Christensen v. Pocket Lounge, Inc., 93-656
| Citation | 519 N.W.2d 401 |
| Decision Date | 27 July 1994 |
| Docket Number | No. 93-656,93-656 |
| Parties | Jim CHRISTENSEN, Appellee, v. POCKET LOUNGE, INC., and United Fire and Casualty, Appellants. |
| Court | United States State Supreme Court of Iowa |
Timothy W. Hamann and Kellyann M. Lekar of Clark, Butler, Walsh & McGivern, Waterloo, for appellants.
C.A. Frerichs and Robert D. Fulton of Fulton, Frerichs, Martin & Andres, P.C., Waterloo, for appellee.
Considered by McGIVERIN, C.J., and CARTER, LAVORATO, NEUMAN, and ANDREASEN, JJ.
This appeal stems from plaintiff Jim Christensen's effort to have a workers' compensation lien declared invalid. The question is whether Iowa Code section 85.22(1) (1993) gives a workers' compensation insurer lien rights on an employee's recovery from third-party tortfeasors to secure reimbursement for benefits payable in the future. The district court, believing the lien could not apply to benefits not yet paid, entered declaratory judgment for Christensen. Because the ruling conflicts with our decision in Shirley v. Pothast, 508 N.W.2d 712 (Iowa 1993), we reverse and remand.
The facts are largely undisputed. Christensen owns defendant Pocket Lounge and is also employed there on occasion as a bartender. While tending bar he was injured in an attempt to evict a drunken patron. Christensen claimed workers' compensation benefits and also brought a tort action against the patron and a dramshop that had served the patron alcohol earlier in the evening.
Pocket Lounge and its workers' compensation carrier, United Fire and Casualty Company, 1 contested Christensen's entitlement to workers' compensation benefits. United filed notice of a workers' compensation lien, pursuant to Iowa Code section 85.22(1), against any potential recovery by Christensen from the third-party tortfeasors. Upon Christensen's subsequent petition for arbitration of the benefits dispute, the deputy industrial commissioner ruled he was entitled to healing period and permanent partial disability benefits as well as past medical benefits. United appealed the deputy's ruling to the industrial commissioner.
While United's administrative appeal was pending, Christensen settled his suit with both third-party tortfeasors. He then filed a motion to quash United's notice of lien on the ground the carrier had made no benefit payments by the time of settlement. He later incorporated his theory in a petition for declaratory judgment, requesting the court to find that because no payments had been made, United could enforce no lien or indemnification rights against his settlement recovery. In its answer to the petition, United admitted that no benefits had yet been paid. Christensen thereafter moved for summary judgment, alleging that the statutory lien was invalid as a matter of law.
The district court ruled in Christensen's favor. Relying on this court's decision in Fisher v. Keller Industries, Inc., 485 N.W.2d 626 (Iowa 1992), the court ruled that Iowa Code section 85.22(1) grants the workers' compensation carrier a lien with respect to payments "so made," but not against payments it may be liable for in the future. It is from this ruling that United appeals.
As we noted at the outset, our decision is guided by Shirley v. Pothast, 508 N.W.2d at 712, an opinion postdating Keller and filed while this appeal has been pending. In Shirley, the plaintiff received workers' compensation benefits for injuries sustained in a work-related automobile collision. The insurer filed notice of a lien under section 85.22(1). Plaintiff moved to discharge the lien, contending that the insurer was not entitled to an amount greater than benefits paid to the date of settlement disbursement by the third-party tortfeasors. Shirley, 508 N.W.2d at 713-14. The insurer resisted the motion, arguing that if the lien were discharged, it would lose the security of that portion of the lien representing future payments and obligations. Id. at 714. The district court, relying on Fisher, discharged the lien upon satisfaction of benefit amounts "thus paid." Shirley, 508 N.W.2d at 714.
We reversed on appeal, distinguishing Fisher on the ground that it dealt with an indemnitor's claimed right to a credit for future benefits whereas the insurer in Shirley asserted rights to a lien securing future benefits. Id. at 718. We determined that while section 85.22(1) does not guarantee an indemnitor any immediate credit for future payments, it does provide security for reimbursement of benefits for which an indemnitor "is liable." Id. Because the indemnitor is liable for prospective benefits, we held that section 85.22(1) provid...
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Ewing v. Allied Const. Services, 97-2086
...to be reimbursed out of the third-party recovery. See Shirley v. Pothast, 508 N.W.2d 712, 718 (Iowa 1993); Christensen v. Pocket Lounge, Inc., 519 N.W.2d 401, 403 (Iowa 1994). Entitlement is subject to Allied's obligation to pay its proportionate share of the $250,000 contingent attorney fe......
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...the right to indemnification have consistently [but not exclusively] been raised in district court."); accord Christensen v. Pocket Lounge, Inc., 519 N.W.2d 401, 401-02 (Iowa 1994); Shirley, 508 N.W.2d at 713; March v. Pekin Ins. Co., 465 N.W.2d 852, 853 (Iowa 1991); Liberty Mut. Ins. Co. v......
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...Whatever difficulty might have existed in reconciling Fisher and Shirley, the question was put to rest in Christensen v. Pocket Lounge, Inc., 519 N.W.2d 401, 402-03 (Iowa 1994). In Pocket Lounge we held an insurer's notice of lien was valid to secure reimbursement from any third-party recov......
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Firstar Bank of Burlington, Iowa v. Hawkeye Paving Corp.
...for benefits paid in the future, as well as for payments already made to the injured employee or his estate. Christensen v. Pocket Lounge, Inc., 519 N.W.2d 401, 403 (Iowa 1994); Shirley v. Pothast, 508 N.W.2d 712, 719 (Iowa 1993). The insurer's lien is, however, conditional: In order to con......