Repose and Stare Decisis in Kentucky


The Kentucky Supreme Court recently decided Calloway County Sheriff's Dept. v. Woodall, Case No. 2018-CA-1509. This is an interesting decision regarding the provision of workers' compensation benefits, time limitations, and survivors. 

The worker, Mr. Spillman, suffered a motor vehicle accident in 2007. He was later awarded permanent indemnity benefits in 2010, and additional benefits were awarded in 2013 ("the remainder of the 425 weeks that he was entitled to"). Thereafter, he underwent surgery, suffered a complication, and died in January 2017. The worker's wife (Woodall) and daughter "were named co-administrators of" the estate. 

The workers' estate moved to "re-open" the workers’ compensation claim, and sought some benefits, while the wife also sought additional "income benefits," on her own behalf. Both categories of benefits were denied at trial. The Board (in Kentucky, the first level of review is an executive-appointed Board) affirmed the trial judge on one category (denial of benefits to the estate), but reversed on the other (death benefits to the spouse). The parties sought further review and "the Court of Appeals affirmed the Board on both issues." That decision led to the Supreme Court review. The Supreme Court likewise concluded that the death benefits to Ms. Woodall were appropriate. 

In an interesting argument before the Court, the widow argued that the employer did not "preserve" the argument that the case would have to be reopened in order for benefits to be paid. She argued that to preserve that argument, the employer would have to appeal the trial judge’s ruling in its favor (cross-appeal). The Court dispelled that argument. It explained that a party that prevails at trial is allowed to argue in support of affirming that trial determination, with no requirement that it first file its own appeal of the trial outcome.

The employer's argument in seeking Supreme Court review was the assertion that "a widow cannot claim death benefits after the deceased’s 425 weeks of PPD benefits have been paid in full." This would require "reopening" the case after it had closed through the exhaustion of those benefits due the injured worker. In its defense, the employer sought to "retroactively" apply a statute passed in 2018 to preclude this reopening. It also argued that the widow's claim was time barred. 

The Court affirmed the re-opening of the case for further benefits to the estate. However, it explained that a widow has rights to death benefits independent of the benefits due the injured worker, and thus she may file a claim in her own behalf as she did here. These are pursuant to KRS 342.750. These benefits include such specific periodic "widow or widower" benefits as well as "a lump-sum" payable to the workers' estate which includes "cost of burial" and other benefits. This lump-sum is specifically limited to instances in which death occurs within four years and is “a direct result of a work-related injury.”

The Court concluded that this four year limitation applies to the estate, by its specific provision. However, that does not apply to the other widow or widower benefits. This, it said, is clear from the “statute’s plain text.” The Court interestingly relied upon dicta in an earlier decision, Family Dollar v. Baytos, 525 S.W.3d 65, 72 (Ky. 2017). The Court notes that case was not about this legal question, but that it was nonetheless “addressed” in that case: “albeit in a footnote as it was not material to the Court’s decision.” That is an interesting concession as regards the nature of dicta. Often courts refer to such prior expressions not required for the determination of some case as "dicta" and instruct litigants that such is not controlling of the outcome of future cases (stare decisis). 

The Court explained that in both the precedent (Baytos) and the current claim under review, the benefits due to the injured worker had been “closed.” In Baytos, that was through a settlement and release, and in Woodall through exhaustion of the entitlement to benefits. It described no distinction in how the closure had occurred. The Court explained that regardless of how closure occurs, it did not preclude the independent claim of a person entitled to death benefits.

The Supreme Court therefore affirmed the appellate court’s remand of the case to the trial judge for determination of entitlement to those independent death benefits.

The Court also addressed the estate’s contention that the four year limitation was unconstitutional. The estate contended that this constraint violated the Equal Protection Clause. The purpose of that clause is to “keep[] governmental decision makers from treating differently persons who are in all relevant respects alike.” In this instance, the estate of someone who passes more quickly (within 4 years) is treated differently than someone whose death occurs after a more extended period. 

There is a delineation in Woodall of the “standards of review” that are applicable in such constitutional challenges: “strict scrutiny,” “heightened scrutiny,” and “rational basis.” It is worthy of review in this context alone. The Court explained that “[w]orkers’ compensation statutes concern matters of social and economic policy.” Therefore, generally, the “classifications” found “within our workers’ compensation statutes only need satisfy rational basis review” (the lowest standard). In order for such a classification to be constitutional, therefore, it need only “be rationally related to a legitimate state interest,” (federal), and “supported by a ‘reasonable basis’ or a ‘substantial and justifiable reason’” (state).  This is the lowest of the standards, the "rational basis."

This illuminates the potential periodically discussed regarding statutory benefit distinctions across the country. In various contexts there are questions about the manner in which state’s presumption statutes exalt various roles and occupations, providing disparate treatment in their favor for specific diagnoses or conditions, based upon such arbitrary classifications. The Court’s explanation may lead some to conclude that the potential for success in any challenges to these presumptions is dubious. Others may contend that the placement of such benefit distinctions in other state statutes, outside of workers' compensation but affecting those benefits, might make for an equal protection distinction. 

