Court: Court of Appeals of Minnesota; January 21, 2019; Minnesota; State Appellate Court
The appeal concerns a personal injury judgment following a workplace accident involving appellant Frederick Fish, who was injured while working for Albany Manufacturing and temporarily assigned to Wells Concrete Productions. Fish's injuries led to workers' compensation benefits totaling approximately $125,000, including temporary total disability (TTD) and permanent partial disability (PPD) payments, as well as a lump-sum settlement of $79,755.
Fish subsequently sued Ramler Trucking, Inc. for negligence. The jury apportioned fault as follows: 75% to Wells, 20% to Ramler, and 5% to Fish, awarding damages of $125,000 for past pain and emotional distress, $108,288 for past healthcare expenses, $105,000 for lost wages, and additional amounts for future damages.
The district court, however, reduced the damages based on the jury's fault allocation, applying Minn. Stat. 604.02, and offset part of the past wage-loss award by the workers' compensation payments Fish received, including a portion of the lump-sum settlement. After these adjustments, the district court ordered a judgment of $55,782.72 against Ramler.
Fish appeals, arguing that the district court erred in reducing damages based on the fault attributed to Wells, who is immune from tort liability under the workers' compensation act, and in calculating offsets against the wage-loss award from the lump-sum settlement. The appellate review will focus on whether the district court correctly applied the law and whether the evidence supports its findings.
Minn. Stat. 604.02 does not permit a reduction of damages awarded to Fish based on the fault assigned to Wells. Fish contends that the district court incorrectly adjusted the judgment against Ramler according to Wells' fault percentage, relying on Minn. Stat. 604.02 and the supreme court's Staab decision. Fish argues that the district court should have followed Lambertson and Minn. Stat. 176.061, subd. 11, to hold Ramler fully liable for damages, minus Fish's fault percentage. This assertion aligns with the Minnesota Workers’ Compensation Act, which provides an exclusive remedy against employers for workplace injuries, while allowing civil actions against third-party tortfeasors with the employer’s subrogation rights. The supreme court has recognized an inequity where third-party tortfeasors may bear full judgments despite greater employer fault due to the absence of common liability. Lambertson established that a third-party tortfeasor could seek contribution from an employer based on the jury's fault allocation, limited to the amount of workers' compensation benefits. The court emphasized the need for equitable remedies to ensure fairness, even without common liability. Subsequent cases have reaffirmed and clarified this equitable contribution remedy, guiding the allocation of damages when both the employer and third-party are negligent, while maintaining the policy of limiting employer liability.
Hudson established that a third-party tortfeasor can seek contribution from a negligent employer, regardless of whether the employee could recover directly due to the comparative fault statute, as this statute does not influence the damage allocation process outlined in Johnson. Kempa reaffirmed the Lambertson approach for determining employer contribution in instances where an employee is entitled to future workers' compensation benefits. It clarified that the procedures for damage allocation between an employer and a third party after workers’ compensation has been paid are separate from the comparative-fault allocation under Minn. Stat. 604.02. The Minnesota Supreme Court in Kempa emphasized that section 604.02 does not apply to an employer's contribution or offset against subrogation claims, indicating that employers and third parties are not jointly or severally liable to the employee, even when Lambertson's allocation utilizes jury findings of comparative fault.
Ramler contends that Lambertson is outdated due to three legal changes: a 2000 amendment to the workers' compensation act, a 2003 amendment to section 604.02, and the Staab decision. The 2000 amendment incorporates Lambertson's contribution procedure and allows an employer to waive the right to recover workers’ compensation benefits before jury selection, thereby removing those benefits from third-party damages. Ramler argues this means that if an employer waives or settles, the case becomes purely a civil matter under section 604.02. However, the amendment does not change the application of section 604.02 when defendants lack common liability, thus maintaining Lambertson's relevance.
The 2003 amendment to section 604.02 introduced a general rule of several tort liability, limiting joint liability to specific situations and stipulating that contributions should be proportional to each party’s fault. This amendment altered the previous joint and several liability framework, thereby impacting the apportionment of damages only among jointly liable parties but does not displace the Lambertson framework for cases involving employer contribution scenarios.
Ramler argues that a recent amendment makes Minnesota a true comparative fault state, limiting its liability to Fish to 20% of the net verdict since none of the specified joint liability circumstances are present. In Decker v. Brunkow, a similar argument was dismissed regarding the 1988 amendments to section 604.02 and the Lambertson allocation procedure. In that case, the jury assigned 5% fault to Brunkow, while the rest fell on Decker's employer. Brunkow claimed the 1988 amendments limited her liability to 5% under the '15% x 4' rule, but the court determined that the amended section did not alter the Lambertson contribution rule, emphasizing the lack of common liability between an employer and a third-party tortfeasor.
The court noted that amended section 604.02 does not apply when a third-party tortfeasor seeks contribution from an employer solely liable under workers' compensation law. It reiterated that the 2003 amendment to section 604.02 applies only when multiple parties are severally liable, and since employers are not liable to employees in tort, common liability is absent, thus excluding section 604.02's application. Furthermore, the Lambertson procedure remains distinct from section 604.02 and is not overridden by it. The court also highlighted that the legislature had not indicated any intent to replace the Lambertson procedure and that a comprehensive legislative solution is necessary.
In C. Staab v. Diocese of St. Cloud, the jury equally apportioned fault between the Diocese and Staab's husband, who was not a party to the lawsuit. Staab's claim that the Diocese should bear all her damages was rejected, with the court clarifying that 'persons' in the 2003 amendment refers to all parties involved in the tort, regardless of their participation in the lawsuit.
Liability in tort is established at the moment the tort is committed, independent of any subsequent claims or actions. In the Staab case, the jury determined the Diocese's fault was under 50%, thus it was not jointly liable for damages. Both tortfeasors in Staab shared common liability, making section 604.02 applicable. However, in this case, because Wells is immune from liability under Minn. Stat. 176.061, no common liability existed. The district court incorrectly applied section 604.02 to reduce damages awarded to Fish based on Wells' fault percentage. On remand, judgment against Ramler should reflect the full jury verdict amount, adjusted for 5% fault attributed to Fish.
The district court also wrongly offset $38,101.08 from the jury's past wage-loss award as duplicative of temporary total disability (TTD) benefits. Fish argued he had exhausted TTD benefits before the settlement, which was acknowledged by Ramler, who asserted the amount should be offset as duplicative of permanent total disability (PTD) benefits. The court concluded that the offset was erroneous since Fish had received TTD benefits for the allowable period. Therefore, the court will not address Ramler's argument regarding PTD benefits at this stage. The district court is instructed to evaluate whether the $38,101.08 should be offset against the jury's verdict concerning PTD benefits. The decision includes a reversal of the district court’s actions and a remand for appropriate judgment adjustments.
The court is not obligated to follow the Gaudreault decision and finds it unpersuasive, noting that a federal court's interpretation of Minnesota law does not bind it, though it may be considered persuasive. The court emphasizes that it is bound by its own published decisions, as well as by the decisions of the Minnesota Supreme Court. It concludes that the district court made an error by improperly reducing the damages awarded to Ramler and does not address Fish's alternative argument regarding the calculation of that reduction. The court points out that the correct approach for determining fault allocation would have been to calculate each percentage based on the total damages rather than applying sequential deductions. Additionally, Ramler claims the district court erred by not offsetting a $41,653.92 balance from a lump-sum settlement, which led to Fish improperly receiving $16,093.24 for past wage loss. However, Ramler did not file a notice of related appeal, so this issue will not be considered further, nor will the $16,093.24 be relevant on remand.
