Frazier v. Workers' Compensation Appeal Board

52 A.3d 241, 616 Pa. 592, 2012 WL 4465855, 2012 Pa. LEXIS 2260
CourtSupreme Court of Pennsylvania
DecidedSeptember 28, 2012
StatusPublished
Cited by59 cases

This text of 52 A.3d 241 (Frazier v. Workers' Compensation Appeal Board) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Frazier v. Workers' Compensation Appeal Board, 52 A.3d 241, 616 Pa. 592, 2012 WL 4465855, 2012 Pa. LEXIS 2260 (Pa. 2012).

Opinion

[243]*243 OPINION

Justice BAER.1

In July, 1993, the General Assembly significantly amended the Workers’ Compensation Act2 with sweeping legislation known commonly as Act 44.3 A portion of Act 44, namely Section 23, provides as follows:

The Commonwealth, its political subdivisions, their officials and employees acting within the scope of their duties shall enjoy and benefit from sovereign and official immunity from claims of subro-gation or reimbursement from a claimant’s tort recovery -with respect to workers’ compensation benefits.

We granted allowance of appeal in this case to determine whether the immunity provisions of Section 23 of Act 44 apply to “subrogation and/or reimbursement claims sought against an employee who has entered into a third[-]party settlement with a Commonwealth [p]arty such as Southeastern Pennsylvania Transportation Authority (‘SEPTA’).” Frazier v. WCAB (Bayada Nurses, Inc.), 607 Pa. 373, 6 A.3d 1288 (2010) (per curiam). For the reasons that follow, we hold that the portion of Section 23 of Act 44, which provides that government shall “benefit from sovereign and official immunity from claims of subrogation or reimbursement from a claimant’s tort recovery,” bars any claim made by the employer, Bayada Nurses, Inc., for the recoupment of workers’ compensation benefits it paid in this case. Accordingly, we reverse the order of the Commonwealth Court.

On March 1, 2005, Lillian Frazier (Claimant) fractured her right ankle when a SEPTA-operated bus, on which she was a passenger, was involved in a motor vehicle accident. At the time of the accident, Claimant was employed by Appellee, Ba-yada Nurses, Inc., and the accident occurred in the course and scope of Claimant’s employment with Bayada Nurses. Accordingly, Claimant filed a claim for workers’ compensation, which was ultimately granted by a workers’ compensation judge.

Thereafter, on May 11, 2006, Claimant filed a third-party lawsuit against SEPTA, contending that it was liable for the injuries she sustained in the bus accident. During the pendency of that action, Baya-da Nurses’ workers’ compensation insurer, Specialty Risk Services, Inc.,4 filed notice of its intent to recoup the benefits it paid to Claimant from any award received from the third-party lawsuit pursuant to Section 319 of the Workers’ Compensation Act, as codified 77 P.S. § 671 (hereinafter, “Section 319”).5 Eventually, on July 26, 2007, [244]*244Claimant settled her lawsuit with SEPTA for $75,000. As part of the settlement, SEPTA agreed that it would “defend, indemnify and hold Claimant harmless with respect to any claim, suit, petition or other action brought against Claimant ... for payment of [the] workers’ compensation lien” filed by Bayada Nurses. Settlement Agreement between Claimant and SEPTA, Jul. 26, 2007 at 1, found at Reproduced Record (R.R.) 13a. Bayada Nurses filed a claim petition and asserted its Section 319 rights in the amount of $47,351.93, which equaled the amount of workers’ compensation benefits Bayada Nurses had paid Claimant up to the time of the settlement agreement. Claimant opposed the petition, claiming that Bayada Nurses was attempting to collect from money paid to Claimant by SEPTA and that SEPTA was immune from claims of subrogation or reimbursement from a claimant’s tort recovery with respect to workers’ compensation benefits under Section 23 of Act 44.

The workers’ compensation judge (WCJ) presiding over the claim petition agreed with Claimant, finding that the immunity provided by Section 23 applies both to subrogation claims asserted by an employer against a governmental entity and reimbursement from settlement proceeds a government party pays to an injured employee. Otherwise, according to the WCJ, the immunity provisions would be rendered useless.

Bayada Nurses appealed to the Workers’ Compensation Appeal Board (WCAB), which reversed, holding that Section 23, along with the sovereign, political subdivision, and official immunity provisions contained within the Judicial Code only extend to direct actions for recovery against a governmental entity. As Bayada Nurses’ claim petition, in the WCAB’s view, did not equate to a direct suit between an individual and a governmental entity, it opined that Section 23 was not applicable to the lien filed by Bayada Nurses.

Claimant appealed to the Commonwealth Court, a panel of which affirmed in an unpublished decision. The panel noted that it had recently decided Fox v. WCAB (PECO Energy Co.), 969 A.2d 11 (Pa.Cmwlth.2009), which, in the panel’s view, concerned the identical issue presented by Claimant, namely, whether Section 23 barred a claim for subrogation or reimbursement by Bayada Nurses against settlement proceeds paid by SEPTA to Claimant. In Fox, an employee of the PECO Energy Company sustained an ankle injury in the course of his employment, and subsequently sued the City of Philadelphia for damages related thereto. The employee and City reached a settlement agreement for $150,000 that included an indemnification clause identical to the one presented in this case. When PECO attempted to subrogate against, or recover reimbursement from, the settlement, the [245]*245employee averred that Section 23 barred the claim. The Commonwealth Court rejected the employee’s contention, noting that Section 319 provides for an absolute and automatic right to subrogation. Id. at 13 (citing Thompson v. WCAB (USF & G Co.), 566 Pa. 420, 781 A.2d 1146 (2001)). With that background, the Commonwealth Court in Fox further expounded: “Because [PECO] is seeking subrogation from [the employee] for the $150,000 he received from the City, not from the City itself, Section 23 of Act 44 does not foreclose [PECO] from enforcing its Section 319 ... reimbursement rights.” Id. at 14.

Through this appeal, Claimant attempted to have the Commonwealth Court revisit the Fox decision, contending that if she were required to reimburse Bayada Nurses from the settlement proceeds, “she would be merely a conduit for money passing from SEPTA to [Bayada Nurses], which Section 23 forbids.” Frazier v. WCAB (Bayada Nurses), Docket No. 905 C.D.2009, Mem. Op. at 4, 2009 WL 8658374 (Pa.Cmwlth., Sept. 17, 2009). The Commonwealth Court disagreed, declined to revisit Fox, found the decision therein controlling, and accordingly affirmed the decision of the WCAB. Claimant subsequently filed a petition for allowance of appeal with this Court, which we granted. See supra p. 2.

This case concerns the interpretation of two pieces of legislation: Section 319 of the Workers’ Compensation Act and Section 23 of Act 44. As statutory interpretation implicates a pure question of law, this Court’s standard of review is de novo and scope of review is plenary. Dep’t of Labor & Indus. v. WCAB (Crawford & Co.), 611 Pa. 10, 23 A.3d 511, 514 (2011).

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Cite This Page — Counsel Stack

Bluebook (online)
52 A.3d 241, 616 Pa. 592, 2012 WL 4465855, 2012 Pa. LEXIS 2260, Counsel Stack Legal Research, https://law.counselstack.com/opinion/frazier-v-workers-compensation-appeal-board-pa-2012.