Don A. Fendon 2013-01-16 04:06:08
Last month we talked about an election of remedies between pursuing a workers’ compensation claim and suing an employer civilly. Now we are going to discuss what constitutes an actual election of remedies. As a general rule, the Appellate Courts in Arizona are strongly inclined to bring workers within the purview of the workers compensation system (“the Act”) when there is an issue regarding an election of remedies. Obviously, third party lawsuits against tortfeasors causing injury to an employee while on the job are always valid if there is good liability against such an entity. Obviously, such cases are not part of this discussion. However, one must keep in mind that when a settlement possibility arises with the third party tortfeasor and his insurance company the workers’ compensation insurer or provider must be kept in the loop, consulted with, and ultimately approve any resolution, especially if the provider’s lien is compromised. (See A.R.S. §23-1023 [C]) Essentially, you must obtain written consent to settle such a claim to make sure the compensation provider can recover its lien for the payment of compensation and medical bills provided to the applicant. In fact, the compromise of any third party claim by the employee or his dependents at an amount less than the compensation and medical, surgical and hospital benefits provided for shall be made only with written approval of the compensation insurance carrier or of the entity liable to pay the claimant. If you do not obtain written permission to compromise the lien, the worker can and will lose his right to any future benefits under “the Act.” In the context of the normal election of remedies cases, however, if an employee accepts workers’ compensation benefits such as merely receiving a compensation check from an insurance carrier or having a medical bill paid, he has made an election. Moreover, in such instances, making a known election is not required. In addition, since most workers’ compensation claims are automatically filed with the Industrial Commission on the very first visit to a physician you can readily understand the paucity of successful lawsuits against insured employers after an on the job injury. It is always clear that a successful claim for workers’ compensation benefits will bar a later suit against an employer. However, it is much less certain whether an unsuccessful, or even an unresolved common lawsuit against the employer will bar a subsequent workers’ compensation claim. In Arizona, the mere filing of what turns out to be an unsuccessful common law suit against an uninsured employer does not constitute a waiver of the workers’ compensation remedy. Under the right circumstances the injured worker may still be able to file a claim at the Industrial Commission and get it successfully processed. The State Supreme Court initially addressed this problem in Jeune v. Industrial Commission, 77 Ariz 410, 274 P.2d 85 (1954). Also with regard to the exclusivity of using “the Act” see Walker v. Industrial Commission, 22 Ariz App. 442, 528 P.2d 634 (1974) and Spear v. Industrial Commission, 114 Ariz 601, 562 P.2d 1099 (Ct. App. 1977). In general, from a perusal of the case law, it appears that the Appellate Courts in Arizona will find a binding election that a worker rejected “the Act” in favor of a lawsuit where the worker has litigated or is able to litigate the merits of his tort claim against the defendant employer. On the other hand, if the lawsuit in Superior Court is dismissed because the injured worker cannot avoid a jurisdictional barrier concerning the exclusivity of “the Act” such as in Juene, Walker and Spear, he has not waived his right to file a workers’ compensation claim at the Industrial Commission of Arizona. Incidentally, the Industrial Commission will not accept a “provisional” filing of a claim or hold a claim in abeyance pending the outcome of a civil suit. The better practice would be to file a civil action promptly, pursue discovery diligently, and accelerate a determination of the critical issues by the trial court so that a timely filing of a workers’ compensation claim can still be made if the Superior Court determination is adverse. Remember, however, you only have one (1) year from the date of injury to file a workers’ compensation claim. Therefore, an attorney would have to move quickly to get a resolution of a civil suit completed and that is generally close to impossible. In conclusion, I believe it is always better and safer for an injured worker to elect workers’ compensation benefits than to file a tort claim against his employer. There is much too much uncertainty in filing a tort claim and the employer is provided all the normal common law defenses including the concept of comparative negligence in the handling of such a suit.
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