64

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native land, to discharge a mortgage on the dependent's home," and also where the employer was about to wind up its business

64 Where a stevedore, who had accidentally lost one of his eyes and was unable to follow his trade, requested commutation of his disability indemnity to enable him to return to Norway, where his parents resided in a home belonging to him, there to take up the business of a fisherman, and it appeared that he was an industrious, temperate, and thrifty man, a commutation of the whole sum was made. Olsen v. Western Fuel Co., 2 Cal. I. A. C. Dec. 643. An employer will be allowed to settle his liability for compensation by the payment of a lump sum, instead of in weekly payments, where the possibility of the workman's future improvement is uncertain, and the employé wishes to return to his native country, provided that the sum be paid by the purchase of a ticket for transportation for him, and the balance upon his departure. Bedini v. Northwestern Pacific R. R. Co., 1 Cal. I. A. C. Dec. 312. But where the only reason assigned by the applicant for the commutation of a permanent disability award is his desire to return to his native country to invest the balance there, such reason is insufficient to justify the Commission in ordering that the amount of benefit made payable be discounted to a lump sum. Galante v. Mammoth Copper Mining Co. of Maine, 2 Cal. I. A. C. Dec. 732.

65 Except in cases of exceptional urgency, as to enable a widow of the deceased employé to discharge a mortgage upon the family home, the Commission will not require a defendant against its objections to pay compensation in a lump sum. Wilson v. Gallegher, 1 Cal. I. A. C. Dec. 306. A commutation to a lump sum of a portion of the death benefit awarded to the mother of an employé will be allowed where it is to be used to discharge a mortgage upon her home. State Comp. Insur. Fund of the State of Cal. v. Jacobsen, 1 Cal. I. A. C. Dec. 311. The commutation of a portion of the award to a lump sum, with proper allowance for interest deductions in finding the present worth of future payments so commuted, will be allowed, where the amount is sought to enable the dependent to remove incumbrances on the family home, defray funeral expenses, and meet an unsecured note given by the deceased. Kennedy v. Guardian Casualty & Guaranty Co., 1 Cal. I. A. C. Dec. 152. But where an injured employé asks that the indemnity awarded be commuted to a lump sum to enable him to purchase furniture for a rooming house and pay off a mortgage on property of his mother in Wisconsin, and there is no showing that it is necessary for the protection of the applicant, or for his best interests, the request will be refused. Kruger v. Strehlow, Freese & Peterson, 2 Cal. I. A. C. Dec. 334.

Where the widow inherited from her husband a house heavily mortgaged, and also some insurance, and it appeared that if her compensation were commuted to a lump sum she could pay off the mortgage and so escape paying interest, and a competent business man volunteered to attend to the HON.COMP.-42

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and leave the state." Requests for commutation have been refused where the applicant was shown to be intemperate, and where he was suffering mental disability."s

The Nebraska Act leaves the question of how much shall be paid. in a lump sum in ordinary cases to the agreement of interested parties, but in such serious matters as death and permanent disability, where the interests of those dependent upon the workman may be involved, the question of whether it is for the best interests of the dependents to have the payments made periodically or to be made in a lump sum must be submitted to the district court, acting in a capacity somewhat analogous to that of a guardian or next friend of the dependents, for its approval or rejection. The object of this provision is to preserve the rights of persons often inexperienced in business matters and unable to protect themselves, and to determine whether it is to their best interests to substitute a lump sum, which might easily be dissipated, for payments made in lieu of

payment of the mortgage and assist her in safely investing the balance, without pay therefor, commutation was allowed. Zarling v. North Side Coal Co., Bul. Wis. Indus. Com. 1912-13, p. 29.

66 Where a death benefit had been rendered against an employer who was not insured, and it was later shown that the employer was about to wind up its business and to leave the state, and the widow of the deceased employé was shown to be competent to handle the balance of the award due her, the balance was commuted in accordance with the provisions of the Act and made payable at once. Decounter v. United Greenwater Copper Co., 2 Cal. I. A. C. Dec. 700.

67 Where an injured employé asks that the indemnity awarded be commuted to a lump sum to establish him in business, and it appears that he is intemperate and had been arrested for drunkenness even since his injury, and there are no unusual circumstances to justify commutation, his request will be refused. Olson v. Tice, 2 Cal. I. A. C. Dec. 333.

68 Where an employé was in a bad mental condition, suffering from some brain trouble which made him very dull and stupid, but the exact character of the disability was very uncertain, and the claimant was unable to show any advantage in a lump sum settlement, or that he was able to conserve a large sum of money, the awarding of a lump sum was inadvisable, and was denied. Catterson v. County of Los Angeles, 2 Cal. I. A. C. Dec. 981.

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wages. There is no provision in this Act allowing either party to compel the employer to pay, or the workman or dependent to receive, a lump sum satisfaction.70 An agreement made by the parties subject to "consent" of the court is prerequisite."1. Such agreement, if reasonable and made in good faith, is binding on the insurer.72

69 Bailey v. U. S. Fidelity & Guaranty Co., 99 Neb. 109, 155 N. W. 237. 70 (Rev. St. 1913, § 3681) Bailey v. U. S. Fidelity & Guaranty Co., supra; Johansen v. Union Stockyards Co., 99 Neb. 328, 156 N. W. 511.

