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                                   BRB No. 91-0283

ALBERT BEVILACQUA                       )
                                        )
          Claimant-Respondent           )
                                        )
     v.                                 )
                                        )
SUN SHIP, INCORPORATED                  )         DATE ISSUED:   04/25/1995)   
                                        )
     and                                )
                                        )
TRAVELER'S INSURANCE COMPANY            )
                                        )
          Employer/Carrier-             )
          Respondents                   )
                                        )
DIRECTOR, OFFICE OF WORKERS'            )
COMPENSATION PROGRAMS,                  )
UNITED STATES DEPARTMENT                )
OF LABOR                                )
                                        )
          Petitioner                    )         DECISION and ORDER  


     Appeal of the Decision and Order Approving Settlement of Paul H.
     Teitler, Administrative Law Judge, United States Department of Labor.

     Steven A. Reed (Pepper, Hamilton & Scheetz), Philadelphia, Pennsylvania,
     for employer/carrier.

     Carol B. Feinberg (Thomas S. Williamson, Jr., Solicitor of Labor; Carol
     DeDeo, Associate Solicitor; Janet R. Dunlop, Counsel for Longshore),
     Washington, D.C., for the Director, Office of Workers' Compensation
     Programs, United States Department of Labor.

     Before: HALL, Chief Administrative Appeals Judge, DOLDER and McGRANERY,
     Administrative Appeals Judges.

     PER CURIAM:

     The Director, Office of Workers' Compensation Programs (the Director), appeals
the Decision and Order Approving Settlement (90-LHC-1175) of Administrative Law
Judge Paul H. Teitler rendered on a claim filed pursuant to the provisions of the
Longshore and Harbor Workers' Compensation Act, as amended, 33 U.S.C. §901 et seq.  (the
Act).  We must affirm the findings of fact and conclusions of law of the
administrative law judge which are rational, supported by substantial evidence and
in accordance with law. O'Keeffe v. Smith, Hinchman & Grylls Associates,
Inc., 380 U.S. 359 (1965); 33 U.S.C. §921(b)(3).

     Claimant was exposed to asbestos while working for employer as a painter at
its shipyard from 1958 to 1979.  In a report dated September 30, 1987, Dr. Giudice
diagnosed claimant as having pleural and parenchymal asbestosis attributable to
asbestos exposure.  Dr. Giudice noted that because of claimant's exposure, he was
at an increased risk of developing malignancies including lung cancer, gastro-intestinal cancer, laryngeal cancer and mesothelioma.  Dr. Giudice stated that he
had discussed the situation with claimant and that he is fully aware of the
possible consequences of asbestos exposure.  Although Dr. Giudice did not state
that claimant required active medical treatment at that time, he noted that
claimant should have annual x-rays, pulmonary function and sigmoidoscopic
examinations and undergo timely medical check-ups as concerns arose.  Finally, Dr.
Giudice stated that claimant's prognosis must remain guarded in view of his
lifelong potential for asbestos-related malignancy as well as the significant
restriction noted on his pulmonary functions.[1] 
  
     Claimant sought compensation under the Act, alleging that he sustained injury
to his lungs as a result of his work-related asbestos exposure.  After the case was
referred to the Office of Administrative Law Judges, claimant and employer entered
into a proposed settlement agreement, in light of the conflicting medical evidence,
providing for claimant's receipt of a lump sum of $8,400.25, and claimant's
attorney's receipt of a fee of $2,000, plus costs of $199.75.   On September 26,
1990, the administrative law judge issued a Decision and Order in which he approved
the parties' proposed settlement, concluding that the agreement is fair and in
claimant's best interest, and was not procured by duress. 

     On appeal, the Director asserts that the administrative law judge exceeded the
scope of his authority in approving the proposed settlement agreement because the
parties' settlement is not in accordance with Section 8(i) of the Act, 33 U.S.C.
§908(i), and Section 702.241(g) of the regulations, 20 C.F.R.
§702.241(g), because it discharges employer from potential liability for
claims not yet in existence.  Additionally, the Director contends that the
settlement agreement violates the provisions of Section 15(b) of the Act, 33 U.S.C.
§915(b), which provides that an employee cannot agree to waive compensation. 
Employer responds urging affirmance and arguing that the settlement agreement,
which discharges employer's liability for all actions or causes of action other
than survivor's benefits, is valid under the Act, and that any worsening of
claimant's asbestos-related disease would be part of the same released claim and
not a new claim.  Claimant has not responded to the Director's appeal.

     The Director specifically takes issue with the language in paragraph 9 of the
Decision and Order Approving Settlement which provides in pertinent part:        
     

     It is specifically understood and agreed that the Claimant, Albert
     Bevilacqua, by this settlement, releases, renounces and settles with Sun
     Ship and all related Sun companies all actions or causes of
     action related to the instant actions. 

Decision and Order at 2 (emphasis added).  The Director maintains that this
language violates the provisions of Section 8(i) of the Act and Section 702.241(g)
of the regulations because it discharges employer from potential liability for
claims not yet in existence, thereby waiving claimant's right to compensation in
violation of Section 15(b) of the Act.  
     We agree with the Director that the settlement proposed by the parties and
approved by the administrative law judge contains language which is not acceptable
under Section 8(i) and its implementing regulations. See generally Kelly
v. Ingalls Shipbuilding, Inc., 27 BRBS 117 (1993).  Section 8(i), as amended
in 1984, provides in pertinent part:

     Whenever the parties to any claim for compensation under this Act,
     including survivors benefits, agree to a settlement, the deputy
     commissioner or administrative law judge shall approve the settlement
     within thirty days unless it is found to be inadequate or procured by
     duress.

