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Intervening Employer Gets His Money Back No Matter What

In a case of first impression, the Supreme Court held that the trial court properly reduced the amount of the jury award of noneconomic damages by the amount of payments the plaintiff's employer was obligated to pay him, despite the fact that the employer was paying for economic losses. Cruz v. Montanez, 294 Conn. 357 (2009). General Statutes § 31-293 (a) expressly provides that an employer's claim for reimbursement of workers' compensation benefits takes precedence over any damages that an injured employee receives in a third party action. Further, the court held that when an injured employee who has received workers' compensation brings an action against a third party tortfeasor, and both the employee and the employer are parties plaintiff, the jury should not be told the amount of the employer's obligation for workers' compensation.

Facts:

  1. The plaintiff, Anastacio Cruz, filed this third party negligence lawsuit against Francisco Montanez and Jason Kannon pursuant to General Statutes § 31-293 (a) seeking to recover for injuries Cruz suffered in a motor vehicle accident that occurred in the course of his employment.
  2. Montanez was Cruz' fellow employee and the driver of the pickup truck in which Cruz was riding as a passenger at the time of the accident. Both men were employed by the defendant Weston Gardens, Inc.
  3. Kannon was the driver of the other motor vehicle involved in the collision.
  4. Cruz collected workers' compensation benefits from Weston Gardens in the amount of $26,090.96.
  5. The defendant Weston Gardens intervened as a plaintiff seeking reimbursement for its workers' compensation payments to Cruz from any damages that Cruz recovered from Montanez and Kannon.
  6. Cruz elected not to present any evidence of economic damages.
  7. Consequently, the jury awarded Cruz $75,000 in noneconomic damages only, and concluded that Montanez and Kannon were 60% and 40% responsible, respectively, for Cruz' injuries.
  8. The trial court rendered judgment apportioning the damages to Weston Gardens in the amount of its workers' compensation payments to Cruz, with the remainder payable to Cruz.
  9. On appeal, Cruz claimed, among other things, that the trial court erred in reducing the amount of the jury award by the payments he had received from Weston Gardens in workers' compensation benefits because those payments were for economic damages and Cruz had sought and recovered only noneconomic damages.
  10. The Supreme Court affirmed the decision of the trial court.

Reasoning:

Pursuant to General Statutes § 31-293 (a), an employer has the right of reimbursement from a judgment against a third party for 1) the amount of any compensation which the employer has paid on account of the injury which is the subject of the suit, plus 2) an amount equal to the present worth of any probable future payments which he has become obligated to pay.

Pursuant to § 31-293 (a), an employer that pays workers' compensation benefits to an injured employee is entitled to reimbursement for those payments from "any damages" that the employee may recover from the third party tortfeasor. "Any damages" in this context means damages of "whatever kind or sort, without limitation." The Supreme Court concluded that it was of no consequence that the jury's award of damages in this case was for noneconomic damages.

One of the primary goals of § 31-293a is to ensure that the ultimate loss falls on the wrongdoer by allowing the employer to take action in order to recover the workers' compensation benefits that it was legally obligated to pay to its injured employee. It is equally as elementary that the claimant should not be allowed to keep the entire amount of his compensation award and the common-law damage recovery. Furthermore, Cruz could have elected to seek recovery for his economic losses, but chose not to do so.

In arriving at its conclusion, the court rejected the plaintiff's argument that the employer had to seek reimbursement directly from the third party tortfeasor, either in a separate action or in the context of the employee's action.

Practice Note:

1.When presenting a third party action pursuant to § 31-293a, present claims for all possible losses, economic and noneconomic, because the court will reduce any jury award by the amount the intervening employer is obligated to pay.

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