Cincinnati Bell Telephone Co. v. Straley

533 N.E.2d 764, 40 Ohio St. 3d 372, 1988 Ohio LEXIS 485
CourtOhio Supreme Court
DecidedDecember 30, 1988
DocketNos. 88-95, 88-114, 88-169, 88-217 and 88-268
StatusPublished
Cited by30 cases

This text of 533 N.E.2d 764 (Cincinnati Bell Telephone Co. v. Straley) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cincinnati Bell Telephone Co. v. Straley, 533 N.E.2d 764, 40 Ohio St. 3d 372, 1988 Ohio LEXIS 485 (Ohio 1988).

Opinions

Locher, J.

The primary issue presented in these actions is whether a self-insured employer under the workers’ compensation laws which has paid medical expenses and other related workers’ compensation bene[376]*376fits to an injured employee may recover damages against a third party who negligently caused the injury to the employee in the absence of any legal relationship based on contract or warranty between the employer and the third party. For the following reasons we hold in the negative and, accordingly, enter the appropriate judgments.

I

This issue has been before this court in one form or another on several occasions and produced mixed results. Today we seek to clarify our position on this issue under various circumstances.

Our most recent pronouncement in this area of the law was made in Ledex, Inc. v. Heatbath Corp., supra. In Ledex, an employee of Ledex, Inc. sustained acid burns when he slipped and fell into a chemical that had leaked from its container onto the floor of the work premises. Ledex, Inc. had purchased the chemical from Heatbath Corporation. The employee filed for and was awarded workers’ compensation benefits. Ledex, Inc. was a state fund employer under the workers’ compensation laws and, as a result of the above accident, experienced an increase in workers’ compensation premiums. Ledex, Inc. filed an action against Heatbath Corporation, seeking damages which included $18,025 as attributable to increased workers’ compensation premiums. The lower courts rejected the claim by Ledex, Inc. that it could recover those damages attributable to increased workers’ compensation premiums.

This court reversed and held in the syllabus that:

“R.C. 4123.82 does not bar an employer whose employee suffers injuries and recovers workers’ compensation therefor from recovering damages for increased workers’ compensation premiums from a third party whose conduct caused the employee’s injuries. (Fischer Constr. Co. v. Stroud, 175 Ohio St. 31 [23 O.O. 2d 309], overruled; Midvale Coal Co. v. Cardox Corp., 152 Ohio St. 437 [40 O.O. 428], reinstated.)”

The Ledex holding was reached as a result of this court’s review of its prior decisions in Truscon Steel Co. v. Trumbull Cliffs Furnace Co. (1929), 120 Ohio St. 394, 166 N.E. 368; Midvale Coal Co. v. Cardox Corp. (1949), 152 Ohio St. 437, 40 O.O. 428, 89 N.E. 2d 673; and Fischer Constr. Co. v. Stroud (1963), 175 Ohio St. 31, 23 O.O. 2d 309, 191 N.E. 2d 164.

In Truscon, a self-insured employer sought to recover workers’ compensation benefits paid to its injured employee from the independent contractor whose employees’ negligence caused the injuries to the employer’s employee. The claim was based solely on the negligence of the independent contractor’s employees. This court concluded that the employer had no cause of action against the independent contractor and stated in the first paragraph of the syllabus that “[a]n employer, whether self-insurer or otherwise, cannot recover from any source any sum to reimburse an amount paid under the Workmen’s Compensation Law to injured employees, whether the injury results from the negligence of some third party or otherwise.” The Truscon court placed great emphasis on the fact that “[n]o statute is cited in support of the claim that the cause of action exists.” Id. at 397, 166 N.E. at 368. The court also reasoned that G.C. 1465-101, the predecessor of R.C. 4123.82, indicated the legislature’s intent “to prevent the reimbursement of the employer for any amount paid pursuant to the provisions of the Workmen’s Compensation [377]*377Act to an injured employee.” Id. at 397-398, 166 N.E. at 369.

Midvale Coal Co., supra, involved an action filed by an employer whose employee was injured in a coal mining accident by a defective explosive cartridge supplied by a third party. The employee filed an application for workers’ compensation and the claim was allowed. As a result, the employer’s workers’ compensation premiums increased. The employer subsequently sought to recover the amount of the increased premiums from the third-party supplier. The lower courts ruled against the employer, but this court reversed, holding in a four-paragraph syllabus that:

“1. Section 1465-101, General Code, was enacted to prevent competition with the state insurance fund and is not applicable to a contract which does not constitute an agreement which undertakes to indemnify or insure an employer against loss or liability for the payment of compensation to workmen or their dependents.

“2. Damages which are incidentally suffered by an employer because of the negligent act of a third party tortfeasor toward such employer’s employee are ordinarily considered too remote to be recoverable against such third party by the employer.

“3. Where a third party negligently injures an employer’s employee and such injury is a direct result of a breach of contract which the third party had with employee’s employer, and as a direct result of such breach the employer suffers damages, such damages are recoverable by the employer against the third party in an action for breach of contract.

“4. Ordinarily a double recovery against a single wrongdoer for the same injury is not permitted, but the double recovery doctrine is not applicable where a single act caused a breach of two duties, one in contract and one in tort.”

The Midvale court distinguished its holding from Truscon based on the differing facts in the two cases:

“In the Truscon case, the injury to the employee was caused by the negligence of a third party. The injury was to the employee and not the employer. The third parfy had a duty to the employee not to negligently injure him but that duty was not owed to the employer. In the instant case, while the act of defendant was a negligent act with reference to plaintiff’s employee, and, therefore, such employee could have an action against defendant for negligence, defendant also breached a duty it owed to plaintiff in that the injury to plaintiff’s employee was not only an act of negligence toward plaintiff’s employee but was a breach of contract with reference to plaintiff.” Id. at 444-445, 40 O.O. at 432, 89 N.E. 2d at 677.

In Fischer, supra, an employer sought to recover the amount of increased workers’ compensation benefits from a third parfy whose agent’s negligence had caused the death of an employee of the employer. The lower courts denied recovery and this court affirmed. The Fischer syllabus stated:

“An employer cannot recover from any source any sum to reimburse him for an increased amount paid as a premium under the Workmen’s Compensation Act due to the death of an employee, although such death was caused by the act of a third party. (Truscon Steel Co. v. Trumbull Cliffs Furnace Co. * * *, approved and followed; Midvale Coal Co. v. Cardox Corp. * * *, overruled.)”

The Fischer court relied upon the determination of the Truscon court at 397-398, 166 N.E. at 369, that R.C. 4123.82 (formerly G.C. 1465-101) indicated the legislature’s intent “to pre[378]*378vent the reimbursement of the employer for any amount paid pursuant to the provisions of the Workmen’s Compensation Act to an injured employee.” Fischer also determined that Midvale

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Cite This Page — Counsel Stack

Bluebook (online)
533 N.E.2d 764, 40 Ohio St. 3d 372, 1988 Ohio LEXIS 485, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cincinnati-bell-telephone-co-v-straley-ohio-1988.