Court Opinion

ID: 9762496
Source: CourtListenerOpinion
Date Created: 2023-08-29 02:25:31.115292+00
Date Added: 2024-06-11T07:29:35.047122
License: Public Domain

LEIBSON, Justice,
dissenting.
Respectfully, I dissent. It is our duty to decide the case at hand, and not to expound at length on some hypothetical fact situation which is not involved in the case at hand. Here we have abandoned the first principle of judicial authority, which is to decide cases in controversy.
These are the facts of this case. Mason Cornelius, an employee of Dix & Associates, was part of a crew involved in laying a waterline across Kentucky Highway # 1430 in Nelson County, Kentucky. He was struck down and fatally injured by a grain truck owned by Bardstown Mills and operated by Jerry L. Key. His employer, Dix & Associates, through its workers’ compensation insurance carrier, paid statutory benefits to his estate and his family totaling about $37,000. In addition to accepting these benefits, Cornelius’ estate brought a wrongful death action seeking complete recovery for full damages against Key/Bardstown Mills. KRS 342.700(1), styled “Remedies when third party is legally liable,” states “the injured employee may either claim compensation or pro*32ceed at law by civil action against such other person to recover damages, but he shall not collect from both.” [Emphasis added.]
Key/Bardstown Mills, the defendants in the wrongful death action, filed a third-party complaint against the employer claiming it had failed to properly warn the public about the construction site and seeking contribution. KRS 342.690(1) specifically authorizes limited contribution. It provides the employer may be liable “to another person who ... has paid damages on account of injury or death of an employe of such employer arising out of and in the course of employment and caused by a breach of any duty or obligation owed by such employer to such other ... limited to the amount of compensation and other benefits for which such employer is liable under this chapter.” This recognizes the right of the party defendant in the employee’s common law tort action to obtain contribution against the employer, but limits recovery to the employer’s liability for benefits under the compensation law.
The employer, Dix & Associates, counterclaimed seeking reimbursement for the workers’ compensation benefits it had paid.
Key/Bardstown Mills settled the wrongful death claim made by the employee’s estate against them for $250,000. Key/Bardstown Mills took a “General Release” acknowledging payment in full for all claims and causes of action and releasing the defendants, Key/Bardstown Mills, “and all other persons, corporations, or other entities, legally liable or responsible, of and from any and all liability, now existing or hereafter to exist or accrue, on account of or because of [Cornelius’] injury and death.” This was a complete release for full damages. It was not subject to interpretation that the employee’s estate and his heirs had been paid only partial satisfaction of the wrongful death claim. The partial settlement principle stated in Richardson v. Eastland, Inc., Ky., 660 S.W.2d 7 (1983) and Restatement (Second) of Torts, § 885(1) has no application to this case. The employee’s estate was paid $250,000 for his wrongful death claim in addition to $37,000 in workers’ compensation benefits the employer had already paid; a total of $287,000. The idea the employee’s estate was paid only 95% is pure fiction.
The settlement was reached without notification to or participation by the employer and made no provision for reimbursement to the employer for the statutory subrogation right to reimbursement for workers’ compensation benefits paid before the settlement, which is created by KRS 342.-700(1). Cf. City of Louisville v. Burch, Ky.App., 611 S.W.2d 532 (1981).
This brings us to certain facts which are unique to this case. As part of the settlement agreement, Key/Bardstown Mills agreed to indemnify Cornelius’ dependants and estate for its statutory obligation to repay workers’ compensation benefits, created by KRS 342.700(1), thus agreeing to assume the estate’s legal responsibility for repaying these benefits. Because of this agreement to indemnify the estate, the trial court entered a summary judgment for Dix & Associates against Key/Bardstown Mills on its claim for reimbursement for “paid workers’ compensation benefits totaling $36,949.54,” plus prejudgment interest. This judgment has never been appealed.
The only question of law before us in this case is thus stated in the “Motion to Transfer”:
“Whether the determination of liability on a contribution claim should be according to percentages of fault in keeping with the comparative negligence principles adopted in Hilen v. Hays for cases pending prior to the effective date of KRS 411.182.” [Emphasis added.]
