WORKERS’ COMPENSATION CASE SUMMARIES – July 2018

Matter of Sheets v. Airy Ridge Farm, LLC, 163 AD3d 1321 (3rd Dept. 7/19/2018)

Facts: The parties in this case stipulated that the claimant had a 45% loss of wage earning capacity. At the time of the stipulation, the claimant was working and receiving a TRE rate of $125.00. At the hearing at which the stipulation was entered, the claimant’s attorney told the claimant that if he were not working, he would be entitled to an award of $169.65 based upon his 45% disability.

After the hearing, the claimant stopped working. Claimant’s Orthopedist issued several medical reports. The initial medical report issued by claimant’s doctor, after he stopped working, indicated a total disability (up from a 50% disability when claimant was working), then the claimant’s orthopedist issued a report stating that the claimant had a 75% disability. The claimant’s counsel requested a hearing to determine if claimant’s awards should be increased. The WCLJ implemented awards at various rates, corresponding to the claimant’s changing medical reports. The carrier appealed to the Workers’ Compensation Board seeking modification of those awards to $169.65 a week based on the 45% loss of wage earning capacity. The Board agreed with the carrier, and the claimant appealed to the Third Department.

Issues: Are wage earning capacity and loss of wage earning capacity the same concept within workers’ compensation law?

Rules: No, “[W]age-earning capacity and loss of wage-earning capacity are distinct concepts. Wage-earning capacity is used to determine a claimant’s rate of compensation taking into consideration the nature of his or her injury and his or her physical impairment and can fluctuate based upon the claimant’s employment status. Loss of wage-earning capacity, on the other hand is used at the time of classification to set the maximum number of weeks over which a claimant with a permanent partial disability is entitled to receive benefits.”

When parties enter into a stipulation, and that stipulation is approved by the WCLJ and incorporated into the WCLJ’s decision, the stipulation is binding so long as there is no showing of fraud, collusion, mistake or other grounds warranting its invalidation.”

Holding: Affirmed.

Rationale: In this case, the court explained that found that wage earning capacity and loss of wage earning capacity are two separate and distinct concepts within workers’ compensation law. The court found that loss of wage of earning capacity determines the amount of weeks that a claimant is entitled to benefits, and wage earning capacity determines the rate at which the claimant gets paid throughout those weeks. The court explained that wage earning capacity, and therefore the rate at which a claimant is paid, can fluctuate based on the nature of claimant’s injury, physical impairment, and employment status.

The Court found that although in other circumstances, a claimant’s rate of pay after a determination of permanency may fluctuate based on employment and physical impairment, in this case the parties had a binding agreement that indicated that if claimant were not working, he would be entitled to $169.65 a week.

Matter of Schmerler v. Longwood Sch. Dist., 163 AD3d 1373 (3rd Dept. 7/26/2018)

Facts: The claimant in this case was a school security guard who was injured while restraining a special needs student. The case was established to the neck, back, and both hands. Later on, the claimant attempted to amend the case for her bilateral hips and knees. The WCLJ found insufficient evidence to find causal relationship. The Board affirmed and denied claimant’s application for Full Board Review. The claimant appealed to the Third Department.

Issue: Can the Board credit the opinion of one medical provider over that of another?

Rule: Yes. “The Board is empowered to determine the factual issue of whether a causal relationship exists based upon the record, and its determination will not be disturbed when supported by substantial evidence. Further it is within the Board’s exclusive province to resolve conflicts in medical opinions.”

Holding: Affirmed.

Rationale: In this matter, the Board credited the testimony of an orthopedic surgeon who examined the claimant on two separate occasions. The surgeon opined that the claimant had normal examinations of the hips and knees. He found that the claimant has normal ranges of motion and that claimant’s complaints of pain to these areas could be the result of referred pain from other regions.

The board was presented with evidence contrary to the opinion of this orthopedic surgeon, but the Court deferred to the Board’s resolution of conflicting medical opinions.

Matter of Empire State Transp. Workers’ Compensation Trust v. Special Funds Conservation Comm., 163 AD3d 558 (2nd Dept. 7/5/2018)

Facts: The Supreme Court, Nassau County directed the Special Funds Conservation Committee to consent, nunc pro tunc, to the settlement of a personal injury action. The Special Funds Conservation Committee appealed.

Issue: Does the Supreme Court have the discretion to judicially compel a party to consent to a settlement, nunc pro tunc?

