a hearing and an opportunity to be heard.

Picture, if you will, some poor unfortunate soul attending a hearing before the Social Security Administration, with proof of physical or mental incapacity, and some attorney like your humble blogger kicking down the hearing room doors and demanding to be heard because the poor soul’s mother or father works for his client.  “Her mother might die on the job, some day, and I want to make sure you don’t make a ruling that would affect us…”

Exactly – insanity.  The conclusive presumption should be done away with – if a person is found incapacitated from earning, then those same documents can be used to prove the case again before a workers’ compensation Judge.  After all, the SSA is giving away other people’s money, and might not be as zealous in its defense as a client with a million dollars on the line (picture $500 per week for 40 years).

If there is time for public comment at the next midnight reform session, perhaps we can bring this up?