Johnson v. Lumbermen's Reciprocal Insurance Exchange
Docket: 5-5396
Court: Supreme Court of Arkansas; November 30, 1970; Arkansas; State Supreme Court
A suit was filed by Johnson against Lumbermen’s Reciprocal Insurance Exchange and the Arkansas Workmen’s Compensation Commission in the Pulaski Chancery Court, seeking to set aside a prior order of the workmen’s compensation commission. The chancery court dismissed the case for lack of jurisdiction, and this dismissal is the focus of the appeal. Johnson claimed that he suffered a back injury while working for J. M. Hampton & Sons Lumber Company on April 2, 1966. In November 1966, he and the insurance carrier reached a joint settlement approved by the compensation commission, which granted him $1,850 as full compensation. Johnson later filed a complaint in March 1968, alleging he had been defrauded in the settlement due to false representations by the insurance adjuster and physician regarding the severity of his injury. He argued that this fraudulent conduct led to his consent to an inadequate settlement and requested that the commission’s approval of the settlement be nullified. The court affirmed the dismissal, referencing prior case law that established the commission’s role in approving settlements as a protective measure for injured workers. It noted that a settlement cannot be reopened merely because subsequent evidence reveals a more serious disability unless there is an assertion of fraud or insanity. Johnson’s claim of fraud was determined not to meet the criteria for extrinsic fraud, which involves deception that prevents a party from presenting a case in court or betrayal by their attorney. The court emphasized that claims of fraud related to the settlement process itself, such as reliance on fraudulent evidence or misrepresentation, do not constitute extrinsic fraud. Ultimately, the court upheld the chancery court’s decision, confirming that there was no basis for jurisdiction as the allegations did not support a claim of extrinsic fraud. The dismissal by the chancery court was affirmed.