Travco Ins. Co. v. Williams

• Decision Date: 25 February 2013
• Docket Number: Misc. Docket No. 7,Sept. Term, 2012.
• Citation: 430 Md. 396,61 A.3d 50
• Parties: TRAVCO INSURANCE COMPANY v. Crystal WILLIAMS.
• Court: Maryland Court of Appeals

430 Md. 396

61 A.3d 50

TRAVCO INSURANCE COMPANY

v.Crystal WILLIAMS.

Misc. Docket No. 7, Sept. Term, 2012.

Court of Appeals of Maryland.

Feb. 25, 2013.

Steven M. Klepper (Kramon & Graham, P.A., Baltimore, MD), on brief, for appellant.

Mark Kotlarsky, Laurel, MD, for appellee.

Argued before BELL, C.J., HARRELL, BATTAGLIA, GREENE, ADKINS, BARBERA and McDONALD, JJ.

GREENE, J.

We have before us questions of law certified by the United States District Court for the District of Maryland pursuant to the Maryland Uniform Certification of Questions of Law Act, Md.Code (1973, 2006 Repl.Vol.), §§ 12–601 to 12–613 of the Courts and Judicial Proceedings Article and Maryland Rule 8–305. The District Court has asked us to determine whether Md.Code (1996, 2011 Repl.Vol.), § 19–513(e) of the Insurance Article (or “ § 19–513(e)”) requires an insurance company to deduct recovered workers' compensation (“WC”) benefits from the benefits payable to an insured for uninsured motorist coverage (“UM”) and personal injury protection (“PIP”) when the insured has not reimbursed its WC provider, the WC provider claims the insured will need to reimburse it from any UM or PIP recovery, and the insured intends to reimburse the WC provider in the future. As an extension of this question, we are asked to determine the appropriate means for resolving a dispute between a PIP or UM insurer and insured regarding a WC provider's subrogation right.¹ Finally, we are asked whether § 19–513(e) permits an insurer to reduce its benefits payable for medical bill “write-downs,” ² assuming that the “write-downs” are considered a WC benefit under the applicable WC law.

We shall hold that, under the plain meaning of § 19–513(e), an insured's benefits payable under UM and PIP coverage “shall be reduced” to the extent that the insured recovered benefits under WC and the WC provider has not been reimbursed. Further, we hold that if the applicable WC law treats “write-downs” of medical bills as WC benefits, and the WC benefits have not been reimbursed, then the insurer shall deduct those benefits, calculated as discounts, from its benefits payable to the insured under § 19–513(e).

We adopt the facts of the case as set forth by the District Court in its Certification Order dated June 8, 2012:

[ ] TravCo Insurance Company (“TravCo”) issued to [ ] Crystal Williams a Maryland personal auto policy, number 978435964 101 1, effective July 28, 2007 to January 28, 2008. The Policy's coverage included UM bodily injury coverage, with limits of $100,000.00 each person, and PIP coverage, with limits of $2,500.00 each person each accident. The policy's UM coverage provided that “any amounts otherwise payable for damages under this coverage shall be reduced by all sums ... [p]aid because of the ‘bodily injury’ under ... [the] worker's compensation law or similar law provided the insurer or self-insurer of worker's compensation benefits has not been reimbursed for amounts paid under the worker's compensation law or similar law.” The [P]olicy's PIP coverage similarly provided: “Benefits payable by the Company under the terms of this insurance to or on behalf of an ‘injured person’ shall be reduced to the extent that benefits therefore are paid, to or on behalf of the ‘injured person’ under any worker's compensation law of any state or the Federal Government.”

At all relevant times, Ms. Williams was employed by the District of Columbia government. On August 2, 2007, Ms. Williams was a passenger in a District of Columbia government's vehicle driven by her supervisor. They were traveling on a work assignment. Their vehicle was rear-ended by an unknown driver. Ms. Williams was stunned by the impact. While she was sitting in the vehicle trying to recover, her supervisor told the other driver to leave the scene. The driver responsible for the accident left and no information about him is known. Ms. Williams was injured in the accident. She missed nine weeks of work and her loss of [ ] earning capacity was $10,476.00. She incurred $13,096.50 in medical expenses and received a 22% disability rating.¹

The medical invoices provided by Ms. Williams to TravCo indicate that her medical providers applied WC “write-downs,” totaling at least $3,591.53.

The District of Columbia government's WC third-party administrator asserts a subrogation right in the amount of $11,043.60 against any PIP or UM recovery by Ms. Williams. Ms. Williams intends to reimburse the District of Columbia government, although TravCo disputes her obligation to do so. The amount that Ms. Williams would reimburse the District of Columbia government cannot be determined before the settlement or judgment with TravCo, and Ms. Williams has no funds to reimburse the District of Columbia government out of pocket.

