Travelers Indemnity Co. of America v. Jarrells

VAIDIK, Judge,

concurring in result.

I agree with the result of the majority opinion, but I respectfully disagree in part with the path taken to get there.

Initially, I agree with the majority opinion that, pursuant to Indiana Code § 22-3-2-13, once an employee receives an award from a third-party tortfeasor that is greater than the worker's compensation benefits received by the employee, a statutory lien is created for the benefit of the employer or the employer's insurance carrier. The statutory lien shall be in the amount of the compensation paid by the employer or insurance carrier to the employee minus the pro rata share of the costs of asserting the third-party claim. Since Jarrells received worker's compensation benefits from his employer's insurance carrier, under the plain language of the statute the insurance carrier has a statutory lien on the award Jarrells received. Thus, from the $508,750 judgment Jarrells received against the defendant R.D.J. Custom Homes, Inc., Travelers Indemnity is entitled to $22,495.75. Contrary to Jarrells' argument, Walkup v. Wabash National Corp., 702 N.E.2d 713 (Ind.1998), does not apply because there is no evidence that the policy under which Jarrells received the benefits explicitly stated that they were not worker's compensation benefits. See id. at 715-16 (concluding that the statutory lien does not apply to insurance benefits received by the plaintiff employee when the insurance policy specifically exeludes payment for worker's compensation benefits).

I part ways with the lead opinion on its treatment of Pendleton v. Aguilar, 827 N.E.2d 614, 621 (Ind.Ct.App.2005), reh'g denied, trans. denied. While I agree that Pendleton is distinguishable from this case, I do not believe it is distinguishable for the reasoning stated by my colleague. Rather, I find Pendleton to be distinguishable because in that case, *920the plaintiff employee, Pendleton, who was a Florida resident, received worker's compensation benefits from the Florida Worker's Compensation Insurance Guaranty Fund ("Florida Fund") rather than worker's compensation benefits pursuant to Indiana law. The opinion in Pendleton does not indicate that Timely Transport,2 Pendleton's employer, is an Indiana entity such that Indiana's worker's compensation law would apply. See Elkhart Sawmill Co. v. Skinner, 111 Ind.App. 695, 42 N.E.2d 412, 415 (1942) ("It will be observed from these authorities that, generally speaking, the Workmen's Compensation Act of Indiana applies only to Indiana employers ... who contract for services to be performed, at least in part, in Indiana.") (citation omitted). There is nothing in Pendleton otherwise indicating that Pendleton was required, pursuant to some other law, to repay the Florida Fund for the benefits he received. As a result, Pendleton neither discusses statutory liens nor expressly prescribes that an employee who receives worker's compensation benefits can escape paying the statutory lien by introducing a collateral source evidence jury instruction, as Jar-rells did, at the third-party trial.

Further, the attorneys for both the plaintiff and defendant in Pendleton urged the jury to take the amount of worker's compensation benefits received into account and not to duplicate the payments. Pendleton, 827 N.E.2d at 621. There is no indication in Pendleton that Pendleton was required to repay the worker's compensation benefits he received or that the jury was informed he was required to repay. Here, however, Jarrells testified in the underlying third-party trial that he knew that if he recovered in the suit he would "have to pay some of th[e] worker's compensation liens back." Partial Tr. of Jerry Jarrells Testimony p. 5-6. Jarrells himself introduced at trial an exhibit consisting of a letter to his attorney from Travelers Indemnity Company wherein an employee of Travelers informed his attorney that the insurance company has a worker's compensation lien.3 comprised of indemnity and medical payments. Appellant's App. p. 21. As a result, the jury in Jarrellsg case was informed that Jarrells was required to repay some amount to the insurance company for the worker's compensation benefits he received.4

Turning to the instruction Jarrells tendered,5 Appellant's App. p. 22, I conclude that the instruction informs the jury that it must consider payments for worker's compensation and that, in determining the *921amount received by Jarrells from collateral sources, the jury may consider any amount Jarrells is required to repay to a collateral source. The instruction further states, "Jarrells may not recover more than once for any item of loss sustained." Here, evidence was presented to the jury that Jarrells had received worker's compensation benefits and that he was required to repay them, and a reasonable jury could conclude that the duty to repay prevents Jarrells from recovering more than once for the worker's compensation benefits he has already received. I cannot say that a reasonable jury, when considering the evidence of the lien and the collateral source evidence jury instruction, would disregard Jarrells' obligation to repay the lien by subtracting out the worker's compensation benefits. "On appeal, we will presume the jury followed the law contained within the trial court's instruction and applied that law to the evidence before it." Tipmont Rural Elec. Membership Corp. v. Fischer, 697 N.E.2d 83, 90 (Ind.Ct.App.1998), reh'g denied, aff'd, 716 N.E.2d 357 (Ind.1999). As a result of these differences, Pendleton does not supercede or excuse the statutory lien obligation.

As for the view expressed by the dissent, it cannot be correct that Jarrells, who tendered the collateral source evidence jury instruction given by the trial court, can eradicate as a matter of law through his tendered jury instruction his statutory obligation under Indiana Code § 22-3-2-13 to repay his employer's insurance carrier for the worker's compensation benefits he received. Such an interpretation of Pendleton or the jury instruction at issue renders Indiana Code § 22-38-2-18 toothless, and courts must strive to give effect to all provisions of a statute.

For the foregoing reasons, I respectfully disagree with part of the lead opinion's rationale in this case. However, I agree with the outcome. I therefore concur in result.

. The opinion in Pendleton does not reveal Timely Transport's location.

. "Lien" is defined as "a right to keep possession of property belonging to another person until a debt owed by that person is discharged." The New Oxford Dictionary 985 (2001). The use of the word "lien" would indicate to a reasonable jury that there is an outstanding debt that is to be repaid.

. Jarrells argues in his brief that Travelers has failed to designate in its Motion for Summary Judgment any evidence or trial testimony showing the amount of the lien and that Jarrells was required to repay the amount he received. However, as the dissent notes, it appears as though Jarrells' counsel attempted to designate the entire record of the case in opposition to summary judgment. Appellant's App. p. 86. Jarrells cannot now complain that we consider materials outside Travelers' designation.

. I note that the instruction is also very similar to the collateral source evidence pattern instruction. See Ind. Pattern Jury Instructions (Civil) 11.07 (2d ed.2007). The pattern instruction does not include the final line of the instruction at issue here and in Pendleton: [Plaintiff] may not recover more than once for any item of loss sustained." Id.; Pendleton, 827 N.E.2d at 621; Appellant's App. p. 22.