The Employers' Liability Act allows the parties interested to "settle all matters of compensation between themselves" (Rev. St. 1913, § 3677). The amount of compensation, when not agreed upon by the parties, is to be determined by the district court (section 3680), and except as expressly provided in the Act must be payable periodically (section 3666). Pierce v. BoyerVan Kuran Lumber & Coal Co., 99 Neb. 321, 156 N. W. 509. When the amount of compensation in periodical payments has been determined, either by agreement of the parties or by decision of the court, it "may be commuted to one or more lump sum payments, except compensation due for death and permanent disability." (Rev. St. 1913, § 3681) Id. There is no requirement in the section of the statute which applies to residents of this country that six months must elapse before an agreement for a lump sum payment may be made, or the consent of the district court be procured to such an agreement. Bailey v. U. S. Fidelity & Guaranty Co., 99 Neb. 109, 155 N. W. 237. In such case no other or different authority for making such commutation is provided by that section. It still depends upon the agreement of the parties, except that their right to so agree in the specified cases depends upon "the consent of the district court." Id.

71 Although in general the agreement of the parties will authorize such commutation, in case of death or permanent disability, the consent of the court is also necessary. If the district court, upon careful investigation, finds that special circumstances exist, making it necessary to commute to a lump sum for the protection of the workman or his dependents, the court may "consent" to such agreement by the parties. Pierce v. Boyer-Van Kuran Lumber & Coal Co., 99 Neb. 321, 156 N. W. 509.

72 If an employer and the party to whom payment is to be made make a reasonable agreement in good faith for the payment of a lump sum, not inconsistent with the amount of the periodical payments previously determined, the agreement will bind an insurance company, which has assumed a risk under section 3688, Rev. St. 1913, equally with the employer. It has no greater rights than he has, and cannot block a settlement by objecting to payment in a lump sum merely because it was not consulted. Bailey v. U.

The Nevada Industrial Commission, believing that the indiscriminate exercise of the authority conferred by section 31 of the Nevada Industrial Insurance Act, which provides that the Commission may, in its discretion, allow the conversion of compensation provided for in this Act into a lump sum payment, under such rules, regulations, and system of computation as may be devised for obtaining the present value of such compensation, would nullify the spirit and intent of the Act, announced by resolution that such authority, as a matter of policy, would be exercised only in extraordinary cases, as in practically all cases it is better for the beneficiaries to receive the award to which they are entitled in installments at stated intervals, rather than in a lump sum.7

The New Jersey Act, as amended in 1913, not only fixes the rate and manner of computation, but indicates principles for the court's guidance in passing on an application for commutation. It provides that: "In determining whether the commutation asked for will be for the best interest of the employé or the dependents of the deceased employé, or that it will avoid undue expense or undue hardship to either party, the judge of the court of common pleas will constantly bear in mind that it is the intention of this Act that the compensation payments are in lieu of wages, and are to be received by the injured employé or his dependents in the same manner in which wages are ordinarily paid. Therefore commutation is a departure from the normal method of payment and is to be allowed only when it clearly appears that some unusual circumstances warrant such a departure. Commutation shall not be allowed for the purpose of enabling the injured employé, or the de

S. Fidelity & Guaranty Co., 99 Neb. 109, 155 N. W. 237. "We find nothing in the statute to justify the claim that if the employer and the workman, or the dependent person to whom payment is due, agree upon a lump sum in lieu of the periodical payments, an insurance company has any right to object to the manner of payment agreed upon by the parties by the consent of the court." Id.; Pierce v. Boyer-Van Kuran Lumber & Coal Co., 99 Neb. 321, 156 N. W. 509.

73 Rep. Nev. Indus. Com. 1913-14, p. 24.

pendents of a deceased employé, to satisfy a debt, or to make payment to physicians, lawyers, or any other persons." 74 Before awarding a lump sum, the judge must determine what sum should be paid periodically, and should state the method by which he reached his result and the reasons which induced him to commute the periodical payments into a lump sum." His decision should be based on specific findings of fact supported by legal evidence.70

In Minnesota the matter of settlement is governed by sections 13 and 14 of the Act, but the question how and in what manner such settlement shall be paid is left with the parties to agree upon. When a lump sum is agreed upon, it is final, and not subject to readjustment. Settlement means one thing, and payment of the amount settled upon another, and when the parties agree that the sum fixed shall be paid in lump, and that sum is in fact paid, the matter is concluded." The parties in controversy must agree to a lump sum award before the court has any right to commute the payments to a lump sum. The court cannot commute the payments against the will of either party."

"Commute" indicates a lessening of the amount of payment."" The amount to be awarded in a lump sum is ordinarily the pres

74 P. L. N. J. 1913, p. 309, § 2, par. 21.

75 (P. L. 1911, p. 134) Mockett v. Ashton, 84 N. J. Law, 452, 90 Atl. 127. The determination of the trial judge should set forth, in cases where weekly payments are to be commuted in a lump sum, the basis of award in amount per week and number of weeks; the commuted amount under paragraph 21 being expressly predicated on such finding. (Laws 1911, p. 142, § 2, par. 20) Long v. Bergen County Court of Common Pleas, 84 N. J. Law, 117, 86 Atl.

529.

76 (St. 1911, p. 143, § 2, par. 21) New York Shipbuilding Co. v. Buchanan, 84 N. J. Law, 543, 87 Atl. 86.

77 (Gen. Laws 1913, c. 467, § 22, subd. 1; Gen. St. 1913, § 8216) Op. Atty. Gen. on Minn. Wk. Comp. Act, Bul. 9, p. 8.

78 State ex rel. Anseth v. District Court (Minn.) 158 N. W. 713.

79 As used in a provision of the Ohio Act that a Board may commute periodical benefits to one or more lump sum payments, the word "commute"