Summary
In Henry Steers, Inc., v. Turner Construction Co.,104 N.J. Law 189, it was said that the amendment of 1913 (reenacted and numbered section 23 (f) by P.L. 1919 pp. 201, 212), "must be liberally construed to effectuate the purpose of its enactment which was, as already indicated, to reimburse the employer for payments which the act required of him regardless of the question of his negligence from the person who was the wrongdoer."
Summary of this case from Scheno Trucking Co., Inc., v. BickfordOpinion
Submitted May 27, 1927 —
Decided October 17, 1927.
On appeal from the Hudson County Circuit Court, in which Judge Ackerson filed the following opinion:
"This case is submitted to the court for determination without a jury, upon the pleadings and two stipulations as to facts, and there are no controverted facts to determine. It involves the construction of paragraph 23(f), Pamph. L. 1919, ch. 93, § 3 (2 Comp. Stat. 1911-1924, Cum. Supp., p. 3885). This statute is a part of what is commonly called the Workmen's Compensation act, originally enacted as chapter 95 ( Pamph. L. 1911), and the particular section of that act which is involved in this controversy deals with the right of the employer to reimbursement from the wrong-doer, who caused an injury to an employe, when a settlement is made between the wrong-doer and the employe.
"The admitted facts disclosed by the pleadings and stipulations show that the plaintiff, a corporation of this state, was engaged in building a dock on the Passaic river, and employed in the performance of that work one Chris Olsen. The defendant, a corporation of this state, was engaged in operating a derrick unloading gravel from scows in the Passaic river, which derrick was supported by a tug rest upon the bulkhead, near the place where the plaintiff's employees, and particularly Chris Olsen were working. About one-ten P.M., February 11th, 1924, the cable on the boom of said derrick belonging to the defendant gave way, and the boom fell causing the bucket of the derrick to strike plaintiff's employe, Chris Olsen, and throw him to a scow below. As a result of the accident, plaintiff's employe, Chris Olsen, sustained two broken ribs, three fractures of the left leg and severe contusions of the elbow, as well as a puncture of the lung. Under the laws of New Jersey, known as `An act prescribing the liability of an employer to make compensation to an employe in the course of employment and establishing an elective schedule of compensation,' approved April 4th, 1911, its amendments and supplements, the plaintiff corporation became obligated to pay to the said Chris Olsen, its employe, because of the injuries received, a compensation for temporary disability from February 11th, 1924, to August 14th, 1924, being a period of twenty-six weeks and three days, at the rate of $17 per week, or $449.28. Under the same statute the plaintiff corporation became legally obligated to pay to or on behalf of the employe such medical, surgical and hospital treatment as was necessary to cure and relieve him of the effect of his injuries, `and to restore the function of the injured members or organs where such restoration is possible; provided, however, that the employer shall not be liable to furnish or pay for physicians' or surgeons' services in excess of $50, and, in addition, to furnish hospital service when necessary in excess of $50, unless the injured person or the physician who treats him or any other person on his behalf, shall file a petition with the workmen's compensation bureau, stating the need for such physicians' or surgeons' services in excess of $50 as aforesaid, and such hospital service or appliances in excess of $50 as aforesaid, and the workmen's compensation bureau, after investigating the need of the same and giving the employer an opportunity to be heard, shall determine that such physician's and surgeon's treatment and hospital services are or were necessary, and that the fees for the same are reasonable, and shall make an order requiring the employer to pay for or furnish the same.'
"The plaintiff corporation rendered medical service to said employe and expended therefor the sum of $632. Respecting this payment, the parties hereto have entered into a stipulation.
"`That the sum of $632, representing medical services, c., was not paid by the plaintiff in this cause as a result of an order by the workmen's compensation bureau.'
"And the parties have also stipulated that this `sum of $632, representing the medical services rendered, was paid direct to the doctors and parties rendering services, and did not at any time pass through the hands of the employe or his dependents.'
"On March 9th, 1924, pursuant to paragraph (f) of section 23 of the compensation statute, the plaintiff corporation herein served, or caused to be served on the defendant, a statement of the compensation agreement between itself and its employe, Mr. Olsen, and by virtue of that notice the plaintiff, under the act, became entitled to receive from the defendant herein, upon the payment of any amount in release by the defendant on account of its liability to the said Chris Olsen, a sum equivalent to the amount of compensation which the plaintiff had theretofore paid to the said Chris Olsen.
"About September 14th, 1925, the defendant paid in release of its liability to the said Chris Olsen, the sum of $3,000, and did not deduct from said amount, for the benefit of the plaintiff herein, the amount of compensation as indicated on the notice served on said defendant and has wholly neglected and refused to pay the full amount indicated in said notice served as aforesaid. The plaintiff demands as damages the sum of $1,081.28, together with interest from September 14th, 1925, and costs of suit.