In Woodall, the Court rejected the argument that there is no “rational basis” for treating workers’ estates differently based upon the passage of time (4 years). It concluded that this limitation is rational as it “serves to bar stale claims, which provides stability and foreseeability to claimants and employers alike.”

The Court took the opportunity to again explain misconceptions regarding time limitations. The employer in Woodall argued the statute should be upheld as it is akin to a statute of limitations. The Court patiently reiterates that this time limitation is not such a limitation. Such “limitations limit() the time in which one may bring suit after the cause of action accrues.” These prescribe the period during which a claim may be made. Conversely, “a statute of repose potentially bars a plaintiff’s suit before the cause of action accrues.” That is, the passage of four years forecloses the entitlement to benefits even though the time to file a claim cannot even begin until that death occurs. The limitation on the lump-sum in this instance, the Court concluded, is a statute of repose. Those who practice law would do well to strive for stronger understanding of the distinction between repose and limitation. 

Reiterating prior precedent, the Court reminded that it has regularly upheld the constitutionality of repose “provisions in the workers’ compensation scheme.” The Estate argued that a prior decision, Vision Mining, Inc. v. Gardner and Parker v. Webster Cty. Coal, LLC, 529 S.W.3d 759, 770 (Ky. 2017) compelled a different result. The Vision decision is discussed at length in Equal Protection in the Bluegrass State (July 2018).

However, the Court concluded that the repose provision here, “the four-year limit” does not apply differently based upon classification of the worker, but “applies equally to all injured workers.” The Court thus found no constitutional infirmity.

The Court noted also that some have “muddled” distinctions and categories as regards constitutional analysis in Kentucky. There is precedent cited in Woodall in discussion of category or classification distinctions, and some confusion in the state’s decisions regarding federal and state constitutional constructs. It seems to conclude that use of terminology, and “short-handed” references to “special laws” may have led over time to misconstruction and misconstruing. There is, in this, some suggestion it seems for careful use of words in both litigation and legislation. The decision conducts an intriguing and lengthy tour of Kentucky constitutional determinations dating back to the 1800s, and the state’s achievement of statehood. The history lesson alone is worth reading the full 26-page decision.

The Court’s outcome is unanimous (all agree with the result. However, Justice Keller wrote a special concurring opinion which itself continues another 19 pages. Justice Keller takes exception to and expresses “strong disapproval of the majority’s decision to purge sixty-five years of our jurisprudence in this area.”  This is a defense of stare decisis, a topic previously addressed in this blog, as regards Kentucky. See Stare Decisis, Goodgame, Livingood, and Westphal (October 2015)

The concurrence is focused upon the Court’s discussion of “special laws.” The opinion cites the “universal disapproval of every person in Kentucky,” an intriguing characterization, and suggested that “the inequality of laws so passed had produced the grossest of wrongs,” such that “the demand for a change on this subject was absolute and universal. It is perhaps difficult to imagine any legislative question upon which any state's populace is in unanimous agreement. Justice Keller describes the effort to curb such “special laws” as a “primary motivating force behind enactment of the new Kentucky Constitution of 1891.”

Its “primary purpose” was “to prevent special privileges for those with wealth and power sufficient to sway the Assembly and to ensure equality under the law.” In that regard, Justice Keller suggests an obligation of “courts to analyze such legislative actions when undue privilege or discrimination is alleged.” That should begin with “the plain language of the applicable provisions,” but the Justice advocates should extend beyond “to determine if the provisions fail to operate uniformly.”

Justice Keller accuses the majority of “dismantling” Kentucky’s “longstanding test for special legislation,” and asserts that step is unnecessary to the resolution of the dispute in Woodall. There is insinuation of inconsistency, with Justice Keller citing the Court’s recent rejection of similar “dismantling” in other contexts.

Justice Keller’s concurrence is interesting reading. It includes the admission that “stare decisis is not inviolate or inflexible and it does not require the perpetuation of error or logic.” However, it takes issue with the methodology of the majority, and an apparent perception that the decision in Woodall moves the law in Kentucky without need and without some conclusion that “such rules have shown themselves to be “unworkable or badly reasoned.” Justice Keller does not find in Woodall “an urgent need to move from one rule of law to another,” and thus rejects the majority explanation as regards “special laws.”

In all, it is an educational opinion of the Court from several perspectives. Those who would practice in the challenges of workers' compensation benefit constraints, the constitutional challenges of equal protection, or the challenges of "special laws" could find instruction and insight here from various perspectives. The decision is worthy of consideration. 

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    About The Author

    • Judge David Langham

      David Langham is the Deputy Chief Judge of Compensation Claims for the Florida Office of Judges of Compensation Claims at the Division of Administrative Hearings. He has been involved in workers’ compensation for over 25 years as an attorney, an adjudicator, and administrator. He has delivered hundreds of professional lectures, published numerous articles on workers’ compensation in a variety of publications, and is a frequent blogger on Florida Workers’ Compensation Adjudication. David is a founding director of the National Association of Workers’ Compensation Judiciary and the Professional Mediation Institute, and is involved in the Southern Association of Workers’ Compensation Administrators (SAWCA) and the International Association of Industrial Accident Boards and Commissions (IAIABC). He is a vocal advocate of leveraging technology and modernizing the dispute resolution processes of workers’ compensation.

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