Best Buy Co. v. Mckinney

• Decision Date: 28 September 2015
• Docket Number: No. A15A1278.,A15A1278.
• Citation: 778 S.E.2d 51,334 Ga.App. 42
• Parties: BEST BUY CO. v. McKINNEY.
• Court: Georgia Court of Appeals

334 Ga.App. 42

778 S.E.2d 51

BEST BUY CO.

v.McKINNEY.

No. A15A1278.

Court of Appeals of Georgia.

Sept. 28, 2015.

Adam Hamilton Long, Lawrenceville, Leryan Paige Lambert, Marion George Waters IV, for Appellant.

Michael J. Warshauer, Trent Scott Shuping, Atlanta, for Appellee.

Opinion

BARNES, Presiding Judge.

This appeal arises from a dispute over a workers' compensation subrogation lien between an employer, Appellant Best Buy Co., Inc., and its former employee, Appellee Christopher McKinney. At issue is whether the trial court erred in denying Best Buy's motion to enforce its subrogation lien against a settlement reached between McKinney and certain third-party tortfeasors. Discerning no error, we affirm.

The record reflects that in January 2011, McKinney fell off a forklift during the course of his employment with Best Buy. As a result of the fall, McKinney suffered several facial bone fractures

and brain damage. McKinney underwent multiple surgeries and received facial implants, and his face is now permanently disfigured and he experiences ongoing cognitive problems caused by his traumatic brain injury. Because of McKinney's injuries sustained from the fall, Best Buy has paid and continues to pay workers' compensation benefits to McKinney.

In January 2013, McKinney filed a negligence and strict liability suit in the State Court of DeKalb County against several defendants involved in the manufacture and maintenance of the forklift from which he fell (the “tort defendants”). Pursuant to OCGA § 34–9–11.1(b), Best Buy moved to intervene in the suit to protect its right to a workers' compensation subrogation lien against any recovery obtained by McKinney from the tort defendants, and the trial court ultimately granted the motion to intervene.

In May 2014, McKinney and the tort defendants attended mediation and settled the case shortly thereafter. In June 2014, McKinney dismissed with prejudice his suit against the tort defendants in light of the settlement.

When McKinney dismissed his suit against the tort defendants, Best Buy filed its motion to enforce its lien against the proceeds of the settlement and requested that the trial court conduct an evidentiary hearing to address the motion. Best Buy argued that it was entitled to an evidentiary hearing so that it could present evidence that McKinney had been “fully and completely compensated” for all of his economic and noneconomic losses incurred as a result of his injuries, a statutory prerequisite for enforcement of a lien under OCGA § 34–9–11.1(b).

The trial court granted Best Buy's request for an evidentiary hearing to determine whether McKinney had been fully and completely compensated, and thus whether Best Buy was entitled to recover under its subrogation lien. At the hearing held in September 2014, Best Buy presented the testimony of two witnesses. The first witness was the general manager of the Best Buy store where McKinney had worked. She testified that, as of September 4, 2014, McKinney had received $173,679.49 in workers' compensation benefits, which included $162,753.08 in medical benefits and $10,926.41 in income benefits. The second witness was a lawyer who was a partner in an Atlanta law firm who had experience in litigation and mediation. The lawyer sought to demonstrate that McKinney had been fully and completely compensated for his losses by comparing his case to that of other reported civil tort cases involving plaintiffs who suffered head injuries

.

After the lawyer testified, Best Buy rested its case. McKinney did not present any evidence, other than the settlement agreement that he had reached with the tort defendants and a settlement statement prepared by his counsel, both of which were filed under seal.

The trial court heard argument from the parties and took the matter under advisement, but the court noted from the bench that it was not persuaded by the lawyer's testimony comparing McKinney's case to other cases. The trial court thereafter entered a written order in which it denied Best Buy's motion to enforce its subrogation lien,¹finding that Best Buy had failed to carry its burden of proving that McKinney had been fully and completely compensated for his economic and noneconomic losses resulting from his injuries.

1. Best Buy contends that the trial court erred in finding that it failed to prove that McKinney had been fully and completely compensated. According to Best Buy, the evidence demanded a finding that McKinney had been fully and completely compensated, given the testimony of the lawyer at the hearing and the lack of evidence presented by McKinney. We are unpersuaded.

