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11/20/89 Liberty Mutual Insurance v. Lloyd Schoenheit Truck &

November 20, 1989

LIBERTY MUTUAL INSURANCE COMPANY, PLAINTIFF-APPELLANT

v.

LLOYD SCHOENHEIT TRUCK & TRACTOR SERVICE, INC., ET AL., DEFENDANTS-APPELLEES

BEFORE ADDRESSING LIBERTY MUTUAL'S ARGUMENT, WE SET FORTH THE STATUTES HEREIN INVOLVED. THE PERTINENT PORTION OF SECTION 5(B) OF THE WORKERS' COMPENSATION ACT (ILL. RE

v.

STAT. 1981, CH. 48, PAR. 138.5(B)) UPON WHICH LIBERTY MUTUAL RELIES, STATES AS FOLLOWS:

THE FIRST PARAGRAPH OF SECTION 2 OF THE WRONGFUL DEATH ACT (ILL. RE

v.

STAT. 1981, CH. 70, PAR. 2) STATES AS FOLLOWS:



APPELLATE COURT OF ILLINOIS, FIFTH DISTRICT

547 N.E.2d 1272, 191 Ill. App. 3d 578, 138 Ill. Dec. 651 1989.IL.1804

Appeal from the Circuit Court of St. Clair County; the Hon. Robert Craig, Judge, presiding.

APPELLATE Judges:

JUSTICE LEWIS delivered the opinion of the court. HARRISON and CHAPMAN, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE LEWIS

The plaintiff, Liberty Mutual Insurance Company (Liberty Mutual), appeals from an order granting a motion for judgment on the pleadings in favor of the defendant Hartford Insurance Company (Hartford). Liberty Mutual had brought a suit for declaratory judgment which was dismissed with prejudice by virtue of the trial court's granting Hartford's motion.

The underlying cause of action which gave rise to Liberty Mutual's complaint was a civil action brought in the circuit court of St. Clair County entitled "Faye Meserole as special administrator of the estate of David Meserole, deceased, plaintiff v. Lloyd Schoenheit Truck and Tractor Service et al., defendant" (Meserole). After a fourth amended complaint was filed, the Meserole case was settled and Hartford made payments to Faye Meserole on behalf of Schoenheit, its insured. Liberty Mutual, at the time of the settlement, held a workers' compensation lien in the amount of $61,598.94 for monies paid to Faye Meserole on behalf of Southern Triangle Oil Company, David Meserole's employer. Hartford was notified by letter of Liberty Mutual's lien claim. Prior to the settlement of the Meserole case, Hartford acknowledged the claim but refused to make payment on the lien and only made payment to the special administrator. Subsequently, Liberty Mutual filed its complaint seeking a declaratory judgment regarding its rights as lienholder, which as we noted previously, was dismissed with prejudice and is the subject of this appeal.

On appeal, Liberty Mutual contends that because Meserole's complaint alleged a claim under the Wrongful Death Act (Ill. Rev. Stat. 1981, ch. 70, par. 1 et seq.), pursuant to section 5(b) of the Workers' Compensation Act (Ill. Rev. Stat. 1981, ch. 48, par. 138.5(b)), Southern Triangle Oil Company, decedent's employer, was entitled to reimbursement for the outstanding workers' compensation lien from the settlement of Meserole's claim with Schoenheit. The basis of Liberty Mutual's contention that its lien is reimbursable is that workers' compensation liens can attach to the settlement proceeds from a wrongful death action. (Esin v. Liberty Mutual Insurance Co. (1981), 99 Ill. App. 3d 75, 424 N.E.2d 1307.) However, Hartford maintains that the settlement was based upon an action under the Structural Work Act (Ill. Rev. Stat. 1981, ch. 48, par. 69) and, therefore, the lien does not attach.

"Where the injury or death for which compensation is payable under this Act was caused under circumstances creating a legal liability for damages on the part of some person other than his employer to pay damages, then legal proceedings may be taken against such other person to recover damages notwithstanding such employer's payment of or liability to pay compensation under this Act. In such case, however, if the action against such other person is brought by the injured employee or his personal representative and . . . settlement is made with such other person, either with or without suit, then from the amount received by such employee or personal representative there shall be paid to the employer the amount of compensation paid or to be paid by him to such employee or personal representative including amounts paid or to be paid pursuant to paragraph (a) of Section 8 of this Act.

. . . No release or settlement of claim for damages by reason of such injury or death, and no satisfaction of judgment in such proceedings shall be valid without the written consent of both employer and employee or his personal representative, except in the case of the employers, such consent is not required where the employer has been fully indemnified or protected by court order." Ill. Rev. Stat. 1981, ch. 48, par. 138.5(b).

"Every such action shall be brought by and in the names of the personal representatives of such deceased person, and, except as otherwise hereinafter provided, the amount recovered in every such action shall be for the exclusive benefit of the surviving spouse and next of kin of such deceased person and in every such action the jury may give such damages as they shall deem a fair and just compensation with reference to the pecuniary injuries resulting from such death, to the surviving spouse and next of kin of such deceased person."

Section 69 of the Structural Work Act (Ill. Rev. Stat. 1981, ch. 48, par. 69) provides in pertinent part as follows:

"For any injury to person or property, occasioned by any wilful violations of this Act, or wilful failure to comply with any of its provisions, a right of action shall accrue to the party injured, for any direct damages sustained thereby; and in case of loss of life by reason of such wilful violation or wilful failure as aforesaid, a right of action shall accrue to the surviving spouse of the person so killed, the lineal heirs or adopted children of such person, or to any other person or persons who were, before such loss of life, dependent for support on the person or persons so killed, for a like recovery of damages for the injuries sustained by reason of such loss of life or lives."

An analysis of the foregoing provisions reveals that reimbursement for workers' compensation liens is limited to third-party actions in which the employee or his personal representative is the plaintiff. In a wrongful death action, the statute requires that the claim be brought by the personal representative of the decedent. In contrast, a structural work action is to be brought in the surviving spouse's ...


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