Dicarlo v. Suffolk Constr. Co., SJC-11854

CourtUnited States State Supreme Judicial Court of Massachusetts
Decision Date12 February 2016
Docket NumberSJC-11853,SJC-11854
PartiesROBERT M. DiCARLO v. SUFFOLK CONSTRUCTION CO., INC., & others; PROFESSIONAL ELECTRICAL CONTRACTORS OF CONNECTICUT, INC., third-party defendant. BERNARD J. MARTIN & another v. ANGELINI PLASTERING, INC., & others.

NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

Suffolk. Middlesex.

Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, & Lenk, JJ.

Workers' Compensation Act, Action against third person, Settlement agreement, Insurer. Lien. Statute, Construction.

Civil action commenced in the Superior Court Department on March 29, 2007.

A petition for settlement was heard by Frances A. McIntyre, J.

A proceeding for interlocutory review was heard in the Appeals Court by Judd J. Carhart, J. After review by the Appeals Court, the Supreme Judicial Court granted leave to obtain further appellate review.

Civil action commenced in the Superior Court Department on September 15, 2011.

A petition for settlement was heard by Dennis J. Curran, J.

After review by the Appeals Court, the Supreme Judicial Court granted leave to obtain further appellate review.

Wystan M. Ackerman for Twin City Fire Insurance Company & another.

Charlotte E. Glinka for Bernard Martin & another.

Thomas R. Murphy for Robert M. DiCarlo.

Paul M. Kessimian & David J. Pellegrino, for American Insurance Association, amicus curiae, submitted a brief.

Annette Gonthier Kiely, Michael C. Najjar, & J. Michael Conley, for Massachusetts Academy of Trial Attorneys, amicus curiae, submitted a brief.

LENK, J. Under Massachusetts law, employees who receive workers' compensation benefits may not sue their employers for claims arising from work-related injuries. See G. L. c. 152, § 24.4 Employees may, however, file claims against third parties for damages arising from those injuries. See G. L. c. 152, §§ 15, 24. When an employee recovers damages from a third party, the workers' compensation insurer is statutorily entitled to a lien on the recovery in the amount that the insurer paid to the employee in benefits. See G. L. c. 152, § 15. In these twocases, we are asked to ascertain the extent of this lien and, in particular, to clarify whether the lien attaches to damages paid by a third party for an employee's pain and suffering.

The cases involve two employees, Robert M. DiCarlo and Bernard J. Martin, who were injured in the course of their employment, collected workers' compensation benefits, and then reached settlement agreements with third parties including damages for, among other things, their pain and suffering. The same insurer insured both employers.5 The insurer sought reimbursement under G. L. c. 152, § 15, from the employees' recoveries, including their awards for pain and suffering. In DiCarlo's case, a Superior Court judge rejected a settlement agreement providing that the insurer would not have a lien on the damages for pain and suffering, concluding that the insurer's lien attached to DiCarlo's entire recovery. DiCarlo appealed, citing the Appeals Court's decision in Curry v. Great American Ins. Co., 80 Mass. App. Ct. 592, 595 (2011) (Curry), which held that an insurer's lien does not attach to damages paid for pain and suffering because workers' compensation does not cover those harms. In Martin's case, a Superior Court judge approved a settlement agreement similar to the agreementrejected by the judge in DiCarlo's case; the insurer appealed from this decision.

Relying in both cases on its precedent in Curry, the Appeals Court determined that the employees' awards for pain and suffering were exempt from the insurer's liens. See DiCarlo v. Suffolk Constr. Co., 86 Mass. App. Ct. 589 (2014); Martin v. Angelini Plastering, Inc., 86 Mass. App. Ct. 1122 (2014). We granted the insurer's applications for further appellate review and combined the two cases for argument. We conclude, similarly, that an insurer's lien does not extend to damages allocated to an employee's pain and suffering.

1. Background and procedural history. In October, 2004, DiCarlo suffered serious injuries to his back while working as an electrician at a construction site. The injuries resulted in ongoing physical and emotional suffering. In the wake of these injuries, the workers' compensation insurer for DiCarlo's employer paid him workers' compensation benefits for medical expenses ($48,431.16) and for lost wages ($233,387.95).