"The answer of the defendant admits that he, the plaintiff, is entitled to the sum of $449.28, which covers compensation paid at the rate of $17 a week during temporary and permanent disability from February 11th, 1924, to August 14, 1924, but denies that it is liable for the sum of $632, the amount of medical expenses expended in an effort to cure the said Chris Olsen. The contention of the defendant is that the statute does not obligate the defendant to reimburse the plaintiff for such medical services, but only obligates the defendant to reimburse the plaintiff for the weekly payments made during temporary and permanent disability.
"The Compensation act was originally passed in this state as Pamph. L. 1911, ch. 95. Paragraph 23 of section 3 at that time contained no provision for reimbursement on the part of the employer from the party whose negligence caused the injury to the employe. Pamph. L. 1911, ch. 95, p. 144.
"The act was amended, so far as this section is concerned, in 1913. The language of the amended act is the same as the law now stands, so far as this particular section is concerned. Pamph. L. 1913, ch. 174, p. 312, § 23. Section 23 was amended again by Pamph. L. 1919, ch. 93, and the particular part that is involved in this controversy was then for the first time designated as (f) of section 23. Pamph. L. 1919, ch. 93, p. 212. The language of the section was not changed, however, the section will also be found in 2 Comp. Stat. 1911-1924, Cum. Supp., p. 3885, the section provides:
"`(f) Where a third person or corporation is liable to the employe or his dependents for an injury or death, the existence of a right of compensation from the employer under this statute shall not operate as a bar to the action of the employe or his dependents, nor be regarded as establishing a measure of damage therein. However, in event that the employe or his dependents shall recover from the said third person or corporation a sum equivalent to or greater than the total compensation payments for which the employer is liable under this statute, the employer shall be released thereby from the obligation of compensation. If, however, the sum so recovered from the third person or corporation is less than the total of compensation payments, the employer shall be liable only for the difference. The obligation of the employer under this statute to make compensation shall continue until the payment, if any, by such third person or corporation is made. Such employer shall file with the third person or corporation so liable, at any time prior to payment, a statement of the compensation agreement or award between himself and his employe, or the dependents of the employe, and the employer shall thereafter be entitled to receive from such third person or corporation, upon the payment of any amount in release or in judgment by the third person or corporation on account of his or its liability to the injured employe or his dependents, a sum equivalent to the amount of compensation payments which the employer has theretofore paid to the injured employe or his dependents, which payment shall be deducted by the third persons or corporation from the sum paid in release or judgment to the injured employe or his dependents.'
"The issue involved in this case is whether or not, where the proper notice has been served upon the third person or corporation who is responsible for the injury to the employe, that corporation or person, when settlement is made with the injured employe, is obligated to reimburse the employer not only for the weekly payments of compensation allowed by the act, but for the medical and hospital services, which the employer, under the act, is obligated to perform for the employe.
"It will be observed that the section quoted above provides:
"`However, in event that the employe * * * shall recover from the said third person * * * a sum equivalent to or greater than the total compensation payments for which the employer is liable under this statute, the employer shall be released thereby. * * * Such employer shall file with the third person so liable, at any time prior to payment, a statement of the compensation agreement or award between himself and his employe * * *, and the employer shall * * * receive * * * upon payment of any amount in release * * * a sum equivalent to the amount of the compensation payments which the employer has theretofore paid to the injured employe * * *.'
"In determining what the total compensation payment for which the employer is liable under the statute, and, therefore, entitled to have reimbursed under this section, it is necessary to refer to the part of the act which prescribes the compensation due the injured employe. Section 14 (a) of the act provides:
"`Compensation for all classes of injuries shall run consecutively and not concurrently, except as provided in paragraph 14, as follows: First, four weeks' medical and hospital services and medicines as provided in paragraph 14. After the waiting period, compensation during temporary disability. * * * Following both, either or none of the above compensation consecutively for each permanent injury. Following any or all or none of the above, if death results from the accident, expenses of last sickness and burial. Following which compensation to dependents, if any.'
"The Workmen's Compensation act was adopted for the purpose of accomplishing an economic reform in the relationship of master and servant, and substitute a speedy and definite relief to the injured employe at the expense of his master, in the place and stead of a delayed and doubtful recovery in an action under the common law, and the legislature went so far as to make the employer responsible even though no negligent act of the employer caused the accident, and even though the accident was the result of the negligent act of a third person. It is to be noted, however, that as the original act stood in 1911, an injured employe could recover from his employer the compensation provided in the act, even though the accident which caused his injury was the negligence of a third party, and the injured employe could also recover from the third party. Believing that this was economically unsound, the legislature in 1913 engrafted section 23 (f) on to the act, whereby, if a recovery is had from such third party, or a settlement made with him, that the employer shall be reimbursed for the moneys theretofore paid to the injured employe, c. It was not necessary to pass this 1913 amendment to the act for any other reason, because, unless the legislature clearly indicated its intent, it could not deprive the employe of his right of action against the wrong-doer. On the other hand, however, there was no right on the part of the employer to reimbursement from the wrong-doer, and therefore, statutory enactment was necessary.
