Dion v. Batten – Subrogation Lien on North Carolina Workers’ Compensation Benefits

The North Carolina Court of Appeal recently affirmed the amount of a workers’ compensation subrogation lien on a judgment obtained by an injured plaintiff against a red light runner. drive7

The issue raised in Dion v. Batten is one that is not unusual for those who are injured while driving in the course and scope of employment. That’s because workers’ compensation benefits are typically awarded far in advance of any personal injury damage award by third-party, at-fault drivers. But plaintiffs are forbidden from collecting double recovery for things like medical expenses or lost wages. So if a workers’ compensation insurance carrier has already provided coverage for those elements and then a subsequent injury lawsuit results in a compensation award for those same damages, the workers’ compensation insurer is then entitled to subrogation – or reimbursement for – the compensation it previously paid.

Plaintiff worked as a servicing agent for a car dealership in Wilmington in March 2009 when the vehicle he was driving for work was struck by a vehicle driven by a defendant who failed to stop at a red light. Because the crash occurred during the course and scope of plaintiff’s employment with the dealership, plaintiff was entitled to – and filed a claim for – workers’ compensation benefits. 

Plaintiff, the employer and the employer’s workers’ compensation servicing agent agreed plaintiff was entitled to nearly $530,000 for injuries sustained in the crash. That agreement was approved between the three parties and approved by the industrial commission in November 2012. The employer and its workers’ compensation insurer asserted they still had rights to liens against any third-party recovery.

In addition to that North Carolina workers’ compensation claim, plaintiff filed a lawsuit against defendant driver, asserting negligence that caused his injuries. After the complaint was filed, three interested insurance companies entered the lawsuit by filing answers as unnamed defendants: Nationwide, Foremost and GEICO. The first had a policy that maintained $30,000 in liability coverage and $100,000 in underinsured motorist coverage (UIM). Plaintiff, meanwhile, had insurance policies with the other two.

Nationwide tendered its $100,000 policy limit to plaintiff, which was dispersed in equal shares to plaintiff, plaintiff’s counsel for attorney fees and employer/ employer insurer. Payment was to serve as a waiver to defendant’s workers’ compensation carrier lien.

Plaintiff then went to an arbitrator with the other two insurers, where a panel decided plaintiff was to receive $285,000 for his personal injuries. A trial judge accepted that award, but determined it should be reduced by $100,000, previously paid to plaintiff by defendant insurer Nationwide. Trial court also awarded interest on the reduced amount, which was $185,000.

Foremost filed a motion to ascertain the amount of the subrogration lien. Trial court issued an order deciding that while employer and insurer had paid $530,000 to the worker, they couldn’t recover more than $285,000 – which was the total amount of the judgement paid to worker in his injury lawsuit for his injuries. However, the judge first subtracted attorney fees and court costs from this amount, to determine the subrogation amount was $190,000.

Plaintiff as well as his former employer and workers’ compensation insurer appealed that amount. It was argued Foremost didn’t have standing to ask for a subrogation amount determination and court lacked subject matter jurisdiction on the issue. Furhter, they argued the court abused its discretion by reducing the workers’ compensation lien from the statutory amount and erred in failing to make findings of fact as to how the court reached its conclusion.

The North Carolina Court of Appeals, however, affirmed on all issues.

If you have been injured at work, contact the Lee Law Offices at 800-887-1965.

Additional Resources:

Dion v. Batten , Aug. 2, 2016, North Carolina Court of Appeals

More Blog Entries:

Reports: Workers Across U.S. Suffer Electrical Injuries, Aug. 18, 2016, Charlotte Work Accident Lawyer Blog

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