Kroh v. American Family Ins., 910417

• Decision Date: 01 June 1992
• Docket Number: No. 910417,910417
• Citation: 487 N.W.2d 306
• Parties: Roger KROH, Plaintiff and Appellant, v. AMERICAN FAMILY INSURANCE, Defendant and Appellee. Civ.
• Court: North Dakota Supreme Court

Page 306

487 N.W.2d 306

Roger KROH, Plaintiff and Appellant, v. AMERICAN FAMILY INSURANCE, Defendant and Appellee.

Civ. No. 910417.

Supreme Court of North Dakota.

June 1, 1992.

Steven L. Latham of Wheeler Wolf, Bismarck, for plaintiff and appellant.

Thomas O. Smith of Zuger, Kirmis, Bolinske & Smith, Bismarck, for defendant and appellee.

LEVINE, Justice.

We consider whether NDCC Sec. 26.1-41-13(1) authorizes a no-fault insurer to deduct from its payment of no-fault benefits, an insured's workers' compensation benefits which have been reduced under NDCC Sec. 65-05-15 because the insured's injury in the nonwork-related motor vehicle accident "aggravated" a prior work-compensable injury. We hold that it does not and, accordingly, reverse and remand.

NDCC Sec. 26.1-41-13(1) allows a no-fault insurer to reduce its payment of basic no-fault benefits under certain circumstances:

"A basic no-fault insurer has the primary obligation to make payment for economic loss because of accidental bodily injury arising out of the operation of a motor vehicle; provided, that the amount of all benefits a claimant recovered or is entitled to recover for the same elements of loss under any workers' compensation law must be subtracted from the basic no-fault benefits otherwise payable for the injury."

NDCC Sec. 65-05-15(3) provides for the apportionment of benefits for aggravation of an injury and subsection (4) reduces workers' compensation benefits by fifty percent in cases where there is unquantifiable aggravation of a compensable injury by a nonemployment injury:

"3. In case of aggravation of a prior compensable injury by a nonemployment injury, the aggravation statute may be invoked where the nonemployment injury acts upon the prior compensable injury, and substantially contributes to the severity, acceleration, or progression of the final result, or, if it acts as a trigger to produce recurrent symptoms, and the trigger is itself a substantial aggravating or accelerating factor. All benefits may be apportioned when the aggravation statute is invoked under this subsection. The aggravation statute may not be invoked if the result is but a natural progression of the compensable injury.

"4. The bureau shall determine the aggravation award based upon all evidence, as reasonably establishes the proportion or percentage of cause as is reasonably attributable to the compensable injury. If the degree of aggravation cannot be determined, the percentage award must be fifty percent of the total benefits recoverable if one hundred percent of the injury has been the result of employment."

On September 1, 1989, Roger Kroh injured his back while working. At the time of his injury, Kroh earned approximately $400.00 per week. The Bureau accepted his claim and paid medical expenses as well as $267.00 a week for disability. On October 30, 1989, Kroh again injured his back, this time in a nonwork-related motor vehicle accident. American Family, Kroh's no-fault insurance carrier, began paying him $150.00 weekly in basic no-fault benefits, the maximum statutory amount. The Bureau, unable to quantify the percentage of Kroh's back injury caused by the prior work-related accident and the subsequent auto accident, applied NDCC Sec. 65-05-15(4), apportioning fifty percent of the injury to each accident and reducing Kroh's workers' compensation disability benefits by fifty percent, to $133.00 a week. American Family, concluding that it could have offset Kroh's workers' compensation benefits against his basic no-fault benefits, which it had not done, refused to pay further basic no-fault benefits.

Kroh sued American Family for breach of contract. Both sides moved for summary judgment. The district court granted summary judgment in favor of American Family. This appeal followed.

Kroh argues that NDCC Sec. 26.1-41-13(1) does not authorize American Family to offset his workers' compensation benefits against his basic no-fault benefits because of the Bureau's inability to determine the degree of aggravation under NDCC Sec. 65-05-15(4), and its consequent fifty percent reduction of his workers' compensation benefits. We agree.

American Family contends that NDCC Sec. 26.1-41-13(1) clearly and unambiguously authorizes the offset it espouses. A statute is ambiguous when it is subject to different, but rational, meanings. Kallhoff v. Workers' Comp. Bureau, 484 N.W.2d 510 (N.D.1992). American Family argues that "the injury" for which NDCC Sec. 26.1-41-13(1) requires offset, is the initial work-related injury which was aggravated by the later nonwork-related auto accident. According to American Family, there is only one "injury" and consequently, any workers' compensation benefits Kroh still receives for his one "injury" must be subtracted from any "basic no-fault benefits otherwise payable for the injury." NDCC Sec. 26.1-41-13(1), when read literally and in isolation, may ordain the result advocated by American Family.

