Thornhill v. Walker-Hill Envtl. & Zurich Am. Ins. Co. of Ill.

• Court: Mississippi Supreme Court
• Writing for the Court: KITCHENS, PRESIDING JUSTICE, FOR THE COURT
• Citation: Thornhill v. Walker-Hill Envtl. & Zurich Am. Ins. Co. of Ill., 345 So.3d 1197 (Miss. 2022)
• Decision Date: 25 August 2022
• Docket Number: 2020-CT-01181-SCT
• Parties: Jeremy THORNHILL v. WALKER-HILL ENVIRONMENTAL AND ZURICH AMERICAN INSURANCE COMPANY OF ILLINOIS

345 So.3d 1197

Jeremy THORNHILL

v.WALKER-HILL ENVIRONMENTAL AND ZURICH AMERICAN INSURANCE COMPANY OF ILLINOIS

NO. 2020-CT-01181-SCT

Supreme Court of Mississippi.

August 25, 2022

ATTORNEYS FOR APPELLANT: RAYNETRA LASHELL GUSTAVIS, ROGEN K. CHHABRA, DARRYL MOSES GIBBS, Jackson

ATTORNEYS FOR APPELLEES: OLIVIA YEN TRUONG, DORIS THERESA BOBADILLA, NATHAN L. BURROW, Gulfport

EN BANC.

KITCHENS, PRESIDING JUSTICE, FOR THE COURT:

¶1. In July 2017, Jeremy Thornhill said that he had injured his back while working. "He sought workers’ compensation benefits from [his employer,] Walker-Hill and its insurance carrier, Zurich American Insurance Company of Illinois (collectively, ‘Employer/Carrier’), but the Employer/Carrier denied that Thornhill had sustained a compensable injury." Thornhill v. Walker-Hill Env't , No. 2020-CA-01180-COA, –––– So.3d ––––, ––––, 2021 WL 4888440, at *1 (Miss. Ct. App. Oct. 19, 2021). Ultimately, the parties agreed to compromise and settled pursuant to Mississippi Code Section 71-3-29 (Rev. 2021). Thornhill submitted the settlement to the Mississippi Workers’ Compensation Commission for approval. After examining the application, the Commission approved the settlement and dismissed Thornhill's case with prejudice. "Pursuant to the settlement, Thornhill signed a general release[,]" which reserved his right to pursue a bad faith claim. Thornhill , –––– So.3d at ––––, 2021 WL 4888440, at *2.

¶2. Believing he had exhausted his administrative remedies, Thornhill filed a bad faith suit against the Employer/Carrier in the Circuit Court of the Second Judicial District of Jones County. His case later was transferred to the Circuit Court of Marion County. There, the Employer/Carrier filed a motion to dismiss, "arguing that Thornhill had not exhausted administrative remedies—and that the circuit court lacked jurisdiction—because the Commission never made a factual finding that he was entitled to workers’ compensation benefits." Id. at ––––, at *1. The trial court granted the motion on the basis that it did not have jurisdiction because Thornhill had not exhausted his administrative remedies, inasmuch as "there [had] been no finding of liability and that Thornhill suffered compensable injuries."

¶3. The Court of Appeals reversed and remanded, finding that Thornhill had exhausted his administrative remedies and that the circuit court had jurisdiction to hear his bad faith claim. Id. at ––––, at *6. The appeals court determined that "Thornhill exhausted his administrative remedies because he fully and finally settled his workers’ compensation claim against the Employer/Carrier, the Commission approved the settlement, and there is nothing left pending before the Commission." Id. (citing Miss. Power & Light Co. v. Cook , 832 So. 2d 474, 480 (Miss. 2002) ).

¶4. We affirm the decision of the Court of Appeals. The judgment of the Marion County Circuit Court is reversed, and the case is remanded to that court for further proceedings.

STATEMENT OF FACTS

¶5. The Court of Appeals related the facts as follows:

Thornhill worked at Walker-Hill as a supervisor driller. He alleges that he injured his back while attempting to move a heavy rig on July 5, 2017. He alleges that he reported his injury to his supervisor the following day, but Walker-Hill denies this allegation. On July 7, Walker-Hill asked Thornhill to take a drug test. Thornhill went to the testing facility and provided a sample, but the sample was reportedly "cold" (i.e., below the minimum acceptable temperature for testing). Thornhill says that he tried to produce a second sample but was unable to do so, and he left without providing a second sample. Walker-Hill says that Thornhill did not return to work for several days and was fired for refusing to submit to a drug screen. Thornhill began seeing a doctor for his back injury, and the doctor eventually recommended that Thornhill undergo back surgery.

