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Worker’s Compensation Act doesn’t give board ability to decide contract construction issue

September 4, 2012

The Indiana Court of Appeals ruled that a Hamilton Superior Judge erred in granting an injured worker’s motion to dismiss a company’s action on whether it was liable to pay workers’ compensation to the injured man, who worked for another company.

Hood’s Gardens entered into a contract with D&E Tree Extraction to have a tree removed for $600. D&E would also haul the wood and debris away and keep the wood. D&E sent Jason Young to remove part of the tree. He was severely injured in the process and rendered a paraplegic. Young’s attorney made a demand that Hood’s Gardens pay workers’ compensation benefits to Young.

HG knew it could be liable under Indiana Code 22-3-2-14(b) because it didn’t check whether D&E had proper insurance, but HG believed the statute didn’t apply because the contract was only for $600. The statute holds a company liable for work exceeding $1,000.

Young argued that the value of the wood hauled away was at least $400, making HG liable. HG filed a complaint for declaratory judgment on the matter, and it later filed a motion for summary judgment. Young sought to have the declaratory judgment dismissed because he argued the worker’s compensation board had exclusive jurisdiction to hear the issues raised by HG. The trial court granted the motion to dismiss.

In Hood's Gardens, Inc. v. Jason Young, Craig Mead d/b/a Discount Tree Excavation a/k/a D & E Tree Extraction, 29A04-1201-PL-8, the appellate court ruled the Declaratory Judgment Act is the appropriate vehicle for resolving the issue raised by HG in its complaint. The issuance of a declaratory judgment serves the useful purpose of determining whether the value of the contract between D&E and HG is a statutory basis for changing HG’s legal status, Senior Judge Carr Darden wrote.

The exclusivity provisions of the Worker’s Compensation Act didn’t give the board exclusive jurisdiction to decide the simple contract construction issue, he wrote. The judges reversed the motion to dismiss and remanded for further proceedings.

 

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