Workers Comp Claim Involving an Insurance Company Denying Benefits*

This is a review of a state court's decision on an appeal of a workers comp claim. The claim reached the state district court after the insured exhausted all of his administrative rights of appeal in the state's workers compensation administrative appellate process. The worker at the center of this case had been fighting to get compensation after he re-injured himself while on the jobsite.

His case had been complicated by the fact the original injury had occurred in one state, while the re-injury had occurred in another.

The insurance carrier had denied the worker's claim by pointing to a passage in the insurance policy which appeared to allow the company to deny injury/re-injury claims that take place in two different states.

The worker contended this was an "ambiguity of coverage" and repeatedly appealed the denial of his workers comp claim until his case reached state district court.

Statement of Facts & Appeal...

On February 10th, 2011, Eddie Raski was working for B & D Sanitation Company in the state of New Jersey as one of two "pick up" men on a sanitation vehicle.

The "pick up" men had the responsibility of helping the gathering arms of the truck latch on to the large dumpsters the truck collected trash from. Once the arms were attached, the driver engaged the lifting mechanism which hoisted the dumpster and flipped its refuse into the bin of the truck.

It had been raining for several days before the 10th of February. The 10th was no different. Raski and the others had just pulled into the rear of a supermarket to pick up its refuse. Along with the other pick up man, Raski's job this day was to jump off the back of the truck and line up the dumpster's rails with the truck's gathering arms.

As Raski went to jump off, he slipped on the rain soaked ledge upon which he was just standing. He fell to the ground, breaking the tibia and fibula of his right leg. He also tore and sprained much of the meniscus in his right knee.

Raski filed a workers comp claim in the State of New Jersey. His medical bills surmounted $21,000 and his partial wages, $5,250. B & D's insurance carrier's orthopedic surgeon ordered Raski to convalesce at home for 90 days while receiving physical therapy.

On the 90th day of his recovery, Raski was cleared to return to work at the same capacity as before his injury. While Raski was recovering from his initial injury, B & D replaced him on the truck on which he was previously working. B & D told Raski the only position they had available was as a pick up man on a New York City crew. Because Raski lived only 45 minutes from New York City, he accepted the position.

On July 1st, 2011, Raski was injured while working on a B & D truck in New York City. That afternoon, while lining up a dumpster's rails with the truck's gathering arms, Raski felt his leg give way, and he collapsed on the spot. New York City Fire and Rescue was called, and Raski was transported to St. Bonaventure Hospital. The on-call orthopedic surgeon ordered an MRI examination as well as a CAT Scan.

The MRI showed some of the tendons and ligaments in Raski's right knee to be torn, and the remaining meniscus severely sprained. The orthopedic surgeon's diagnosis was a re-injury to the same area of tendons, ligaments, and meniscus in Raski's right knee.

According to the doctor, the meniscus which remained from Raski's initial injury was not strong enough to withstand the jumping Raski had again been doing from the sanitation truck.

Raski filed a new workers comp claim, this time in the state of New York. After reviewing his claim the workers compensation carrier contacted the State's Special Disability Insurance Fund and requested reimbursement for the additional medical bills and lost wages they would have to pay Raski. The Fund denied the carrier's claim for reimbursement. The carrier in turn denied Raski's claim.

Undaunted, Raski filed an appeal to the Workers Compensation Board in the State of New York. In his appeal, Raski contended the clause in his workers compensation insurance carrier's policy which governed additional workers compensation claims was "vague and ambiguous." He quoted the following language from the policy:

"In the event a covered employee claims an injury while in the performance of his assigned duties, and that injury occurred in another state in which the insured does business and is covered by this policy, the employee shall have the right to choose in which state he wants to be covered for the new injury. 

If the initial injury occurred in the primary state, and the new injury is asserted to have occurred in another of the carrier's places in an additional state in which it conducts business, a determination of the extent of the amount of reimbursement for the claim will be dependent upon the granting or denial of supplemental compensation to the carrier from the State's Special Disability Fund. 

In the event the Special Disability Fund denies the carrier's claim for reimbursement, the carrier may in turn deny what they claim is only an employee's re-injury."

During the appeals process, the insurance carrier gave two justifications for their denial of Raski's new workers comp claim:

1. The employee's claim of a new injury was inadequate. The claim was nothing more than a slight exacerbation of the original injury. The employee's claim they said, was nothing more than a ruse to secure additional undeserved benefits.


2. The employee already exhausted his medical and salary benefits in the original state. He was not entitled to a new claim in a new state. They referred to the new workers comp claim as the employee's attempt to "double dip" into insurance benefits.

Raski denied both of the accusations and eventually took his case to state district court.

Outcome...

After hearing the evidence of both parties, the state district court ruled:

"Employees injured on the job have a right to be compensated by their employer for medical costs and lost wages. Those same employees shall be bound by terms and conditions of the insurance policy within which they are covered.

For the insurance carrier to accuse their insured of perpetrating a ruse is wrong and actionable. Although this court has not been called upon to hear evidence of defamation of the insured's character, the appellant in this case would be well-served to explore that possibility.

When those policies are written so as to allow for ambiguity and vagueness the decision of this court, and the courts preceding it shall in almost all cases side with the employee. 

When in preparation of the language which purports to cover employees, the writer must make clear the intentions and meaning of that policy. 

We revert to the reasonable and prudent man theory when deciding these matters. That is, would a reasonable and prudent man be able to understand with a degree of clarity the language purporting to provide coverage to him? When the preponderance of evidence says no, then this court will persist in finding in favor of the insured."