Court Reverses Decision that Exclusive Remedy Barred Negligence Lawsuit

Publish Date:Mar 15, 2013
Summary:
The California Court of Appeal (Sixth Appellate District) has ruled that the trial court was in error when it granted a defendant’s motion for summary judgment in a case where the plaintiff filed a negligence lawsuit against the defendant after the plaintiff received workers’ compensation benefits from the defendant’s insurer.

The California Court of Appeal (Sixth Appellate District) has ruled that the trial court was in error when it granted a defendant’s motion for summary judgment in a case where the plaintiff filed a negligence lawsuit against the defendant after the plaintiff received workers’ compensation benefits from the defendant’s insurer.

The court’s decision in Minish v. Hanuman Fellowship et al. was filed on January 31, 2013 and was certified for publication on February 25, 2013. Notice of the case’s publication was issued this week. A copy of the Court of Appeal’s decision is available at www.courts.ca.gov

Diane Marie Minish was injured on the property of Hanuman Fellowship when she fell off a forklift. Minish received $172,589.02 in workers’ compensation medical benefits and $78,839.99 in temporary disability benefits from Hanuman’s workers’ compensation insurer.

Minish filed a lawsuit against Hanuman seeking compensatory and punitive damages for injuries she sustained allegedly due to Hanuman’s negligence.  Hanuman responded by asserting the affirmative defense that Minish’s lawsuit was barred by the exclusive remedy provisions of the Workers’ Compensation Act.  Hanuman filed a motion for summary judgment arguing that the undisputed facts established that Minish was covered by workers’ compensation.

Minish opposed the motion for summary judgment contending that Hanuman submitted her claim for workers’ compensation benefits without her consent and that she tried to return the workers’ compensation benefits she received.

The trial court applied the doctrine of judicial estoppel to prevent Minish from claiming that she was not covered by workers’ compensation and granted Hanuman’s motion for summary judgment.

The Court of Appeal reversed the trial court’s ruling on the motion.  The appellate court held that the trial court erred in its application of the judicial estoppel doctrine.

The doctrine of judicial estoppel precludes a party from successfully asserting a position in one judicial or administrative proceeding and then taking a totally different position in a second proceeding.  The trial court reasoned that Minish’s successful assertion to the Workers’ Compensation Appeals Board (WCAB) that she was covered by workers’ compensation precluded her from taking the position in her lawsuit that she was not covered by workers’ compensation. The Court of Appeal ruled that the trial court’s reasoning was wrong.

The Court of Appeal pointed out that there was no evidence in the record that the WCAB made a determination that she was covered by workers’ compensation.  The court acknowledged that Hanuman’s workers’ compensation insurer paid benefits to Minish but observed that the insurer “is not a judicial or quasi-judicial tribunal charged with authority to make binding determinations of workers’ compensation claims.”  The court concluded that although the payment of benefits by the insurer “may be consistent with the implied assertion of coverage in plaintiff’s WCAB claim, those payments by themselves do not establish that the WCAB --- the relevant tribunal for the purposes of analyzing the element of success--- ever adopted or accepted as true the position plaintiff asserted in her claim as true.”  The trial court erred in applying the doctrine of judicial estoppel “because the material facts necessary to show that the WCAB has adopted or accepted as true the position plaintiff asserted in her WCAB pleadings were neither undisputed nor conclusively established.” 

The Court of Appeal noted that its ruling on the summary judgment motion does not necessarily eliminate Hanuman’s affirmative defense of the exclusive remedy of workers’ compensation from the case.  Minish sought to negate the affirmative defense by arguing that she was not covered by workers' compensation because she was a volunteer outside of the scope of workers’ compensation. The final portion of the Court of Appeal’s decision addresses this issue.

California’s Workers’ Compensation Act generally applies to employees and excludes volunteers.  However, Labor Code section 3363.6 allows a nonprofit organization to provide workers’ compensation benefits to its volunteers. The statute states that if an organization’s board of directors declares in writing that its volunteers are covered by workers’ compensation, the volunteers are deemed to be employees while performing voluntary service for the organization.

Pursuant to section 3363.6, the Hanuman Board of Directors declared in writing that its volunteers were entitled to workers’ compensation benefits. Minish was a volunteer at Hanuman’s facility, but she argued that the board’s action did not extend workers’ compensation benefits to her because section 3363.6 required the board declaration to identify her personally as a covered volunteer and required her to accept workers’ compensation coverage. The Court of Appeal rejected Minish’s argument. The court held that section 3363.6 does not require that the board’s declaration to personally identify those volunteers who are considered covered employees nor does the statute require  each volunteer to individually accept the coverage.
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