Personal Injury and Workers' Compensation Settlements for Incapacitated Persons: Part Ii

• Publication year: 2001
• Pages: 55
• Citation: Vol. 30 No. 1 Pg. 55

30 Colo.Law. 1 Colorado Lawyer 2001.

2001, February, Pg. 55. Personal Injury and Workers' Compensation Settlements For Incapacitated Persons: Part II

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55

Vol. 30, No. 1, Pg. 1

The Colorado Lawyer
February 2001
Vol. 30, No. 2 [Page 55]

Specialty Law Columns
Estate and Trust Forum
Personal Injury and Workers' Compensation Settlements For Incapacitated Persons: Part II
by Spencer J. Crona, Byron K. Hammond

In November 1995, the entire Colorado Rules of Probate Procedure ("C.R.P.P.") Rule 16 was repealed and readopted, essentially replacing the prior Probate Form 31A with an outline of requirements for what information a personal-injury settlement approval petition must provide to the court regarding a minor or incapacitated person. Part I of this article, published in the January 2001 issue at page 43, discussed these changes, as well as how the new Colorado Uniform Guardianship and Protective Proceedings Act ("Colorado UGPPA")1 likely will affect the preparation and judicial treatment of such C.R.P.P. 16 proceedings. This Part II discusses how the Colorado Workers' Compensation Act ("Act")2 and the Colorado UGPPA actually allow a deeper examination of competency with respect to workers' compensation settlements

The Workers' Compensation Act and the Probate System

When a person is injured by a negligent party, that person may resort to civil litigation in anticipation of obtaining a recovery from the negligent party. However, should that same person be injured in the course of his or her employment traditional personal injury claims may not be available for obtaining a recovery. Instead, workers' compensation law becomes the exclusive and limited remedy for recovery

Workers' compensation is one of the oldest social insurance programs in existence, being adopted in most states during the 1910s and 1920s. State workers' compensation programs are generally designed to provide an exclusive remedy for obtaining wage loss and medical treatment benefits for an employee injured in the course of his or her employment, regardless of the employee's or employer's fault.3 In drafting the Act, the intent of the General Assembly was that it be a quick and efficient mechanism for delivering disability and medical benefits to injured workers without the necessity of litigation.4 The employer must provide the medical treatment reasonably needed by the employee at the time of the injury or onset of the occupational disease, and must continue these benefits for the period of the employee's disability, even if that disability exists for life.5

The Act is premised on a trade-off between employees and employers. Both employees and employers mutually renounce their common law rights and defenses.6 In exchange, employees promptly receive the limited statutory workers' compensation benefits for industrial injuries, and employers receive the cost benefits of a system intended to deliver such benefits efficiently and without the necessity of litigation. The Act is intended to present a streamlined, exclusive mechanism for providing benefits during an employee's disability. Because the injured employee ("claimant") has renounced common law rights, he or she is expected to receive medical and disability benefits during the disability without litigation and without entering into any contract for provision of these benefits.

Unless disputes arise, the claimant has virtually no discretion. Benefits continue pursuant to the Act, and the claimant need not take affirmative action to keep such benefits in place. Because the remedies of the Act are exclusive in nature, and both the employer and the claimant have renounced their common law rights, a claimant's lack of competency is rarely an issue. However, there is a point at which minimal discretion evolves into maximum possible discretion under the Act. That point is when the claimant proposes to contractually enter into a full and final settlement of the employer's obligation to provide workers' compensation benefits.

Through settlement, the claimant exercises the discretion to leave the safety and potentially unlimited benefits provided by the Act in...