NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3160-14T1
TINA L. TALMADGE,
Plaintiff-Appellant,
v.
CONNIE S. BURN and ALVAN A. BURN,
Defendants,
APPROVED FOR PUBLICATION
and
JULY 26, 2016
THE HARTFORD,
APPELLATE DIVISION
Defendant/Intervenor-
Respondent.
__________________________________
Argued May 16, 2016 - Decided June 22, 2016
Before Judges Lihotz, Fasciale and Higbee.
On appeal from Superior Court of New Jersey,
Law Division, Sussex County, Docket No. L-
401-13.
Phillip C. Wiskow argued the cause for
appellant (Gelman, Gelman, Wiskow &
McCarthy, LLC, attorneys; Mr. Wiskow, of
counsel and on the brief).
David R. Kunz argued the cause for
respondent (Kunz & Germick, attorneys; Mr.
Kunz, on the brief).
The opinion of the court was delivered by
LIHOTZ, P.J.A.D.
Plaintiff Tina Talmadge appeals from a January 29, 2015
order denying her motion to declare the medical benefits portion
of a workers' compensation lien unenforceable. The Hartford,
the workers' compensation carrier for plaintiff's employer,
intervened in this matter seeking reimbursement from any
recovery the defendant tortfeasor paid to plaintiff, as
authorized by N.J.S.A. 34:15-40 (section 40) of the Workers'
compensation Act (the Act), N.J.S.A. 34:15-1 to -142. On
appeal, plaintiff argues because benefits that could have been
paid through plaintiff's personal injury protection (PIP)
provisions of her automobile liability policy are not
recoverable from the tortfeasor, a section 40 workers'
compensation lien for payment of similar costs should be denied.
We disagree and affirm.
The facts are not disputed. Plaintiff, while working for
her employer, Child and Family Services, Inc., was driving her
personal automobile when involved in an auto accident caused by
defendant Connie Burns. As a result of the accident, plaintiff
underwent an anterior cervical fusion. The Hartford, as the
workers' compensation carrier for plaintiff's employer, paid
plaintiff over $127,000 in medical, wage, and indemnity
benefits.
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Plaintiff filed a complaint and ultimately settled her
claims against Burns in the amount of Burn's auto insurance
policy limit of $250,000. The Hartford asserted a workers'
compensation lien of $84,510.78 against this third-party
recovery.
Plaintiff moved to reduce The Hartford's claimed lien. She
argued The Hartford's inclusion of any medical benefits paid to
plaintiff was legally unenforceable and not subject to
reimbursement. The Law Division judge denied plaintiff's
motion, citing section 40 of the Act. Plaintiff filed this
appeal.
In enacting the Act, the Legislature sought to streamline
recovery of benefits to workers injured in the course of
employment. Estate of Kotsovska, ex rel. Kotsovska v. Liebman,
221 N.J. 568, 583-84 (2015). Under the Act's remedial no-fault
system, qualified employees receive medical treatment and
limited compensation "without regard to the negligence of the
employer." Id. at 584 (quoting N.J.S.A. 34:15-7); see also
Tlumac v. High Bridge Stone, 187 N.J. 567, 573 (2006) ("[T]he
remedial purpose of the Workers' Compensation Act [is] to make
benefits readily and broadly available to injured workers
through a non-complicated process.").
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Section 40 permits a workers' compensation insurance
carrier to seek reimbursement of benefits it pays when a third-
party, other than the employer, caused the employee's injury.
Utica Mut. Ins. Co. v. Maran & Maran, 142 N.J. 609, 613 (1995)
("Under section 40, the workers' compensation carrier is
entitled to reimbursement whether or not the employee is fully
compensated."). The statute provides:
(a) The obligation of the employer . . .
under this statute to make compensation
payments shall continue until the payment,
if any, by such third party or his [or her]
insurance carrier is made.
(b) If the sum recovered by the employee
. . . from the third person or his [or her]
insurance carrier is equivalent to or
greater than the liability of the employer
. . . under this statute, the employer . . .
shall be released from such liability and
shall be entitled to be reimbursed, . . .
for the medical expenses incurred and
compensation payments theretofore paid to
the injured employee . . . less employee's
expenses of suit and attorney's fee as
hereinafter defined.
[N.J.S.A. 34:15-40(a)-(b).]
