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Flanigan v. Department of Labor and Industries3/3/1994
In these two consolidated cases we review conflicting decisions from different divisions of the Court of Appeals. In each case, the spouse of a worker killed on the job obtained workers' compensation benefits and also recovered damages for loss of consortium in a suit against a third party. The Department of Labor and Industries (Department) claimed a portion of each third party recovery as reimbursement for the workers' compensation benefits it had paid.
We hold the Department's right to reimbursement does not extend to a spouse's third party recovery for loss of consortium. We affirm the Court of Appeals, Division Three, in Flanigan v. Department of Labor & Indus., 65 Wash. App. 119, 827 P.2d 1082 (1992), and reverse the Court of Appeals, Division One, in Downey v. Department of Labor & Indus., 65 Wash. App. 200, 827 P.2d 1101 (1992).
I
Facts
Flanigan v. Department of Labor & Indus.
Janice Flanigan's husband died from injuries suffered while working on a job which was covered by Washington's workers' compensation act, the Industrial Insurance Act,
RCW Title 51. The Department of Labor and Industries granted her application for surviving spouse's benefits. Flanigan then sued a third party tortfeasor, both individually and as representative for her husband's estate. She recovered $189,000 for her own loss of consortium. She also recovered for her husband's estate an award of $94,468.50 in economic damages.
The Department claimed reimbursement from the proceeds of the entire recovery, including Janice Flanigan's separate award for loss of consortium. According to the parties' stipulation, the Department asserted a lien against the entire third party recovery in the amount of $82,522.89; the Department demanded reimbursement in the amount of $39,735.40; and no benefits or compensation were to be paid until the excess recovery of $70,717.37 had been offset. The Board of Industrial Insurance Appeals (Board) affirmed the Department's order.
The Spokane County Superior Court reversed the Board on summary judgment. The Court of Appeals, Division Three, affirmed the Superior Court. Flanigan v. Department of Labor & Indus., supra. The Department obtained discretionary review in this court.
Downey v. Department of Labor & Indus.
Charles Downey contracted employment-related asbestosis and obtained workers' compensation benefits. He and his wife, Miriam Downey, sued third parties and recovered a total award of $184,875 as compensation both for his asbestosis and her loss of consortium. The Department's policy, which is not being challenged here, is to allocate 80 percent of asbestosis awards to the worker and 20 percent
to the spouse for loss of consortium. The Department asserted against Charles Downey's 80 percent share the Department's right to be reimbursed for the benefits it had paid him. The Department did not initially assert its reimbursement right against Miriam Downey's 20 percent share. Nevertheless, after Charles Downey died and Miriam Downey began receiving a pension as a surviving spouse, the Department determined it would use her 20 percent share as a source of reimbursement of her pension payments. According to the parties' stipulation, the amount of this reimbursement is $11,369.57.
The Board, after an initial proposed order in favor of Miriam Downey, reversed itself and ruled the Department's right of reimbursement applied to the loss of consortium recovery. The Board's order was upheld on summary ju
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