[Cite as State ex rel. Dillard Dept. Stores v. Ryan, 122 Ohio St.3d 241, 2009-Ohio-2683.]

T HE S TATE EX REL . D ILLARD D EPARTMENT S TORES , A PPELLANT , v . R YAN , A DMR ., A PPELLEE , ET AL . [Cite as State ex rel. Dillard Dept. Stores v. Ryan, 122 Ohio St.3d 241, 2009-Ohio-2683.] Workers’ compensation — A second volunt ary dismissal under Civ.R. 41(A)(1)(a) by an employee-claimant filed after the parties had agreed to settle a claim in an employer-initiated workers’ compensation appeal pursuant to R.C. 4123.512 is not a final judicial de termination that payments made to the employee should not have been made , when the court of common pleas has not entered judgment to that effect. (No. 2007-2225 — Submitted April 8, 2009 — Decided June 16, 2009.)
A PPEAL from the Court of Appeals for Franklin County, No. 06AP-726, 173 Ohio App.3d 339, 2007-Ohio-5556.

–––––––––––––––––– S YLLABUS OF THE C OURT A second voluntary dismissal under Civ.R. 41(A)(1)(a) by an employee-claimant filed after the parties had agreed to settle a claim in an employer-initiated workers’ compensation appeal pursuant to R.C. 4123.512 is not a final judicial determination that payments made to the employee should not have been made, when the court of common pleas has not entered judgment to that effect.

–––––––––––––––––– M OYER , C.J.
I {¶ 1} A self-insured employer can ge nerally obtain reimbursement for workers’ compensation payments made to an employee when those payments are subsequently found to have been unwarran ted through administrative or judicialS UPREME C OURT OF O HIO

2 proceedings. R.C. 4123.512(H). Here we ar e presented with the issue of whether reimbursement is required by statute fo llowing a second voluntary dismissal by the employee, implicating the double-dismissa l rule in Civ.R. 41(A)(1). We hold that reimbursement is not required when the action is dismissed pursuant to a settlement agreement between the employer and employee, even if both the agreement and the dismissal purport to determine that the employee was not permitted to participate in workers’ compensation.
II {¶ 2} Pamela Scott wa s injured in 1999 while working for appellant, Dillard Department Stores, a self-insured employer. Her claim for workers’ compensation was certified by Dillard. Scott later sought an additional allowance for an “L4-5 Disc Bulge,” which Dillard challenged. A district hearing officer
from the Industrial Commission additiona lly allowed the disc condition, and Dillard appealed. A staff hearing offi cer upheld the decision and the Industrial Commission refused further appeal. {¶ 3} Dillard then appealed to the Trumbull County Court of Common Pleas, pursuant to R.C. 4123.512. Scott file d her complaint with the court as required by the statute. She later voluntarily dismissed the complaint under Civ.R. 41(A)(1)(a) but refiled it within the time permitted by the saving statute,
R.C. 2305.19. Before the trial court coul d hear the appeal, Scott and Dillard agreed to settle Scott’s entire workers’ compensation claim. According to the agreement, Dillard would pay Scott $15,000 in exchange for a release of all claims arising from her injuries. The agreement also provided that the appeal in the trial court would “be dismissed with prejudice with the following order: Pamela S. Scott is not entitled to participate in The Ohio Workers’ Compensation Fund for the alleged condition of L4-L5 di sc bulge at the plaintiff’s costs.” {¶ 4} Dillard submitted the settlement agreement to the Industrial Commission for approval pursuant to R.C. 4123.65. As the statute stipulates,January Term, 2009

