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Tozer v. Scott Wetzel Services Inc.3/10/1994
Defendant, Scott Wetzel Services, Inc., appeals the judgment entered on a jury verdict in favor of plaintiff, Edward Tozer. We reverse.
The trial here was held in accordance with the remand order entered in Scott Wetzel Services, Inc. v. Johnson, 821 P.2d 804 (Colo. 1991). There our supreme court affirmed the Conclusion of panels of this court that an independent claims adjusting company, such as defendant, owes a duty of good faith to a client's injured employee in investigating and processing a workers' compensation claim, notwithstanding an absence of any contractual privity with the employee. At the trial on remand, the jury found for plaintiff on his claim of breach of good faith and awarded economic, non-economic, and exemplary damages.
Defendant is an independent insurance adjuster which was engaged by Safeway Stores, Inc., to process and adjust Safeway's workers' compensation claims. Plaintiff, Edward Tozer, was a Safeway employee. He also worked nights at his own janitorial business.
Plaintiff suffered a work-related injury. Safeway, acting through defendant, admitted liability for temporary total disability benefits and began paying plaintiff for such benefits.
Because of the injury and subsequent surgery, plaintiff was unable to work for several months. And, the injury forced him to cease work again after two weeks, at which time defendant resumed payment for temporary total disability. Later, plaintiff's doctor concluded that he had reached maximum medical improvement and rated plaintiff as having a ten percent permanent partial impairment of the right shoulder.
At that time, defendant filed its final admission of liability, admitting liability for an amount representing partial permanent disability and ceased temporary total disability payments. Plaintiff objected to defendant's admission, asserting that he was entitled to vocational rehabilitation and greater benefits for permanent partial disability.
Plaintiff's doctor released him to light duty work at his janitorial company, but recommended that he not resume his duties at Safeway. At a later date, plaintiff also underwent surgery for problems related to his shoulder injury. Because he was unable to resume any work after that surgery, defendant again began paying temporary total disability benefits to him.
Some months later, plaintiff's doctor again found that he had reached maximum medical improvement and that his permanent partial impairment rating remained at ten percent disability of his right shoulder. Defendant then filed a second final admission of liability, admitting liability for temporary total disability benefits for the period after surgery and for permanent partial disability thereafter. Plaintiff again contested this admission of liability.
The Administrative Law Judge (ALJ) determined that, during the period that plaintiff was unemployed by Safeway, but was working in his janitorial business, he was entitled to receive temporary partial disability benefits. The amount of such benefits was based upon the ALJ's findings as to the amount of net income received by plaintiff from this business while he was partially disabled.
In determining this net income, the ALJ found that plaintiff's business, during the year of his surgery, had gross receipts of some $83,000. Based upon plaintiff's income tax returns for that year, the ALJ deducted from such gross receipts certain business expenses, including depreciation for equipment, salaries, and taxes. These deductions resulted in a net income from the business of some $18,500, which the ALJ divided equally between plaintiff and his wife, due to her par
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