Lump-sum payments -- Reopening as remedy for disagreement -- Abatement
of application for resolution.
(1) If the employee and employer and special fund or any of them reach an agreement
conforming to the provisions of this chapter in regard to compensation, a
memorandum of the agreement signed by the parties or their representatives shall be
filed with the commissioner, and, if approved by an administrative law judge, shall
be enforceable pursuant to KRS 342.305. Where all parties have not joined in the
settlement agreement, it shall not be approved unless it is certified that the party not
participating in the settlement has been served with a copy of the agreement not less
than ten (10) days prior to submission of the agreement for approval. This provision
shall not be construed to prevent the voluntary payment of compensation for the
periods and in the amounts prescribed by this chapter, but nothing shall operate as a
final settlement except a memorandum of agreement filed with the commissioner
and approved by the administrative law judge. Upon claims settled after December
12, 1996, the special fund shall have the option of settling its liability for income
benefits on the same terms as those reached between the employee and employer.
Notice of the special fund exercise of the option granted in this subsection shall be
made by letter of the director of the Division of Workers' Compensation Funds
mailed to the parties within ten (10) days of receipt by the director of a copy of the
agreement.
(2) Settlement agreements concluded after July 14, 2000, providing for commuted
lump-sum payment of future income benefits which would otherwise be payable in
amounts greater than one hundred dollars ($100) per week shall not be approved
unless there is reasonable assurance that the worker will have an adequate source of
income during disability. This subsection is remedial and applies to all pending and
future claims.
(3) Upon lump-sum settlement of future periodic payments, the discount rate used in
the calculation of the settlement amount shall be fixed by the commissioner. Before
January 1 of each year commencing in 2001, the commissioner shall fix the
discount rate to be utilized in the succeeding year based at one-half of one percent
(0.5%) below the interest rate paid upon ten (10) year United States Treasury notes
as of August 1 of the preceding year. However, upon lump-sum settlement of future
periodic payments in weekly amounts that are forty dollars ($40) or less, the
commissioner shall fix the discount rate used in the succeeding year based at the
interest rate paid upon ten (10) year United States Treasury notes as of August 1 of
the preceding year.
(4) If the parties have previously filed an agreement which has been approved by the
administrative law judge, and compensation has been paid or is due in accordance
therewith and the parties thereafter disagree, either party may invoke the provisions
of KRS 342.125, which remedy shall be exclusive.
(5) An application for resolution of claim shall be held in abeyance during any period
voluntary payments of income benefits are being made under any benefit sections of
this chapter to the maximum which the employee's wages shall entitle unless it shall
be shown that the prosecution of the employee's claim would be prejudiced by
delay.
Effective: July 14, 2018
History: Amended 2018 Ky. Acts ch. 40, sec. 6, effective July 14, 2018. -- Amended
2010 Ky. Acts ch. 24, sec. 1808, effective July 15, 2010. -- Amended 2002 Ky. Acts
ch. 246, sec. 4, effective July 15, 2002. -- Amended 2000 Ky. Acts ch. 514, sec. 16,
effective July 14, 2000. -- Amended 1996 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 11,
effective December 12, 1996. -- Amended 1990 Ky. Acts ch. 2, sec. 1, effective July
13, 1990. -- Amended 1987 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 30, effective
January 4, 1988. -- Amended 1960 Ky. Acts ch. 147, sec. 14, effective June 16,
1960. -- Amended 1952 Ky. Acts ch. 182, sec. 10. -- Recodified 1942 Ky. Acts ch.
208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4931.
Notes of Decisions
Coalfield Tel. Co. v. Thompson, 113 S.W.3d 178 (Ky. 2003).
· cites it 7× “Although recognizing that the parties exchanged “letters of settlement,” the ALJ concluded that KRS 342.265 required an agreement to be signed by the parties or their representatives and approved by an ALJ in order to be enforceable.”
Greene v. Paschall Truck Lines, 239 S.W.3d 94 (Ky. Ct. App. 2007).
· cites it 8× “Thus, he did not address whether the agreement should have been submitted for approval as required by KRS 342.265, nor did he consider whether PTL should have recovered any portion of its subrogation hen.”
Hall v. Hosp. Resources, Inc., 276 S.W.3d 775 (Ky. 2008).
