Greene v. Maharaja of India, Inc., BH-88

• Decision Date: 18 March 1986
• Docket Number: No. BH-88,BH-88
• Citation: 11 Fla. L. Weekly 672,485 So.2d 1329
• Court: Florida District Court of Appeals
• Parties: 11 Fla. L. Weekly 672 Cherri J. GREENE, Appellant, v. MAHARAJA OF INDIA, INC. and Aetna Life & Casualty, Appellees.

Page 1329

485 So.2d 1329

11 Fla. L. Weekly 672

Cherri J. GREENE, Appellant, v. MAHARAJA OF INDIA, INC. and Aetna Life & Casualty, Appellees.

No. BH-88.

District Court of Appeal of Florida,

First District.

March 18, 1986.

Rehearing Denied April 24, 1986.

Robert B. Staats, of Staats, Overstreet & White, Panama City, for appellant.

James N. McConnaughhay and David A. McCranie, of Karl, McConnaughhay, Roland, Maida & Beal, P.A., Tallahassee, for appellees.

WIGGINTON, Judge.

Claimant appeals from the deputy commissioner's order denying her claim for benefits on the alternative bases of election of remedies and equitable estoppel. The issue presented is whether claimant's settlement of a claim for personal injuries in a civil action constituted an election of remedies or calls for an application of the doctrine of equitable estoppel barring her from now seeking workers' compensation benefits. We answer the question in the negative and reverse.

On January 20, 1983, claimant suffered severe personal injury in an automobile accident. The car was being driven by Viola Owens, a coemployee, and the accident occurred while the two women were returning from a trade show they had attended on behalf of the employer, Maharaja of India, Inc. ¹ The automobile was titled in the name of Kumar Samtani for the use of Vaco, Inc. Vaco subsequently loaned the car to the employer, which in turn entrusted it to Manu Samtani, the employer's president, who permitted Owens to drive it to the trade show.

Claimant did not initially file a claim for workers' compensation benefits, and when the employer/carrier voluntarily began paying benefits, she returned the check on the advice of her attorney. They decided to return the benefits until it could be determined whether or not claimant was entitled to receive them, since, they maintained, there was some confusion as to whether the accident arose out of and in the course of claimant's employment. Nevertheless, the benefits were returned with the express caveat that their return was without prejudice to claimant's right to later file a proper claim for benefits.

On October 5, 1983, claimant filed suit in circuit court for personal injuries against Toyota Motor Sales and Toyota Motor Corporation, Viola Owens, the employer, Vaco, Kumar and Manu Samtani, Travelers Insurance Company, and State Farm. The complaint was later amended to, among other things, drop as named defendants the two insurance companies.

The employer and Owens raised as affirmative defenses the argument that claimant's remedy was limited to that provided by the provisions of the Workers' Compensation Act, chapter 440, Florida Statutes. To those affirmative defenses, claimant filed a simple denial.

Settlement negotiations began in October, 1984. It was allegedly claimant's intention that she settle her claim for personal injuries against all defendants named in the action with the exception of Toyota, and to leave open her claim for workers' compensation benefits. Thereafter, in December, claimant entered into a "Partial Settlement of Disputed Claim." Under the settlement, she was to receive $125,000, $100,000 from Travelers Insurance Company (the automobile insurer), $10,000 from State Farm (Owens' insurer), and $15,000 from the Samtanis personally. Significantly, paragraph two of the settlement provided that claimant had accepted the employer's position that she was, on the date of the accident, an employee. Under the paragraph, it was provided that upon payment of the sums set forth in the settlement, claimant would dismiss with prejudice the employer from the civil action and would file a claim for workers' compensation benefits. In consideration of the dismissal with prejudice, the employer agreed that it would urge its workers' compensation carrier to immediately begin payment of all compensation benefits provided under chapter 440.

On December 1, 1984, the employer's attorney wrote to the carrier and demanded that it begin paying claimant all workers' compensation benefits to which she was entitled. In the letter, the attorney indicated that "[w]e have concluded a settlement of claim in order to avoid the possibility of any excess verdict being rendered against our client, and your insured [the employer]."

On January 7, 1985, claimant filed both her claim for benefits and her application for hearing. In the pretrial stipulation, the carrier set forth that claimant was not entitled to receive benefits because the injury did not occur within the scope of employment, because claimant had refused benefits and because claimant had elected to pursue her remedy in circuit court and was therefore estopped to claim workers' compensation benefits. Although the deputy found that at the time of the accident claimant was in the course and scope of her employment,

... because of her actions in seeking redress for her injuries in circuit court wherein she took the position that she was not within the course and scope of her employment and thereafter by settling her circuit court claim under circumstances where settlement sums could be received only if she were not within the course and scope of her employment, she has in effect "elected her remedy" and is now estopped in asserting a position contrary to that previously taken.

The deputy found this case to be controlled by Federated Mutual Implement and Hardware Insurance Company v. Griffin, 237 So.2d 38 (Fla. 1st DCA 1970), and concluded that claimant, by taking the position in circuit court that she was not within the course and scope of her employment at the time of the accident, was equitably estopped from taking a contrary position to obtain compensation benefits. The deputy also relied on Rhodes v. Industrial Commission, 92 Ill.2d 467, 66 Ill.Dec. 83, 442 N.E.2d 509 (1982), Martin v. C.A. Productions Company, 8 N.Y.2d 226, 203 N.Y.S.2d 845, 168 N.E.2d 666 (1960), Pearson v. Harris, 449 So.2d 339 (Fla. 1st DCA 1984), Matthews v. G.S.P. Corporation, 354 So.2d 1243 (Fla. 1st DCA 1978), and Hume v. Thomason, 440 So.2d 441 (Fla. 1st DCA 1983).

Additionally, the deputy found that upon the settlement of the case with claimant's coemployees who otherwise would be immune from liability had the accident occurred within the course and scope of claimant's employment, and after specifically rejecting offered workers' compensation benefits and affirmatively denying that she was within the course and scope of her employment, claimant elected her remedy to pursue her claim in the circuit court action and was therefore estopped to claim workers' compensation benefits. Citing to Williams v. Duggan, 153 So.2d 726 (Fla.1963), and Williams v. Robineau, 124 Fla. 422, 168 So. 644 (1936), the deputy found that the settlement was to claimant's advantage, and was "efficacious" since it provided a remedy to the dispute that was the subject of the cause of action. On those bases, the deputy dismissed the claim with prejudice.

Citing for support to the cases relied on by the deputy, claimant argues that unless and until there has been an adjudication on the merits and some prejudice to the opposing party, there can be no binding election of remedies. In her case, she claims that the settlement did not amount to an adjudication on the merits and submits she made no attempt to bar the compensation carrier from maintaining its statutory defensive position that claimant was injured during the course and scope of her...