TravCo does not dispute that Ms. Williams' claims fall within the PIP or UM insuring agreements. Nevertheless, disputes regarding the effect of Section 19–513(e) have prevented settlement of her claims.

As this case requires us to interpret the meaning of a Maryland statute, we apply our longstanding principles of statutory construction. In State Farm Mut. Auto. Ins. Co. v. Ins. Comm'r, 283 Md. 663, 670, 392 A.2d 1114, 1117–18 (1978) [hereinafter State Farm ], we discussed statutory interpretation principles with reference to the predecessor of the statute at issue in the present case. We explained:

The cardinal rule of statutory construction is to ascertain and carry out the real legislative intention. A statute should be construed according to the ordinary and natural import of the language used without resorting to subtle or forced interpretations for the purpose of limiting or extending its operation. That is, we must confine ourselves to the statute as written, and may not attempt, under the guise of construction, to supply omissions or remedy possible defects in the statute. Thus, if there is no ambiguity or obscurity in the language of a statute, there is usually no need to look elsewhere to ascertain the intent of the Legislature .... [W]here statutory language is plain and free from ambiguity and expresses a definite and sensible meaning, courts are not at liberty to disregard the natural import of words with a view toward making the statute express an intention which is different from its plain meaning.

Id. (citations and quotations omitted).

The predecessor to § 19–513(e), Md.Code, Art. 48A, § 543(d), provided that PIP and UM benefits “shall be reduced to the extent that the recipient has recovered benefits under [WC] laws of any state or the federal government.” Md.Code, Art. 48A, § 543(d) (1957, 1972 Repl.Vol., 1978 Cum.Supp.). We explained that § 543(d) was “plain and unambiguous.” See State Farm, 283 Md. at 671, 392 A.2d at 1118 (holding that the statute's plain meaning required the insurer to reduce PIP benefits payable to its insured by the amount that the insured received under WC). This Court reaffirmed that statement as to § 19–513(e)'s predecessor statute in later cases. See Hines, 305 Md. at 377–78, 504 A.2d at 636–37 (noting that the language of the statute “is clear and unambiguous in requiring the reduction of PIP and UM benefits to the extent that the recipient has recovered [WC] benefits”); Smelser v. Criterion Ins. Co., 293 Md. 384, 385, 444 A.2d 1024, 1025 (1982) (explaining that the statute “means precisely what it says when it specifies that ... [PIP benefits] are to be reduced to the extent that a recipient has recovered sums pursuant to [WC laws of any state]”).

In State Farm, we were asked to determine whether an insurance company could deduct the monetary payments a claimant received under WC, even though the claimant already reimbursed the WC provider. We focused our inquiry on what the term “has recovered” meant as it was used in the statute. State Farm, 283 Md. at 671–72, 392 A.2d at 1118. In other words, we were asked to interpret whether, under the statute, the claimant “recovered” the WC benefits, even though he repaid that money to the WC provider. Noting that the dictionary defined “to recover” as “to get,” “to obtain,” “to come into possession of,” “to receive,” “to succeed in a [legal] proceeding,” and “to obtain in any legal manner in contrast to voluntary payment,” we held that under those meanings, the insured had “recovered” WC benefits when he received the money from his WC provider as a result of his claim. Id. (citations omitted). Therefore, under the statute, the insurer was required to reduce the benefits payable to the insured by the amount of WC benefits the insured had received.

We were asked to interpret the statute again in Gable v. Colonial Ins. Co., 313 Md. 701, 548 A.2d 135 (1988). In that case, an insurance company claimed that its policy provision which stated that it could deduct PIP benefits by the amount the insured may be entitled to recover in the future under WC law, allowed it to deduct the WC benefits the insured would have gotten, even though the insured party never received such WC benefits. Gable, 313 Md. at 702, 548 A.2d at 135–36. We explained that the term “has recovered” in the statute, referred, in the past tense, to WC benefits “ actually received.” Further, we noted that

[t]he language of § 543(d) shows a legislative intent to provide offsets only for workmen's compensation benefits actually received and not for future benefits. The subsection provides for a deduction only for workmen's compensation benefits that the claimant “has recovered.” The General Assembly drew a sharp distinction between workmen's compensation benefits which have been received and those benefits which have not.

Gable, 313 Md. at 704, 548 A.2d at 136–37. This statute, we explained, stood in sharp contrast to the language in similar statutes in other states, allowing, for example, benefits to be reduced for WC benefits “recovered or recoverable.” See Gable, 313 Md. at 706, 548 A.2d at 137–38 (citing NY. Ins. Law § 5102(b)(2) (Consol.1985)). “[T]he...