ILNews

Justices reaffirm precedent on worker's comp claims

Back to TopCommentsE-mailPrintBookmark and Share

The Indiana Supreme Court has upheld a decision by the state Worker's Compensation Board dismissing an injured trucker's claim, finding the employee's settlement with a third-party driver voided whatever responsibility the company had on the issue.

But in deciding the case, the justices also called out an Indiana Court of Appeals panel for stepping away from a precedent in place since at least 1988 by doing something that should be left up to the state's lawmakers.

The unanimous ruling came Thursday afternoon in Jimmie C. Smith v. Champion Trucking Company, Inc., No. 93S02-0906-EX-276. The appeal stems from a matter before the Worker's Compensation Board of Indiana, relating to an August 2003 accident in Ohio by a truck driver working for Jeffersonville-based Champion Trucking. After the crash, the company paid $4,342 of Smith's initial medical expenses through worker's compensation coverage. About five months after leaving the company in August 2004, Smith asserted a permanent injury and tried to adjust his claim to get compensation for additional medical expenses. He also retained another attorney to try and recover from the motorist who'd mostly caused the accident in Ohio.

While Champion wasn't notified of any litigation or settlement negotiations, Smith's worker's compensation attorney at one point notified the company about the intent to sue that third-party driver. The company notified Smith's private attorney in July 2005 about its entitlement to a lien on any settlement proceeds for what it had already paid the former worker, but Smith settled for $10,342 that same month without notifying the former employer. The settlement released that third-party driver from any liability for the accident and left the dispute between Smith and Champion.

Smith's attorney paid 75 percent of the medical lien amount to Champion and kept 25 percent for the attorney's fees authorized by the worker's compensation statute, and the company soon after moved to dismiss Smith's claim adjustment application because of the settlement.

In July 2008, the Worker's Compensation Board ruled that Smith's settlement terminated Champion's liability because of Indiana Code § 22-3-2-13 (2004), which bars employees from getting any additional employer compensation after a third-party settlement. Smith appealed that the provision didn't apply because he'd settled for less than what worker's compensation had provided.

Past precedent generally addressed that topic and provided some guidance, which was an issue the Supreme Court hadn't specifically ruled on in the past. In February 2009, an Indiana Court of Appeals three-judge panel reversed the board's determination and found Smith should be allowed to continue his worker's compensation claim pending at the time of settlement. Judges Mark Bailey, Michael Barnes, and Paul Mathias relied on DePuy, Inc. v. Farmer, 847 N.E.2d 160, 164 (Ind. 2006), which held that a "final judgment" against third parties effectively ends an employer worker's compensation liability.

At that time in DePuy, justices recognized the issue that Smith is now raising but specifically chose not to address the question.

But with Smith's case now on transfer, the Indiana Supreme Court held differently and reinforced the caselaw that settlements, regardless of the amount, do in fact negate any further company responsibility for worker's compensation coverage if that person hasn't first gotten consent. The justices applied what it called a long line of state decisions to support the proposition. Specifically the high court said Paragraphs 1 and 2 of Section 13 of the Worker's Compensation Act impose a bright-line rule that's long been recognized by Indiana courts before this case.

"For at least twenty years, the Court of Appeals has held that if an employee settles with a third party without first obtaining employer's consent, the employer's sole avenue for reimbursement of worker's compensation payments is through the employee, and the employer may not continue to pursue the third party," Justice Theodore Boehm wrote for the court, citing State v. Mileff, 520 N.E. 2d 123 (Ind. Ct. App. 1988). "Although some other jurisdictions do not adhere to the same interpretation of similar provisions, the Court of Appeals, citing the interest of finality from the point of view of the third party, has long held that once an employee releases the third party from liability related to the injury-causing accident, the employer may not continue to pursue that third party. Given this longstanding precedent on an issue of statutory interpretation, we believe it is up to the legislature to implement any change."

The justices affirmed the full compensation board's dismissal of Smith's adjustment application, and Justice Brent Dickson noted that he concurred in result.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

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