CASE NO. 3915 CRB-03-98-10
COMPENSATION REVIEW BOARD
WORKERS’ COMPENSATION COMMISSION
JANUARY 19, 2000
NANCY LESCO, Dependent Widow of ROBERT LESCO, Deceased
(NO RECORD OF INSURANCE)
SECOND INJURY FUND
The claimant was represented by William Gallagher, Esq., Gallagher & Calistro, 1377 Boulevard, P.O. Box 1925, New Haven, CT 06509.
The employer Glass Crafters was represented by Lawrence Langerman, Karp & Langerman, 185 Plains Road, Milford, CT 06460, who did not appear at oral argument.
The Second Injury Fund was represented by Sarah Posner, Esq., Assistant Attorney General, 55 Elm Street, P. O. Box 120, Hartford, CT 06141-0120.
ITT Hartford was represented by Jason Dodge, Esq., Pomeranz, Drayton & Stabnick, 95 Glastonbury Boulevard, Glastonbury, CT 06033, who did not appear at oral argument.1
This Petition for Review from the October 9, 1998 Finding and Award of the Commissioner acting for the Third District was heard June 18, 1999 before a Compensation Review Board panel consisting of then Commission Chairman Jesse M. Frankl and Commissioners Angelo L. dos Santos and Stephen B. Delaney.
JESSE M. FRANKL, COMMISSIONER. The Second Injury Fund has petitioned for review from the October 9, 1998 Finding and Award of the Commissioner acting for the Third District.2 In that decision the trial commissioner ruled that pursuant to § 31-293 the Fund was entitled to a credit for the claimant widow’s settlement of a third party suit, but held that said credit applied only to the claimant widow’s recovery for wrongful death but not to her recovery for loss of consortium. In support of its appeal, the Fund argues that it is entitled to a full credit for the net amount of the third party suit, including payment for loss of consortium. Alternatively, the Fund argues that the trial commissioner failed to properly review the allocation of the amounts recovered for wrongful death and loss of consortium. We find no error.
The trial commissioner found the following relevant facts. On February 1, 1991, the claimant decedent was killed in an accident while working for the respondent employer, which did not have workers’ compensation insurance. The decedent was married to Nancy Lesco (claimant widow) and they had one daughter. The decedent had previously been married to Linda Lesco, and they had two children, Robert and Anthony. The trial commissioner took administrative notice of previous awards in this case, including an order issued by a trial commissioner pursuant to § 31-306 that half of the decedent’s compensation rate would be paid to the claimant widow and her child, and the other half to the guardian for Robert and Anthony.
The trial commissioner further found that the claimant widow filed a third party suit in superior court against Royal Glass Company3 for wrongful death and loss of consortium. On March 9, 1995, the parties4 reached a settlement of the superior court lawsuit in the amount of $800,000.00. The claimant’s attorney in that suit (who is the same attorney in her present workers’ compensation claim) reported to the superior court that the $800,000.00 settlement was to be divided by allocating $400,000.00 to the wrongful death claim and $400,000.00 to the loss of consortium claim. The issue regarding a credit against future workers’ compensation benefits was referred by the court to the workers’ compensation forum. (Finding ¶ 13; see also Claimant’s Exh. A, superior court transcript of 3/9/95 at p. 7).
The wrongful death settlement of $400,000.00 was passed through the probate court in New Haven, with net proceeds reported as $194,126.38. The accounting by the probate court listed the following deductions:
1. Attorney’s fees of $125,000.00.
2. Litigation expenses of $2,341.51.
3. Payment of a state welfare lien of $46,808.53.
4. Payment of a workers’ compensation lien of $31,723.62.
From the net proceeds of $194,126.38, the decedent widow received $97,063.19 and the three children each received $32,354.39. However, pursuant to a mutual distribution agreement presented to the probate court, the claimant widow gave each child additional funds in the amount of $153,826.33, so that each child received a total of $83,630.00.
The trial commissioner concluded that the claimant widow’s recovery for loss of consortium would not be included in determining the credit which the Fund was entitled to under § 31-293. From the $400,000.00 wrongful death claim, the trial commissioner deducted the following: (1) the workers’ compensation lien paid by the claimant in the amount of $31,723.58; (2) the litigation expenses of $2,341.51; (3) the $97,063.17 paid to the children in the probate court ($32,354.39 x 3); and (4) attorney’s fees of $107,500.00. These deductions add up to $238,628.28, which leaves the Fund with a credit in the amount of $161,371.72 against § 31-306 benefits to be paid to the claimant widow.
We will first address the Fund’s legal argument that recovery for loss of consortium in a third party suit should be credited against workers’ compensation payments pursuant to § 31-293. The Fund argues that by excluding the loss of consortium, the claimant widow effectively avoids the policy in workers’ compensation against “double recovery,” citing Enquist v. General Datacom, 218 Conn. 19 (1991).
