Opinion
804127/2015
09-14-2015
Jennifer N. Witkowski, Plaintiff, v. Penske Truck Leasing Corp. PENSKE TRUCK LEASING CO., LP RELIANCE STEEL & ALUMINUM COMPANY EARLE M. JORGENSEN COMPANY KENNETH R. CARPENTER COUNTY OF ERIE, Defendant.
APPEARANCES: J. MICHAEL HAYES, ESQ. Attorney for Plaintiff WILLIAM K. KENNEDY, ESQ. Attorney for Defendants Penske, Reliance, Jorgensen & Carpenter MICHAEL A. SIRAGUSA, ESQ. By: JEREMY C. TOTH, ESQ. Attorney for County of Erie
APPEARANCES:
J. MICHAEL HAYES, ESQ.
Attorney for Plaintiff
WILLIAM K. KENNEDY, ESQ.
Attorney for Defendants Penske, Reliance,
Jorgensen & Carpenter
MICHAEL A. SIRAGUSA, ESQ.
By: JEREMY C. TOTH, ESQ.
Attorney for County of Erie
Frederick J. Marshall, J.
In this action for negligence and personal injury, the defendant, County of Erie (hereinafter "County"), has moved, pursuant to CPLR §3211(a)(7), for an order dismissing the plaintiff's amended complaint. Plaintiff joined the County as a defendant alleging that it is a necessary party pursuant to CPLR §1001(a). The basis for adding the County as a necessary party is that the plaintiff, after being injured in a motor vehicle accident received Medicaid benefits from the County to cover her medical expenses. She also assigned to the County her right to recover medical expenses from any party determined to be responsible for her injuries. See 42 U.S.C. 1396k(a)(1).
Citing a recent decision by the Hon. James J. Punch, Acting Supreme Court Justice in Orleans County, the County contends that it is not required to be made a party at this early stage of the litigation and that any lien or subrogation rights it may have can be resolved after trial or settlement. On that basis, Judge Punch dismissed the County of Orleans from a personal injury lawsuit.
Counsel for the plaintiff argues that in order for complete relief to be accorded to the plaintiff and other defendants, the County's right to recover benefits paid to the plaintiff and the amount of those benefits must be dealt with. There is no dispute that the insurers for the other defendants will insist that the County's right to recovery be resolved before any compensation is paid to the plaintiff, be it through settlement or verdict after trial.
Here, the County's right to recover is limited to the amount expended by the County for plaintiff's medical expenses. See Arkansas Dept. of Health and Human Services, et.al. v Ahlborn, 547 U.S.268, 126 S.Ct. 1752 [2006]. In other words, plaintiff's entire settlement or verdict may not be accessed to reimburse the County. Only the proportional amount attributed to recovery of medical expenses will be subject to the County's lien.
If plaintiff settles her case and is unable to negotiate an amount to be paid to the County, a hearing must be held to determine the proper proportional amount to be paid from the proceeds of settlement to satisfy the County's interests. Even if the plaintiff does not seek to recover expenses, as is the case here, or attempts to classify the settlement as being for pain and suffering only, the County's lien is preserved and an allocation hearing must be held. Matter of Homan v County of Cattaraugus Dept. of Social Services, 74 AD3d 1754 [4th Dept.2010].
Should this plaintiff take her case to verdict, such verdict will not include medical expenses because plaintiff has not sought to recover them. Even if the County were to perfect it's lien, it cannot be asserted against a verdict for pain and suffering only. See Ahlborn, supra. Presumably, the County would be limited to enforcing it's right of subrogation by bringing a separate lawsuit against the tortfeasors. Two separate trials would be a waste of time and resources and could result in inconsistent verdicts.
The County's position that its joinder is premature is without merit. Clearly, the County has an interest in seeing the plaintiff recover as much money as possible so that it may recoup, from the responsible tortfeasors all or part of the benefits paid to the plaintiff. The County's ability to maximize its recovery could be drastically affected by events that occur during the course of litigation. If it is not a party, the County can do nothing to preserve and enhance it's right to recovery. And even if its right to recover is contingent upon a finding of liability or the reaching of a settlement, such contingency does not act as a legal impediment to it's participation in this lawsuit.
CPLR §1001(a) provides that a person ought to be a party "if complete relief is to be accorded between the parties to the action or who might be inequitably affected by a judgment in the action. . ." In this Court's opinion both of the grounds listed in CPLR §1001(a) are applicable here.
The plaintiff will not be paid and cannot be accorded complete relief unless the County receives its proper share of proceeds and releases its right to a lien. The plaintiff's ability to be compensated, the defendant's obligation to pay, and the County's entitlement to a portion of the proceeds are all inextricably entwined. Furthermore, as pointed out previously, the County's right to share in those proceeds might be inequitably affected should it be allowed to decline to participate in the litigation.
The last of the County's concerns is that it will be forced to join every personal injury case where it has paid the plaintiff Medicaid benefits for medical expenses. This, indeed, may occur and may require the expenditure of County time and resources. But it is not a valid reason to ignore the clear mandate of the law.
For these reasons, the Court determines that the County of Erie is a necessary party to this lawsuit and the County's motion to dismiss is denied.
Plaintiff's cross-motion for summary judgment is also denied. Her contention that the County does not have a valid lien due to the anti-lien provisions of 42 U.S.C. 1396(p)(a)(1) is without merit. See Matter of Homan, supra.
Submit Order.
DATED:September 14, 2015
____________________________
Hon. Frederick J. Marshall
Justice, Supreme Court