Rather than deciding the issue presented, Justice Vance’s Opinion undertakes to consider the rights of an injured worker to recover damages at common law against a tortfeasor (not his employer), and mandates that such damages should be reduced to the extent of his employer’s negligence. Here the employee’s estate has been paid off in full. It is not a party to this appeal. The damages it has been paid are not subject to challenge; nor can they be designated only a partial payment of the employee’s wrongful death damages, as done in the *33Majority Opinion, by any stretch of the imagination.
We are called upon by the parties to construe the contribution statute, KRS 412.030, as it applies to this case between the appellant, Dix & Associates and the appellees, Key/Bardstown Mills. The Majority responds by holding the contribution statute no longer exists, presumably eradicated because our Court adopted comparative negligence in Hilen v. Hays, Ky., 673 S.W.2d 713 (1984), and replaced by an apportionment scheme in which the injured worker will lose a percentage to be apportioned to the employer, regardless of whether or not the damages thus cut off are replaced by workers’ compensation.
KRS 412.030, the contribution statute at issue was not court-created and cannot properly be court-repealed. It states as follows:
“Contribution among wrongdoers may be enforced where the wrong is a mere act of negligence and involves no moral turpitude.”
This statute was enacted in 1926 to supplant the existing common law rule in negligence cases that no right of action for contribution existed between joint tort-feasors in pari delicto. See Consolidated Coach Corp. v. Burge, 245 Ky. 631, 54 S.W.2d 16 (1932). Before the statute was enacted “recovery over [would] not be allowed as between joint tortfeasors ... in pari delicto.” Louisville Ry. Co. v. Louisville Taxicab & Transfer Co., 256 Ky. 827, 77 S.W.2d 36, 39 (1934). The statute now permits such recovery.
Contribution and apportionment are two different entities. The right of contribution is about one tortfeasor who has paid or become obligated to pay the victim seeking recoupment for a part of this obligation from another tortfeasor who contributed to cause the injury. Historically, it has been required “pro rata,” interpreted to mean in equal shares (50/50), because the injury has been considered single and indivisible. It is one thing to consider changing the method of computing contribution from equal shares to proportionate shares; it is a different thing to abolish any portion of the worker’s right to recover from a third party tortfeasor as reserved to him by KRS 342.700(1). It is one thing to change from 50/50 to assigned percentages the method for computing how much a third party tort-feasor may deduct from the portion of the claim as to which the employer has the right of statutory subrogation under KRS 342.700(1);1 it is a different thing to set aside a portion of the employee’s right “to recover damages” from a third party tort-feasor reserved to by him KRS 342.700(1) and substitute limited liability from the third party tortfeasor to the injured or deceased worker. We cannot properly decide in this case to abolish any portion of the workers right to recover from a third party tortfeasor as reserved to him by KRS 342.700(1).
We cannot properly decide:
1) that the contribution statute has been repealed and the right to contribution has been abrogated by a decision about the common law in Hilen v. Hays, supra;
2) that there should be limitations on the statutory right of an injured worker, preserved in KRS 342.700(1), to pursue his common law remedy other than those limitations imposed in this or some other statute;
3) that the employer’s statutory obligations to pay benefits to an injured worker as structured under the workers’ compensation law has been either increased or impaired by our decision in Hilen v. Hays; or
4) what will be the law in future cases when we must then determine the impact of KRS 411.182 (the new apportionment statute effective July 15, 1988)2 on the workers’ compensation law.
NONE OF THESE ISSUES ARE BEFORE US. Yet the Majority Opinion *34speaks to all four of these issues in derogation of the limits of judicial power which extend only to deciding cases in controversy. Plainly put, this is an Opinion written to decide issues other than those presented and to decide tort rights between parties other than those presently involved, who are Dix & Associates on the one hand and Key/Bardstown Mills on the other.
The two issues we were asked to address on this appeal are:
1) Whether henceforth contribution from a joint tortfeasor should be recovered on a proportionate or a percentage basis rather than using the long-standing principle of equal shares (50/50); and
2) Whether Dix & Associates was entitled to a directed verdict, not because statutory contribution is repealed, but because under the facts of this case its “negligence, if any, was not the proximate cause of the injury.”
