PaTLA Amicus Victory

Supreme Ct: No comp subrogation against UM recovery

by Dale Larrimore, Esq.

The Pennsylvania Supreme Court has recently affirmed the Commonwealth Court decision in American Red Cross v. WCAB (Romano), 745 A.2d 78 (Pa.Cmwlth.2000). Amicus Curiae Committee member Daniel Bricmont, of Pittsburgh, wrote the amicus brief on behalf of PaTLA.

Frank Romano was a passenger in a vehicle in the course and scope of his employment when he was injured in an accident caused by an uninsured motorist. Mr. Romano sustained a serious injury requiring an open reduction and pinning and rodding of the femur. He recovered UM benefits from two companies that insured his own private vehicles. His employer, American Red Cross, then attempted to assert a subrogation lien against that recovery of UM benefits. The WCJ denied the claim for subrogation, distinguishing Warner v. Continental, 688 A.2d 177 (1996) as limited to circumstances where the claimant sought an award of UM benefits from an insurance policy purchased by the employer. The decision was affirmed by the WCAB and the Commonwealth Court, which cited Standish v. American Manufacturers Mutual Ins. Co., 698 A.2d 599 (1997), and held that an employer and the comp carrier only have a right to subrogation against an insurance policy that provides liability protection for the tortfeasor. Where the policy flows to the benefit of the claimant and provides recovery to the claimant when the tortfeasor cannot pay all or some of his total liability, there is no right of subrogation.

Any claimant, like anyone else, is free to insure himself against any contingency for which he may obtain insurance and we read nothing in the Act that evidences an intent on the part of the General Assembly to allow an employer to take advantage of such a claimant’s foresight. Id. 745 A.2d at 81.

By amending the Act in 1993, the Legislature explicitly afforded employers limited subrogation rights, i.e., only against sums received from suits against third-party tortfeasors.

Other Workers’ Compensation Issues
The Amicus Curiae Committee also participated in another workers’ compensation case with a successful result before the State Supreme Court. In Bethlehem Steel Corporation v. WCAB (Laubach), 760 A.2d 378 (2000), the claimant was working in a light duty job with restrictions due to a work injury. The issue before the court was whether the claimant was entitled to a reinstatement of benefits when he was laid off from that job due to the closing of the plant. The Supreme Court affirmed the Commonwealth Court and held that an employee is entitled to reinstatement of benefits under these circumstances. PaTLA members Lawrence Chaban, of Washington County, and Thomas Baumann, of Allegheny County, wrote the Amicus Curiae brief on behalf of PaTLA.

These cases are only a small example of the many cases that the Amicus Curiae Committee participates in through referrals from member attorneys. We hope to continue to participate in the most important cases affecting our members and affecting the rights of accident victims and all citizens of Pennsylvania. A copy of the amicus brief in any case may be obtained by any PaTLA member by contacting Kara Lafty, PaTLA’s Executive Assistant, at 215-546-6451 ([email protected]).

The Amicus Curiae Committee is also participating in several other cases involving workers’ compensation issues.

In McIlvaine Trucking Inc. v. WCAB (States), the claimant, Robert States, worked as a truck driver for McIlvaine Trucking. Every week he would go to the employer’s site in New Stanton, Pa. and get the company truck, drive it to Greensburg and load the truck, and then haul it to various locations in Pennsylvania, Maryland or West Virginia. He returned the truck to New Stanton at the end of the week. Only 25% of his time was spent in states other than Pennsylvania. States was injured while disconnecting the truck in New Stanton.

When the claimant attempted to obtain Pennsylvania workers’ compensation benefits, the employer asserted as a defense an agreement signed by States at the time he was hired, in which he agreed to be bound by West Virginia workers’ compensation laws.

The WCAB affirmed the decision of the WCJ which awarded benefits to the claimant, citing Neff v. WCAB (Burr), 624 A.2d 727 (1993), which held that agreements vesting exclusive jurisdiction over workers’ compensation claims in another state, where the claimant is injured in Pennsylvania, are void. In a memorandum opinion, the Commonwealth Court, per Collins, J., reversed. The Supreme Court granted the claimant a petition for permission to appeal. Amicus Curiae member Lawrence Chaban submitted an amicus brief on PaTLA’s behalf to the Supreme Court. Oral argument has not been scheduled.

In Ramich v. WCAB (Schatz Electric), the Pennsylvania Supreme Court is considering the issue of whether a claimant is required to request attorney fees for an unreasonable contest prior to the closing of the record. PaTLA member Marc Jacobs, of Philadelphia, submitted the amicus brief on behalf of PaTLA.

Finally, the Supreme Court has accepted the petition for allowance of appeal in Thompson v. WCAB(USF&G and Craig Welding), 730 A.2d 536 (Pa.Cmwlth.1999), a case with important potential ramifications to every PaTLA member on the issue of subrogation arising out of on-the-job accidents. If a third-party recovery is only for pain and suffering and includes no wage loss or medical payments to the plaintiff, can the workers’ compensation carrier recover subrogation on the wage loss and medical bills that are paid to the claimant or his doctors? On the facts of this case, the Commonwealth Court held that the employer and the comp carrier were barred on equitable grounds from enforcing their subrogation rights against the plaintiff’s recovery, which was for pain and suffering only. PaTLA member, and Philadelphia Trial Lawyers Association President George Martin, of Philadelphia, submitted the amicus brief on behalf of the PaTLA.

Dale Larrimore, a partner in the Philadelphia firm of Deutsch, Larrimore, Farnish & Andersson, LLP, is Chair of PaTLA’s Amicus Curiae Committee.

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