Senac v. Sandefer
Decision Date | 21 June 1982 |
Docket Number | No. 81-C-2925,81-C-2925 |
Citation | 418 So.2d 543 |
Court | Louisiana Supreme Court |
Parties | Henry J. SENAC v. Ronald Davis SANDEFER, Manchester Insurance & Indemnity Company and the Louisiana Insurance Guaranty Association. |
Dennis A. Pennington, Spedale, Sanders & Pennington, Baton Rouge, for applicant.
Richard Creed, Jr., Owen, Richardson, Taylor, Mathews & Atkinson, Baton Rouge, for respondents.
The plaintiff, Henry J. Senac, filed suit against Ronald D. Sandefer and his automobile liability insurer, Manchester Insurance & Indemnity Company, seeking damages for personal injuries received in an automobile accident. Plaintiff was operating his employer's delivery truck when it was involved in an accident on December 3, 1971, with a vehicle owned by the defendant, Ronald Sandefer and insured by Manchester Insurance & Indemnity Company. Plaintiff sought recovery for medical expenses, pain and suffering, and loss of wages. Manchester Insurance & Indemnity Company became insolvent and its obligations were assumed by the Louisiana Insurance Guaranty Association (LIGA) pursuant to La.R.S. 22:1375 et seq.
The parties entered into a joint stipulation which provides as follows:
The legal issue stated in section 4 of the joint stipulation, supra, was resolved in favor of the plaintiff by the trial court. In written reasons for judgment, the trial court observed that the $4,900 in stipulated general damages to which the plaintiff was entitled did not include recovery for any loss of wages. The compensation benefits received by the plaintiff under the provisions of La.R.S. 23:1021, et seq. were payments made in lieu of salary. Citing Fontenot v. Hanover Insurance Company, 385 So.2d 238 (La.1980), the trial court held that LIGA was not entitled to any credits for the $4,900 paid by the compensation insurer because there had not been a duplication of recovery as contemplated by La.R.S. 22:1386.
The court of appeal reversed the trial court judgment finding that "compensation payments are in lieu of both wage loss and damages for pain and suffering, and that recovery of both compensation payments and damages for pain and suffering is double recovery under the workmen's compensation law." Senac v. Sandefer, 405 So.2d 1128, 1131 (La.App. 1st Cir. 1981). This court granted writs to review the correctness of that decision. 407 So.2d 747 (La.1981).
The Insurance Guaranty Association Law, La.R.S. 22:1375 et seq., was enacted by the legislature in 1970 as a response to the serious problem of insurer insolvencies. Ursin v. Insurance Guaranty Association, 412 So.2d 1285 (La.1982) (on rehearing). The purpose of the Insurance Guaranty Association Law is stated in La.R.S. 22:1376 as follows:
The purpose of this Part is to provide a mechanism for the payment of covered claims under certain insurance policies to avoid excessive delay in payment and to avoid financial loss to claimants or policyholders because of the insolvency of an insurer, to assist in the detection and prevention of insurer insolvencies, and to provide an association to assess the cost of such protection among insurers.
La.R.S. 22:1378 provides for a liberal construction of the act to effectuate the designated purpose "under section R.S. 22:1376, which shall constitute an aid and guide to interpretation."
La.R.S. 22:1382(1)(b) provides that the Louisiana Insurance Guaranty Association shall:
(b) Be deemed the insurer to the extent of its obligation on the covered claims and to such extent shall have all rights, duties and obligations of the insolvent insurer as if the insurer had not become insolvent.
Accordingly, in the instant case, LIGA is to be treated as though it were the insurer that issued Mr. Sandefer's policy. Billeaudeau v. Lemoine, 386 So.2d 1359 (La.1980); Hickerson v. Protective National Insurance Company, 383 So.2d 377 (La.1980). LIGA contends, however, that it is entitled to a credit for the benefits which Senac has received from his employer's compensation insurer, by virtue of La.R.S. 22:1386, entitled "Nonduplication of recovery," which provides in relevant part as follows:
The purpose of this provision is to prevent double recovery. Hickerson, supra, at 379. The issue before this court, therefore, is whether double recovery will result from a judgment against a third party tortfeasor awarding a claimant, who has already received workers' compensation disability benefits, general damages which do not include lost wages or medical expenses.
The Workers' Compensation Act was described by this court in Atchison v. May, 201 La. 1003, 10 So.2d 785 (1942), as social legislation passed for the joint benefit of labor and management.
It can thus be seen that as between the employee and his employer, the employee surrenders his former right to full damages and accepts, instead, compensation measured as a percentage of his wages. See W. Malone & H. Johnson, Workers' Compensation in 13 Louisiana Civil Law Treatise § 32 (1980); 1 A. Larson, The Law of Workmen's Compensation § 1.10 (1981).
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