3 because the commission did not issue an or der disapproving the settlement within 30 days, it was automatically approved. R.C. 4123.65(D). Scott dismissed her complaint in the trial court for a sec ond time under Civ.R. 41(A)(1)(a), this time with prejudice. {¶ 5} Dillard then applied for reimbursement from the state surplus fund for the compensation it had paid to Scott related to the L4-L5 disc bulge. After receiving the application for reimbursement, the Bureau of Workers’ Compensation (“BWC”) filed a motion for relief from the judgment and for substitution of parties with the trial court, arguing that the appeal should be reinstated and the BWC substituted for Scott as plaintiff so that it could protect the interests of the state surplus fund. {¶ 6} Before the trial court issued a decision on the BWC’s motion, the BWC denied Dillard’s application for reimbursement administratively. Dillard subsequently brought the instant action, a complaint for writ of mandamus filed in the Tenth District Court of Appeals, seeking a writ to compel the BWC to vacate its order denying reimbursement and grant reimbursement to Dillard. Dillard argued that Scott’s dismissal of the appeal was a final judicial determination that the payments it had made to Scott for th e L4-L5 disc bulge should not have been made and that pursuant to R.C. 4123.512 and this court’s decision in State ex rel. Sysco Food Serv. of Cleveland, Inc. v. Indus. Comm. (2000), 89 Ohio St.3d 612, 734 N.E.2d 361, it was entitle d to reimbursement. {¶ 7} The court of appeals denied the writ. State ex rel. Dillard Dept. Stores, Inc. v. Ryan , 173 Ohio App.3d 339, 2007-Ohio-5556, 878 N.E.2d 668, ¶ 10. It held that “a self-insured employer who pays a significant sum of money to settle a workers’ compensation claim is not a prevailing party such that the employer can obtain reimbursement from the surplus fund.” Id. at ¶ 7. The court argued that “ Sysco [89 Ohio St.3d 612, 734 N.E.2d 361] carves out a judicial exception on constitutional grounds to the legislature’s comprehensive workers’S UPREME C OURT OF O HIO

4 compensation scheme for Ohio—an excep tion that we believe should not be lightly extended to cover the facts in the case before us.” Dillard at ¶ 8. The court also took note of the practical cons equences that would follow if Dillard were reimbursed from the surplus fund. Id. at ¶ 9. Employers would be encouraged to pursue meritless appeals, agree to a settlement, and then seek reimbursement, which would quickly deplete the surplus fund. Id. {¶ 8} Before the decision of the Tenth Di strict Court of Appeals denying Dillard’s claim was issued, Dillard filed a motion for judgment with the trial court, asking the court to issue an order that Scott was no longer entitled to participate in the workers’ compensa tion fund for her L4-L5 disc bulge. Scott v. Dillard Dept. Stores, Inc. (Jan. 2, 2008), Trumbull C.P. No. 2002 CV 02440, 2008
WL 6463130

. The trial court issued a decision on both Dillard’s motion for judgment and the BWC’s previously file d motion for relief from the judgment and for substitution of parties. Id. The court denied both motions, finding that the action had been settled and dismissed by the parties and that there was no judgment to vacate. Id. {¶ 9} Dillard filed an appeal as of right with this court from the Tenth District’s decision denying its co mplaint for a writ of mandamus.
III {¶ 10} R.C. 4123.512(H) provides: “If, in a final administrative or judicial action, it is determined that payments of compensation or bene fits, or both, made
to or on behalf of a claimant should not have been made, the amount thereof shall be charged to the surplus fund * * *.” The right to surplus-fund reimbursement for self-insuring employers was upheld in Sysco , 89 Ohio St.3d at 614-616, 734
N.E.2d 361. {¶ 11} Dillard is now seeking reimbursement from the state surplus fund for compensation it had paid to Scott for her L4-L5 disc bulge prior to reaching a settlement agreement on her entire workers’ compensation claim. Dillard arguesJanuary Term, 2009

