702.243 Settlement application; how submitted, how approved, how disapproved, criteria.

(a) Within 30 days of receipt, the adjudicator must evaluate the settlement application and notify the parties in writing if the application is incomplete or if the adjudicator requests additional information. If all parties are represented by counsel, any such notice must also state that the 30-day period in   § 702.241(b) will not commence until the adjudicator receives the completed application and the additional information.

(b) The adjudicator must issue a compensation order approving or disapproving the settlement application, and file and serve it on the parties in accordance with § 702.349 unless the settlement has already been deemed approved under paragraph (f) of this section. If the adjudicator disapproves the settlement application in any part, the order must include the adjudicator’s reasons for finding the settlement inadequate or procured by duress.

(c) In determining whether the settlement is adequate and procured without duress, the adjudicator must consider all of the information required by § 702.242(a), any additional information requested under § 702.242(b), and the parties’ attestations in the settlement application, to which the adjudicator may defer.

(d) If the adjudicator disapproves any part of a settlement application, the entire application is disapproved unless the parties have stated in the application that they agree to settle the parts independently.

(e) After a settlement application is disapproved by  

(1) A district director, the parties may submit an amended application to the district director or request a hearing before an ALJ on either the settlement disapproval or the merits of the case under sections 8 and 19 of the Act, 33 U.S.C. 908 and 919.

(2) An ALJ, the parties may submit an amended application to the ALJ, file an appeal with the Benefits Review Board under section 21 of Act, 33 U.S.C. 921, or proceed with a hearing on the merits of the case.

(f) If all parties to the settlement are represented by counsel and the adjudicator does not formally approve or disapprove the application within 30 days after receipt of a complete settlement application and any additional requested information (see § 702.242(b)), the application will be deemed approved. A settlement application that is deemed approved under this paragraph will be considered filed in the office of the district director on the last day of the 30-day period as calculated under § 702.241(d).

(g) The liability of an employer/ insurance carrier is not discharged until the settlement is specifically approved by a compensation order issued by the adjudicator or deemed approved under § 702.241(b) and paragraph (f) of this section.

(h) Attorney’s fees in a settlement application may include fees for work performed before other adjudicators and tribunals. If the settlement is approved, the attorney’s fees will be considered approved within the meaning of § 702.132.

(i) When parties settle cases being paid under a final compensation order where no substantive issues are in dispute, the adjudicator, in determining whether the proposed settlement amount is adequate, may compare the amount to the present value of future compensation payments commuted, computed by:

(1) Determining the probability of the death of the beneficiary before the expiration of the period during which he or she is entitled to compensation according to a current life expectancy table or calculator specified by OWCP; and

(2) Applying the discount rate specified at 28 U.S.C. 1961.

85 FR 80611, Dec. 14, 2020