(dissenting).
I dissent.
Transamerica sued Sydow for reimbursement of workmen’s compensation benefits paid. The complaint alleged that Transamerica paid Sydow compensation on the basis of an accident that happened on July 1, 1974; that Sydow sued a doctor for malpractice in the treatment of the injuries suffered in the accident which case was settled and dismissed; that Transamerica did not intervene because Sydow’s lawyer agreed by letter to protect Transamerica in any judgment or settlement obtained; that Sydow, through his lawyer, refused and failed to account to Transamerica or to advise of the amount of the settlement and failed to reimburse Transamerica for any amounts paid.
Sydow filed a motion to dismiss for failure to state a claim for relief. The motion was granted and the complaint dismissed. Transamerica appeals. The appeal should be affirmed.
A. Dismissal without prejudice is not an appealable order.
The trial court ordered “that plaintiff’s claim be and it hereby is dismissed.” Dismissal without prejudice is not a final order and is not appealable. Ortega v. Transamerica Ins. Co., 91 N.M. 31, 569 P.2d 957 (Ct.App.1977), Sutin, J., dissenting; Armijo v. Co-Con Const. Co., 92 N.M. 295, 587 P.2d 442 (Ct.App.1978). This appeal should be dismissed. However, in Rumpf v. Rainbo Baking Co., 96 N.M. 1, 626 P.2d 1303 (Ct.App.1981), Sutin, J., dissenting, cert. denied, plaintiff’s complaint was dismissed with prejudice. No appeal was taken from the judgment. However, this Court said:
[Although the dismissal with prejudice was not an issue on appeal, we hold that it was improper under the circumstances of this case. [Emphasis added.] [Id. 1304.]
* * ifc * * *
. .. The case is remanded for modification and deletion of that portion of the judgment which dismisses the claim with prejudice. [Id. 1306.]
This Court now has the judicial power to modify, delete, add or otherwise amend a judgment below which is not before this Court. It naturally follows that upon disposition of this case we can remand it to the district court and order that the words “with prejudice” be added to make it an appealable Order.
A judgment which dismisses a complaint without prejudice should be an appealable order because, by giving notice of appeal, the appellant has decided not to plead over. Ortega and Armijo should be overruled on this issue.
B. Transamerica is not entitled to reimbursement.
The only issue on this appeal is whether Transamerica is entitled to reimbursement of compensation benefits paid Sydow. Sydow’s motion to dismiss was granted based upon Security Insurance Co. of Hartford v. Chapman, 88 N.M. 292, 540 P.2d 222 (1975) and its interpretation of §§ 52-1-49(B) and 52-1-56(C), N.M.S.A.1978.
Initially, Chapman and S.I.C. sued a hospital and doctors for injuries sustained by Chapman as a result of negligence of defendants. Chapman sought damages while 5.1.C. sought reimbursement for compensation benefits paid Chapman. Chapman settled without notifying or consulting with 5.1.C. S.I.C. amended its complaint to seek reimbursement. The complaint was dismissed with prejudice and S.I.C. appealed. The dismissal below was affirmed.
Section 52-1-49(B) as summarized reads:
(1) An employee who furnished medical services to a workman shall be liable for injuries resulting from neglect, lack of skill or care on the part of any person employed by the employer to care for the workman.
(2) The workman has an option to hold the employer liable for the injuries or retain the right to sue the person who injured the workman. Election to accept or reject the provisions of this section shall be made in writing.
(3) If the workman elects to hold the employer liable, the workman shall assign to the employer, the claim against the third person and the employer may sue the third person in the workman’s name.
I agree with Transamerica that the meaning of this statute is clear. It states:
Its intent is to give the worker an option. He may choose to hold his employer liable for the negligence of the doctor furnished by the employer, or he may choose to release the employer. If the worker chooses the second alternative, he is then free to sue the doctor on his own and the employer does not have a right to reimbursement from any damages or settlement proceeds obtained by the worker from the doctor and surely, has no obligation to pay for the results of the malpractice.
This section is not a reimbursement statute.
Sydow chose the second alternative. This Court’s opinion should end here.
Section 52-1-49(B) does not involve any proceedings under the Workmen’s Compensation Act. The employer is not required to pay workmen’s compensation benefits for any subsequent tortious conduct of a third person, such as malpractice of a doctor, who takes care of or treats an injured workman. It provides an injured workman with a common law remedy against the employer or third person tortfeasor. It focuses upon the common law liability of an employer for damages for injuries to an injured workman caused by a third person tortfeasor.
The damages sought by the injured workman or the employer are for those injuries suffered at the second injury, subsequent to the first injury which is the accidental injury. No recovery of compensation benefits or damages are sought for the first injury. Section 52-1-49(B) applies only to the second injury, the subsequent tortious conduct of the third person.
If the injured workman chooses not to hold the employer liable for the second injury, the workman can sue the third person tortfeasor to recover damages for injuries caused by the second injury event.
