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White Electric Co. v. Bak3/12/1996
OPINION BY JUDGE JOSEPH E. BAKER
White Electric Company, Inc. and State Farm General Insurance Company (jointly referred to herein as employer) appeal from a decision of the Workers' Compensation Commission (commission) that rejected employer's motion to deny further compensation benefits to Charles Joseph Bak, Jr. (claimant) on the ground that claimant settled his third-party action against Paul Ferranti (Ferranti) without notifying or obtaining employer's agreement to the terms of the settlement. In its opinion, the commission noted that the parties were familiar with the facts and that it would repeat only those necessary to explain its opinion. The facts stated in this opinion are facts found by the commission. Although employer submits four questions for our consideration, the determinative issue is whether the facts are sufficient to support the commission's decision that claimant's settlement did not deprive employer of subrogation rights under the Workers' Compensation Act (Act). If claimant's actions operated to deprive employer of its rights, claimant would be barred from obtaining further compensation benefits.
On appeal, we must view the facts in the light most favorable to the party prevailing before the commission. Crisp v. Brown's Tysons Corner Dodge, Inc., 1 Va. App. 503, 504, 339 S.E.2d 916, 916 (1986). The commission's opinion states that on January 23, 1990, claimant was injured in a motor vehicle accident with Lisa Lannigan (Lannigan). Employer denied claimant's contention that his injuries were job -related. A hearing was held before Deputy Commissioner Arrighi (Arrighi), who found that claimant had suffered a temporomandibular joint (TMJ) injury which was job-related and that employer was responsible for compensation benefits.
When employer failed to accept responsibility for the injuries, claimant petitioned the commission to require employer to comply with Arrighi's finding. On August 24, 1993, another hearing was held, this one before Deputy Commissioner Phillips (Phillips). Phillips also ruled that the TMJ injury was job -related and compensable. In that hearing, Dr. Michael J. Kelley, an oral surgeon, was declared to be the treating physician for the TMJ injury. Employer denied that claimant's dental problems were job-related and requested a review by the full commission.
While the foregoing described proceedings were pending, on January 23, 1991 claimant was involved in a motor vehicle accident with Ferranti. The parties stipulated that the injuries received in the Ferranti accident were not job -related; however, in a third-party action filed against Ferranti, in his motion for judgment, claimant alleged that as a result of Ferranti's negligence, claimant suffered aggravation of his pre-existing TMJ condition. In the course of that suit, claimant responded to interrogatories propounded to him, swearing that he had presently incurred or in the future would incur medical expenses relating to the TMJ injury in the sum of $17,098. Without notifying employer--or seeking its agreement--claimant settled his suit against Ferranti for $8,000.
On October 25, 1994, on employer's application, a further hearing was held, this time before Deputy Commissioner Lahne (Lahne). Employer contended that any condition from which claimant suffered was caused by his failure to cooperate with medical treatment and that claimant was barred from receiving further compensation benefits because he settled his suit against Ferranti without employer's knowledge or agreement. In support of that contention, employer asserted that the medical evidence showed that the injuries claimant incurred in the January 23, 1991 accident aggravated claimant's TMJ conditio
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