5 that it is entitled to reim bursement because Scott’s s econd voluntary dismissal of her complaint, pursuant to the settleme nt, amounted to an adjudication on the
merits that she was not entitled to compensation. We disagree. {¶ 12} To be eligible for surplus-fund reimbursement, an employer must have obtained a final judici al determination that co mpensation should not have been paid. R.C. 4123.512(H). There has been no such determina tion in this case. {¶ 13} Dillard is correct that Scott’s second voluntary dismissal of her complaint under Civ.R. 41(A)(1)(a) amounts to an “adjudication upon the merits.” Civ.R. 41(A)(1). This is known as the “double-dismissal rule.” Olynyk v. Scoles
, 114 Ohio St.3d 56, 2007-Ohio-2878, 868 N.E.2d 254, ¶ 8. The second dismissal is necessarily with prejudice and “res judicata applies if the plaintiff files a third complaint asserting the same cau se of action.” Id. at ¶ 10. {¶ 14} The problem, however, is that the circumstances here are substantially different from those of a typical case involving the double-dismissal rule. This case does not involve a plai ntiff repeatedly filing and voluntarily dismissing a complaint, thereby prolonging litigation. Scott instead voluntarily dismissed her complaint for the second time only because a settlement had been reached. The double-dismissal rule would prevent her from refiling her complaint, as would the release of claims contained in the settlement agreement. We also note that R.C. 4123.512(D) has been amended, effective June 30, 2006, to prohibit employees from dismissing th eir complaints without the employer’s permission in an employer-initiated appeal, but the amendment does not apply to
this case. {¶ 15} Although Scott’s second dismissa l was with prejudice, this does not mean there has been a final judicial determination that the payments to Scott related to her L4-L5 disc bulge should not have been made. No court has issued any judgment with such a finding. In fact, the trial court expressly denied Dillard’s motion for judgment, which sought a declaration that Scott was notS UPREME C OURT OF O HIO

6 entitled to participate in the workers’ compensation fund for her condition. Scott v. Dillard Dept. Stores, Inc. (Jan. 2, 2008), Trumbull C.P. No. 2002 CV 02440,
2008 WL 6463130. The cour t found that the action had been se ttled and
dismissed. Id. {¶ 16} The precedent cited by Dillard to support its argument that a second voluntary dismissal amounts to a final judicial determina tion that benefits were improperly paid is easily distinguishable. Dillard first relies on our holding
in Kaiser v. Ameritemps, Inc. (1999), 84 Ohio St.3d 411, 704 N.E.2d 1212, syllabus, that “[a] workers’ compensation claimant may employ Civ.R. 41(A)(1)(a) to voluntarily dismiss an app eal to the court of common pleas brought by an employer under R.C. 4123.512.” We also stated, “If an employee does not refile his complaint within a year’s time, he can no longer prove his entitlement to participate in the workers’ compensati on system.” Id. at 415. The facts in Kaiser , however, were not related to reimbursement from the surplus fund. Instead, we were presented only with the issue of whether an employee can take advantage of a Civ.R. 41(A)(1)(a) voluntary dismissal ev en though the employer is the party that brought the appeal. Id. at 412. A lthough the running of the saving statute would prevent the employee from refiling the complaint, and thus from proving his entitlement to workers’ compensation, that result still does not equate to a judicial determination that previous co mpensation payments should not have been
made. {¶ 17} Dillard also relies on Fowee v. Wesley Hall, Inc. , 108 Ohio St.3d 533, 2006-Ohio-1712, 844 N.E.2d 1193, ¶ 19, in which we held that “in an employer-initiated workers’ compensation appeal, after the employee-claimant files the petition as required by R.C. 4123.512 and voluntarily dismisses it as allowed by Civ.R. 41(A), if the employee-claimant fails to refile within the year allowed by the saving statute, R.C. 2305.19, the employer is entitled to judgment on its appeal.” But Fowee only involved the question of whether the savingJanuary Term, 2009

