Cosse v. Allen-Bradley Co.

• Decision Date: 18 October 1993
• Docket Number: No. 93-C-0301,ALLEN-BRADLEY,93-C-0301
• Citation: 625 So.2d 486
• Parties: Godfrey COSSE v.COMPANY et al.
• Court: Louisiana Supreme Court

Page 486

625 So.2d 486

Godfrey COSSE v. ALLEN-BRADLEY COMPANY et al.

No. 93-C-0301.

Supreme Court of Louisiana.

Oct. 18, 1993.

Rehearing Granted Dec. 10, 1993.

On Motion to Dismiss Feb. 4, 1994.

Christopher J. Bruno, Joseph M. Bruno, Bruno & Bruno, New Orleans, for applicant.

Thomas J. Wyllie, Richard B. Eason, Adams & Reese, John J. Weigel, Madeleine Fischer, Gavin P. Mahlie, John M. Holahan, Jr., Jones, Walker, Waechter, Poitevent, Carrere & Denegre, New Orleans, John A. Bivins, Roy, Carmouche, Bivins, Judice, Henke & Breaud, Lafayette, Daniel Lund, Alan H. Katz, New Orleans, Windhurst, Gaudry, Ranson, Higgins & Gremillion, Daniel A. Ranson, Steven D. Oliver, Harvey, for respondent.

MARCUS, Justice. ^*

Godfrey Cosse was injured on June 7, 1984 while in the course and scope of his employment with Celotex Corporation (Celotex), when his leg was caught in a scrap conveyor at Celotex's Marrero plant. Cosse filed suit for damages, naming as defendants Link-Belt Corp. (Link-Belt) (the conveyor's manufacturer) and Rust Engineering Co. (Rust) (the designer of the conveyor). Celotex, a self-insurer worker's compensation carrier, intervened into the suit for reimbursement of worker's compensation benefits and/or medical expenses paid or to be paid in the future. After a jury trial, the jury returned a verdict in favor of Cosse and awarded him $444,612 in damages. The jury allocated fault as follows: 5% to Cosse, 15% to Celotex and its employees, 50% to Rust and 30% to Link-Belt. The trial judge entered judgment finding Rust and Link-Belt liable jointly, severally and in solido for $422,343.40 ¹ together with legal interest from the date of judicial demand and costs. Celotex, as intervenor, was awarded $96,474.40 ² plus legal interest from the date of each payment and in preference to sums due Cosse. In addition, Celotex received a credit for future compensation benefits or medical expenses in the amount of $127,614, subject to a reduction for Cosse's 5% fault. The judge ordered Celotex to deduct from its intervention award 52% of Cosse's attorney fees and costs.

Celotex, Link-Belt and Rust appealed. The court of appeal reversed the judgment of the trial court and rendered judgment in favor of Link-Belt and Rust and against Cosse. 590 So.2d 108 (La.App. 5th Cir.1991). On the applications of Cosse and Celotex, we granted certiorari and rendered an opinion reversing the judgment of the court of appeal, reinstating the apportionment of fault as found by the jury and remanding the case to the court of appeal to consider issues raised by Celotex that had not been reached by the court of appeal or this court. 601 So.2d 1349 (La.1992). On remand, the court of appeal reversed the trial court on several issues, finding the trial court erred in reducing Celotex's reimbursement recovery by Cosse's 5% fault and erred in casting Celotex with 52% of Cosse's recovery costs. 612 So.2d 286. ³ Upon Cosse's application, we granted certiorari to review the correctness of that decision. ⁴

The issues presented for our consideration are (1) whether Celotex's reimbursement recovery should be reduced by the percentage of Cosse's fault, and (2) what percentage of Cosse's recovery costs Celotex should be held liable to pay.

Celotex's Reimbursement Recovery

At the time of Cosse's 1984 accident, La.R.S. 23:1101 provided in pertinent part:

Any person having paid or having become obligated to pay compensation under the provisions of this Chapter may bring suit against such third person to recover any amount which he has paid or become obligated to pay as compensation to such employee or his dependents. [emphasis added].

In 1985, La.R.S. 23:1101 was amended to read, in pertinent part:

B. Any person having paid or having become obligated to pay compensation under the provisions of this Chapter may bring suit against such third person to recover any amount which he has paid or becomes obligated to pay as compensation to such employee or his dependents. The recovery allowed herein shall be identical in percentage to the recovery of the employee or his dependents against the third person and, where the recovery of the employee is decreased as a result of comparative negligence, the recovery of the person who has paid compensation or has become obligated to pay compensation shall be reduced by the same percentage.

