Jarka Corp. v. Fireman's Fund Indem. Co.
| Decision Date | 21 June 1955 |
| Citation | 142 N.Y.S.2d 369,286 A.D. 148 |
| Parties | The JARKA CORPORATION, Plaintiff-Appellant, v. FIREMAN'S FUND INDEMNITY COMPANY and Garcia & Diaz, Inc., Defendants-Respondents. |
| Court | New York Supreme Court — Appellate Division |
John M. Johnston, New York City, of counsel (Chester Bordeau, New York City, on the brief; White & Case, attorneys), for appellant.
Jeremiah G. Mahony, New York City, of counsel (Thomas P. Curtin, New York City, attorney), for respondents.
Before PECK, P. J., and COHN, BREITEL and RABIN, JJ.
Involved is the question whether an employer which has made compensation and medical payments to a longshore employee, without an award, is entitled to maintain an action for reimbursement for such payments from the wrongdoer, who, with notice of the employer's claim, had settled an action brought against it by the employee.
Plaintiff employer, pursuant to the provisions of the Longshoremen's and Harbor Workers' Compensation Act, U. S. Code, tit. 33, § 914, 33 U.S.C.A. § 914, made compensation and medical payments to its employee, without an award. The employee then sued Garcia & Diaz, Inc., a defendant herein, asserting that it was primarily responsible for the injury. Before the institution of the employee's action, the employer notified defendant Garcia & Diaz, Inc., of the payments and claimed reimbursement. A similar notification was sent to Garcia & Diaz, Inc's., insurer, also a defendant herein. Thereafter, defendants settled the action with the employee, and paid the entire proceeds to him. Plaintiff employer thereupon instituted this action, and appeals from the denial of its motion for summary judgment and the grant of defendants' motion to dismiss the complaint for legal insufficiency.
An employer who, without an award, has made compensation payments is subrogated, to the extent of those payments, to the employee's claim against the wrongdoer. This right of subrogation may be satisfied out of the fund created by a recovery from the tort-feasor at the instance of the employee, irrespective of whether the recovery is by way of court award or settlement. The Etna, 3 Cir., 138 F.2d 37; Fontana v. Pennsylvania R. Co., D.C., 106 F.Supp. 461. Almost the precise question was determined in Ruggiero v. Liberty Mutual Insurance Co., 272 App.Div. 1027, 74 N.Y.S.2d 428, affirmed 298 N.Y. 775, 83 N.E.2d 467. There the pivotal principle was the subrogation of rights to a fund arising from a settlement, which subrogation was based on payments...
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