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Flanigan v. Department of Labor and Industries3/3/1994
3, 225. After a hearing, a trial court ruled that the children had a right to pursue their own independent claims. The court also held that it would vacate the settlement if the children elected to do so and that the Department had no authority to settle the children's claims. Ebsary, at 223-24.
Division One of the Court of Appeals upheld the trial court's decision. The court reasoned that the Department's interest was limited to making a recovery to replenish the workers' compensation accident fund.
In this case, Rosa Ebsary's claims against Pioneer and DOC were assigned by operation of law pursuant to RCW 51.24.070
when Rosa declined to make a voluntary assignment. Thus, the only purpose of the assignment was replenishing of the state accident fund. The assignment did not and could not affect the claims of the Ebsary children because neither of them received workers' compensation benefits. It follows that if DLI had attempted to settle the children's claims, it would have been acting without authority.
Ebsary, at 225. If noneconomic damages were separate and not intended to be compensated by the Act, then the Department would not have authority to settle such claims. Yet, in Ebsary, the Department settled the widow's claims for noneconomic damages.
The logical reading of the cases in this area, together with the plain language of the Act is that sure and certain workers' compensation benefits are meant to compensate for all damages arising out of the industrial injury including noneconomic damages such as loss of consortium. Where the Act applies, it is an exclusive remedy and provides sure and certain compensation to injured workers in lieu of all damages arising out of that injury. Such workers and beneficiaries may seek additional recovery from liable third parties, but any recovery is subject to reimbursement by the Department, including noneconomic damages. Contrary to the majority's holding, neither the Act, nor the case law, distinguishes between economic damages and noneconomic damages.
A resolution such as that proposed by the majority endangers the industrial insurance fund and improperly forces the innocent employer to bear the cost for the actions of a responsible third party.
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