In Schiano v. Bliss Exterminating, 13 Conn. Workers’ Comp. Rev. Op. 45, 1852 CRB-4-93-9 (Dec. 7, 1994), we held that “Section 31-293’s employer entitlement to a credit for amounts recovered from a third party does not extend to a settlement received by a claimant’s spouse for damages resulting from her loss of the claimant’s consortium.” Id. at 48. In support of its appeal, the Fund seeks to distinguish Schiano on the basis that the claimant in Schiano was not fatally injured as was the claimant in the instant case. Thus, the Fund argues that Schiano does not apply because there the claimant and the spouse were separate individuals, whereas here there is only the claimant widow. We find no merit to this argument, as it would indeed be an absurd result to offset benefits based upon a claimant widow’s recovery for loss of consortium only where the claimant husband has died, but not where the claimant husband has survived. Instead, we must review the language of § 31-293 and any relevant case law in order to determine whether the respondents are entitled to a credit for recovery under a spouse’s loss of consortium claim.
Section 31-293 allows an injured employee to sue a third party tortfeasor in a private cause of action, and allows the employer to obtain reimbursement for workers’ compensation benefits from a third party tortfeasor by intervening in the claimant’s cause of action or by bringing a separate cause of action. Libby v. Goodwin Pontiac-GMC Truck, Inc., 241 Conn. 170, 174 (1997). The “employer’s statutory right to subrogation of the proceeds of the employee’s claim against the tortfeasor implements the public policy of preventing double recovery by an injured employee....” Id. Pursuant to § 31-293, an employer may seek reimbursement for identifiable future benefits, along with a credit for unknown future benefits against the net proceeds of a third party recovery. Enquist, supra, at 25-27.
Section 31-293 does not address the issue of whether recovery based upon loss of consortium is reimbursable. Other than the Schiano case, the parties have brought no other cases to our attention which specifically address this issue. We note that Professor Larson, in his treatise, does not provide a general rule on this issue, but merely states as follows: “As to the question whether the carrier’s lien extends to damages earmarked for loss of consortium, Michigan, Minnesota, and Wisconsin have held that it does not. Illinois has held that it does, and Indiana has done the same when the allocation to consortium was a transparent device to defeat the carrier’s rights.” 6 A. Larson, The Law of Workmens’ Compensation § 74.36, p. 14-615.
“Loss of consortium is defined as the loss of services, financial support, and the variety of intangible relations that exist between spouses living together in marriage.” Shegog v. Zabrecky, 36 Conn. App. 737, 751 (1995). “The ‘intangible’ components of consortium are the ‘constellation of companionship, dependence, reliance, affection, sharing and aid which are legally recognizable, protected rights arising out of the civil contract of marriage.” Id. (citation omitted). Damages for loss of consortium “include future as well as past suffering.” Id. Since “loss of consortium is incapable of precise measurement, considerable latitude is allowed a jury in estimating damages.” Id.
In Connecticut, the cause of action for loss of consortium has “evolved over time.” DeMarinis v. United Services Automobile Assn. Casualty Ins. Co., 44 Conn. App. 172, 176 (1997). The Connecticut Supreme Court held in Hopson v. St. Mary’s Hospital, 176 Conn. 485 (1979) that “either spouse has a claim for loss of consortium shown to arise from a personal injury to the other spouse caused by negligence of a third person.” DeMarinis, supra, at 176. In DeMarinis, supra, the court explains the development of case law regarding loss of consortium. On October 1, 1989, § 52-555a was enacted which provides that a claim for loss of consortium due to the death of a spouse “shall be separate from and independent of all claims or causes of action for the determination of damages with respect to such death.” The Appellate Court in DeMarinis, supra, reviewed this statute and concluded that “(t)he postmortem loss of consortium cause of action, although separate and independent as a basis for claiming damages, remains derivative of the claim arising out of injury to the spouse, and it could not come into existence without that injury.” Id. at 178.
We agree with the Fund’s argument that under the Workers’ Compensation Act there is a strong policy against double recovery. Specifically, the purpose of § 31-293 is “the avoidance of two independent compensations for the injury.” Enquist, supra, at 26. As explained above, a claim for loss of consortium compensates a spouse for ‘intangible’ components including the “constellation of companionship, dependence, reliance, affection, sharing and aid which are legally recognizable, protected rights arising out of the civil contract of marriage.” Shegog, supra, at 751. These intangible components are not compensated for under the Workers’ Compensation Act. Accordingly, allowing a spouse to recover for such intangible factors without offsetting workers’ compensation benefits does not lead to a double recovery.
Other jurisdictions have followed this reasoning. See DeMeulenaere v. Transport Ins. Co., 342 N.W.2d 56 (Wis. App. 1983). In Eisner v. Hertz Corp., 407 N.E.2d 1286 (1980), the Supreme Court in Massachusetts held that an employer’s insurer was not entitled to reimbursement for recovery under loss of consortium because loss of consortium was not a compensable injury under the state workers’ compensation act. Similarly, the Florida Court of Appeals held that “sums attributable to loss of consortium are to be excised from the net recovery to be shared with the compensation carrier on the theory that this element of damage is not reimbursable under the Florida Workers’ Compensation Act.” DeMeulenaere, supra, at 59-60, citing Department of Health and Rehabilitation Services v. McConkey, 421 So.2d 29, 32, n.1 (Fla.Dist.Ct.App.1982); see also Rascop v. Nationwide Carriers, 281 N.W.2d 170 (1979); Kottka v. PPG Industries, Inc., 388 N.W.2d 160, 168 (Wis. 1986). Although these decisions are not binding upon this board, we find their reasoning to be sound.
