Skitromo v. Meriden Yellow Cab Co., Inc.

• Decision Date: 28 July 1987
• Docket Number: No. 12946,12946
• Citation: 528 A.2d 826,204 Conn. 485
• Court: Connecticut Supreme Court
• Parties: Julian R. SKITROMO v. MERIDEN YELLOW CAB COMPANY, INC., et al.

Page 826

528 A.2d 826

204 Conn. 485

Julian R. SKITROMO v. MERIDEN YELLOW CAB COMPANY, INC., et al.

No. 12946.

Supreme Court of Connecticut.

Argued May 5, 1987.

Decided July 28, 1987.

P. Bryden Manning, Hartford, for appellants (defendants).

Kenneth G. Bartlett, Bridgeport, for appellee (plaintiff).

Before PETERS, C.J., and HEALEY, CALLAHAN, SPALLONE and SPEAR, JJ.

SPALLONE, Associate Justice.

The sole issue in this appeal is whether an employer who is obligated to pay workers' compensation benefits to an injured employee may credit against its future compensation liability the amount recovered by that employee in a third party action despite the employer's failure to intervene in the third party proceedings in the manner prescribed by General Statutes § 31-293. ¹ We hold that the employer's failure to intervene in the third party action deprived it of any interest in the employee's third party recovery, and that the employer, therefore, is not entitled to credit that recovery against its future workers' compensation liability. Since the compensation review division reached the same conclusion, we find no error.

The facts in this case are not in dispute. The plaintiff, Julian R. Skitromo, was employed as a cab driver by the named defendant, Meriden Yellow Cab Company, Inc. On August 13, 1979, while driving a cab in the course of his employment, the plaintiff was struck from the rear by another vehicle. The plaintiff was severely injured and subsequently made a workers' compensation claim against his employer. The plaintiff was awarded benefits and received a total of $41,331, including $14,208 in medical payments, between August 13, 1979, and October, 1982. These benefits were paid by the codefendant Travelers Insurance Company, the employer's insurer.

By writ, summons and complaint returnable May 6, 1980, the plaintiff commenced a common law negligence action against the third party tortfeasor. On October 31, 1980, a certified letter was sent to the named defendant notifying it of the pending court proceedings. The letter was received on November 1, 1980. On January 14, 1981, the named defendant filed a motion to intervene in the suit. The motion was denied by the trial court because it had been filed beyond the thirty day period provided in General Statutes § 31-293. In October, 1982, the plaintiff settled his third party action for $90,000 from which he, after paying certain fees and expenses, netted $56,610.80.

After the plaintiff settled his third party action, the defendants terminated the plaintiff's workers' compensation benefits, claiming that they had a right to offset their inchoate future liability to the plaintiff against his net recovery in the third party settlement. The plaintiff thereafter initiated workers' compensation proceedings to compel the defendants to restore the benefits.

By finding and award dated May 18, 1984, the workers' compensation commissioner found that the defendants were obligated to pay to the plaintiff all benefits due him pursuant to the provisions of the Workers' Compensation Act, without any deductions or credits for the plaintiff's third party settlement. The defendants appealed the commissioner's decision to the compensation review division, which affirmed the commissioner. The defendants then filed this appeal.

The defendants concede that because they failed to intervene in a timely fashion in the third party action, they have no right to reimbursement of the $41,331 already paid to the plaintiff in benefits. They contend, however, that they may credit the net amount received by the plaintiff in the third party settlement against their future workers' compensation liability. The defendants rely on a series of cases discussing the right of an employer to set off amounts received by an employee in third party actions against the employer's workers' compensation liability. See Stavola v. Palmer, 136 Conn. 670, 680, 73 A.2d 831 (1950); Mickel v. New England Coal & Coke Co., 132 Conn. 671, 678, 47 A.2d 187 (1946); United States Fidelity & Guaranty Co. v. New York, N.H. & H.R. Co., 101 Conn. 200, 203, 125 A. 875 (1924); Rosenbaum v. Hartford News Co., 92 Conn. 398, 400-403, 103 A. 120 (1918).

These cases, however, establish only than an employer has a general right to be reimbursed from a third party tortfeasor for benefits paid to an employee for injuries caused by the third party. This right is established by General Statutes § 31-293, which allows both employers and employees to bring an action against a third party who is allegedly responsible for the employee's injury. By allowing either an employer or an employee to bring an action, the law seeks to vindicate both the employee's interest in receiving the full scope of tort damages that remain uncompensated by a workers' compensation award and the employer's interest in being reimbursed for payments made because of the third party's malfeasance. See DeSantis v. Gaudioso, 39 Conn.Sup. 222, 223, 476 A.2d 149 (1983); 2A A. Larson, Workmen's Compensation Law § 71.20.

The issue in the present case, however, is not whether an employer generally has the right to be reimbursed from a third party tortfeasor for workers' compensation benefits paid to an injured employee. As § 31-293 and the cases cited by the plaintiff establish, our workers' compensation law clearly provides an employer with the means to enforce his right to reimbursement from a third party tortfeasor. Instead, the issue is whether an employer forfeits his right to reimbursement when he fails to act to enforce those...