Rule: “Where a party is seeking to compel nunc pro tunc consent to a settlement pursuant to Workers’ Compensation Law § 29(5), the party must demonstrate that the compromise is reasonable, the delay in seeking approval was not attributable to the party’s fault or neglect, and the party whose consent is sought was not prejudiced by the delay. Resolution of a petition for judicial approval of a settlement is committed to the sound discretion of the Supreme Court.”

Holding: Affirmed.

Rationale: In this case, the Second Department found that there was evidence demonstrating that the settlement was reasonable, that the delay in obtaining consent was adequately explained, and that the record was devoid of evidence that the Special Disability Fund was prejudiced by the settlement.

Sanchez v. 3180 Riverdale Realty, LLC, 163 AD3d 885 (2nd Dept. 7/18/2018)

Facts: The plaintiff was employed by Badaly & Badaly Construction and was allegedly injured while performing construction work on a premises owned by the defendant, 3180 Riverdale Realty, LLC. The defendant moved for summary judgement dismissing the complaint based on the exclusivity defense of the Workers Compensation Law. The Supreme Court granted the motion for summary judgement. The plaintiff appealed.

Issues: How does a defendant show that they are the alter ego of the plaintiff’s employer?

Holding: Reversed.

Rules: “The protection against lawsuits brought by injured workers that is afforded to employers by Workers’ Compensation Law §§ 11 and 29(6) also extends to the entities that are alter egos of the entity that employs the injured workers. A defendant moving for summary judgement based on the exclusivity defense of the Workers’ Compensation Law under this theory must show, prima facie, that it was the alter ego of the plaintiff’s employer. A defendant may establish itself as the alter ego of a plaintiff’s employer by demonstrating that one of the entities controls the other or that the two operate as a single integrated entity. However, a mere showing that the entities are related is insufficient where a defendant cannot demonstrate that one of the entities controls the day-today operations of the other.”

Rationale: In this case, the Second Department found that the defendant failed to make a prima facie showing that they and B & B Construction were a single integrated entity or that either entity controlled the day to day operations of the other. The claimant was only employed by B & B Construction. Additionally, the defendant was a single legal entity. Therefore, the Second Department found that the Supreme Court should have denied the defendant’s motion for summary judgement dismissing the complaint based on the exclusivity defense of the Workers’ Compensation Law.

Commerce & Indus. Ins. Co. v. One Whitehall, L.P., 2018 NY Slip Op 31759(U) (Sup. Ct., New York 7/23/2018)

Facts: The plaintiff, Commerce and Industry Insurance Company, in this case was seeking a declaration that it has no duty to defend or indemnify Titan Contracting Group. Inc. in connection with an underlying personal injury action.

Titan’s employee, Galo Guaman sued One Whitehall L.P., The Topps Company, and JRM Construction Management, LLC. for injuries sustained at a construction site. Topps then sued Titan for contractual indemnity, and common-law indemnity and contribution.

The plaintiff issued a workers’ compensation and employers’ liability insurance policy to Titan. “The Commerce Policy provides that it will cover the insured against claims or suits brought by third parties resulting from injury to an employee of the insured but only where recovery is permitted by law. The Commerce Policy further provides that it does not cover liability assumed under a contract.”

Issue: Does the plaintiff have the obligation to defend and indemnify Titan Contracting Group in their law suit against The Topps Company?

Holding:  No. The Judge found that the plaintiff does not have to defend or indemnify Titan Contracting Group in regards to the underlying personal injury action. Section 11 does not apply as Galo Guaman did not sustain a grave injury. Therefore, recovery from Titan would not be permitted by law. Additionally, the Commerce Policy specially says that it does not cover liability assumed under a contract. Therefore, the plaintiff would have no duty to defend or indemnify Titan regarding the breach or contract or contractual indemnity causes of action.

Rules: “Section 11 of the Workers’ Compensation Law provides that: an employer shall not be liable for contribution or indemnity to any third person based upon liability for injuries sustained by an employee acting within the scope of his or her employment for such employer unless such third person proves through competent medical evidence that such employee has sustained a grave injury which shall mean only one or more of the following: death, permanent and total loss of use or amputation of an arm, leg, hand or foot, loss of multiple fingers, loss of multiple toes, paraplegia or quadriplegia, total and permanent blindness, total and permanent deafness, loss of nose, loss of ear, permanent and severe facial disfigurement, loss of an index finger or an acquired injury to the brain caused by an external physical force resulting in permanent total disability.”