The courts of appeal have split on the issue of whether the 1985 amendment to La.R.S. 23:1101 should be applied to accidents arising before its effective date. Some courts have taken the view that the amendment is substantive in nature and may not be applied retroactively. ⁵ The court of appeal in the present case adopted that view. By contrast, other courts have concluded that the 1985 amendment did not change the law, reasoning that when comparative negligence was adopted, the doctrine was equally applicable to the worker's compensation recovery under La.R.S. 23:1101. ⁶ Cosse urges us to adopt this view and hold that the 1985 amendment is not a substantive change, but merely restates a pre-existing rule that the compensation carrier can only recover to the extent the injured employee can recover.

This court has not addressed the effect of comparative fault on the right of reimbursement granted to the compensation carrier. However, an analogous situation was presented under the system of contributory negligence in Vidrine v. Michigan Millers Mut. Ins. Co., 263 La. 300, 268 So.2d 233 (1972) (on rehearing). In Vidrine, the precise issue before the court was whether an employer to whom fault was attributed was prevented from recovering against the third-party joint tortfeasor the compensation payments made by the employer to its non-negligent employee. On original hearing, the court struggled with the question of whether the general tort law of contributory negligence served to modify the statutory right granted under La.R.S. 23:1101, ultimately concluding that the employer's negligence could bar his right to recovery of reimbursement. Justice Barham dissented, reasoning that the statutory right was absolute:

Nothing contained in these statutes qualifies the employer's right to obtain indemnification. Unless that statutory right is abridged by other statute or is against public policy, it is absolute. The right is not dependent on absence of negligence. Id. at 239.

On rehearing, the majority adopted the position of the dissent, holding "the right is an absolute one and is not limited by the statute." Id. at 246. The court further noted that while its original holding may have been based on considerations of equity, any change in the law was a matter for the legislature:

As we read the original majority opinion, that holding is not based on the language of the statute or on our jurisprudence, but instead, on concepts of equity and/or socio-economic reasons. If the views expressed are valid, a change in the law is essential so as to have it comport therewith. But this is not a matter for the Court; it addresses itself solely to the legislative department of our government. Id.

Applying the reasoning of Vidrine to the present case, we find the language of La.R.S. 23:1101 in effect at the time of Cosse's accident is clear and unambiguous. It provides that the party paying compensation may bring suit against a third party tortfeasor "to recover any amount which he has paid or become obligated to pay as compensation." (emphasis added). The language of the statute does not qualify the compensation carrier's right to reimbursement, nor does application of comparative fault principles serve to modify the absolute right granted by this statute. ⁷ The court of appeal decisions reaching a contrary conclusion have attempted to achieve a measure of equity in favor of the employee. ⁸ However, as we stated in Vidrine, such considerations are the concern of the legislature, not the courts. In the present case, the legislature acted in 1985 to remedy any inequity.

Having concluded that the 1985 amendment to La.R.S. 23:1101 is a substantive change in the law, it is clear that it may not be retroactively applied to this 1984 accident. ⁹ La.Civ.Code art. 6. Accordingly, we find the court of appeal correctly reversed the judgment of the trial court reducing Celotex's recovery by Cosse's 5% fault.

Apportionment of Recovery Costs

The next issue raised by Cosse is whether the court of appeal erred in giving retroactive effect to the 1989 amendment to La.R.S. 23:1103, thereby limiting Celotex's liability for Cosse's recovery costs to one-third of Celotex's recovery for pre-judgment payments or pre-judgment damages, rather than following, as the trial judge did, the formula set forth in Moody v. Arabie, 498 So.2d 1081 (La.1986), for calculating the percentage of recovery costs for which an intervening employer should be liable.

Prior to 1989, the worker's compensation law was silent as to the allocation of recovery costs, including attorney fees. In 1986, this court in Moody set out a formula to establish the employer's proportionate interest in the recovery, which would determine the percentage of its liability for the recovery costs. Under that formula, the employer's share of the recovery was determined by dividing the employer's reimbursement by the recovery from the third person. The trial judge applied that formula in the present case, determining that Celotex was liable for 52% of the recovery costs. ¹⁰

In 1989, La.R.S. 23:1103 was amended (effective January 1, 1990) to add paragraph C, which provides in pertinent part:

C. If either the employer or employee intervenes in the third party suit filed by the other, the intervenor shall only be responsible for reasonable legal fees and costs incurred by the attorney retained by the plaintiff. Such reasonable legal fees shall not exceed one third of the intervenor's recovery for pre-judgment payments or pre-judgment damages.

In finding the 1989 amendment applicable to this case, the court of...