Court Opinion

ID: 9514418
Source: CourtListenerOpinion
Date Created: 2023-08-06 22:49:17.727976+00
Date Added: 2024-06-11T09:06:17.264277
License: Public Domain

SABERS, Justice
(dissenting).
[¶ 11.] The majority opinion is inconsistent with precedent, workers’ compensation treatises, and settled principles of statutory construction.
Each statute must be construed according to its manifest intent as derived from the statute as a whole, as well as other enactments relating to the same subject. Words used by the legislature are presumed to convey their ordinary, popular meaning, unless the context or the legislature’s apparent intention justifies departure. When conflicting statutes appear, it is the responsibility of the court to give reasonable construction to both, and to give effect, if possible, to all provisions under consideration, construing them together to make them harmonious and workable. However, terms of a statute relating to a particular subject will prevail over general terms of another statute. Finally, we must assume that the legislature, in enacting a provision, had in mind previously enacted statutes relating to the same subject.
Weger v. Pennington County, 534 N.W.2d 854, 856 (S.D.1995) (citations omitted).
[¶ 12.] By equating “collect” with “judgment” and “liquidation of a claim”, the Department of Labor, the circuit court, and the majority all reach the type of conclusion we strive to avoid. See, e.g., In re Gossman, 1996 SD 124, ¶ 6, 555 N.W.2d 102, 104 (“When a statute does not define a term, it should be construed according to its accepted usage, and a strained, unpractical or absurd result should be avoided.”) (citing Nelson v. *294South Dakota State Bd. of Dentistry, 464 N.W.2d 621, 624 (S.D.1991)).
[¶ 13.] SDCL 62-4-38, prior to amendment, read as follows:
Whenever an injury for which compensation is payable under this title shall have been sustained under circumstances creating in some other person than the employer a legal liability to pay damages in respect thereto, the injured employee may at his option either claim compensation or proceed at law against such other person to recover damages or proceed against both the employer and such other person, but he shall not collect from both.
(Emphasis added). The majority’s construction of this one word, “collect,” renders the italicized section of the statute meaningless.
[¶ 14.] The majority opinion claims that a claimant such as Andreson is precluded from “further workers’ compensation benefits after taking judgment against a third party.” See supra ¶ 7.4 This conclusion is inconsistent with the statutes. How could a claimant ever “proceed against both” as permitted under the statutes according to the majority opinion? He could not, and that is why the majority decision is wrong.
[¶ 15.] The majority is essentially treating SDCL 62-4-38 as an “election of remedies”5 statute. The fact that the employer is subro-gated to the claimant’s rights in the judgment against the third party tortfeasor precludes a claim of election of remedies. See Benson v. Sioux Falls Med. & Surgical Clinic, 62 S.D. 324, 252 N.W. 864 (1934) (construing the forerunner to SDCL 62-4-38).6 The Benson court reversed a directed verdict for the defendant tortfeasor, holding that the circuit court incorrectly concluded that when the claimant settled with and released his employer from further liability, any cause of action against the tortfeasor was also thereafter barred:
We are not concerned with an election of remedies as that term is ordinarily used; no election between proceedings is required. Under the express terms of the statute an injured employee may proceed both against the employer under the compensation act and the third person in an action at law.
Id. at 334, 252 N.W. at 869 (emphasis added); accord Stratton v. Sioux Falls Traction Sys., 49 S.D. 113, 119, 206 N.W. 466, 468 (1925) (noting that the employer’s right to reimbursement “precludes an election of remedies”).
[¶ 16.] In fact, in National Farmers Union Property & Casualty Co. v. Bang, 516 N.W.2d 313, 321 (S.D.1994), we stated that SDCL 62-4-39 creates, for the employer’s benefit, a statutory workers’ compensation lien on the judgment as a setoff of workers’ compensation benefits paid to the employee. See also Schipke v. Grad, 1997 SD 38, ¶ 14, 562 N.W.2d 109, 113 (“The employee may claim workers’ compensation from the em*295ployer or pursue a legal action against the third party, but may not collect from both. If the employee has collected from both, the employer is reimbursed for the amount of the workers’ compensation paid less the reasonable expense of collecting same. SDCL 62-4-39.”) (emphasis added);7 cf. Wilson v. Hasvold, 86 S.D. 286, 194 N.W.2d 251 (1972) (after claimant received the maximum allowable workers’ compensation benefits, he was allowed to continue a separate common-law action for damages from tortfeasor). This issue was also settled by Bang, 516 N.W.2d at 321:

Defendant Bang’s argument that allowing a lien toill result in procedural complications requiring a plaintiff to choose between proceeding against either a tort-feasor or his workers’ compensation carrier has no merit. A plaintiff is not required to determine the extent of workers’ compensation before proceeding with a tort claim.