Rationale: In this claim, the judge did not find that the employee, Galo Guaman, had a grave injury as defined by § 11 of the Workers’ Compensation Law. The claimant’s alleged injuries consisted of “an injury to his left shoulder and arm which required arthroscopic surgery, cervical injury, [and] lumbar spine injury requiring lumbar laminectomy and partial discectomy.” The judge noted that the Court of Appeals has previously interpreted the language of Section 11 narrowly and has previously held that the list of grave injuries under § 11 should be read as “exhaustive, not illustrative.”

Dumervil v. Port Auth. of N.Y. & N.J., 163 AD3d 628 (2nd Dept. 7/11/2018)

Facts: The plaintiff in this case was an employee of the defendant. She alleged that she was injured at work due to a defective condition on the premises. Before commencing this action, the claimant had both applied for and been found eligible for Workers’ Compensation Benefits.

The defendant in this matter filed a motion for summary judgement dismissing the complaint and all cross claims insofar as asserted against them. The Supreme Court, Queens County denied the defendant’s motion and the defendant appealed.

Holding: Reversed.

Issue: Is Workers’ Compensation Law the exclusive remedy for an employee against their employer for an injury they sustained at work?

Rule: Yes. “The Workers’ Compensation Law expressly provides that an employee’s eligibility to collect workers’ compensation benefits is the employee’s exclusive remedy against an employer for job-related injuries. The exclusive remedy provisions are an essential part of a trade-off underlying the Workers’ Compensation Law. A cornerstone of the workers’ compensation framework is a tradeoff. The employee is afforded swift and sure compensation and the employer is assured that its workers compensation liability to its employee shall be exclusive and in place of any other liability whatsoever.”

Rationale: In this case the Second Department held that the defendant made a prima facie showing that they are entitled to a judgement as a matter of law by producing evidence that the plaintiff “was their employee, that she was injured in the course of her employment and that she was found eligible for benefits under the Workers Compensation Law.”

Flanagan v. Kajima USA, Inc., 163 AD3d 775 (2nd Dept. 7/18/2018)

Facts: The Supreme Court, Suffolk County, granted the defendant’s motion for summary judgement dismissing the plaintiff’s complaint insofar as asserted against it. The plaintiff appealed.

Holding: Affirmed.

Issues: Can an individual have more than one employer under Workers’ Compensation Law? What defines a special employee?

Rules: “A person may be deemed to have more than one employer for purposes of Workers’ Compensation Law, a general employer and a special employer. A special employee is described as one who is transferred for a limited time of whatever duration to the service of another.  . . . Although no one factor is decisive in determining whether a special employment relationship exists, a key consideration is the employer’s right to direct the work and degree of control exercised over the employee.”

Rationale: The Second Department affirmed the Supreme Court, Suffolk Count’s decision granting the motion of the defendant Kajima Construction Services, Inc. for summary judgement dismissing the complaint insofar as asserted against it. The Second Department Found that the defendant made a prima facie showing that the plaintiff was a special employee. Therefore, under Workers’ Compensation Law, the plaintiff was barred for recovering damages for a personal injury suit.

Pacan v. Urena, 2018 NYLJ Lexis 2564 (Sup. Ct., Nassau 2018)

Facts: Thomas Urena (Urena) brought his car to the car wash to be cleaned. Urena then got out of the car and gave it to Castillo Benitez (Benitez), an employee of the car wash, to be washed. Benitez was driving the car and hit Maribell Pacan (Pacan), another employee of the car wash. Pacan tried to sue Urena under Vehicle and Traffic Law (VTL) 388 and hold him vicariously liable as the vehicle owner. Urena moved for summary judgement dismissing this complaint.

Holding: The motion for summary judgement dismissing the complaint is granted.

Issue: Does Workers’ Compensation Law § 29(6) bar a plaintiff from holding a vehicle owner vicariously liable for an injury caused by the plaintiff’s coworker?

Rule: Yes. The Workers’ Compensation Law, “having deprived the injured employee of a right to maintain an action against a negligent co-employee, bars a derivative action which necessarily is dependent upon the same claim of negligence for which the exclusive remedy has been provided.”

Rationale: In making its ruling, the Supreme Court, Nassau County relied on the precedent of Isabella v. Hallock, 22 NY3d 788 [2014] and Rauch v. Jones, 4 NY2d 595 [1958]. In both of these precedential cases, the Courts held that the owner of a vehicle could not be held responsible for personal injuries of the plaintiff, when the claim against the owner would be a derivative action that is dependent on the same claim of negligence for which the exclusive remedy is Workers’ Compensation Law.

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