Brazfield v. Mountain States Mutual Casualty Co.

SUTIN, Judge

(concurring in part and dissenting in part).

I concur as to affirmance of partial summary judgment but dissent as to affirmance of summary judgment.

Plaintiff filed a claim for relief in two counts: (1) for continued payment of workmen’s compensation benefits for disability after death of a workman whose death resulted from unrelated causes and (2) for breach of a settlement agreement entered into between decedent’s attorney and defendant subsequent to decedent’s death. The trial court granted defendant partial summary judgment under Count I and summary judgment under Count II.

A. Compensation payments ceased upon death of decedent.

On August 12, 1974, decedent suffered an accidental injury within the course and scope of his employment. Following this injury and to the date of his death on April 17, 1977, defendant paid decedent all workmen’s compensation benefits to which he was entitled. Death resulted from causes unrelated to the accidental injury and defendant ceased making any further payments.

Plaintiff contends that the Workmen’s Compensation Act is a “support” statute inasmuch as § 52-1 — 46, N.M.S.A.1978 provides for detailed distribution of compensation benefits to dependents. Therefore, the family is entitled to compensation. The Act is a “support” statute when the workman’s death is related to his employment. It is not a welfare statute enacted for the benefit of a family whose breadwinner dies from unrelated causes.

Section 52-1 — 47(0) states that:

[I]n no case shall compensation benefits for disability continue after the disability ends or after the death of the injured workman;

Plaintiff’s argument flows all around this section but never mentions it. Silence on this provision never won a victory on appeal.

“After the death of the injured workman” does need interpretation. Compensation benefits for an injured workman continue after death “if an accidental injury sustained by a workman proximately results in his death.” Section 52-1 — 46. To give effect to subsection (C), logic dictates that compensation benefits shall not continue after the death of an injured workman “if the death results from unrelated causes.”

Under a former statute, it was said that the question was not free from doubt. Cranford v. Farnsworth & Chambers Company, 261 F.2d 8 (10th Cir. 1958). The following year, the section of the Act that raised the doubt was repealed and the present statute enacted. To seek relief for the continuation of benefits after death that results from unrelated causes, the workman must look to the legislature. The Act must be amended to directly award compensation benefits to dependents of an injured workman “if death results from unrelated causes.”

Partial summary judgment was properly granted defendant.

B. The authority of an attorney to act continues after decedent’s death if the attorney acts in good faith without knowledge of death.

On or about April 1, 1977, decedent authorized his attorney to settle decedent’s compensation benefits. For purposes of appeal only, defendant concedes that a genuine issue of material fact exists on whether a settlement was reached.

Decedent died April 17, 1977. An oral settlement took place on April 19 or 20, 1977. Neither decedent’s attorney nor defendant knew of decedent’s death prior to the agreement reached.

The trial court granted summary judgment on the theory that the authority of decedent’s attorney to agree to a settlement had been revoked by operation of law on April 17, 1977, prior to the time the settlement was effective.

This problem is a matter of first impression in New Mexico. The question to decide is whether the harsh common law rule should be followed, or whether an exception should be made in workmen’s compensation cases.

“The general rule is that the death of the client revokes his attorney’s authority to act for him.” Hamilton v. Hughey, 284 Or. 739, 588 P.2d 38, 40 (1978). This rule has been applied to a settlement effected a day after a client’s death in an action for damages arising out of an automobile accident. Pautz v. American Insurance Company, 268 Minn. 241, 128 N.W.2d 731 (1964). Similarly, decedent’s attorney cannot accept an offer of settlement made by a defendant in a motor vehicle collision case when the acceptance is made after decedent’s death. Mubi v. Broomfield, 108 Ariz. 39, 492 P.2d 700 (1972). An attorney has no authority to take any steps unless and until authorized by the personal representative of the deceased, duly qualified. State v. Terte, 293 S.W.2d 6 (Mo.App.1956). So, it has been held that an attorney has no authority in a compensation case to take an appeal after claimant’s death. Switkes v. John McShain, Inc., 202 Md. 340, 96 A.2d 617 (1953).

The attorney-client relationship ceases because the power of an attorney to act is dependent upon the control and direction of the client, which has been withdrawn by death. When applied methodically in every case, the rule is harsh and unfair. Note, Powers of an Agent After the Death of the Principle, 44 Harvard L.Rev. 265 (1930-31). Each case must be carefully scrutinized to determine whether the effect of the rule is fair and equitable under the circumstances. Otherwise dependent families or estates may suffer unusual harm even though decedent’s attorney acted in good faith and without knowledge of decedent’s death.

The Civil Law adopted the same general rule, but with an exception, namely, where an agent performed some act within the scope of his authority, in good faith and without knowledge of the principle’s death, the authority would not be terminated. Comments, Death of Principle as Terminating Agent’s Power to Act, 12 Mo.L.Rev. 50 (1947); Simms v. Braren, 252 So.2d 459 (La.App.1971); Catlin v. Reed, 141 Okla. 14, 283 P. 549 (1930). Catlin and other non-Civil Law states adopted this rule as an additional exception to the general rule.

As a matter of public policy, this exception to the general rule should be adopted in cases involving workmen. The Workmen’s Compensation Act is in derogation of the common law. It should not be burdened with common law rules. Over a half century ago, Justice Bratton set the spirit of the Act in Gonzales v. Chino Copper Co., 29 N.M. 228, 222 P. 903 (1924). He pointed out that it was designed “to avoid the application of certain well-established rules of law which oftentimes worked seeming harsh results . . .” [id. 232, 222 P. 905.] We should continue in that spirit today.

In the instant case, whether decedent’s attorney’s authority terminated at decedent’s death depends upon whether the attorney acted in good faith and without knowledge of decedent’s death. This conduct is a genuine issue of material fact.

Summary judgment on Count II should be reversed.