MILLER AND MILLER CONST. CO., INC. v. Madewell

736 So. 2d 1098, 1998 Ala. Civ. App. LEXIS 403, 1998 WL 290178
CourtCourt of Civil Appeals of Alabama
DecidedJune 5, 1998
Docket2970084
StatusPublished
Cited by7 cases

This text of 736 So. 2d 1098 (MILLER AND MILLER CONST. CO., INC. v. Madewell) is published on Counsel Stack Legal Research, covering Court of Civil Appeals of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
MILLER AND MILLER CONST. CO., INC. v. Madewell, 736 So. 2d 1098, 1998 Ala. Civ. App. LEXIS 403, 1998 WL 290178 (Ala. Ct. App. 1998).

Opinion

736 So.2d 1098 (1998)

MILLER AND MILLER CONSTRUCTION COMPANY, INC.
v.
Gary Wayne MADEWELL.

No. 2970084.

Court of Civil Appeals of Alabama.

June 5, 1998.
Rehearing Denied July 24, 1998.

David M. Wilson and Nicholas W. Woodfield of Janecky, Newell, Potts, Wilson, *1099 Masterson & Smith, P.C., Birmingham, for appellant.

J. Barton Warren, Huntsville, for appellee.

YATES, Judge.

Gary Wayne Madewell sued his employer, Miller and Miller Construction Company ("Miller"), seeking workers' compensation benefits for injuries he sustained on November 10, 1994, during the course of his employment. Madewell also asserted a products liability claim against various third-party defendants. Madewell subsequently settled the products liability claim against the third-party defendants for $400,000. The third-party defendants were dismissed with prejudice, pursuant to a pro tanto release.

Thereafter, Madewell moved for a summary judgment, contending that under § 25-5-77, Ala.Code 1975, he was entitled to future medical expenses from Miller. Miller also moved for a summary judgment, contending that it should not be responsible for Madewell's future medical expenses until he had exhausted the proceeds he had received from the third-party defendants. On June 3, 1997, the court, relying on Bussen v. BE&K Construction Co., 728 So.2d 617 (Ala.Civ.App.1997),[1] entered a summary judgment in favor of Madewell. The court still had before it the issues of loss of earning capacity and permanent partial disability. Following ore tenus proceedings, the court, on September 15, 1997, entered an order finding, among other things, that Miller had paid Madewell $4,138 in temporary total disability benefits and had paid $20,494.05 for medical expenses incurred by Madewell. The court recognized that Miller's subrogation claim totaled $24,632.05 and entered a judgment accordingly. Miller appeals.

The sole issue is whether the court erred in entering a summary judgment in favor of Madewell on his claim for future medical benefits. Miller has provided this court with an excellent brief; it argues that this court should reconsider its ruling in Bussen. In Bussen, this court was faced with the question whether an employer is entitled, under § 25-5-11(a), Ala. Code 1975, to subrogation of future medical expenses not yet incurred by an employee, where the employee has received a settlement from a third-party tortfeasor in an amount that exceeds the compensation payable under the Workers' Compensation Act. Section 25-5-11(a) permits an employee to proceed against his employer for compensation benefits and, at the same time, to proceed against any other party who may also be liable for the employee's injuries. Section 25-5-11(a) states, in part:

"(a) ... If the injured employee ... recovers damages against the other party, the amount of the damages recovered and collected shall be credited upon the liability of the employer for compensation. If the damages recovered and collected are in excess of the compensation payable under this chapter, there shall be no further liability on the employer to pay compensation on account of the injury or death. To the extent of the recovery of damages against the other party, the employer shall be entitled to reimbursement for the amount of the compensation theretofore paid on account of injury or death.... For purposes of this amendatory act, the employer shall be entitled to subrogation for medical and vocational benefits expended by the employer on behalf of the employee...."

Section 25-5-11(e) provides:

"(e) In a settlement made under this section with a third party by the employee... the employer shall be liable for that part of the attorney's fees incurred in the settlement with the third party ... in the same proportion that the amount of the reduction in the employer's liability to pay compensation *1100 bears to the total recovery had from the third party. For purposes of the subrogation provisions of this subsection only, `compensation' includes medical expenses, as defined in Section 25-5-77, if and only if the employer is entitled to subrogation for medical expenses under subsection (a) of this section."

In Bussen, which I authored, I expressed the opinion that an employer's liability for an employee's future medical expenses is not terminated by the employee's settlement with a third-party tortfeasor, stating:

"Section 25-5-11(a) relieves an employer from its obligation of making further compensation payments when an employee recovers damages from a third-party action that are in excess of the amount of compensation payable under the Act. `Compensation' refers to compensation as defined in § 25-5-1(1) and not the expanded definition of `compensation' found in § 25-5-11(e), which includes medical expenses. The definition of `compensation' found in § 25-5-11(e) is expressly limited to that subsection. Therefore, § 25-5-11(a) does not terminate the employee's right to the payment of future medical benefits when he has recovered damages from a third-party action that are in excess of the compensation payable under the Act. The legislature's refusal to expand the definition of `compensation' for purposes of § 25-5-11(a) indicates an intent not to terminate an employee's right to future medical benefits when he recovers third-party damages that exceed the amount of compensation payable under the Act."

728 So.2d at 619. Bussen was further premised on the fact that the Act speaks in terms of past payments and not in terms of future payments. Based on my interpretation of the statute and on basic principles of subrogation, I wrote, "An employer's right to reimbursement for medical benefits expended on behalf of the employee... does not accrue until the employer has actually expended, or paid out, those medical benefits on the employee's behalf." Id., at 620.

The holding in Bussen should not in any way be construed or interpreted to mean that the employer's right to subrogation or reimbursement for medical expenses that it has paid on behalf of an employee is limited to only those expenses incurred through the date of the third-party recovery by the employee.

As Judge Crawley pointed out in his dissent in Bussen, the problem created by the statute is whether the employer will be able to collect, at a later date, money it has expended on behalf of the employee. "Upon receipt from the third party and after payment to the insurer of an amount for `benefits expended,' the balance of the proceeds of a third-party recovery will be paid to the worker, who may or may not reserve a sufficient amount to reimburse the insurer for future expenses." 728 So.2d at 621 (Crawley, J., dissenting). Judge Crawley argued that this court should allow the insurer to withhold or suspend payment of medical benefits "until the amount of such benefit payments equals the balance of the third-party recovery, at which time the insurer would resume payment of the appropriate benefits." Id., at 621. This would require the employee to exhaust portions of his third-party recovery, which could have been compensation for injuries or damages sustained that are not contemplated by the Act, such as past and present physical pain and suffering and mental anguish.

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Bluebook (online)
736 So. 2d 1098, 1998 Ala. Civ. App. LEXIS 403, 1998 WL 290178, Counsel Stack Legal Research, https://law.counselstack.com/opinion/miller-and-miller-const-co-inc-v-madewell-alacivapp-1998.