Ex parte Mobile Pub. Library

Decision Date02 September 2022
Docket NumberSC-2022-0450
PartiesEx parte Mobile Public Library v. Mobile Public Library In re: Daniel B. O'Brien, in his capacity as Standing Chapter 13Trustee for the United States Bankruptcy Court for the Southern District of Alabama
CourtAlabama Supreme Court

Mobile Circuit Court: CV-17-902697; Court of Civil Appeals: 2200845

PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS

MITCHELL, JUSTICE

WRIT DENIED. NO OPINION.

Parker, C.J., and Shaw, Bryan, and Mendheim, JJ., concur.

MITCHELL, Justice (concurring specially).

Aaron E. Mosley,[1] an employee of the Mobile Public Library ("the Library"), was injured in an automobile accident that was caused by an uninsured motorist and that occurred while Mosley was acting within the line and scope of his employment. Mosley recovered uninsured-motorist benefits in a third-party action against the uninsured motorist and Mosley's and the Library's uninsured-motorist insurance carriers. The circuit court then allowed the Library to be reimbursed for compensation and medical benefits it had paid to Mosley with the moneys he had recovered in the third-party action. The Court of Civil Appeals reversed that judgment on appeal.

In its petition for the writ of certiorari, the Library asks us to consider how far an employer's reimbursement and subrogation rights extend when one of its employees has received workers' compensation benefits and later recovers damages in a third-party action for the same injuries. Under Ala. Code 1975, § 25-5-11(a), when an employee is injured or killed in an accident that occurs during his or her employment "under circumstances also creating a legal liability for damages on the part of any party other than the employer," the employee -- or, in some instances, the employee's dependents, the employer, or the employer's workers' compensation insurance carrier -- may bring a claim against the liable third party without giving up any rights to workers' compensation benefits. Thus, the statute allows an employee to simultaneously pursue a workers' compensation claim and bring a lawsuit against a party who is not his or her employer when the employee has been in a work-related accident such as a car wreck caused by another motorist. The statute says, however, "[t]o the extent of the recovery of damages against the other party, the employer shall be entitled to reimbursement for the amount of compensation theretofore paid on account of injury." The meaning of that language seems straightforward -- but this Court complicated matters when it gave what I believe was the wrong interpretation of that language over 50 years ago, and that interpretation was subsequently baked into the statute through codification by the Legislature.

In State Farm Mutual Automobile Insurance Co. v. Cahoon, 287 Ala. 462, 468, 252 So.2d 619, 623 (1971), this Court construed the language of the predecessor statute to § 25-5-11[2] and concluded that, in a cause of action under that statute, "the basis of the liability of any party other than the employer rests in tort for negligently injuring the workman." (Emphasis added.) Thus, under Cahoon, an employer cannot be reimbursed under § 25-5-11 for uninsured-motorist benefits an employee recovers -- because those benefits arise out of contract, not tort. That is the way our appellate courts have applied Cahoon. See Bunkley v. Bunkley Air Conditioning, Inc., 688 So.2d 827, 831-32 (Ala. Civ. App. 1996) (reversing the circuit court's judgment, which had credited an employee's recovery of uninsured-motorist benefits against his future workers' compensation benefits, and stating that "subrogation under § 25-5-11 does not extend to the recovery of damages under contracts of insurance that are separate and apart from the wrongful conduct that injures the worker"); River Gas Corp. v. Sutton, 701 So.2d 35, 39 (Ala. Civ. App. 1997) (citing Cahoon and Bunkley and holding that the employer was not entitled to subrogation against money the employee was paid by his automobile insurer through settling his claim for underinsured-motorist benefits because the insurer's "liability did not arise out of the negligent conduct of the 'third-party wrongdoer' that injured [the employee]"); Maryland Cas. Co. v. Tiffin, 537 So.2d 469, 473-74 (Ala. 1988) (plurality opinion) (allowing a settlement in a wrongful-death action to be credited against an employer's liability under § 25-5-11(a) and distinguishing Cahoon because it did not involve "actionable fault of parties other than the employer"); H & H Wood Co. v. Monticello Ins. Co., 668 So.2d 38, 40 (Ala. Civ. App. 1995) (holding that a workers' compensation insurer could not intervene as a matter of right under § 25-5-11 in an employee's action against his employer's automobile insurer). That was also the approach taken in this case by the Court of Civil Appeals when it reversed the circuit court's judgment. In its opinion, the Court of Civil Appeals, relying on Cahoon and its progeny, rejected the Library's argument that it was entitled to reimbursement for uninsured-motorist benefits provided under an insurance plan for which it paid and said that "any plain-language approach to § 25-5-11(a) that requires the overruling of Cahoon is for the consideration of the [S]upreme [C]ourt." See O'Brien v. Mobile Public Library, [Ms. 2200845, Mar. 18, 2022] ___So. 3d ___, ___ (Ala. Civ. App. 2022). Judge Terry Moore -- the author of the two-volume treatise Alabama Workers' Compensation -- concurred in the result and wrote separately to say that he "believe[d] that [Cahoon] erroneously construed" the language of the predecessor statute to § 25-5-11 and that Cahoon and its progeny "erroneously preclude an employer or its workers' compensation carrier from enforcing its statutory credit and reimbursement rights." Id. at (Moore, J., concurring in the result) (citing 2 Terry A. Moore, Alabama Workers' Compensation §§ 21:79-21:84 (1st ed. 1998)). But, Judge Moore noted, "I agree with the main opinion that, unless and until the [S]upreme [C]ourt overrules Cahoon and its progeny, those cases govern our decision on this point." Id.

Like Judge Moore, I see no basis for the Cahoon Court to have drawn the distinction between tort and contract actions. There's certainly nothing in the language of the statute suggesting that such a distinction exists.

Nonetheless, in 1992, when the Legislature reenacted § 25-5-11, it made only minor changes to the language of the statute -- and, importantly, it affirmatively reenacted the language that the Cahoon Court had construed. Which means, for better or worse, the tort/contract distinction made by the Cahoon Court was baked into the statute when the Legislature amended it. See Jones v. Conradi, 673 So.2d 389, 392 (Ala. 1995) ("'We believe it is pertinent to point out that there exists, and has long existed, in this state, a principle that when the legislature … incorporates [a Code section] into a subsequent Code, prior decisions of this court permeate the statute, and it is presumed that the legislature deliberately adopted the statute with knowledge of this court's interpretation thereof.'" (quoting Edgehill Corp. v. Hutchens, 282 Ala. 492, 495-96, 213 So.2d 225, 227-28 (1968))); Williams v. Williams, 276 Ala. 43, 47, 158 So.2d 901, 904 (1963) ("The applicable rule is that the re-enactment, or the amendment of a non-material part, of a statute which has been judicially construed is an adoption of the construction.").[3]And the tort/contract distinction is the understanding under which the Court of Civil Appeals has operated since 1992, including its opinion in this case.

Because the Library is seeking reimbursement from the injured employee's recovery in contract of uninsured-motorist benefits under the Library's insurance policy, it has nowhere to go in this case because the "Cahoon-ized" version of § 25-5-11 doesn't allow it to obtain reimbursement from such a contractual recovery. Even if we now overruled Cahoon, § 25-5-11 would continue to carry the tort/contract distinction that was embraced by the Legislature in 1992 -- which means, to get...

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