DeOliveira v. Liberty Mutual Insurance Company

CourtSupreme Court of Connecticut
Writing for the CourtKATZ, J.
Citation870 A.2d 1066,273 Conn. 487
PartiesANTONIO DEOLIVEIRA v. LIBERTY MUTUAL INSURANCE COMPANY.
Decision Date03 May 2005

273 Conn. 487
870 A.2d 1066

ANTONIO DEOLIVEIRA
v.
LIBERTY MUTUAL INSURANCE COMPANY

(SC 17132), (SC 17169).

Supreme Court of Connecticut.

Argued February 9, 2005.

Officially released May 3, 2005.


Norcott, Katz, Palmer, Vertefeuille and Zarella, Js.

Daniel L. FitzMaurice, with whom was Michelle I. Turner, for the appellant (defendant).

Laurence V. Parnoff, with whom was Robert A. Serafinowicz, for the appellee (plaintiff).

William F. Gallagher and Patricia Nielsen filed a brief for the Connecticut Trial Lawyers Association as amicus curiae.

Opinion

KATZ, J.

This consolidated action1 is the culmination of fifteen years of litigation between the plaintiff, Antonio DeOliveira, and the defendant, Liberty Mutual Insurance Company, resulting in multiple lawsuits alleging, in essence, that the defendant unreasonably delayed its processing of the plaintiff's workers' compensation claim, thereby causing him to suffer psychological injuries in addition to his physical injury. The action comes before this court, emanating from two separate actions, in the form of five questions certified to us by the United States District Court for the District of Connecticut, pursuant to General Statutes § 51-199b (d), and concurrently reserved by the Superior Court for advice, pursuant to General Statutes § 52-235.2 The dispositive question is whether Connecticut recognizes a cause of action against an insurer for bad faith processing of a workers' compensation claim. We conclude that such a claim is barred by General Statutes § 31-284 (a),3 the exclusivity provision of the Workers' Compensation Act (act), and, therefore, the plaintiff's remedies are limited to those afforded under the act. Accordingly, we answer the first question, as certified by the District Court and reserved by the trial court, in the negative.4

The record reveals the following facts and tortured procedural history relevant to the questions presented to this court. On May 11, 1989, toward the end of his work shift at Ross and Roberts, Inc. (company), the plaintiff suffered an injury to his lower back when lifting a heavy bag of materials. No one else was present when the accident occurred, and the plaintiff reported the injury to two of his supervisors the following day. Because the company had no physician, the plaintiff sought treatment first at a health clinic and later from Frank J. Forte, a chiropractor. On May 25, 1989, the plaintiff filed for workers' compensation benefits.

On May 31, 1989, the company notified the plaintiff and the workers' compensation commission (commission) that it intended to contest that the plaintiff's injury arose in the course of his employment. The company thereafter directed the plaintiff to be evaluated by Donald Dworken, an orthopedic specialist. Dworken confirmed the plaintiff's version of events as the source of his injury. Forte also opined in a report dated June 7, 1990, that the plaintiff's back injury was directly and causally related to the accident at work. The plaintiff continued treatment with Forte, Dworken and two other physicians for his back injury. Dworken released the plaintiff for light duty on September 11, 1989. The plaintiff unsuccessfully attempted to secure work within his job restrictions.

On December 20, 1989, the plaintiff sought treatment by Mark Gang, a psychiatrist, for emotional problems, including depression. Gang later referred the plaintiff to another psychiatrist for treatment. Both psychiatrists concluded that the cause of the plaintiff's depression was twofold, in part caused by his inability to work as a result of his injury and in part caused by a loss of honor and self-esteem as a result of the way he had been treated by the company regarding his claim and the nonpayment of benefits. Gang concluded that the plaintiff suffered from symptoms of posttraumatic stress and that, as of May, 1991, he was totally disabled as a result of his emotional impairment.

In October, 1990, the plaintiff filed an action in Superior Court against the company and the defendant, as the company's workers' compensation insurer, alleging that they had acted negligently, recklessly, intentionally and in bad faith by contesting his workers' compensation claim. He further alleged that the company and the defendant were liable for both his physical injury and his psychological injuries that stemmed from their bad faith handling of his claim.