In October 2017, Thornhill filed a petition to controvert with the Commission. In November 2017, the Employer/Carrier filed an answer in which they admitted both that Thornhill's injury arose out his employment and that they had received proper notice of the injury. However, the Employer/Carrier denied that Thornhill was entitled to benefits, citing his refusal to complete the drug test. In April 2018, the Employer/Carrier filed an amended answer in which they denied that Thornhill had suffered any work-related injury and denied that they had received proper notice of the injury.^[1]

Following a hearing, an administrative judge ordered Thornhill to undergo an independent medical examination (IME) by Dr. Robert McGuire to "determine [Thornhill's] current condition and need for medical treatment." In his subsequent report, Dr. McGuire noted that Thornhill had been injured at work in 2015 but was able to return to work and function normally following conservative treatment. Dr. McGuire concluded that the surgery recommended by Thornhill's treating physician was "absolutely appropriate." Dr. McGuire concluded that Thornhill needed back surgery because of his injury in July 2017, which had "substantially aggravated [his] preexisting condition." Finally, Dr. McGuire concluded that Thornhill had not reached maximum medical improvement (MMI) and would not reach MMI until approximately six months post-surgery.

Id. at ––––, at *1-2.

¶6. After Thornhill had undergone the IME and Dr. McGuire had published his report, the Employer/Carrier and Thornhill agreed to mediation. During mediation, the parties compromised and agreed to settle the claim for $145,000. "In July 2019, Thornhill filed an application, which the Employer/Carrier joined, for the Commission to approve their compromise settlement." Id. at ––––, at *2. The application, which is titled "Application For Approval of Compromise Settlement," says, in relevant part:

[T]he employer and carrier have contested the compensability of claimant's claim. Claimant would show unto the Commission that [he] has contended, and now contends, that he is entitled to compensation, whereas said employer and carrier have contended, and now contend, that claimant is not entitled to any medical benefits or compensation, and in no event, to the amount thereof demanded by the claimant. Accordingly, in order to purchase peace and to avoid additional costs associated with the further prosecution of this claim and as a complete and total compromise of all issues, including compensability, the said employer and carrier have offered to pay claimant the sum of $145,000, without discount, in complete settlement of all claims of every kind and nature. As a material part of this compromise settlement, the claimant has agreed to be responsible for the payment of any and all medical charges whether known or unknown by the claimant and/or the employer and carrier.

....

Claimant further shows that this request and application are made pursuant to the provisions of Section 71-3-29 of Mississippi Code Annotated (1972), and that this case comes within the purview of such section for the reason that compensability vel non of claimant's injury is in issue and that it is impossible to determine the exact extent of the disability suffered by claimant, if any. Thus, it would be to the best interest of claimant for the Commission to allow said employer and carrier to settle and compromise said differences herein with claimant, and to allow said payment to be made in full discharge of all responsibility of said employer and carrier under the terms of the Mississippi Workers’ Compensation Act.

(Emphasis added.) On July 16, 2019, after "sufficiently examin[ing] [Thornhill's] proposal, and being fully advised" on the merits, the Commission determined that the compromise settlement was "in the best interest of the claimant[.]" As a result, the Commission entered an order approving the settlement and dismissed the case with prejudice. The Commission's order granting the compromise settlement specifically stated, in relevant part:

The Commission finds that the claimant, on the one hand, and the employer and carrier, on the other hand, have a disagreement as to the cause and to the extent of disability sustained by the claimant, if any, and that the case is a proper one for disposition under the provisions of Section 71-3-29 of Mississippi Code Annotated (1972).

It is, therefore, ordered that said compromise settlement should be, and the same is hereby, approved and that [Employer/Carrier] shall pay to Jeremy Thornhill, claimant, the sum of $145,000, without discount, in complete settlement of all claims of every kind and nature. This lump sum is compensation for permanent impairment that will affect the claimant for the rest of his life....

It is further ordered that upon payment of said sum to claimant, said employer and carrier ... shall stand fully and completely discharged of any other or further liability to the claimant, or otherwise, for, arising out of, or connected with the alleged injury sustained by Jeremy Thornhill on or about July 5, 2017, or of the effects thereof, and that this matter be, and it is hereby, dismissed with prejudice. Further, the claimant is hereby authorized and empowered to execute any receipt, release, or other instrument required by said employer and carrier to evidence their release, acquittal, and discharge herein.

¶7. "Pursuant to the settlement, Thornhill signed a general release that released the Employer/Carrier from all claims arising out of or connected with this alleged on-the-job injury." Thornhill , –––– So.3d at ––––, 2021 WL 4888440, at *2. The release was drafted by the Employer/Carrier and contained the following language:

[Thornhill] reserves and does not release, however, the right to bring a claim for bad faith against any party and the parties agree administrative remedies in [Thornhill's] workers’ compensation claim have been fully and finally exhausted.

¶8. On January 15, 2020, Thornhill filed a complaint against the...