New Mexico Statutes
Article 5 - Workers' Compensation Division
Section 52-5-14 - Order of approval.

A. If the workers' compensation judge finds the lump-sum payment agreement to be fair, equitable and consistent with provisions of the Workers' Compensation Act [Chapter 52, Article 1 NMSA 1978] or the New Mexico Occupational Disease Disablement Law [52-3-1 NMSA 1978], he shall approve the agreement by order, and the order shall not be set aside or modified except as provided in the applicable law. The workers' compensation judge may refuse to approve a settlement if he does not believe that it provides substantial justice to the parties.
B. In making lump-sum settlements, the payment due the worker or his dependents shall not be discounted at a greater rate than a sum equal to the present value of all future payments of compensation benefits computed at a five percent discount compounded annually.
History: Laws 1986, ch. 22, § 40; 1989, ch. 263, § 82; 1990 (2nd S.S.), ch. 2, § 58.
The 1990 (2nd S.S.) amendment, effective January 1, 1991, deleted the former first sentence of Subsection B regarding compensation converted into lump sum settlement by agreement.
Jurisdiction pending appeal. — The workers' compensation division did not have jurisdiction to enter an order of settlement in a case where an appeal was pending. Riesenecker v. Arkansas. Best Freight Sys., 1990-NMCA-100, 110 N.M. 451, 796 P.2d 1147.
Approval by workers' compensation judge in accordance with requirements of Subsection A of this section and Section 52-5-13 NMSA 1978 is necessary to assure adherence to the policies established by the legislature favoring periodic payments over lump sum payments, requiring careful effort to assure that a worker or the dependents understand the consequences of replacing periodic payments with a discounted lump sum amount, and assuring that the settlement is fair, equitable, and consistent with the Worker's Compensation Act. Paradiso v. Tipps Equip., 2004-NMCA-009, 134 N.M. 814, 82 P.3d 985, cert. denied, 2004-NMCERT-001.
Stipulated compensation order that failed to comply with approval process was invalid and unenforceable. — Where, in 2004, the parties entered into a stipulated compensation order (SCO) to settle a dispute regarding worker's entitlement to workers' compensation benefits as the result of an accident and injuries to worker's back that occurred in 2002, and where there was no hearing by the workers' compensation judge (WCJ) to approve the provisions of the SCO or otherwise confirm worker's knowledge of the partial lump-sum settlement or any of the material facts contained therein, and where, in 2014, employer filed a motion for a supplemental compensation order (MSCO), the WCJ erred in granting the MSCO and in approving the SCO under 52-5-13 and -14 NMSA 1978, because the SCO was not in compliance with 52-5-12(C) NMSA 1978, and therefore the WCJ had no authority to approve the SCO containing a partial lump-sum payment of benefits; the SCO was invalid and unenforceable. Baca v. State, 2017-NMCA-076, cert. denied.

Structure New Mexico Statutes