The Majority Opinion side-steps the first question, choosing instead to hold the right to contribution is eliminated by the advent of apportionment. The Majority Opinion never speaks to the second question, choosing instead to take the jury’s apportionment of “causative fault,” 95% as to Key/Bardstown Mills and 5% as to Dix & Associates, as a given, and use this as a point of departure from which to expound tort law against the injured worker.
Justice Vance’s Opinion acknowledges, in a backhand manner, that he raises and decides issues which are not framed by the decision of the trial court nor raised by the parties on appeal. He states:
“The issue of contribution was raised on the appeal whereby appellant contended that the negligent third-party was not entitled to any contribution whatever, albeit for a different reason than the one adopted in this opinion. The question of whether the appellees should be entitled to any contribution whatever because they had settled only the liability for the 95% of the injury apportioned to them was fully explored in the oral argument before this Court.” [Emphasis added.]
But the employer, Dix & Associates, did not question the existence of the legal right to seek contribution against an employer. The employer, Dix & Associates, claimed only that there was no factual justification for the claim over against the employer for contribution.
Justice Vance is the one who first raised the “question of whether the appellees should be entitled to any contribution whatever because they had settled only the liability for the 95% of the injury apportioned to them.” This was a unique proposition brought up at oral argument by Justice Vance, not raised by the parties. His conclusion as to the issue he raised is “appel-lees have no claim against Dix and Associates for contribution.” But an appellate court cannot properly raise and decide issues in this manner. It is an unprecedented departure from procedure. The Majority Opinion has turned a factual argument regarding sufficiency of the evidence to support a finding into a decision that apportionment has been substituted for the right to maintain a claim for contribution.
The Majority Opinion opens with a statement to the effect that we granted transfer of this case “to consider whether a conflict exists between [certain previous] opinions of this Court.” The only proper reason for granting a transfer is to consider the issues presented, and these issues can only be considered in the context presented, viz., the existing fact situation and the issues between the parties to the appeal.
After ' the settlement, because Key/Bardstown Mills was still seeking to enforce a right to contribution against Dix & Associates, the trial court submitted the case to a jury to decide whether Dix & Associates was guilty of contributory negligence.3 The jury apportioned “causative fault” 95% against the third party tort-feasors, Key/Bardstown Mills, and only 5% *35against the employer, Dix & Associates. Nevertheless, the trial judge, following what has always been the way the contribution statute has been construed until now, applied the contribution statute in equal shares (50/50). Further, the trial court reasoned that because assessing contribution for one half the amount paid the employee’s estate by Key/Bardstown Mills would exceed the $37,000 in benefits paid under the workers’ compensation law, and because KRS 342.690(1) limits the employer’s liability to its liability under the workers’ compensation law, the employer/ compensation carrier’s right to indemnity for benefits paid and the third party tortfeasor’s right to contribution were a “washout.”
The issue appealed was whether we should overrule precedent and substitute proportionate sharing for equal sharing in construing and applying the contribution statute, not whether we should abandon the statute. It would have sufficed for this case to hold henceforth contribution among tortfeasors will be by percentages between tortfeasors, but the Majority chose a different course; it went after the rights of the injured worker which were not at issue in this case.
There is a fundamental difference between the present situation and Hilen v. Hays, supra. In Hilen, we were dealing with common law claims, judge-made law subject to judicial reconsideration. But contribution among negligent tortfeasors is not a creature of common law; it is statutory: KRS 412.030. In Reda Pump Co., a Div. of TRW, Inc. v. Finch, Ky., 713 S.W.2d 818, 821 (1986), a 6/1 Opinion authored by Justice Vance, who writes this one, the author states the reason behind overruling precedent in Hilen v. Hays was “that a rule promulgated by a court could be changed by a court”; Reda Pump then holds this same reasoning does not apply to a products liability claim because we could not override the statutory mandate in products cases (KRS 411.320(1)) that contributory negligence shall be a complete defense. Yet here we take the opposite view. Here, where it is not the products manufacturer’s protective statute but the protection afforded the injured worker by the workers’ compensation statutes which are at issue (his right to seek a complete recovery from a negligent third party at common law rather than settle for the limited benefits the workers’ compensation law provides) we agree upon a harsh and different rule. We are quick to protect the negligent manufacturer from liability, and quicker still to impair the injured worker’s potential recovery of complete damages against a negligent third party, even though both rights are protected by statute.