In further support of its appeal, the Fund cites § 52-555d in support of its argument that allowing the loss of consortium claim to be excluded from reimbursement under § 31-293 would cause double recovery. Section 52-555d provides as follows:
No action with respect to any claim or cause of action for loss of consortium shall be brought by one spouse against an employer of the other spouse if such other spouse is entitled to receive, is receiving or has received benefits pursuant to chapter 568 [the Workers’ Compensation Act].
We find the Fund’s reliance on § 52-555d to be misplaced, as that section addresses only the exclusivity of the Workers’ Compensation Act.
We will now address the Fund’s concerns regarding the apportionment of the settlement proceeds for the wrongful death claim. In Schiano v. Bliss Exterminating, 3436 CRB-4-96-10 (April 8, 1998), the trial commissioner concluded that the claimant had not established that any portion of the settlement was attributable to the loss of consortium claim, and dismissed his claim for a reduction in the moratorium amount. In Schiano, supra, we explained that it was “the claimant’s burden to establish that part or all of the third party settlement was due to his wife’s loss of consortium claim rather than his compensable injuries.” In that case, the trier found that the claimant was unable to do so, citing the testimony of two attorneys and several letters exchanged between said counsel in support of his decision. We found no error in that determination, as it was the commissioner’s prerogative to weigh the credibility of the evidence and the testimony of the witnesses. Id, citing Webb v. Pfizer, Inc., 14 Conn. Workers’ Comp. Rev. Op. 69, 70-71, 1859 CRB-5-93-9 (May 12, 1995).
Similarly, in the instant case we conclude that it was within the discretion of the trial commissioner as the finder of fact to determine the appropriate apportionment of the claimant widow’s recovery. Here, the claimant widow presented evidence which indicated that the $800,000.00. recovery for wrongful death and loss of consortium claims was equally divided between the two claims. The Fund presented no evidence to the contrary, despite the trial commissioner’s granting of its motion for a continuance for a second formal hearing. In the instant case, the trial commissioner, who is the sole finder of fact and is charged with the assessment of the evidence, accepted the $400,000.00 allocation to the loss of consortium claim. We see no reason to overturn this determination, and we note that even in its appeal the Fund has failed to present an argument that the $400,000.00 allocation to the loss of consortium claim was outside the bounds of normal recoveries in civil actions of this type. We do note, however, that trial commissioners should closely scrutinize settlements which appear to circumvent reimbursement under § 31-293. See DeMeulenaere, supra, at 60.
Finally, we will address the Fund’s argument that the proceeds from the wrongful death claim in the amount of $97,063.17 paid to the children in the probate court ($32,354.39 x 3 children) should be included in the credit under § 31-293. In the instant case, the children may receive workers’ compensation benefits under § 31-306 pursuant to a prior trial commissioner’s order that one half of the decedent’s compensation rate be paid to the claimant widow and her child, and the other half to be paid to the guardian for Robert and Anthony. (Finding ¶ 7). Accordingly, their receipt of said money would result in a double recovery if they received future § 31-306 benefits without allowing a credit for the $97,063.17. Thus, the $97,063.17 must be added to the credit of $161,371.72, for a total of $258,434.89. In all other respects, the trial commissioner’s decision is affirmed.
Accordingly, this case must be remanded solely for a revised award regarding the monetary credit.
Commissioners Angelo L. dos Santos and Stephen B. Delaney concur.
1 ITT Hartford was effectively removed as a party to this case pursuant to the August 21, 1996 granting of its Motion to Reopen. (See 6/9/98 TR. at p. 4-5, and p. 15). That Motion to Reopen was made on the basis that ITT Hartford was not the insurer of Glass Crafters on the date of the claimant’s accident. The removal of ITT Hartford as a party was not appealed or contested, and is not an issue in the present case. BACK TO TEXT
2 The claimant had also filed an appeal from the October 9, 1998 Finding and Award, but subsequently withdrew that appeal. (Claimant’s Brief at p. 4). BACK TO TEXT
3 Although the initial Finding and Award of June 9, 1993 listed Royal Glass as the employer, a Corrected Finding and Award was issued on June 9, 1993, which indicated that the correct employer was Glass Crafters. It appears from the transcript of the superior court hearing contained in Claimant’s Exh. A, that Glass Crafters was an intervenor in the claimant’s wrongful death and loss of consortium suit. (See Claimant’s Exh. A, 3/9/95 Transcript of superior court at p. 1). BACK TO TEXT
4 The Second Injury Fund was not a party to that lawsuit. BACK TO TEXT