33 U.S.C. §908(i)(1988).  Section 702.241(g) of the Act's implementing
regulations states:
     An agreement among the parties to settle a claim is limited to the
     rights of the parties and to claims then in existence; settlement
     of disability compensation or medical benefits shall not be settlement
     of survivor benefits nor shall the settlement affect, in any way, the
     right of survivors to file a claim for survivor's benefits.

20 C.F.R. §702.241(g)(emphasis added).

     Section 702.241(g) of the regulations explicitly states what is implicit under
the statute--that settlement of a claim is "limited to the rights of the parties
and to the claims then in existence." See Cortner v. Chevron International Oil
Co., Inc., 22 BRBS 218 (1989).  Thus, in Cortner, where the claimant
filed a claim for bilateral hernias and asbestos-related disease and was alive at
the time of the settlement, the Board vacated the settlement which discharged
employer from all claims for compensation, medical benefits, survivor benefits, and
death benefits.  The Board held that Section 8(i) of the Act and Section 702.241(g)
of the regulations prohibited the settlement of potential future survivor claims
which would not arise until the death of the injured worker. See Cortner,
22 BRBS at 220.  In contrast to Cortner, the Board has, in cases involving
settlements of claims for a work-related hearing loss, construed those settlements
as only applying to the hearing loss claim for which benefits were sought where the
settlement agreement as a whole clearly indicated a compromise settlement of the
hearing loss in existence at the time of the settlement. See Poole v. Ingalls
Shipbuilding, Inc., 27 BRBS 230 (1993); Kelly, 27 BRBS at 120.  In
Poole, therefore, the Board affirmed the administrative law judge's decision
to specifically limit a settlement to the present claim, noting that claimant was
a retiree and was unlikely to return to the workforce. See Poole, 27 BRBS
at 235.  Similarly, in Kelly, the Board affirmed the administrative law
judge's approval of a settlement, noting that claimant had not worked for employer
since 1959, could not file a future hearing loss claim against employer in the
absence of future injurious exposure, and that a death benefits claim relating to
an occupational hearing loss is unlikely. See Kelly, 27 BRBS at 120.

     Although the parties' agreement in this case does not attempt to discharge any
future survivor or death claims and, in fact, employer concedes in its response
that the agreement does not purport to do so, we agree with the Director that the
language contained in paragraph 9 of the parties' agreement nonetheless is
overbroad because it discharges employer from liability for future claims not yet
in existence. We note that Dr. Giudice's report specifically stated that claimant
has an increased risk of developing cancer as a result of his asbestos exposure. 
Because the settlement agreement purports to relieve employer from liability for
"all related actions or causes of action related to the instant action," it would
preclude claimant from obtaining compensation and medical benefits from employer
if he were to develop asbestos-related cancer in the future.  The settlement
agreement as a whole cannot logically be construed as being limited to the claim
for claimant's pulmonary condition which is "currently in existence" and therefore
violates Section 8(i) of the Act and Section 702.241(g) of the regulations
prohibiting the settlement of potential future claims.

     Moreover, we agree with the Director that the proposed settlement violates
Section 15(b) of the Act which prohibits an employee from waiving his right to
compensation and invalidates any attempts to do so.  33 U.S.C. §915(b).  The
United States Court of Appeals for the Fifth Circuit has stated that a claimant's
agreement to accept compensation pursuant to a submitted but unapproved settlement
is invalid under Section 15(b) because it is an agreement to waive compensation.
See generally Oceanic Butler, Inc. v. Nordahl, 842 F.2d 773, 21 BRBS 33
(CRT)(5th Cir. 1988), aff'g 20 BRBS 18 (1987).  Once approved, pursuant to
Section 8(i), settlement agreements are binding and Section 15(b) no longer
applies. See generally Guiterrez v. Metropolitan Stevedore Co., 18 BRBS 62
(1986) (Section 8(i) is a narrow exception to Section 15(b)).  Settlement
procedures must be followed to effect a waiver of compensation.  In the instant
case, the attempt to settle claims not yet in existence violates Section 8(i) and
therefore contravenes Section 15(b).  Consequently, we vacate the administrative
law judge's Decision and Order approving the parties' settlement.  The case is
accordingly remanded for the administrative law judge to take further action
necessary to the resolution of this claim.  

     Accordingly, the administrative law judge's Decision and Order Approving
Settlement is vacated, and the case is remanded for further proceedings as the
parties require to dispose of the claim.

     SO ORDERED.

                                                                        

                         BETTY JEAN HALL, Chief
                         Administrative Appeals Judge            


                                                                        

                         NANCY S. DOLDER
                         Administrative Appeals Judge



                                                                        

                         REGINA C. McGRANERY
                         Administrative Appeals Judge
    
 

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Footnotes.


1)Dr. Bresnitz, who examined claimant on behalf of the Office of Workers' Compensation Programs, submitted the opinion that claimant has bilateral pleural plaques secondary to asbestos exposure and "possible early asbestosis" but stated "there was no evidence of asbestos-related disease on physical examination." Dr. Epstein, who examined claimant on behalf of employer, opined that claimant has asbestos-related pleural plaques but does not have asbestosis or a work-related impairment. Back to Text

NOTE: This is an UNPUBLISHED LHCA Document.

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