Pa highest court clarifies road map for Workers Comp  carriers to protect Subrogation claims.

 

The Honorable Judge Olson has clarified the “Magic words “ by which a  Workers Comp Carrier in Pennsylvania can assert a Subrogation claim against a Third Party pursuant to the much litigated Section 319 of the Pa Workers Comp Act.  In the Matter of Hartford Insurance Group on behalf of Chunli Chen v. Kamara et al. (2017 Pa. Super LEXIS 84) The Superior court clarified the  years old conundrum where Workers Comp Carriers were prohibited from asserting direct Third Party Subrogation claims to protect their interests.  This law has not changed, but the court clarified that Workers comp Carriers may assert Third Party Claims “ On behalf of “ their insureds. In an act of deliberate careful drafting Counsel for the Hartford was successful on appeal in having the court distinguish between a Workers Comp carriers attempt to bring an independent subrogation action which was recently again prohibited by  the Court in Domtar Paper ( see Liberty Mutual Insurance Co. v. Domtar Paper., 113 A.3d 1230 ( Pa. 2015).

The Hartford carefully drafted its complaint to file” On behalf of Chunli Chen, its insured and by doing so the Court allowed the Complaint to proceed.

 

Defendant  also argued that because the insurer was not actually at the accident scene, it should be prohibited from filing the state required  verification as to the facts and circumstances pursuant to which the claim was incurred.  The Court held that Pa R.C.P. 1024 which requires a verification to a complaint, was not violated by the signing of a verification by an employee of the Hartford, because “ Hartford is a party to this litigation and janes Young, as a representative of Hartford , properly verified the complaint. “

The court noted that the verification merely required verification “ to the best of my information and belief” this was sufficient to make the verification valid, even if the Hartford representative had no personal first hand knowledge of the facts.

This clarification will now allow Workers Compensation carriers to bring subrogation suits  not only their own interests but on behalf of their insureds.   And since Section 319 of the Pa Workers Comp act provides the Workers Comp carrier with an absolute lien as to its interests, WC carriers will be pleased to pursue viable cases where the member previously failed to bring an action for whatever reason.