· cites it 2× “In Kendrick , the Court of Appeals stated: Addressing the claimant's argument that the abeyance provisions contained in KRS 342.265(5) and the statute of limitations contained in KRS 342.”
Hudson v. Cave Hill Cemetery, 331 S.W.3d 267 (Ky. 2011).
· cites it 4× “1 Moreover, they failed to reduce an agreement to a memorandum as required by KRS 342.265 or submit it to the ALJ for approval, and nothing guaranteed that it would have been approved had they done so.”
Palmore v. Helton, 779 S.W.2d 196 (Ky. 1989).
· cites it 4× “Additionally, KRS 342.265 clearly permits the employer and employee to enter into a settlement agreement, subject to approval by the Board (now the Administrative Law Judge), which agreement becomes *198 an award upon approval.”
Cincinnati Ins. Co. v. Samples, 192 S.W.3d 311 (Ky. 2006).
· cites it 2× “See KRS 342.265; 803 KAR 25:036. The trial court also deducted the $25,000.”
Am. Stand., Inc. v. Stephen, 565 S.W.2d 158 (Ky. Ct. App. 1978).
· cites it 3× “The Special Fund says this holding of the circuit court is correct because KRS 342.265 is controlling, which provides that when the compensation agreement was finalized by board approval, the award was then final; pursuant to KRS 342.”
Kendrick v. Toyota, 145 S.W.3d 422 (Ky. Ct. App. 2004).
· cites it 4× “185 and KRS 342.265. It also submits this is not a situation in which estoppel/waiver applies.”
Skaggs v. Wood Mosaic Corp., 428 S.W.2d 617 (Ky. Ct. App. 1968).
· cites it 3× “However, in KRS 342.265 it is provided that if the employe and employer “reach an agreement” in regard to compensation a memorandum of the agreement shall be filed with the board, and “No limitation of time shall begin to run until the date upon which such agreement is filed…”
Yocom v. Jordan Auto Parts Co., 521 S.W.2d 519 (Ky. Ct. App. 1975).
· cites it 4× “” On November 5, 1973, the agreement was submitted to and approved by the Board, KRS 342.265, and the following order entered: “It is ordered by the Board that the agreement, filed herein November 5, 1973, be and the same is hereby approved, plaintiff to recover compensation at…”
Indus. Track Builders of Am. v. Lemaster, 429 S.W.2d 403 (Ky. Ct. App. 1968).
· cites it 3× “KRS 342.265 provides that if the employe and employer reach an agreement in regard to compensation it shall be filed with the Board and unless so filed and approved shall not operate as a final settlement.”
— Ky. Rev. Stat. § 342.265(1) — 11 cases
Coalfield Tel. Co. v. Thompson, 113 S.W.3d 178 (Ky. 2003).
“Although recognizing that the parties exchanged “letters of settlement,” the ALJ concluded that KRS 342.265 required an agreement to be signed by the parties or their representatives and approved by an ALJ in order to be enforceable.”
Greene v. Paschall Truck Lines, 239 S.W.3d 94 (Ky. Ct. App. 2007).
“Thus, he did not address whether the agreement should have been submitted for approval as required by KRS 342.265, nor did he consider whether PTL should have recovered any portion of its subrogation hen.”
Hudson v. Cave Hill Cemetery, 331 S.W.3d 267 (Ky. 2011).
“1 Moreover, they failed to reduce an agreement to a memorandum as required by KRS 342.265 or submit it to the ALJ for approval, and nothing guaranteed that it would have been approved had they done so.”
— Ky. Rev. Stat. § 342.265(2) — 1 case
— Ky. Rev. Stat. § 342.265(4) — 6 cases
— Ky. Rev. Stat. § 342.265(5) — 4 cases
Hall v. Hosp. Resources, Inc., 276 S.W.3d 775 (Ky. 2008).
“In Kendrick , the Court of Appeals stated: Addressing the claimant's argument that the abeyance provisions contained in KRS 342.265(5) and the statute of limitations contained in KRS 342.”
Kendrick v. Toyota, 145 S.W.3d 422 (Ky. Ct. App. 2004).
“185 and KRS 342.265. It also submits this is not a situation in which estoppel/waiver applies.”
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