Bankhead v. Aztec Const. Co.

• Citation: 48 Wn.App. 102,737 P.2d 1291
• Decision Date: 04 June 1987
• Docket Number: No. 09016-3-II,09016-3-II
• Parties: Rose M. BANKHEAD, individually and as Guardian of Daniel M. Bankhead, Respondent, v. AZTEC CONSTRUCTION COMPANY, Defendant, Appeal of DEPARTMENT OF LABOR AND INDUSTRIES of the State of, Washington, Statutory Lienholder.
• Court: Court of Appeals of Washington

Page 102

48 Wn.App. 102

737 P.2d 1291

Rose M. BANKHEAD, individually and as Guardian of Daniel M.

Bankhead, Respondent, v. AZTEC CONSTRUCTION COMPANY, Defendant,

Appeal of DEPARTMENT OF LABOR AND INDUSTRIES of the State

of, Washington, Statutory Lienholder.

No. 09016-3-II.

Court of Appeals of Washington,

Division 2.

June 4, 1987.

Thornton A. Wilson, Asst. Atty. Gen., Seattle, for appellant.

Donald E. Kelley, Tacoma, for respondent.

GOODLOE, Judge Pro Tem. ^*

This case involves application of the distribution requirements of RCW 51.24.060 of the Industrial Insurance Act to damages recovered by a personal representative on behalf of a deceased worker's estate. The trial court held that RCW 51.24.060 did not apply. We reverse.

The facts are not in dispute. Daniel Bankhead was injured in the course of his employment on March 14, 1980. For his injury, Mr. Bankhead claimed and received industrial insurance benefits and compensation. See RCW 51. As of October 1984, the Department of Labor and Industries (Department) had paid industrial insurance benefits totalling $141,796.23 to or on behalf of Mr. Bankhead and his estate.

Because the injury was caused by "third parties" not in the same employ as Mr. Bankhead, Mr. Bankhead was authorized to pursue a separate cause of action against such third parties pursuant to RCW 51.24.030. Mr. Bankhead elected, through his guardian and mother, Rose Marie Bankhead, to begin this action against Aztec Construction Company.

Shortly after the suit was filed, Mr. Bankhead died. Pursuant to the survival provisions of RCW 4.20.046, Mrs. Bankhead was appointed the personal representative for continuation of the action. In October 1984, the estate settled the lawsuit for $75,000. Mrs. Bankhead received no damages personally.

The Department then filed a Notice of Statutory Lien demanding reimbursement in the amount of $23,917.70 from the settlement in accordance with the distribution requirements of RCW 51.24.060. Mrs. Bankhead did not contest the amount of the claimed lien. Rather, she contended that the Department was not entitled to any reimbursement because the settlement, having been made by one other than an "injured worker or beneficiary", was not subject to the statutory distribution requirements. The Department moved the trial court for an Order of Determination of the Department's Claimed Lien, which motion was denied. The trial court evidently concluded that the $75,000 recovered by Mrs. Bankhead on behalf of her son's estate was not subject to the distribution requirements of RCW 51.24.060. The Department appeals.

The sole issue before the court is: When a deceased worker's personal representative recovers damages in a survival action against the third parties who caused the worker's injury, does RCW 51.24.060 entitle the Department to a lien on this recovery for reimbursement of a portion of industrial insurance benefits previously paid out to the injured worker? We hold that RCW 51.24.060 entitles the Department to a reimbursement lien.

The Industrial Insurance Act (Act), RCW 51, provides the exclusive remedy for workers, along with their families and dependents, unintentionally injured during the course of their employment. A worker who receives workers' compensation benefits under the Act has no separate remedy for his or her injuries except where the Act specifically authorizes a cause of action. RCW 51.04.010; 51.32.010. RCW 51.04.010 states:

The state of Washington ... declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for workers, injured in their work, and their families and dependents is hereby provided regardless of questions of fault and to the exclusion of every other remedy, proceeding or compensation, except as otherwise provided in this title; and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished, except as in this title provided.

(Italics ours.) The exclusiveness of the remedy provided in the Act is repeated in RCW 51.32.010:

Each worker injured in the course of his or her employment, or his or her family or dependents in case of death of the worker, shall receive compensation in accordance with this chapter, and, except as in this title otherwise provided, such payment shall be in lieu of any and all rights of action whatsoever against any person whomsoever ...

The exclusiveness of the remedy is also well recognized by the Supreme Court. See Provost v. Puget Sound Power & Light Co., 103 Wash.2d 750, 696 P.2d 1238 (1985); Thompson v. Lewis Cy., 92 Wash.2d 204, 595 P.2d 541 (1979); West v. Zeibell, 87 Wash.2d 198, 550 P.2d 522 (1976).