7 statute applied to an employee refiling a complaint in an employer-initiated appeal. Id. at ¶ 1. The court of appeals in Fowee had held that the saving statute did not apply and ordered th e trial court to proceed on the complaint filed by the employee more than a year after voluntarily dismissing the first complaint. Fowee v. Wesley Hall, Inc. , Hamilton App. No. C-040188, 2004-Ohio-7002, at ¶ 1, 4, 22. In reversing the court of appeals and holding that the employer was entitled to judgment on its appeal, we did not hold that the employer was entitled to a judicial finding that payments made to the employee should not have been made. More important, there was no settlement of the workers’ compensation claim as there is here, nor was any cons ideration given to po ssible reimbursement of the employer from the surplus fund.
IV {¶ 18} Dillard attempted to create a final judicial determination that the compensation payments should not have been made by inserting language into the settlement agreement requiring that Scott’s complaint “be dismissed with prejudice with the following order: Pamela S. Scott is not entitled to participate in The Ohio Workers’ Compensation Fund for the alleged condition of L4-L5 disc bulge at the plaintiff’s costs.” But as the court of appeals observed, the inclusion of this language in the dismissal entry “does not turn that dismissal into something it is not.” State ex rel. Dillard Dept. Stores v. Ryan , 173 Ohio App.3d 339, 2007-Ohio-5556, 878 N.E.2d 668, ¶ 73. “[A]lthough courts will place upon a contract the construction which the partie s to the contract have placed thereon, that construction is binding only upon such parties and not upon a third person.” Wright Aeronautical Corp. v. Glander (1949), 151 Ohio St. 29, 42, 38 O.O. 510, 84 N.E.2d 483. The settlement agreement between Dillard and Scott cannot bind
the BWC to reimburse Dillard. {¶ 19} Dillard points out that the I ndustrial Commissi on approved the settlement agreement as a matter of law by not objecting to it within the requiredS UPREME C OURT OF O HIO

8 statutory period of 30 days. R.C. 4123.65(D). This period of administrative review, however, is “to protect parties against settlements that are ‘clearly unfair’ or that constitute ‘gross miscarriage[s] of justice.’ ” Gibson v. Meadow Gold Dairy (2000), 88 Ohio St.3d 201, 202, 724 N.E.2d 787, quoting R.C. 4123.65(D). There is, therefore, no statutory obligation to review settlement agreements for potential state liability, or specifically for reimbursement from the surplus fund. This administrative approval process falls far short of making the BWC part of the settlement agreement. {¶ 20} The Tenth District was also apt to point out the practical implications of allowing an employer to obtain reimbursement in these
circumstances. See Dillard , 173 Ohio App.3d 339, 2007-Ohio-5556, 878 N.E.2d 668, at ¶ 9. Once the Industrial Commission rules in favor of an employee on a compensation claim, the employer is entitled to appeal to the common pleas court. R.C. 4123.512. Employers would be encourag ed to pursue even meritless appeals if they thought they could then reach a settlement with the employee and subsequently obtain reimbursement from the surplus fund for all past compensation by simply inserting language into the settlement and dismissal stating that the employee is not entitled to participate. The employee would have little reason to contest such language because the settlement would likely also
include a release of claims. Alt hough the employer could not obtain
reimbursement for the settlement itsel f under R.C. 4123.512(H), it could receive reimbursement for compensation already paid. Such a system would quickly deplete the surplus fund, leaving not hing for employers that deserve
reimbursement.
V {¶ 21} We hereby affirm the court of a ppeals judgment denying the writ of mandamus sought by Dillard. In the specific circumstances of this case, there has been no final judicial or administr ative determination, pursuant to R.C.January Term, 2009

9 4123.512(H), that payments made to Sco tt for her claimed L4-L5 disc bulge
should not have been made. Dillard is not entitled to reimbursement from the workers’ compensation surplus fund. A second voluntary dismissal under Civ.R. 41(A)(1)(a) by an employee-claimant filed after the parties had agreed to settle a claim in an employer-initiated workers’ compensation appeal pursuant to R.C. 4123.512 is not a final judicial determination that payments made to the employee should not have been made, when the court of common pleas has not entered judgment to that effect. Judgment affirmed.
P FEIFER , L UNDBERG S TRATTON , O’C ONNOR , O’D ONNELL , L ANZINGER , and
C UPP , JJ., concur.

__________________ Moscarino & Treu, L.L.P., Michael J. Bertsch, and Kathleen E. Gee, for appellant. Richard Cordray, Attorney General, and Stephen D. Plymale, Assistant Attorney General, for appellee.

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