Lozano v. GTE Lenkurt, Inc.

920 P.2d 1057, 122 N.M. 103
CourtNew Mexico Court of Appeals
DecidedJune 20, 1996
Docket15803
StatusPublished
Cited by23 cases

This text of 920 P.2d 1057 (Lozano v. GTE Lenkurt, Inc.) is published on Counsel Stack Legal Research, covering New Mexico Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lozano v. GTE Lenkurt, Inc., 920 P.2d 1057, 122 N.M. 103 (N.M. Ct. App. 1996).

Opinion

OPINION

FLORES, Judge.

1. Plaintiffs-Appellants Debbie Gonzales and Sylvia Sena (Appellants) appeal the district court’s adoption of a special master’s report which recommends the disbursement of a $2 million third-party settlement among 225 plaintiffs, their attorneys, and their workers’ compensation carrier. Appellants raise five issues on appeal: (1) whether the district court erred in adopting the special master’s report; (2) whether the district court erred in failing to order an accounting of expenditures from two trust accounts administered by their attorneys before it adopted the special master’s report and entered a judgment allocating the proposed Dow Chemical Company (Dow) settlement; (3) whether the district court’s allocation of the Dow settlement among the plaintiffs was arbitrary and capricious; (4) whether the district court erred in allocating additional reimbursement to GTE Lenkurt, Inc. (GTE); and (5) whether the district court erred in awarding $800,000 in attorney fees from the Dow settlement.

2. GTE contests all but the last issue and raises as an additional issue whether this appeal should be dismissed because Appellants have failed to join necessary and indispensable parties. We reverse on the “accounting” issue and remand with instructions for the district court to order an accounting of disbursements from the GTE medical trust fund and from the Shell/DuPont settlement fund and to determine, based on that accounting, whether to award or withhold attorney fees. We affirm the judgment of the district court as to all other issues.

FACTS

3. Appellants Sylvia Sena and Debbie Gonzales were employees of GTE from 1974 to 1985 and from 1976 to 1982, respectively. They were 2 of 123 workers on whose behalf attorney Josephine Rohr filed individual occupational disease and disablement (ODD) claims in the mid-1980s. In 1985, all the claims against GTE arising from exposure to toxic chemicals were consolidated. During the course of the ODD cases, Ms. Rohr associated with other attorneys, including the Maloney Law Firm from San Antonio, Texas. In 1987, 115 of the original plaintiffs settled their claims for a lump-sum payment of $2.5 million.

4. The $2.5 million settlement was distributed in the following manner: (1) $1.2 million was paid to the workers in compensation benefits; (2) GTE placed $800,000 in a medical trust fund for payment of past and future medical expenses of the workers, to be administered by Ms. Rohr; and (3) $500,000 was paid in attorney fees and costs.

5. In September 1987 the 115 workers in the ODD cases were joined by an additional 110 employees of GTE and, together they filed a third-party products liability action against the chemical companies that manufactured the chemicals used in the GTE plant. These companies included DuPont Chemical Company (DuPont), Shell Chemical Company (Shell), Dow, and other chemical manufacturers. Ms. Rohr and her associates represented all the plaintiffs.

6. In 1990 DuPont settled with the plaintiffs for $1.5 million and Shell settled with the plaintiffs for $3 million. The settlement monies were distributed as follows: (1) $410,-000 was paid to GTE in accordance with GTE’s reimbursement right; (2) $1,192,500 was distributed to the plaintiffs at the rate of $5,300 per worker; (3) $1.8 million or forty percent of the settlement as specified in the contingency agreement between the plaintiffs and their attorneys, was allocated as attorney fees; and (4) $1,097,500 was paid to the Maloney Law Firm as reimbursement for costs advanced during the course of litigation. One million dollars of the attorney fees was placed in an escrow account to be used in litigation against Dow. The plaintiffs also contributed part of their payments from the Shell/DuPont settlement to fund the Dow litigation.

7. In January and February of 1992 a test case including thirteen of the plaintiffs in the third-party action against Dow was tried to a jury and a verdict was returned in favor of Dow. Subsequently, Dow settled with all the plaintiffs for $2 million.

8. The plaintiffs, GTE, and the attorneys could not agree on a distribution plan for the settlement monies. Therefore, Judge Frank Zinn was appointed as neutral mediator and special master in accordance with SCRA 1986, LR2-602 (Repl.1994) and SCRA 1986, 1-053 (Repl.1992). Two settlement conferences and a one-day hearing were held. On December 17, 1993, the special master made the following recommendations for distribution of the $2 million Dow settlement: (1) $300,000 to GTE as reimbursement for the monies paid to settle claims in the ODD action, which amount was to come out of the monies disbursed to the 115 workers who participated in the ODD action; (2) $900,000 to be disbursed to the plaintiffs according to years worked, weighted so no plaintiff would receive less than $500; each plaintiff would receive $785.34 for each year worked; the 115 workers that participated in the ODD action would have their share proportionately reduced to reimburse GTE; and (3) $800,000 to be awarded to the plaintiffs’ attorneys in the third-party action. Also, it appears that $500 was paid to each of fifty children of the plaintiffs (to be matched by Dow).

9. On June 29, 1994, after a two-day hearing on objections to the special master’s report, the district court entered a judgment adopting the report and ordering the $2 million settlement to be distributed pursuant to the recommendation of the special master.

DISCUSSION

I. Nonjoinder of Other Interested Persons Not Fatal to Appeal

10. Initially, we address GTE’s argument that this appeal should be dismissed. More specifically, GTE urges this Court to dismiss this appeal because Appellants did not join the 223 other plaintiffs and then-attorneys. In support of its position, GTE relies on authority that applies Federal Rule of Civil Procedure 19 or its state law equivalent. However, Federal Rule 19 as well as our state rule, see SCRA 1986, 1-001, -019 (Repl.1992), address mandatory joinder of parties in causes of action at the trial level and do not apply to cases on appeal.

11. Our Rules of Appellate Procedure require service of the notice of appeal on “trial counsel of record for each party other than the appellant.” SCRA 1986, 12-202(D)(3) (Cum.Supp.1995). Appellants complied with this rule. Also, interested parties may join an appeal, but our rules do not require the present appeal to be dismissed because the attorneys and other plaintiffs were not joined. See SCRA 1986, 12-202(F)(1). Neither is there any statutory support for GTE’s argument. NMSA 1978, Section 39-3-16 (Repl.Pamp.1991), states that “[i]f there are several parties entitled to ... take an appeal and any of them have separate interests in the judgment ... it is not necessary to join these parties in the ... appeal.”

12. After a party or other interested person has been notified of an appeal, the decision whether to join in the appeal is left to them. See, e.g., State ex rel. Sweet v. Village of Jemez Springs, Inc. City Council, 114 N.M. 297, 303, 837 P.2d 1380

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Bluebook (online)
920 P.2d 1057, 122 N.M. 103, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lozano-v-gte-lenkurt-inc-nmctapp-1996.