RCW 51.24, the "third party chapter", provides an exception to the Act's prohibition of any other remedy. See In re Estate of Kinsman, 44 Wash.App. 174, 721 P.2d 981 (1986). RCW 51.24.030 authorizes an "injured worker or beneficiary" to seek damages for injuries to the worker which were negligently caused by third parties not in the same employ. However, any such recovery by the "injured worker or beneficiary" is subject to the distribution requirements of RCW 51.24.060. RCW 51.24.060 entitles the Department to a proportionate share in the recovery up to the amount necessary to reimburse the Department for sums paid and provides the Department with a lien on the recovery by which to secure its reimbursement. RCW 51.24.060(1) and (2).

Mrs. Bankhead argued before the trial court that RCW 51.24.060 authorized the Department to obtain reimbursement only from an injured worker or beneficiary and not from the personal representative of a deceased worker. Since she was not the one injured and cannot qualify as a workers' compensation beneficiary, see RCW 51.08.020, Mrs. Bankhead contended that her recovery is exempt from statutory distribution requirements. Further, Mrs. Bankhead argued that in the absence of an express provision otherwise, the third party chapter, RCW 51.24, only applies when a worker is injured and not when a worker dies. Mrs. Bankhead raises these same arguments as respondent on appeal.

The Department argues on appeal that the third party chapter covers all injuries, including fatal injuries, that arise from covered employment. See, e.g., RCW 51.08.100 (definition of injury); Woods v. Department of Labor & Indus., 62 Wash.2d 389, 393, 382 P.2d 1014 (1963) ("injury" as used in the Act includes those happenings that produce death); see also RCW 51.24.030, as amended, Laws of 1984, ch. 218, § 3. The Department stresses that the Act provides the exclusive remedy for injured workers and their families. Mrs. Bankhead derived no personal cause of action under the Act and made no personal recovery; any recovery made by Mrs. Bankhead was in her capacity as personal representative and belongs to Mr. Bankhead's estate. Thus, the Department argues the recovery paid to Mr. Bankhead's estate is identical to recovery paid to an "injured worker" and is subject to RCW 51.24.060's distribution requirements.

The Department's position is correct. The Act has preempted all civil causes of action arising from workplace injuries with the exception of those third party actions authorized under RCW 51.24. Kinsman, at 177; Glass v. Stahl Specialty Co., 97 Wash.2d 880, 884, 652 P.2d 948 (1982). The exclusive remedy provisions of the Act apply to fatal as well as nonfatal injuries. RCW 51.32.010; see also Seattle-First Nat'l Bank v. Shoreline Concrete Co., 91 Wash.2d 230, 588 P.2d 1308 (1978); West v. Zeibell, supra. These provisions serve to preclude not only the injured worker, but all other persons and members of his or her family, from bringing a separate suit; they even preclude those such as nondependent parents who are not Act "beneficiaries". West v. Zeibell, supra; Ledesma v. A.F. Murch Co., 87 Wash.2d 203, 205, 550 P.2d 506 (1976); see RCW 51.08.020; 51.08.050. Since injuries resulting in death are thus barred from action by the exclusive remedy provisions, such injuries can only be actionable, if at all, under the third party chapter. Mrs. Bankhead claims she is exempt from the distribution requirements of RCW 51.24.060 because she is neither an "injured worker or beneficiary" within the meaning of that language. But if she were neither an "injured worker or beneficiary", then she would never have been entitled to bring a third party action under RCW 51.24.030; she would have no action at law whatsoever for her son's workplace injuries. See generally, Survey of Washington Law, Wrongful Death--Minor Child, 12 Gonz.L.Rev. 561, 567-68 (1977) (discussing exclusive remedy provisions of Act as general bar to suit by parents where child dies as a result of an industrial accident).

The Department's position is buttressed by the recent addition of clarifying language to the Act. A new section was added to RCW 51.24.030 in 1984 to clarify that "injury" includes death. See Laws of 1984, ch. 218, § 3. In addition, a new subsection (2) was added to RCW 51.24.050 that authorizes the Department to obtain the appointment of a personal representative for the purpose of maintaining a third party action when an injured worker dies. Laws of 1984, ch. 218, § 4. RCW 51.24.050 permits the assignment of third party actions to the Department, to be prosecuted on behalf of the injured worker, when the injured worker elects personally not to proceed. The 1984 amendment to this section implies that the Legislature contemplated that a personal representative would sometimes be needed to maintain a deceased worker's action. The distribution scheme in RCW 51.24.050 is essentially the same as that in RCW 51.24.060. The primary difference is that under RCW 51.24.050 the Department, rather than the worker, undertakes to prosecute the action. The Department would not normally have the authority to have a personal representative appointed. Thus, it was necessary...