Mesothelioma Law Suit Runs Into Problems Due to Plaintiff's Failure to Notify Insurance Company of Settlement*



Summary:

This is a review of a mesothelioma law suit appeal. The main issue of the appeal was the lower court's decision to bar the wife of a deceased and formerly injured man from receiving workers' compensation death benefits after the woman, on behalf of her husband's estate, settled a lawsuit with a third party.

Normally, a person can receive both workers' compensation and an award from a settlement with a third party for the same injury, but there are certain rules that apply. The plaintiff in this case had inadvertently violated one of those rules, namely the requirement that the person receiving the benefits must get the consent of the court or the insurance company to the settle with the third party within three months of the agreement.

The woman, distraught with her husband's death, had failed to make the proper notifications and the lower court had ruled she was no longer eligible to receive her husband's benefits. She and her attorney appealed the case, citing her emotional distress at the time of the infraction.

Statement of Facts...

In 2009 Greg Lauter commenced a mesothelioma law suit against Catstate Properties LDT and BQ Orange Industries seeking damages for injuries he sustained from the inhalation of asbestos. At the same time, he also filed a disability claim for workers compensation benefits with DOL Insurance Company. When he died several months later in 2010 from complications from mesothelioma lung cancer, his wife pursued both cases on his behalf.

Greg Lauter began working at BQ Orange in 1998. His job duties included pipe fitting and welding. The building in which he was employed was built in 1972 and at the time of its construction was owned by Catstate. During his employment at Orange, Lauter was unknowingly exposed to the asbestos used during the building's construction.

Beginning in 2006, Lauter began to suffer shortness of breath and a general weakness. His limbs also began to ache and he complained often of flu like symptoms. Over the next few years his condition worsened until in 2008 he was too weak to work any longer. At about that time Lauter was diagnosed with mesothelioma lung cancer.

In 2009 Lauter filed suit against Catstate for personal injuries he sustained as a result of the asbestos he inhaled. Once he died, his wife Leigh modified the original petition to include a claim for Lauter's wrongful death. Lauter also sued Orange for workers' compensation benefits.

Four months into the lawsuit, Leigh Lauter entered into settlement negotiations with Catstate. Eventually Calstate and Lauter came to a settlement agreement in the full amount of $750,000. Lauter continued to press on with her husband's workers' compensation claim against Orange and the DOL Insurance Company. Lauter never notified either Orange or DOL of her settlement with Calstate.

Upon learning of the settlement in the mesothelioma law suit between Lauter and Catstate, DOL filed an intervening petition in the suit requesting that the workers' compensation benefits presently being paid to Lauter's estate be suspended.

In support of their request, DOL cited the provisions of workers' compensation law which provided that a plaintiff may settle a third party lawsuit arising out of the same conditions which were alleged to have caused the injury only if the injured party notified the insurance company or the court within three months of the settlement and obtained the insurance company's prior consent to settle, or with the express approval of the court having jurisdiction over the claim.

In its request to have Lauter's workers' compensation death benefits discontinued and forfeited, DOL cited the state workers' compensation statute which read in part:

The failure to obtain either the insurance company's (the carrier's) consent or court approval with three (3) months of any settlement will bar the plaintiff from receipt of further workers compensation benefits.

In her response Lauter argued she previously discussed the possible settlement with DOL's representatives. Lauter contended she spoke with several employees she contacted at the insurance company. She was though ultimately unable to recall the names of the persons at DOL she said she spoke with.

Lauter also contended she was too upset and overwhelmed by the death of her husband Greg Lauter and as a result was confused about many of the laws and regulations surrounding the lawsuit.

Outcome...

After hearing all the evidence duly admitted in the appeal of the mesothelioma law suit, and after hearing arguments from all interested parties and their counsel the court ruled as follows:

Although we can empathize with the plight of the plaintiff, especially as the evidence was clear she had much to do in the months and days leading to her husband's death from mesothelioma lung cancer, we must at long last hold her to the law as we would any other individual seeking the recourse she prays for.

The plaintiff's offer of evidence to support her contention of timely notification to the defendant DOL Insurance Company is unsupportable by the evidence.

The only notification by the plaintiff came after the lawsuit with BQ Orange Industries was settled 10 months after the original lawsuits were filed. The language in the statute leaves us no room for interpretation. It is clear on its face and must be respected by all parties whom wish to invoke its authority.

The mandate of this court was to decide whether the plaintiff afforded the defendant DOL Insurance company notice of their settlement with Catstate Properties LTD. And if that notice was given, whether it was done so within the statutory three (3) month period after the initial lawsuit was filed by the plaintiff.

Additionally, and in the alternative this court was asked to decide if the plaintiff sought permission of the lower court to settle its case with Catstate Property LTD. and if so whether such notice was made to the court within the requisite three (3) month period.

We find in both matters the plaintiff wholly failed to make proper notifications to either DOL Insurance Company, or to the Court. We also find neither DOL Insurance Company, nor the Court ever expressed their acknowledgment or permission for the plaintiff to settle the case with Catstate Properties LTD.

We therefore sustain the lower court's decision and find for the defendants.

Important Points...

  • Normally when an employee is covered by workers' compensation insurance and he is injured the law permits him only to seek compensation for his injuries from his employer's workers' compensation insurance. There are exceptions to that rule.

    When during his employment the injuries are a result of a "third party" the injured party is usually permitted to pursue a claim against that third party. There is a procedure to do so, and if that procedure is not followed the injured party may lose his workman's compensation benefits.

    When an injured party fails to notify either the insurance company or the court of their settlement with a third party, the court may discontinue any further workman's compensation benefits.

  • Appeals are normally made when one party in a lawsuit is dissatisfied with the results, but appeals can't be successful unless there exists an issue of law to be reviewed.

    Sometimes, the issue of facts and the law become intertwined. In this case, the law required three months notification of the settlement of the original mesothelioma law suit. The facts included the plaintiff's failure to prove notice was timely given.

    Appeals such as the above case are not heard by another jury. Instead they are heard by an appellate court. Depending upon the state and the level of the court, an appeal can be heard by one judge, or all the way up to the United States Supreme Court, by nine judges.


*This case example is for educational purposes only. It is based on actual events although names have been changed to protect those involved. Any resemblance to real persons or entities is purely coincidental.

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TYPE OF ACCIDENT
AUTO ACCIDENT
PERSONAL INJURY
WORKERS COMPENSATION
MEDICAL ERROR
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