"It is apparent, therefore, that the last above-mentioned section of the act must be liberally construed to effectuate the purpose of its enactment, which was, as already indicated, to reimburse the employer for payments which the act required of him, regardless of the question of his negligence, from the person who was the wrong-doer. To permit the employer in such a case to recover only the stated weekly compensation payments and not the medical and hospital bills, would be accomplishing only a part of the purpose which the legislature intended by the adoption of section 23 (f). That this result was never intended, must be apparent when we consider in most cases it is efficient medical and hospital services that lessen the total amount of the weekly compensation payments, and a case could very well arise whereby prompt and efficient medical service during the so-called waiting period, the injured employe is saved from permanent disability as defined by the act, and yet much medical service may have amounted to a considerable sum, the wrong-doer in such a case, if the defendant's contention in the case sub judice is correct, would escape all liability to the innocent employer who would have to pay the doctor's bill.
"The reimbursement from the wrong-doer to the employer, which was intended by section 23 (f), is completely set forth in section 14a of the act, which provides:
"`Compensation for all classes of injuries shall run consecutively and not concurrently, except as provided in paragraph 14, as follows: First, medical and hospital services and medicines as provided in paragraph 14. After the waiting period, compensation during temporary disability. * * * Following both, either or none of the above compensation consecutively for each permanent injury. Following any or all or none of the above, if death results from the accident, expenses of last sickness and burial. Following which compensation to dependents, if any.'
"It will be noted that this paragraph covers everything which is to be paid by the employer to the employe, and it seems clear that when the legislature later put section 23 (f) into the act, that it was intended to include medical expenses in the reimbursement which was to be made by a third party to the employer of the person injured by such third party's negligence.
"It is true that in the case of Benjamin Johnes v. Brabban, 90 N.J.L. 355, the court uses this language:
"`It is very doubtful, we think, whether the opinion of the learned judge of the Common Pleas, that the physician's bill was compensation, is sound, but whether so or not, the payment of the physician's bill required no agreement, and would not be subject to review; it is only where there is an agreement that there can be a review after a year. * * *.'
"But this was a case where an injured employe had filed a petition under the Workmen's Compensation act nearly two years after the accident, and the employer pleaded the statute of limitations, which is one year, as provided in the act, and the petitioner relied upon the fact that the employer had furnished a physician for medical attendance within one year of the accident, and that, therefore, an agreement from compensation had been thereby made within the contemplation of the act.
"It is to be noted that the expression of the court in the last cited case as to whether a physician's bill was compensation, is mere obiter dictum, as the court was merely deciding whether there was such an agreement within the year, as would save the employe's action from the bar of the statutory limitation. Further, even if there is a distinction between medical service and weekly payments, so far as the statutory limitation is concerned, that is probably based on the sound theory that if the employer does not agree to make the weekly payments within a year, and a petition is not filed within that time, the claim should be barred on the theory of laches. This is a benefit which the employer derived as a result of the increased benefits that the employe obtains under this statute. While taking away from the employer all the defenses known to the common law and giving them to the employe as benefits, it, in return, insists that the employe institute his suit or perfect his claim by agreement within a year. There is no sound reason why a party, whose negligence has caused the loss, should obtain any benefit over what that party had under the common law.
"I conclude, therefore, that the expense of medical and hospital services furnished by the employer to the employe is comprehended within the `total compensation payments,' which under section 23 (f) a third party, whose negligence has caused an injury to an employe, is to reimburse to the injured person's employer.
"Inasmuch, therefore, as the answer admits the proper statement of the agreement between the injured employe and the plaintiff here, was served upon the defendant, and inasmuch as it appears that such a statement shows that $449.28 was paid pursuant to an agreement on account of disability up to August 14th, 1924, and that the sum of $632 was paid pursuant to the agreement for medical and hospital expenses, therefore, I find that the plaintiff is entitled to a judgment against the defendant for the sum of $1,081.28, together with interest thereon at six per cent. from September 14th, 1925, that being the date of settlement between defendant and injured employe, from which date interest is claimed, which interest amounts to $95.68, making a total of $1,176.96, for which amount judgment may be entered in accordance herewith."
For the appellant, McDermott, Enright Carpenter and Carl S. Kuebler.
For the respondent, Collins Corbin and Charles W. Broadhurst.
The judgment under review herein should be affirmed, for the reasons expressed in the opinion delivered by Judge Ackerson in the Circuit Court.
For affirmance — THE CHIEF JUSTICE, PARKER, MINTURN, KALISCH, BLACK, KATZENBACH, LLOYD, WHITE, VAN BUSKIRK, McGLENNON, KAYS, HETFIELD, DEAR, JJ. 13.
For reversal — None.