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Combined Insurance v. Shurter3/10/2000
1. Declaratory Judgments: Appeal and Error. In an appeal from a declaratory judgment, an appellate court, regarding questions of law, has an obligation to reach its conclusion independent from the conclusion reached by the trial court.
2. Workers' Compensation: Subrogation: Tort-feasors. Neb. Rev. Stat. § 48-118 (Reissue 1993) grants an employer who has paid workers' compensation benefits to an employee injured as a result of the actions of a third party a subrogation interest against that third party.
3. Workers' Compensation: Subrogation. Under Neb. Rev. Stat. § 48-118 (Reissue 1993), an employer's subrogation interest becomes vested as soon as an employee's injury occurs.
4. Workers' Compensation: Subrogation: Tort-feasors. An employee's settlement of a claim against a third-party tort-feasor out of time does not extinguish an employer's vested statutory subrogation interest in the settlement proceeds under Neb. Rev. Stat. § 48-118 (Reissue 1993).
Appeal from the District Court for Adams County: Stephen Illingworth, Judge. Reversed and remanded for further proceedings.
NATURE OF CASE
Combined Insurance (Combined), the employer of Lois J. Shurter, appeals the decision of the district court for Adams County dismissing its petition for declaratory judgment filed against Shurter in which, pursuant to Neb. Rev. Stat. § 48-118 (Reissue 1993), Combined sought $34,045 of the $75,000 settlement proceeds which Shurter had received from Southern Nebraska Rural Public Power District (Southern Nebraska Power), the alleged tort-feasor. Section 48-118 pertains to an employer's subrogation rights under the Nebraska Workers' Compensation Act. We find that the trial court erred in ruling that Combined had no subrogation rights to the proceeds of the $75,000 settlement received by Shurter, and we therefore reverse, and remand for further proceedings.
STATEMENT OF FACTS
The parties have stipulated to the relevant facts, and there are no factual disputes in this case. The facts may be summarized as follows: On February 2, 1994, Shurter, an employee of Combined, was injured in a work-related accident involving the collision of her automobile with a truck owned by Southern Nebraska Power and driven by one of its employees. Combined, through its workers' compensation insurer, CNA Insurance (CNA), paid workers' compensation benefits totaling $34,045 to or on behalf of Shurter. GAB Robins North America, Inc. (GAB), was an agent and third-party administrator for CNA and had full authority to make and receive payments on behalf of Combined and CNA.
Notwithstanding the provisions of the Political Subdivision Tort Claims Act (the Act), Neb. Rev. Stat. §§ 13-901 to 13-926 (Reissue 1991 & Cum. Supp. 1994), neither Combined nor Shurter filed a timely claim with or petition against Southern Nebraska Power, a political subdivision as defined under the Act, with regard to the February 2, 1994, accident. Neither Combined nor Shurter complied with the notice requirements and statute of limitations provisions of the Act. Nevertheless, according to the stipulated facts, Shurter hired an attorney on May 9, 1996, who made an out-of-time claim against Southern Nebraska Power for Shurter's damages resulting from the accident. Notwithstanding the provisions of § 48-118, Shurter did not give written notice by certified or registered mail to CNA, GAB, or Combined of the claim she was making against Southern Nebraska Power.
On February 6, 1997, Southern Nebraska Power offered to settle Shurter's claim for $75,000. Shurter accepted the offer on February 17. CNA, GAB, and Combined were neither involved in the negotiations
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