Taylor v. Delgarno Transportation, Inc.

OPINION

RIORDAN, Justice.

This matter is before this Court through a certification from the United States District Court for the District of New Mexico, Honorable Edwin L. Mechem, District Judge, pursuant to Section 34-2-8, N.M.S. A.1978 (Repl.Pamp.1981).' The issue certified which is of first impression in New Mexico’s law, is as follows:

Where the workman has obtained a verdict against third party tortfeasors for a work related injury and the verdict, under comparative fault principles, includes a determination that the employer is at fault and such fault is a proximate cause of the workman’s injury,

(1) does such determination reduce or affect the employer’s right to be reimbursed for amounts paid in compensation and medical benefits? and, if so;

(2) in what amount, assuming that an allocation of damages in proportion to the employer’s percentage of fault exceeds the amounts paid by the employer?

Billy Thomas Taylor (Taylor) was employed by Inland Drilling Company (Inland). Taylor was employed as a driller at a carbon dioxide drilling rig. On June 25, 1980, Inland made the decision to move the drilling rig to another site. Inland employed Delgarno Transportation, Inc. (Delgarno) to move the rig. Taylor was preparing the rig for moving, when a Delgarno driver hooked a winch line onto the hoisting line which moved the “doghouse” forward. The movement of the “doghouse” released the floor plate which Taylor was lying on, and Taylor fell into a water tank below him. The “doghouse” which weighed several tons, fell on top of Taylor.

Taylor brought a cause of action against Delgarno for negligence and causes of action against BMS Industries, Inc. (BMS) and Cooper Manufacturing Corporation (Cooper) for products liability, negligence in design and failure to warn of dangers of a “water tank-doghouse” unit. Inland had purchased the transportable “water tank-doghouse” unit from Cooper which was originally manufactured by BMS.

On July 16, 1982, Cooper settled with Taylor for $30,000.00. On July 26, 1982, this matter came to trial and on August 10, 1982, the jury reached its decision. The jury found damages in the amount of $1,400,000.00 and apportioned the negligence as 50% to Delgarno, 35% to BMS, 10% to Inland, 5% to Taylor and 0% to Cooper. However, on October 18, 1982, Taylor agreed to settle his claim with Delgarno for $510,000.00, in spite of the award.

The United States District Court has not entered judgment on the verdict, and instead has certified the issue of whether Inland’s insurer is entitled to reimbursement for the $61,279.04 of workmen’s compensation paid to Taylor. We hold that Inland’s insurer is entitled to reimbursement in full for the workmen’s compensation paid to Taylor.

The pertinent part of Section 52-1-8, N.M.S.A.1978, states that:

Any employer who has complied with the provisions of the Workmen’s Compensation Act [52-1-1 to 52-1-69 NMSA 1978] relating to insurance, or any of the employees of the employer, including management and supervisory employees, shall not be subject to any other liability whatsoever for the death of or personal injury to any employee, except as provided in the Workmen’s Compensation Act, and all causes of action, actions at law, suits in equity and proceedings whatever, and all statutory and common-law rights and remedies for and on account of ... personal injury to, any such employee * * are hereby abolished except as provided in the Workmen’s Compensation Act. [Emphasis added.]

In Roseberry v. Phillips Petroleum Company, 70 N.M. 19, 21, 369 P.2d 403, 405 (1962), we interpreted the above statutory language by stating that:

It expressly limits the liability of the employer and abolishes all rights and remedies of every person whomsoever against the employer except as provided by the Act. The basis upon which the Workmen’s Compensation law rests is that it imposes upon the employer an absolute, though limited, liability, not based upon the principle of tort but upon compensation to the injured employee regardless of fault. * * * [Emphasis added.]

See also Beal v. Southern Union Gas Company, 62 N.M. 38, 304 P.2d 566 (1956).

Roseberry v. Phillips Petroleum Company, supra, further states that:

Our statutes could scarcely be more explicit in abolishing every statutory or common-law right or remedy against the employer not provided by the Workmen’s Compensation Act, accruing to any person whomsoever, which arises by reason of such injury. [Emphasis added.]

Id. 70 N.M. at 22, 369 P.2d at 405.

Therefore, New Mexico’s Workmen’s Compensation Act (Act), Sections 52-1-1 through 52-1-69, N.M.S.A.1978 (Orig.Pamp. and Cum.Supp.1982), does not look to the fault of an employer. Instead, the employer is liable to the employee for compensation if the conditions of Section 52-1-9, are met.

However, an injured employee may sue a third party, other than the employer or an employee of the employer, for negligence in causing the injured employee’s accident. § 52-1-56. If the injured employee recovers in a third-party suit, then Section 52-1-56 provides a right of reimbursement for benefits received under the Act out of the judgment in the third party action. Castro v. Bass, 74 N.M. 254, 392 P.2d 668 (1964); Reed v. Styron, 69 N.M. 262, 365 P.2d 912 (1961). The intent of Section 52-1-56, is to prevent dual recovery. Brown v. Arapahoe Drilling Company, 70 N.M. 99, 370 P.2d 816 (1962).

