Swain v. D & R Transport Co., Inc., Civ. No. 88-90-ALB/AMER(DF).

• Decision Date: 30 April 1990
• Docket Number: Civ. No. 88-90-ALB/AMER(DF).
• Citation: 735 F. Supp. 425
• Parties: Marjory Ann SWAIN, Individually and as Trustee for the Heirs and next of kin of Colin E. Swain, decedent, and Liberty Mutual Insurance Company, Plaintiffs, v. D & R TRANSPORT COMPANY, INC. and George P. Ayers, Defendants.
• Court: U.S. District Court — Middle District of Georgia

735 F. Supp. 425

Marjory Ann SWAIN, Individually and as Trustee for the Heirs and next of kin of Colin E. Swain, decedent, and Liberty Mutual Insurance Company, Plaintiffs, v. D & R TRANSPORT COMPANY, INC. and George P. Ayers, Defendants.

Civ. No. 88-90-ALB/AMER(DF).

United States District Court, M.D. Georgia, Albany/Americus Division.

April 30, 1990.

Foy R. Devine & Bruce H. Morris, Devine & Morris, Atlanta, Ga., and Michael S. Polk, Hertogs, Fluegel, Sieben, Polk, Jones & Laverdiere, Hastings, Minn., for plaintiffs.

Ben L. Weinberg, Jr. & Kathryn S. Whitlock, Atlanta, Ga., for Liberty Mut. Ins. Co.

John K. Fitzgerald & Robert E. Corry, Jr., Atlanta, Ga., for defendants.

FITZPATRICK, District Judge.

Currently pending before the court are cross-motions for partial summary judgment filed by plaintiff Marjory Ann Swain (Swain) and intervenor Liberty Mutual Insurance Company (Liberty Mutual). The respective motions seek to determine whether or not Liberty Mutual is entitled to assert a subrogation claim in the above styled action.

FINDINGS OF FACT

Plaintiff Marjorie Ann Swain, a citizen of Minnesota, has filed a wrongful death suit against defendants D & R Transport Company Inc. (D & R Transport), and George P. Ayers. The event giving rise to plaintiff Swain's action occurred on or about September 11, 1987. On that date, plaintiff Swain's husband Colin E. Swain, a Minnesota resident who was employed by Knudsen Trucking, a Minnesota corporation, was killed as a result of injuries he sustained in an accident in which his truck collided with a truck driven by defendant George P. Ayers. At the time of the accident, Ayers was acting within the scope of his employment as a truck driver for D & R Transport, a Georgia corporation. Colin Swain was also acting within the scope of his employment with Knudsen Trucking when the accident occurred; he therefore qualified for workers' compensation benefits.

Since Colin Swain qualified for workers' compensation benefits, plaintiff Swain, the widow of Colin Swain, and his children were eligible to receive workers' compensation benefits that were payable under either Minnesota law or Georgia law. In accordance with the workers' compensation insurance policy purchased by Colin Swain's employer, the insurance carrier, Liberty Mutual, began paying workers' compensation benefits to plaintiff Swain and also to the Swain's children pursuant to Minnesota law. Liberty Mutual has now intervened in the instant tort action brought by plaintiff Swain and seeks to be subrogated to plaintiff Swain's claim against the defendants to the extent of the benefits it has paid.

CONCLUSIONS OF LAW

The issue presented by the respective summary judgment motions now before the court is whether Liberty Mutual is entitled to seek subrogation in the above styled action filed under diversity jurisdiction. The question arises because two states that have a stake in the outcome of this case have conflicting laws relating to the subrogation rights of workers' compensation insurance carriers. Minnesota law grants a workers' compensation insurer subrogation rights in a tort action brought by an employee or his survivors against a third-party tort-feasor. Minn.Stat. § 176.061, subd. 5(a) (1984). Conversely, Georgia law does not give a workers' compensation insurer the right to be subrogated to an employee's claim against a third-party tort-feasor. 1972 Ga.Laws 3 (repealing O.C.G.A. § 114-403); Intex Products, Inc. v. Roper Corp., 160 Ga.App. 579, 287 S.E.2d 610 (1981). Thus, the dispositive question for the court is which state's law controls the subrogation rights of Liberty Mutual in the case sub judice.

In a suit brought pursuant to diversity jurisdiction, federal district courts must follow the conflict of laws rules prevailing in the state in which it is sitting. Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). The court, therefore, looks to Georgia's conflict of laws rules to determine whether the court should apply Minnesota law or Georgia law to resolve the subrogation issue.

Although no Georgia court has directly addressed the question of which state's law is controlling on the subrogation issue where the employee is injured in Georgia but collects workers' compensation benefits pursuant to the laws of another state, the Georgia conflict of laws rule most applicable to the instant case is found in Sargent Industries, Inc. v. Delta Air Lines, Inc., et al., 251 Ga. 91, 303 S.E.2d 108 (1983). In Sargent, an Iowa resident who was employed by Delta Airlines (Delta) filed a negligence and products liability suit in the Northern District of Georgia, against Sargent Industries, Inc., (Sargent) based on injuries she suffered during an evacuation training exercise. Sargent then filed a third-party complaint for contribution and indemnity against Delta. When the case was appealed, the United States Court of Appeals for the Eleventh Circuit asked the Georgia Supreme Court to decide the following certified question.

Under Georgia law, does the Illinois or Georgia workers' compensation rule of law apply in fixing a defendant-product manufacturer's right to seek contribution and indemnity by impleading the

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