(Emphasis added) (citing Helmbolt v. LeMars Mut. Ins. Co., 404 N.W.2d 55, 59 (S.D.1987)).
[¶ 17.] Reimbursement to the employer is, and always was, an inherent provision of the statutory framework for compensating the employee injured by a third party. See SDCL 62-4-39:
If compensation has been awarded and paid under this title and the employee has recovered damages from another person, the employer having paid the compensation may recover from the employee such an amount equal to the amount of compensation paid by the employer to the employee, less the necessary and reasonable expense of collecting the same.
See also 6 Larson’s Workmen’s Compensation Law § 71.20, at 14-5 to 14-13:
The obvious disposition of the matter is to give the employer so much of the negligence recovery as is necessary to reimburse him for his compensation outlay, and to give the employee the excess. This is fair to everyone concerned: the employer, who, in a fault sense, is neutral, comes out even; the third person pays exactly the damages he would normally pay, which is correct, since to reduce his burden because of the relation between the employer and the employee would be a windfall to him which he has done nothing to deserve; and the employee gets a fuller reimbursement for actual damages sustained than is possible under the compensation system alone.
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As for the employee, he gets no windfall; what he gets is nothing more than actual restoration to himself of what he has lost because of the third person’s wrongful act.... The right of the claimant to keep a double recovery must not be confused with the right to collect the double recovery subject to the obligation to pay over to the employer or carrier the amount of the latter’s compensation outlay.
(Emphasis in original).
[¶ 18.] A plain reading of SDCL 62-4-39 shows that Brink, as employer, could recover funds paid by BHPL to Andreson if Andre-son pursued his compensation remedy before pursuing BHPL.8 However, under the majority opinion’s note 2, Andreson can not seek recovery from BHPL if he already elected his remedy by seeking workers’ compensation benefits from Brink. This is nonsensical. There is no reason a claimant cannot pursue the tort claim prior to seeking further workers’ compensation benefits, as Andreson did in this case. This court clearly stated in Bang that a “plaintiff is not required to determine the extent of workers’ compensation before proceeding with a tort claim.” 516 N.W.2d at 321 (emphasis added). If a claimant is forced to wait to sue the third party until he has pursued all potential workers’ compensation benefits, the statute of lim*296itation on that suit will inevitably expire in the meantime.9 Furthermore, the majority opinion overlooks SDCL 62-7-33, which provides for reopening and modification in the event of a change in the claimant’s condition.10 If, as the majority claims, judgment against the tortfeasor cuts off any further workers’ compensation benefits, that statute becomes meaningless. “[TJhere is a presumption against a construction which would render a statute ineffective or meaningless.” In re Real Estate Tax Exemp. for Black Hills Legal Serv., Inc., 1997 SD 64, ¶ 12, 563 N.W.2d 429, 432 (citations omitted).
[¶ 19.] The fear of double recovery is unfounded in light of the reimbursement provisions of SDCL 62-4-39 & -40.11 “It is elementary that the claimant should not be allowed to keep the entire amount both of his compensation award and of his common-law damage recovery.” 6 Larson’s, § 71.20, at 14-5; see also id. § 73.10, at 14-354:
An injured employee who believes that his injury arose out of and in the course of his employment, and who also believes that it was caused by the tort of a third party, is confronted with the possibility of claiming compensation and of suing the third party at common law. The statutes of many jurisdictions allow him to proceed with both, always, of course, subject to the condition that he cannot retain both recoveries.
(Emphasis added); see also St. Paul Fire & Marine Ins. Co., v. Farner, 648 F.2d 489 (8th Cir.1981) (construing SDCL 62-4-39 & -40 and allowing workers’ compensation insurer to recoup the benefits it paid to its employee’s widow, who recovered $125,000 in a wrongful death action against the third party tortfeasor).
[¶ 20.] The majority’s decision to dismiss this lawsuit and deny these benefits to An-dreson based on fear of double recovery finds no support in the statutes. It is inconsistent with precedent, workers’ compensation treatises, and settled principles of statutory construction.12 We should reverse and remand for hearing.