In Royal Indem. Co. v. Southern Cal. Petroleum Corp., 67 N.M. 137, 353 P.2d 358 (1960), we dealt with the issue of whether an employer whose negligence concurred with a third party in causing an employee’s injury, barred the employer’s insurer from reimbursement for compensation paid under the Act. Royal held that the Act was the employee’s exclusive remedy regardless of employer’s negligence. The Act specifically grants a right of reimbursement for benefits paid if a third-party claim is successful. Therefore, in Royal, the employer’s insurer was entitled to reimbursement for the compensation paid.

Royal was decided under the prior New Mexico law of contributory negligence. In Scott v. Rizzo, 96 N.M. 682, 634 P.2d 1234 (1981), the contributory negligence concept for New Mexico was abolished and the doctrine of “pure” comparative negligence was adopted. And, in Bartlett v. New Mexico Welding Supply, Inc., 98 N.M. 152, 646 P.2d 579 (Ct.App.), cert. denied, 98 N.M. 336, 648 P.2d 794 (1982), joint and several liability was held not to be retained by the adoption of “pure” comparative negligence. We denied certiorari in the Bartlett case; however, we specifically recognize and affirm the holding of the Court of Appeals in Bartlett.

Taylor asserts that Bartlett and Scott have affected the right to reimbursement under the Act. Taylor urges us to follow the California approach. Associated Const. v. Workers’ Compensation, 22 Cal.3d 829, 150 Cal.Rptr. 888, 587 P.2d 684 (1978), holds that when an issue of an employer’s concurrent negligence arises in regard to a third-party claim, the employer’s degree of fault is determined, as well as the total damages to which the employee is entitled. Then, the employer’s credit for paid workmen’s compensation benefits would be denied if the employer’s paid benefits do not reach the employer’s proportionate share of fault. If the workman’s compensation benefits already paid exceed the employer’s proportionate share, then the excess amount is reimbursed to the employer.

The California Court has also adopted “pure” comparative negligence, Li v. Yellow Cab Company of California, 13 Cal.3d 804, 119 Cal.Rptr. 858, 532 P.2d 1226 (1975), but has retained the doctrine of joint and several liability, American Motorcycle Ass’n v. Superior Court, 20 Cal.3d 578, 146 Cal.Rptr. 182, 578 P.2d 899 (1978). However, California’s Workmen’s Compensation statutes and case law are different than New Mexico’s.

Witt v. Jackson, 57 Cal.2d 57, 17 Cal.Rptr. 369, 366 P.2d 641 (1961), which was decided under California’s prior contributory negligence rule, dealt with an issue similar to that presented in Royal Indem. Co. v. Southern Cal. Petroleum Corp., supra. The California Supreme Court in following a different approach, held that there was nothing in their Workmen’s Compensation Code to suggest that a negligent employer could take advantage of the reimbursement provision. Therefore, in the absence of express terms to the contrary, the workman’s compensation provision is qualified by the California civil code section which provides that “No one can take advantage of his own wrong.” Id. 57 Cal.2d at 72, 17 Cal.Rptr. at 377, 366 P.2d at 649. Thus, whether an action is brought by the employer or the employee, the third-party tortfeasor should be able to invoke the concurrent negligence of the employer to defeat its right to reimbursement. Therefore, under California’s statutory law, a negligent employer could not recover already paid workmen’s compensation benefits from the amount a third party paid to the injured employee. Since the employee was not allowed dual recovery, the injured employee’s damages were reduced by the amount of compensation already received.

Thereafter, the California Supreme Court in Associated Const. v. Worker’s Compensation, supra, only modified the Witt decision in terms of comparative negligence, while keeping the Witt decision’s central objectives intact.

Because California’s Workmen’s Compensation case law and statutes are different than New Mexico’s, we do not find this as persuasive authority to change our prior holdings under Royal and Roseberry, now that New Mexico has adopted “pure” comparative negligence.

New Mexico’s Workmen’s Compensation statutes are to be construed liberally in favor of the workman. Glover v. Sherman Power Tongs, 94 N.M. 587, 613 P.2d 729 (Ct.App.), cert. denied, 94 N.M. 675, 615 P.2d 992 (1980); Transport Indemnity Company v. Garcia, 89 N.M. 342, 552 P.2d 473 (Ct.App.), cert. denied, 90 N.M. 9, 558 P.2d 621 (1976). However, provisions of the Act may not be disregarded in the name of a liberal construction. Transport Indemnity Company v. Garcia, supra.

New Mexico’s Workmen’s Compensation Act provides that the employer shall not be subject to any other liability than stated in the Act and that all common law and statutory rights and remedies are abolished as provided in the Act. § 52-1-8. The Act also provides that the employer is entitled to reimbursement for compensation paid out if the employee recovers from a third party. § 52-1-56. Although a jury may apportion liability to an employer under the “pure” comparative negligence standard, none of this apportioned negligence shall reduce the employer’s right of reimbursement, regardless of the jury’s finding.

Although Taylor’s argument deserves consideration to reach the result he desires, we would have to either ignore the Act or hold a portion of the Act unconstitutional in addition to overruling numerous prior New Mexico cases. This is for the Legislature to do and not the courts.

Therefore, we hold that Inland’s insurer is entitled to reimbursement for workmen’s compensation benefits paid to Taylor. § 52-1-56. Because “pure” comparative negligence principles do not effect an employer’s insurer’s right of reimbursement, part (2) under the certified question need not be answered,

jrp jg gQ ORDERED

FEDERICI and STOWERS, JJ., concur. PAYNE, C.J., and SOSA, Senior Justice, respectfully dissent.