Henceforth a negligent third party (such as Key/Bardstown Mills) will be free to assign liability to the injured worker’s employer who will, many times, have no interest in defending because it enjoys the statutory immunity of the workers’ compensation law. There are many injuries to workers where workers’ compensation benefits are minimal calling for very substantial common law damages. For example, a worker killed on the job who has no depen-dants may have a sizable wrongful death claim against a third party tortfeasor but the workers’ compensation death benefits are negligible. Severe burns can cause hideous pain and disfigurement, but no permanent disability for which workers’ compensation benefits are due. An injury causing loss of child bearing potential, or loss of taste and smell, may represent a substantial common law claim in which the employer/compensation carrier has no stake. The list of examples of cases where the employer would have no interest in defending is practically unlimited.
The Kansas statute cited as persuasive in the Majority Opinion, K.S.A. 44-504(d), does not provide for reducing the employee’s recovery against the third party. On the contrary, the full extent of the statute is to provide, where the worker’s employer is found partially responsible, that “the employer’s subrogation interest or credits against future payments of compensation and medical aid, ... shall be diminished by the percentage of the damage award attributed to the negligence of the employer. ...” This says nothing about reducing *36the employee’s recovery against the third party, which is the major thrust of Justice Vance’s Opinion.
The present decision cannot be justified by attributing it to the new rule of comparative fault announced in Hilen v. Hays, supra. Our Opinion in Hilen v. Hays borrows from the Uniform Comparative Fault Act, 12 U.L.A., Civ.Proc. & Rem.Law, 39 (Cum.Supp.1984) for a fair understanding of the new principle. In Hilen v. Hays, we used §§ 1 and 2 of the Uniform Comparative Fault Act in defining the concept of comparative fault. We did not consider the present fact situation which is whát happens when a named defendant seeks contribution from a third party. The Uniform Comparative Fault Act provides for this circumstance in §§ '4, 5 and 6. It recognizes the continued viability of statutory contribution where there is contributory fault on the part of a third party defendant who is protected from having to make payments to the injured party. The plaintiff and the defendant are then required to absorb the loss thus occasioned in proportion to their own contributory fault. This means that where the injured worker bears no share of contributory fault in the accident, he still recovers complete damages for injury or death against a third party tortfeasor who claims the employer was also at fault. Only the employer’s claim for the portion of the complete recovery for which compensation benefits had been previously paid would be reduced or eliminated by employer’s proportionate negligence. If we are to change the basic structure that has existed heretofore under the contribution statute, we should change to a fair arrangement as set out in §§ 4, 5 and 6 of the Uniform Comparative Fault Act, not to the harsh and unjust arrangement which will follow from the Majority Opinion.
There is another unique aspect to this case. As part of this settlement, Key/Bardstown Mills took an assignment from Cornelius’ estate of .any rights the estate or his dependants might have to collect future unpaid benefits against Dix & Associates. KRS 342.180 provides that "no claim for compensation under this Chapter shall be assignable.” But in this ease there was no claim to assign in any event, because once complete damages have been paid by a third party tortfeasor, this extinguishes any further employer’s liability to pay workers’ compensation benefits, under the proviso in KRS 342.700(1) which states “the injured employee may either claim compensation or proceed at law by civil action against [‘some other person than the employer’] to recover damages, but he shall not collect from both.” Since the employee’s estate has made and acknowledged by “General Release” complete recovery for all wrongful death damages, the mandate of KRS 342.700(1) is that the employer owes no further workers’ compensation benefits and is entitled to repayment of such benefits as have been paid already.