DiCarlo and his wife then filed a tort action in the Superior Court against the defendants: Walter Brook Crossing, LLC, the owner of the construction site where DiCarlo worked; and Suffolk Construction Co., Inc., the contractor managing that site. The defendants then filed third-party complaints against Professional Electrical Contractors of Connecticut, Inc. (Professional Electrical), seeking indemnification. The defendants and Professional Electrical thereafter reached an agreement with DiCarlo to settle all claims for $100,000. After reaching this agreement, the parties presented a proposed settlement agreement to the court as required by G. L. c. 152, § 15. The agreement allocated thirty-five per cent of the settlement to DiCarlo's pain and suffering, indicating specifically that the amount would not be subject to the insurer's lien.

A Superior Court judge reviewed the settlement agreement and, as required by G. L. c. 152, § 15, gave the insurer an "opportunity to be heard" on the fairness of the settlement. The insurer objected to the agreement, arguing that, the Curry case notwithstanding, its lien should attach to the award for pain and suffering. The judge agreed with the insurer and declined to approve the settlement. DiCarlo appealed, and the Appeals Court reversed. See DiCarlo v. Suffolk Constr. Co., supra at 594.

Martin was injured in August, 2010, while working as an electrician at a construction site. Since then, he has suffered ongoing physical pain and mental anguish. The insurer paid Martin $566,392.94 in benefits.6 Martin and his wife thereafterfiled a tort action against Angelini Plastering, Inc., a subcontractor at the construction site where Martin was injured, and Shawmut Design and Construction, the general contractor managing that site. The parties agreed to settle all claims for $1 million.

In a settlement agreement filed pursuant to G. L. c. 152, § 15, the parties requested that thirty per cent of the payment be allocated to Martin's pain and suffering, and that the amount be exempt from the insurer's lien. A different Superior Court judge approved the settlement, over the insurer's objection that the award for pain and suffering should be included in its lien. The insurer, as an interested party, appealed from the judge's decision, and a panel of the Appeals Court affirmed. See Martin v. Angelini Plastering, Inc., supra.

2. Discussion. General Laws c. 152, § 15 (§ 15),7 generally provides that, where an injured employee collectsworkers' compensation benefits and then recovers damages for the same injury from a third-party tortfeasor, "[t]he sum recovered [from the third party] shall be for the benefit of the [workers' compensation] insurer." The "sum" to which the insurer is entitled is described, in the next sentence, as "the gross sum received in payment for the injury." G. L. c. 152, § 15.

The nub of the dispute before us concerns the meaning of the phrase "gross sum received in payment for the injury," and, in particular, the meaning of the word "injury." The employees urge that "injury" be construed narrowly to mean only those injuries for which workers' compensation benefits are payable, thereby excluding pain and suffering from its purview and, by consequence, excluding damages for pain and suffering from the reach of an insurer's lien. The insurer, on the other hand, advocates a more expansive view of the term "injury" as used in the phrase "gross sum received in payment for the injury." By including pain and suffering within the meaning of "injury," all damages awarded the employee would be subject to the insurer's lien.8 For the reasons that follow, we conclude that both statutory language and legislative intent support the narrower meaning of "injury," and that damages for pain and suffering are not within the insurer's lien.

Like all statutory provisions, § 15 "must be interpreted according to the intent of the Legislature ascertained from all its words construed by the ordinary and approved usage of the language, considered in connection with the cause of its enactment, the mischief or imperfection to be remedied and themain object to be accomplished, to the end that the purpose of its framers may be effectuated." Galenski v. Erving, 471 Mass. 305, 309 (2015), quoting Worcester v. College Hill Props., LLC, 465 Mass. 134, 139 (2013) (College Hill). "In interpreting the meaning of a statute, we look first to the plain statutory language." College Hill, supra at 138.

As mentioned, the workers' compensation statute provides an insurer with a lien on the "gross sum received in payment for the injury" (emphasis supplied). The insurer here urges that we interpret this phrase in light of other uses of the term "injury" in G. L. c. 152, the workers' compensation act, where the word often appears to refer to the totality of harm suffered by a worker, including pain and suffering. See Randall's Case, 331 Mass. 383, 386 (1954) ("if reasonably practicable, words used in one place in a statute with a plain meaning are given the same meaning when found in other parts of the same statute"). See, e.g., G. L. c. 152, § 1 (using "compensable injury" to describe subset of injuries for which compensation may be paid); G. L....

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