However, statutes that are clear and unambiguous when read separately may contain a latent ambiguity when read together and applied to a particular set of facts. State ex rel. Moug v. N.D. Auto., Etc., 322 N.W.2d 245 (N.D.1982). And we must construe together all statutes relating to the same subject matter and give full force and effect to the legislative intent. See e.g., Cass County Electric Co-op v. N.S.P., 419 N.W.2d 181 (N.D.1988). Kroh maintains that NDCC Sec. 26.1-41-13(1) and NDCC Sec. 65-05-15(3), read together, create a distinction between two kinds of injuries. NDCC Sec. 65-05-15(3) expressly differentiates between "injuries" when it says "[i]n case of aggravation of a prior compensable injury by a nonemployment injury, the aggravation statute may be invoked where the nonemployment injury acts upon the prior compensable injury." (Emphasis added.) That explicit distinction is implied in NDCC Sec. 26.1-41-13(1), Kroh maintains. So, he has suffered two distinct injuries, his "work-compensable injury" and his injury sustained in the auto accident, a "nonemployment injury," that aggravated his "work-compensable injury." Because NDCC Sec. 26.1-41-13(1) requires the payment of no-fault benefits only for an injury sustained from an auto accident, Kroh argues that the offset of workers' compensation benefits is available only if the injury for which workers' compensation benefits are paid, is one arising from an auto accident. Kroh says that, because he is entitled to basic no-fault benefits only for his "accidental bodily injury" arising from his nonwork-related automobile accident not covered by workers' compensation, no workers' compensation benefits for his other injury may be offset.

We conclude that either interpretation is reasonable, and, therefore, the statutes, when read together, are ambiguous. When interpreting ambiguous statutes, this court may consider pertinent extrinsic evidence. State ex rel. Moug, 322 N.W.2d at 247. That evidence may include legislative history, the object of the statute and the consequences of a particular construction. NDCC Sec. 1-02-39; Kallhoff, 484 N.W.2d at 512; St. Alexius Hospital v. Eckert, 284 N.W.2d 441 (N.D.1979).

Our review of the legislative history tells us that NDCC Sec. 26.1-41-13(1) has remained unchanged since its original enactment in 1975. 1975 N.D.Sess.Laws, ch. 265 Sec. 10. NDCC Sec. 65-05-15 is a much older statute. It was first enacted in 1913 and, until 1931, applied when a work-related injury from one employment was aggravated by a work-related injury in a second employment. 1925 Supp.Comp.Laws, Sec. 396a7; 1931 N.D.Sess.Laws, ch. 312 Sec. 1. From 1931 until 1981, NDCC Sec. 65-05-15 applied only when a work-related injury aggravated a prior nonwork-related injury. Then, in 1981, NDCC Sec. 65-05-15 was amended to also reduce benefits in the situation in which a nonwork-related injury aggravated a prior work-related injury. 1981 N.D.Sess.Laws, ch. 643 Sec. 5. So, until 1981, the issue in this case would not have arisen. There would have been no reduction of workers' compensation benefits under NDCC Sec. 65-05-15 because that statute would not have applied to aggravation of a work injury by a nonwork injury. It seems clear, therefore, that until 1981, the legislature evidenced no interest to offset against no-fault benefits workers' compensation benefits that were subject to the aggravation statute.

The legislative history of NDCC Sec. 65-05-15 contains but one reference to the 1981 amendment. Mr. Thompson, the drafter of the amendment, prepared a statement for the Legislative Committee, explaining:

"Presently, the 'aggravation statute' refers specifically to conditions which preexist an employment injury. But it often happens that an individual will suffer an employment injury, return to work, and, at some later time, have a non-employment injury which aggravates the prior employment injury and may, in fact, be much more severe than the employment injury. The Bureau feels that that specific situation should be addressed in the aggravation statute as well. Therefore, the appropriate language has been inserted." 1981 Senate Industry, Business and Labor Committee Minutes, Drafter's Notes, S.B. 2127 (March 2, 1981).

Unfortunately, neither Mr. Thompson nor anyone else explained the intended effect of the 1981 amendment upon the offset of workers' compensation benefits under NDCC Sec. 26.1-41-13(1). But Mr. Thompson's comments confirmed the obvious purpose of the 1981 amendment to NDCC Sec. 65-05-15(3)--to bar payment of workers' compensation benefits for whatever aggravation that a "nonemployment injury" causes to a prior "work-compensable injury." Providing benefits only for work-related injury and not for aggravation to work-related injury by nonemployment injury is in accord with the purpose of the Workers' Compensation Act, "providing sure and certain relief for workers injured in their employment." See Holmgren v. Workers' Comp. Bureau, 455 N.W.2d 200, 202 (N.D.19...