The ultimate failure of logic in this case expresses itself through this quote from p. 14 of the Opinion:
“Since the employee in this case has only recovered 95 percent of his total damage from the negligent third party, the continuation of 5 percent of his workers compensation benefits will not amount to a double recovery. A double recovery can be prevented by allowing Dix & Associates to recoup only 95 percent of the compensation benefits paid. If the injured employee recovers only 95 percent of his loss from the negligent third party and his employer could recover out of that fund 100 percent of the amount paid in compensation benefits, not only would the employee not be whole, but the employer would profit from his own negligence.”
Surely this cannot mean that this worker who has been paid complete damages, including amounts previously paid by workers’ compensation, and signed a General Release acknowledging such payment, is still owed workers’ compensation benefits. Surely this has no application to the present case where the employee’s depen-dants and estate have not, as our Opinion states, “recovered 95 percent of his total damage from the negligent third party,” but on the contrary, have recovered 100 percent of his total damages from the third *37party plus some $37,000 in workers’ compensation benefits. These are benefits which the estate would be obligated to repay under KRS 342.700(1) but for the fact that the negligent third party has assumed the employee’s statutory obligation to repay them.
The letter from Key/Bardstown Mills’ counsel to counsel for the employee’s estate which accompanied the General Release to be executed by the estate, stated as follows:
“Enclosed is a check of draft of Midwestern Indemnity in the amount of $250,000. Our settlement agreement included our accepting responsibility for the compensation already paid.”
This letter between the employee’s estate and Key/Bardstown Mills acknowledges the fact that the estate has not only been paid 100% of the wrongful death claim, but has been paid another $37,000 for which the employer has statutory subrogation, an obligation for which Key/Bardstown Mills is “accepting responsibility.”
It should be apparent that the unique settlement between Key/Bardstown Mills and the employee’s estate leaves but one sensible resolution. This would be to recognize as the central fact that Key/Bardstown Mills assumed the employee’s obligation to repay workers’ compensation benefits. The parties to this settlement disregarded the proviso in KRS 342.-700(1) that the employee “shall not collect from both.” Because of the statutory structure of the workers’ compensation law, which we have no right to countermand, in this settlement between the employee’s estate and the third party tort-feasor the third party tortfeasor extinguished any further right to seek contribution against the employer by assuming the employee’s obligation to repay the employer.
The letter also disregarded the proviso in KRS 342.180 that “no claim for compensation under this Chapter shall be assignable.” It goes on to state:
“It [‘our settlement’] also included the agreement that there would be no more workers’ compensation benefits to the two children and that the rights to those benefits would be assigned by the children to Bardstown Mills.”
The employer’s Summary Judgment for recoupment of workers’ compensation benefits stands unchallenged on this appeal. We have no right to disregard it, just as we have no right to decide here what law should apply in future cases to the claims of injured workers because in this case all of the claims of the deceased worker are fully paid and not appealed. Key/Bardstown Mills’ claim for contribution against the employer should fail because the settlement made by this third party tortfeasor with the employee’s estate was in derogation of the employer’s statutory subrogation rights. But because Dix & Associates have not presented this issue on appeal, the judgment should be affirmed.
It may well be that in some future case, some fact situation different from this one, it will be appropriate to declare the contribution statute should be construed differently than we have construed it for so many years. When we reach that proper case, the solution presented by the Kansas statute is certainly worthy of consideration, recognizing, as it does, that it applies only to “the employer’s subrogation interest or credits against future payments of compensation,” and that it is not a device to reduce the recovery of an injured employee innocent of wrongdoing against a third party tortfeasor. That recovery should be reduced only by the amount of workers’ compensation benefits he has collected, as the statutes provide. Because of the unique fact situation presented by the settlement in the present case, the entire discussion is beyond the scope of the issues presented. The judgment should be affirmed.
COMBS, and LAMBERT, JJ., join this dissent.

. Keeping in mind that under KRS 342.690(1) whatever the percentage may be it can only be used as a setoff limiting the obligation to repay the employer.

. All parties agree this 1988 statute has no application to this case.

. This was a mistake (to be discussed infra at p. 36) because Key/Bardstown Mills had already given up this right by agreeing to assume the employee’s responsibility under KRS 342.700(1) to repay benefits upon recovery of complete damages from the third party tortfeasor. But Dix & Associates has not preserved this error.