Between February, 1991, and January, 1993, the workers' compensation commissioner for the fourth district (commissioner) held hearings and accepted evidence on the plaintiff's workers' compensation claim. The plaintiff sought compensation for both his back injury and his psychological injury, claiming that the latter stemmed from his accident. He also sought, as a result of the defendant's unreasonable contesting of his back injury claim, interest on payments withheld, civil penalties and attorney's fees. In June, 1994, the parties agreed to delay the commissioner's decision in hopes of resolving the case by stipulation. On March 30, 1995, the commissioner issued his finding and award. The commissioner found that the plaintiff's back injury was compensable under the act. The commissioner further found that the company's denial of the compensability of the plaintiff's physical injury was unreasonable and caused unnecessary delay, and awarded the plaintiff $4000 in attorney's fees. With respect to the plaintiff's psychological injury, the commissioner found that that injury was not substantially a result of his work-related injury, but, rather, a result of his frustration with the treatment he had received by the company and the delays in resolving his claim. Accordingly, the commissioner found that the company's denial of compensability with respect to the psychological injury was reasonable and declined to award any penalties for the company's actions relating to that claim. Thereafter, pursuant to General Statutes § 31-301, the plaintiff appealed from the commissioner's decision to the compensation review board (board) regarding the compensability of his psychological injury.

On December 8, 1995, the plaintiff's action in Superior Court was dismissed under the court's dormancy program. On December 13, 1996, the board affirmed the commissioner's decision, concluding that the plaintiff's psychological injury was not work-related because his employment was not the proximate cause of that injury. The Appellate Court subsequently affirmed the board's decision; DeOliveira v. Ross & Roberts, Inc., 47 Conn. App. 919, 703 A.2d 1191 (1997); and this court thereafter denied the plaintiff's petition for certification to appeal from that decision. DeOliveira v. Ross & Roberts, Inc., 243 Conn. 965, 707 A.2d 1265 (1998).

On December 20, 1995, the plaintiff commenced a second action in Superior Court, this time against the defendant only. In a seven count revised complaint directed at the defendant's actions in contesting compensability and unduly delaying payments, the plaintiff asserted claims of negligent, reckless and intentional conduct, implied breach of the covenant of good faith, negligent and intentional infliction of emotional distress and a violation of the Connecticut Unfair Trade Practices Act, General Statutes § 42-110a et seq. Thereafter, the defendant moved for summary judgment on the ground, inter alia, that the plaintiff's claims were barred by the exclusivity provision of the act, and the plaintiff filed a cross motion for summary judgment. At an April 11, 2002 hearing before the trial court, Gallagher, J., the parties agreed to arbitrate the claims, and concurrently to reserve certain questions of law underlying the claims to the Appellate Court.

In April, 2002, the plaintiff filed a third action in Superior Court, asserting identical claims to those asserted in the pending 1995 action, but directed solely at the defendant's post-1995 conduct. Since the commissioner's award in 1995, the defendant had failed to make the disability payments owed to the plaintiff until April, 1998, and had failed to pay the $4000 attorney's fee penalty until September, 1999. As a result, upon application by the plaintiff, in August, 2001, the commissioner ordered the defendant to pay a 20 percent penalty and 12 percent interest for the period of delay on the payment of benefits, as well as 10 percent interest for the period of delay on the payment of attorney's fees.

The defendant removed the 2002 action to the United States District Court for the District of Connecticut on diversity grounds. On December 5, 2003, after considerable legal wrangling in both the state and federal courts, the parties concurrently filed in the Superior Court a joint motion for reservation of five questions to the Appellate Court and filed in the District Court a joint petition for certification of the same five questions to this court. The trial court, Levin, J., and the District Court, Kravitz, J., respectively, granted the motion and the petition. This court accepted the District Court's reservation and thereafter transferred the Superior Court case from the Appellate Court to this court.

The dispositive question before this court is whether Connecticut recognizes a cause of action against an insurer for bad faith processing of a workers' compensation claim.5 The plaintiff asserts that a tort action may be brought because a psychological injury caused by the tortious handling of a workers' compensation claim is not a compensable work-related injury under the act and, hence, the commission lacks jurisdiction over such claims. The plaintiff further asserts that intentional torts generally are not covered under the act. Thus, because such injuries are not within the scope of the act, the plaintiff contends that the exclusivity provision of the act is inapplicable. Finally, the plaintiff contends that a person who is injured by such conduct has no redress available under the act because the...

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