. The majority also implies that Andreson reopened his compensation claim because he was "dissatisfied with the verdict” against Brink. (Supra ¶ 3). This is clearly not the case, as Andreson filed his petition with the Department of Labor five months before trial.

. “An 'election of remedies' arises when one having two coexistent but inconsistent remedies chooses to exercise one, in which event he loses the right to thereafter exercise the other." Black’s Law Dictionary 518 (6th ed.1990). "Election of remedies is not simply a rule of procedure; rather, it is based upon substantive law, birthed in the existence of contracts and the rights derived from those contracts." Ripple v. Wold, 1996 SD 68, ¶ 4, 549 N.W.2d 673, 674 (citation omitted). This is not a contract case. It is a workers' compensation case. The proper resolution of this case rests upon the plain language of the statute. "Workers’ compensation laws are purely statutory and the rights of the parties and the manner of procedure under the law must be determined by its provisions.” Schipke v. Grad, 1997 SD 38, ¶ 10, 562 N.W.2d 109, 112 (citing Nilson v. Clay County, 534 N.W.2d 598, 601 (S.D.1995) (quoting Caldwell v. John Morrell & Co., 489 N.W.2d 353, 364 (S.D.1992)).

.South Dakota has never had a workers’ compensation election statute. The legislative history of SDCL 62-4-38 reveals that it has survived virtually unchanged since its adoption in 1917. See SL 1917, ch. 376, § 11; RC 1919, § 9446; SL 1921, ch. 416; SDC 1939, § 64.0301; SL 1964, ch. 224. 6 Larson's Workmen’s Compensation Law lists the few (7) states which still retain election statutes (South Dakota is not included), but notes that even in those states "an election does not result in complete forfeiture of either compensation benefits or third-party damages.” § 73.10, at 14-355 n2.

. Schipke cites the current version of SDCL 62-4-39, which was amended after Andreson's injury. However, that amendment is not material to whether an employer is subrogated to the verdict, but only concerns the amount of the verdict which may be subtracted for attorney fees.

. Obviously, Brink is subrogated to Andreson's rights in the $35,000 judgment against BHPL as a setoff against the compensation paid to him. In fact, since Brink paid $36,000 in benefits to Andreson, Brink is subrogated to the entire amount, less "the necessary and reasonable expense of collecting the same.” SDCL 62-4-39.

. See Wade R. Habeeb, Annotation, Effect of Injured Employee’s Proceeding for Workmen's Compensation Benefits on Running of Statute of Limitations Governing Action for Personal Injury Arising From Same Incident, 71 ALR3d 849 (1976) (collecting cases and noting the statute is not tolled by the workers' compensation proceedings); accord L.S. Tellier, Annotation, Statute of Limitations Applicable to Action, By Way of Subrogation or the Like, By Employer or Insurance Carrier Against Third Person for Injury to Employee, 41 ALR2d 1044 (1955) (applicable statute of limitation is one governing personal injury or wrongful death).

. SDCL 62-7-33 provides, in relevant part: "[P]ayments may be ended, diminished, increased or awarded ... if the department finds that a change in the condition of the employee warrants such action.”

. SDCL 62-4-40 provides:
If compensation is awarded under this title, the employer having paid the compensation, or having become liable therefor may collect in his own name or that of the injured employee, or his personal representative, if deceased, from any other person against whom legal liability for damage exists, the amount of such liability and shall hold for the benefit of the injured employee or his personal representative, if deceased, the amount of damages collected in excess of the amount of compensation paid such employee or his representative, less the proportionate necessary and reasonable expense of collecting the same, which expenses may include an attorney’s fee not in excess of thirty-five per cent of damages so collected, and shall be subject finally to the approval of the department.

.The defect of this decision is demonstrated by the result: The third party tortfeasor pays $35,-000. Brink, as employer, is subrogated to the entire amount ($36,000) less recovery costs. An-dreson, the injured party, receives nothing for rehabilitation or additional permanent partial disability.
Clearly, a claimant is entitled to proceed against his employer for permanent partial disability benefits not yet collected from the employer. Furthermore, one can always proceed against an employer for rehabilitation and retraining benefits, as they are not part of the cause of action against a third party tortfeasor. Finally, when a claimant sustains a second injury, as is the case here, which results in a need for additional permanent partial disability and retraining benefits, the claimant is entitled to reopen his claim according to SDCL 62-7-33.