Under the Workers' Compensation Act (the “Act”), OCGA § 34–9–1 et seq., if an employer pays workers' compensation benefits to an employee who was injured while acting in the course and scope of his employment, and the employee sues a third party for causing the injuries, the employer can intervene in the suit and seek to enforce a subrogation lien against any recovery obtained by the employee from the third party.OCGA § 34–9–11.1(b). A “recovery” to which the lien can attach includes the proceeds of any settlement between the employee and third party. Georgia Elec. Membership Corp. v. Garnto,266 Ga.App. 452, 453, 597 S.E.2d 527 (2004). But the lien is limited

to the recovery of the amount of disability benefits, death benefits, and medical expenses paid under [the Act] and shall only be recoverable if the injured employee has been fully and completely compensated,taking into consideration both the benefits received under [the Act] and the amount of the recovery in the third-party claim, for all economic and noneconomic losses incurred as a result of the injury.

(Emphasis supplied.) OCGA § 34–9–11.1(b). In other words, a precondition to the enforcement of the lien is that the employee have been fully and completely compensated for his losses, a determination that “is made by comparing the sum of the workers' compensation benefits paid by the [employer] and the amount of the employee's recovery in the third-party action, to all economic and noneconomic losses caused by the injury.” Georgia Elec. Membership Corp.,266 Ga.App. at 453, 597 S.E.2d 527.

The employer has the burden of proving that the injured employee has been fully and completely compensated for his economic and noneconomic losses, and whether the employer has carried that burden is a question for the trial court. Georgia Elec. Membership Corp.,266 Ga.App. at 454, 597 S.E.2d 527; Anthem Cas. Ins. Co. v. Murray,246 Ga.App. 778, 780(1), 542 S.E.2d 171 (2000). On appeal, we defer to the trial court's determination as to whether there has been full and complete compensation unless clearly erroneous. Georgia Elec. Membership Corp.,266 Ga.App. at 454, 597 S.E.2d 527; Canal Ins. Co. v. Liberty Mut. Ins. Co.,256 Ga.App. 866, 872–873(2), 570 S.E.2d 60 (2002).

In deciding whether an employee has been fully and completely compensated, the trial court should not “take into account the employee's contributory/comparative negligence or assumption of the risk.” Homebuilders Assoc. of Ga. v. Morris,238 Ga.App. 194, 196, 518 S.E.2d 194 (1999). See Canal Ins. Co.,256 Ga.App. at 873(2), 570 S.E.2d 60. Furthermore, because a subrogation lien “is available only against recovery for economic losses,” a trial court cannot enforce the lien against the portion of the employee's recovery that was meant to compensate him for his noneconomic losses, i.e., his pain and suffering. Anthem Cas. Ins. Co.,246 Ga.App. at 780(1), 542 S.E.2d 171. See Canal Ins. Co.,256 Ga.App. at 873(2), 570 S.E.2d 60. Hence, we have held that if the trial court is unable to determine what portion of the employee's recovery against the third party was meant to compensate him for his economic losses versus his noneconomic losses, the court cannot enforce the lien. See City of Warner Robins v. Baker,255 Ga.App. 601, 604–605(3), 565 S.E.2d 919 (2002); Anthem Cas. Ins. Co.,246 Ga.App. at 780(1), 542 S.E.2d 171.

Guided by these principles, we turn to the record in the present case. As previously noted, Best Buy relied upon the lawyer's testimony at the hearing to demonstrate that McKinney had been fully and completely compensated. The lawyer was a certified mediator and had experience handling civil litigation and workers' compensation cases in the metropolitan Atlanta area, including DeKalb County. The lawyer reviewed the settlement agreement reached between McKinney and the tort defendants, and he compared McKinney's total recovery in workers' compensation benefits and settlement proceeds to the jury verdicts obtained in four other reported civil tort cases involving plaintiffs who suffered head injuries

. One of the four cases involved a domestic violence assault, while the other three involved motor vehicle accidents. Based on the damages awarded by the jury in those four cases, the lawyer concluded that McKinney's total recovery in workers' compensation benefits and settlement proceeds exceeded the amount he likely would have been awarded by a jury.

The lawyer also conducted research into McKinney's employment history. According to the lawyer, McKinney had continued to serve as an assistant high school football coach and then had held coaching positions with several arena football teams after falling from the forklift.

Based on his research into the damages awarded in the other four civil tort cases and McKinney's career trajectory after sustaining his injuries, the lawyer opined that McKinney had been fully and completely compensated for his economic and noneconomic losses by the workers' compensation benefits and settlement proceeds he had recovered.

On cross-examination, however, the lawyer conceded that in valuing a case in his own litigation practice, he would not have simply compared the case to the damages awarded by juries in other reported cases, but would have personally observed the plaintiff testifying in his deposition, reviewed all the depositions and documents that...