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caused by the delay of wage payment. See Overnight Motor
Transp. Co. v. Missel, 316 U.S. 572, 583-584 (1942). While we
do not question the existence or severity of petitioners’
medical conditions, they have failed to demonstrate that any
portion of the settlement was paid on account of those
conditions.
With no mention of personal injuries in the amended
complaint or pretrial order and given the unavailability of the
type of relief claimed by petitioners under the cause of action
they pursued, there has been no showing that the defendant
settled the claim with an intention of compensating plaintiffs
for personal injury or illness.
The income exclusion test, under section 104(a)(2), for
personal injury or sickness compensation is two-prong. Both
prongs, settlement on account of personal injury or sickness
and settlement of a tort or tortlike claim, are required.
Because petitioners cannot show that any portion of the
settlement was paid as compensation for personal injury or
sickness, the income is not excludable under section 104(a)(2).
Though there is some authority that a claim under FLSA may not
sound in contract, thereby opening the possibility of a claim
sounding in tort, it is unnecessary to consider that argument
here because both prongs of the test must be met.
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