ILNews

Court rules on workers' comp dispute

Back to TopE-mailPrintBookmark and Share

The Indiana Court of Appeals reversed a finding that a company had acted in bad faith in denying workers' compensation benefits because there was a dispute over who should pay the benefits. The appellate court also encouraged employers to come to an early agreement to share treatment costs pending a liability determination to avoid a situation similar to the one in the instant case.

In Ag-One Co-Op and Trane v. James Andrew Scott, No. 93A02-0904-EX-298, James Andrew Scott, a former Trane employee who went to work for Ag-One, went without medical care or compensation from June 2004 until September 2006 because Trane and Ag-One Co-Op disputed who was responsible for his medical expenses. Scott hurt his shoulder in September 2002 while working for Trane and received workers' compensation benefits. He worked for Ag-One from March to May in 2004 and re-aggravated his shoulder injury. Scott filed an application for adjustment of claim against Trane; Trane asked that Ag-One be brought on as a party because it believed the company was liable for part of Scott's injuries.

In early 2006, a single hearing member of the Indiana Worker's Compensation Board and the full board found Trane, not Ag-One, to be responsible for Scott's medical care and expenses. The full board also allowed Scott 45 days to file a claim against Ag-One, which he did, alleging bad faith. The full board affirmed the single hearing member's decision that Ag-One acted in bad faith and should pay half the $5,000 in damages and $1,600 in attorney's fees.

The Court of Appeals found Borgman v. Sugar Creek Animal Hospital, 782 N.E.2d 993 (Ind. Ct. App. 2002), to be instructive in its finding that that there can be no bad faith in denying benefits if the employer didn't act improperly in denying benefits, wrote Judge Paul Mathias.

"While we share the Board's concern that Scott went without medical care while Trane and Ag-One disputed who was liable for Scott's worker's compensation benefits, we fail to see how Ag-One can be said to have acted in bad faith in denying Scott's claim for benefits when Ag-One was ultimately found not to be liable for such benefits," he wrote.

The appellate court cautioned that its decision shouldn't be interpreted as encouragement for multiple employers in disputes over liability to refuse payment while awaiting the Indiana Worker's Compensation Board's decision. It understood the board's frustration with Trane and Ag-One in refusing to cover Scott's benefits while awaiting the board's decision, and noted that if they had both paid something during the dispute, the company found not liable could be reimbursed from the other employer. The appellate court ordered the decision reversed and vacated.

"We encourage employers in like situations in the future to come to an early agreement to share treatment costs pending determination of which employer is fully or partially liable. Doing so could go far in facilitating settlement of the claim and will avoid liability for the type of bad faith determined by the Board in this case, a determination that will usually be upheld under our deferential standard of review," Judge Mathias wrote.

Judge Margret Robb concurred and wrote in a separate opinion in addition to vacating the order Ag-One pay damages to Scott, the board should enter an order determining Trane's responsibility for the entire $5,000 as bad faith damages.

ADVERTISEMENT

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Just an aside, but regardless of the outcome, I 'm proud of Judge William Hughes. He was the original magistrate on the Home place issue. He ruled for Home Place, and was primaried by Brainard for it. Their tool Poindexter failed to unseat Hughes, who won support for his honesty and courage throughout the county, and he was reelected Judge of Hamilton County's Superior Court. You can still stand for something and survive. Thanks, Judge Hughes!

  2. CCHP's real accomplishment is the 2015 law signed by Gov Pence that basically outlaws any annexation that is forced where a 65% majority of landowners in the affected area disagree. Regardless of whether HP wins or loses, the citizens of Indiana will not have another fiasco like this. The law Gov Pence signed is a direct result of this malgovernance.

  3. I gave tempparry guardship to a friend of my granddaughter in 2012. I went to prison. I had custody. My daughter went to prison to. We are out. My daughter gave me custody but can get her back. She was not order to give me custody . but now we want granddaughter back from friend. She's 14 now. What rights do we have

  4. This sure is not what most who value good governance consider the Rule of Law to entail: "In a letter dated March 2, which Brizzi forwarded to IBJ, the commission dismissed the grievance “on grounds that there is not reasonable cause to believe that you are guilty of misconduct.”" Yet two month later reasonable cause does exist? (Or is the commission forging ahead, the need for reasonable belief be damned? -- A seeming violation of the Rules of Profession Ethics on the part of the commission) Could the rule of law theory cause one to believe that an explanation is in order? Could it be that Hoosier attorneys live under Imperial Law (which is also a t-word that rhymes with infamy) in which the Platonic guardians can do no wrong and never owe the plebeian class any explanation for their powerful actions. (Might makes it right?) Could this be a case of politics directing the commission, as celebrated IU Mauer Professor (the late) Patrick Baude warned was happening 20 years ago in his controversial (whisteblowing) ethics lecture on a quite similar topic: http://www.repository.law.indiana.edu/cgi/viewcontent.cgi?article=1498&context=ilj

  5. I have a case presently pending cert review before the SCOTUS that reveals just how Indiana regulates the bar. I have been denied licensure for life for holding the wrong views and questioning the grand inquisitors as to their duties as to state and federal constitutional due process. True story: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS Shorter, Amici brief serving to frame issue as misuse of govt licensure: https://www.scribd.com/doc/312841269/Thomas-More-Society-Amicus-Brown-v-Ind-Bd-of-Law-Examiners

ADVERTISEMENT