More specifically, "section 40 prevents the worker from
retaining any workers' compensation benefits that have been
supplemented by a recovery against the liable third party."
Utica, supra, 142 N.J. at 613.
Plaintiff argues, as a no-fault insured, she may not
recover medical benefits from another no-fault insured. Since
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The Hartford's subrogation rights are limited to claims
plaintiff may assert, N.J.S.A. 34:15-40(f), she concludes the
workers' compensation carrier has no entitlement to attach
payment from the tortfeasor for reimbursement of medical
expenses it previously paid. We reject this syllogism as an
inaccurate statement of the law.
The statutory construct under the no-fault insurance system
provisions of the Automobile Insurance Cost Reduction Act,
N.J.S.A. 39:6A-1.1 to -35, is "intended to serve as the
exclusive remedy for payment of out-of-pocket medical expenses
arising from an automobile accident" as a "trade-off for lower
premiums and prompt payment of medical expenses." Caviglia v.
Royal Tours of Am., 178 N.J. 460, 466-67 (2004) (citing Roig v.
Kelsey, 135 N.J. 500, 503, 511-12 (1994)). Accordingly, an
injured no-fault insured who receives PIP benefits may not seek
recovery from the tortfeasor for claims resulting from "medical,
hospital and other losses for which he had already been
reimbursed." Bardis v. First Trenton Ins. Co., 199 N.J. 265,
279 (2009) (quoting Cirelli v. Ohio Cas. Ins. Co., 72 N.J. 380,
387 (1977)). Thus, the Legislature did not intend "to leave the
door open for fault-based suits when enacting the No-Fault Law."
Roig, supra, 135 N.J. at 516.
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When an employee suffers an automobile accident while in
the course of employment, workers' compensation is the primary
source of satisfaction of the employee's medical bills, as
provided by the collateral source rule, N.J.S.A. 39:6A-6, which
"relieves the PIP carrier from the obligation of making payments
for expenses incurred by the insured which are covered by
workers' compensation benefits." Lefkin v. Venturini, 229 N.J.
Super. 1, 7 (App. Div. 1988). "Where only workers' compensation
benefits and PIP benefits are available, the primary burden is
placed on workers' compensation as a matter of legislative
policy by way of the collateral source rule of N.J.S.A. 39:6A-
6." Id. at 9 (citing Aetna Ins. Co. v. Gilchrist Bros., Inc.,
85 N.J. 550 (1981)).
In instances where an employee, as a result of a work
related automobile accident injury, also has a claim for
recovery against a third-party, the Legislature overcame the
possible "inequity of double recovery" by including section 40,
which requires an injured employee to refund paid workers'
compensation benefits once recovery is obtained from the
tortfeasor, thereby avoiding duplication of the workers'
compensation benefits by the tort recovery. Frazier v. New
Jersey Mfrs. Ins. Co., 142 N.J. 590, 597-98 (1995). The statute
clearly permits an employee who received workers' compensation
6 A-3160-14T1
benefits to seek recovery against the third-party for those
benefits, including paid medical expenses. The statute also
expressly entitles the workers' compensation carrier to
repayment of all benefits paid to the employee. See Greene v.
AIG Cas. Co., 433 N.J. Super. 59, 68 (App. Div. 2013) (stating
"if repayment of the workers' compensation carrier from the
third-party recovery were not required, the workers'
compensation exclusion would result in a double recovery to the
plaintiff in contravention of clear legislative policy against
duplication of awards.").
In Greene, we stated "[i]t has long been understood that
the clear intent of [s]ection 40 . . . is to prevent an injured
employee from recovering and retaining workers' compensation
payments, while at the same time recovering and retaining the
full damages resulting from a third-party tort suit." Id. at 64
(citing United States Cas. Co. v. Hercules Powder Co., 4 N.J.
157, 163–65 (1950)). This is so even when the net recovery,
after satisfaction of the workers' compensation lien, does not
fully compensate the employee. Frazier, supra, 142 N.J. at 602.
Accordingly, there is no basis to interfere with the Law
Division order. The employer's workers' compensation carrier's
lien, which includes medical expenses paid, must be satisfied
7 A-3160-14T1
from plaintiff's $250,000 recovery from Burns. N.J.S.A. 34:15-
40(b).
Affirmed.
8 A-3160-14T1
Tina L. Talmadge v. Connie S. Burn and Alvan A. Burn and the Hartford
Combined Opinion