If the injured workman chooses to hold the employer liable for the second injury, the workman’s claim against the third person tortfeasor is assigned to the employer. The employer, then, has a duty to bring an action against the third person in the name of the workman. The workman looks to the employer for those damages recovered from the third person.
Sydow chose to pursue the doctor, the third party tortfeasor and then settled the matter. Sydow was not required to reimburse Transamerica for any compensation paid by the employer for the first injury.
Transamerica relies principally on the fact that Sydow gave no written notice of its election to accept or reject the provisions of this section.
Chapman said:
The employee did not give the election in writing as required by the statute and did not file suit against the employer for additional workmen’s compensation benefits for the alleged malpractice. He instead elected to sue the physicians, technicians and hospital. [88 N.M. 298.]
Chapman did not explain why written notice to the employer was unnecessary. But it did hold, by reason of affirmance of the judgment below, that a written election to release the employer from liability and to pursue the third party tortfeasors was not required.
Notice in writing is mandatory. If Transamerica could show that it was prejudiced by lack of notice, reversible error could result. Prejudice cannot result when an injured workman chooses to take action against the third party tortfeasor. It releases the employer from liability to the workman. The workman cannot exercise his common law remedy against the employer. It relieves the employer of the cost and expense of suing the third party tortfeasor for and on behalf of, and in the name of, the workman with no benefits accruing to the employer.
Notice in writing to the employer is solely for the protection of the workman. If notice is given that the workman chooses to hold the employer liable for the second injury and the employer fails to perform its duty, the employer is liable under a common law remedy afforded the workman. If the workman fails to give notice to the employer and for some reason the workman cannot recover from the third party tortfeasor, the workman suffers the loss of damages for the second injury.
The failure of Sydow to give written notice to Transamerica of its election was not prejudiciously erroneous.
Under Chapman, Sydow complied with § 52-1-49(B) and Transamerica was not entitled to reimbursement.
Section 52-1-56(C) has erroneously been held to be a reimbursement statute since Kandelin v. Lee Moor Contracting Co., 37 N.M. 479, 24 P.2d 731 (1933). We are bound by this interpretation. As summarized, it reads:
If a workman is injured by a third person tortfeasor he “shall not be allowed to receive payment or recover damages therefor and also claim compensation from the employer, and in such case the receipt of compensation from the employer shall operate as an assignment to the employer ... of any cause of action, to the extent of payment by the employer to the workman . .. occasioned by the injury which the workman . .. may have against any other party for the injuries ...” [Emphasis added.]
Unlike § 52-1-49(B), no reference is made to a second injury claim, the subsequent tortious conduct of a third person. It is not applicable to a second injury claim. It is applicable only when the negligence of a third person causes the first injury, the accidental injury, under which a workman is entitled to compensation benefits.
“In such case” refers to the previous language, i. e., if the workman has been paid some compensation by the employer for the first injury, and has recovered in tort from a third party tortfeasor for the accident that caused the first injury, then the employer is entitled to reimbursement from the tort recovery not only to the amount of compensation paid but to total liability to the workman for compensation benefits. The reason is that § 52-1-56(C) prohibits a workman from obtaining a double recovery for the same injury. It does not prohibit a workman from making a full recovery for a second injury caused by subsequent tortious conduct of a third person.
For the second injury set forth in § 52-1-49(B), the employer is not entitled to reimbursement. The employer has paid nothing for the second injury. Having paid nothing, the employer cannot seek reimbursement. Under Chapman, § 52-1-56(C), Transamerica is not entitled to reimbursement.
Transamerica raises a collateral issue in this appeal. Attached to the complaint is an exhibit, a letter written by Sydow’s lawyer. It reads:
This letter will confirm my conversation with you in which you informed me you represent Transamerica Insurance and would like to be reimbursed for workmen’s compensation payments made to Mr. Sydow out of any recovery Mr. Sydow might obtain in his suit against Dr. _ for alleged malpractice. As I told you, I am aware of Transamerica’s interest in the case and am prepared to protect that interest at this time out of any settlement or judgment. It is my desire that you accept this letter as a letter of protection and not intervene in the case. As you can see, if we can proceed on this basis, I would appreciate it very much.
This letter did not create prejudicial error. It did cause Transamerica to refrain from seeking reimbursement by way of intervention in the action brought by Sydow against the doctor. Inasmuch as Transamerica was not entitled to reimbursement, it was not entitled to intervene and was saved the cost and expense of intervention. Events which would have occurred after intervention are speculative. The issue of reimbursement might have been raised during the Sydow-doctor litigation. If by intervention, Sydow would have mistakenly reimbursed Transamerica for compensation payments made, Transamerica might have been subject to additional litigation in which Sydow would seek recovery of the money paid Transamerica.
This is not to say that I condone the letter sent by Sydow’s lawyer. Opposing lawyers’ first duty was not to bypass the issue of reimbursement but to definitely determine the right of Transamerica to reimbursement. If a difference of opinion prevailed, the issue could have been reserved for action pending disposition of the Sydow-doctor litigation.
The dismissal of plaintiff’s complaint should be affirmed in this appeal.