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McAllister v. Resorts Intern. Hotel & Casino

March 31, 1997

JOHN C. MCALLISTER, PETITIONER-APPELLANT,
v.
RESORTS INTERNATIONAL HOTEL & CASINO, AND THE SECOND INJURY FUND, RESPONDENTS-RESPONDENTS.



On appeal from the Division of Workers' Compensation.

Approved for Publication April 2, 1997.

Before Judges Pressler, Stern and Humphreys. The opinion of the court was delivered by Humphreys, J.A.D.

The opinion of the court was delivered by: Humphreys

The opinion of the court was delivered by

HUMPHREYS, J.A.D.

A previous workers' compensation award to petitioner was reduced by the amount of Social Security benefits being paid on behalf of his children to their mother. Petitioner appeals the reduction. He concedes that if the Social Security payments were being made to his children at the time of the initial award, then a reduction is proper. He contends, however, that the reduction should not be made because the children were born after the initial award.

We affirm substantially for the reasons stated by Judge Lashman in her comprehensive written opinion of May 24, 1995. We add the following.

Petitioner was awarded workers' compensation benefits for injuries occurring during the period 1978 to 1981. He was found to have suffered a permanent fifty percent partial total disability. In 1993, petitioner was awarded total disability benefits pursuant to a settlement. The parties agreed as part of the settlement that the two insurance companies for the employer and the State Second Injury Fund would be entitled to an offset pursuant to N.J.S.A. 34:15-95.5 based upon petitioner's receipt of Social Security disability benefits.

Petitioner's Social Security benefits are $665 per month. He is forty-three years of age. He does not have any source of income other than his Social Security disability benefits and his workers' compensation award.

At a hearing to approve the settlement, petitioner testified that in addition to Social Security disability benefits being paid to him, benefits were also being paid to two of his children, one born in 1984 and the other in 1990.

Petitioner had lived with the mother of these children until 1990 but was not legally married to her. After their separation, the mother applied for and obtained Social Security benefits for the children. Petitioner contends that this was done without his knowledge. The benefits are paid directly to her for the children. The children live in Delaware with their mother. Judge Lashman said that petitioner visits with the two children "whenever he can." Petitioner does not contribute toward the children's support other than through the Social Security disability benefits paid to them.

Petitioner's counsel acknowledged at oral argument before us that if the petitioner's award is not reduced by the total amount of Social Security disability benefits, then the Social Security Administration is likely to disallow the benefits that the children are receiving. In other words, if petitioner's workers' compensation award is not reduced, then the children's benefits will be.

Judge Lashman ruled that petitioner's workers' compensation benefits would be reduced from $103.40 per week to $54.94 per week until his youngest child reached age eighteen in 2008 or graduated high school, whichever occurs later. Thereafter, the workers' compensation benefits would return to $103.40 per week.

Judge Lashman found and we agree that the reductions were mandated by federal and State statutes, see 42 U.S.C. § 424a(a)(7); N.J.S.A. 34:15-95.5, federal regulations, see 20 C.F.R. § 404.408(i), and judicial decisions. Trusty v. Consolidated Freightways, 210 Mont. 148, 681 P.2d 1085, 1089 (Mont. 1984) (Social Security benefits paid to family members may be included in state's offset formula); Guillory v. Stone & Webster Eng'g Corp., 545 So. 2d 605, 610 (La. Ct. App. 1989) (total family Social Security benefits are part of the calculation of the Social Security offset to workers' compensation benefits); see also Social Security Ruling 74-9c; Arthur Larson, The Law of Workers' Compensation ยง 97.35(a) at 18-29 to 18-32 (MB) (expressing surprise that more states do not take advantage of the provision of the Social ...


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