HARRISBURG – A trio of judges from the Superior Court of Pennsylvania ruled that a Philadelphia trial court was wrong to prevent a Connecticut insurance company from being granted party status and intervening, in an action where it was slated to pay $350,000 as part of a $1.45 million settlement agreement to an MRI machine technician injured in an explosion.
Superior Court judges Maria McLaughlin, Megan McCarthy King and Dan Pellegrini ruled on Aug. 5 to remand John and Elaine Gleason’s cases against Alfred I. DuPont Hospital for Children and HSC Builders & Construction Managers to the Philadelphia County Court of Common Pleas.
Pellegrini authored the Court’s opinion in this matter.
“Mr. Gleason was employed as an MRI Field Service Technician by Medical Imaging Group (MIG). Hartford Insurance Group provides workers’ compensation insurance to MIG. On May 29, 2015, while Mr. Gleason was performing maintenance on an MRI machine at DuPont Hospital, a fire and explosion occurred in the main distribution panel. Mr. Gleason’s hair, skin and clothing caught fire and he suffered severe burns, scarring, disfigurement and temporary blindness,” Pellegrini said.
“The Gleasons filed two actions against various defendants in 2016 and 2017 [in the Philadelphia County Court of Common Pleas], alleging negligence and loss of consortium. The defendants answered the complaints and filed cross-claims and the actions were consolidated in February 2018. The Gleasons reached a proposed settlement agreement with the defendants and they filed a petition seeking the trial court’s approval of its terms on Dec. 12, 2019. The agreement provided for a total settlement payment of $1.45 million. That sum was allocated between the Gleasons, with $580,000 to Mr. Gleason and $870,000 to Mrs. Gleason for the loss of consortium claim.”
On Dec. 25, 2019, all defendants joined in support of the Gleasons’ petition without taking a position on the allocation between the spouses. The trial court approved the unopposed settlement on Jan. 27, 2020, after oral argument and because the cross-claims were not disposed of by the settlement agreement, the case remained listed for trial.
Hartford has paid $988,474 to and on behalf of Mr. Gleason in medical expenses, wage loss benefits and to fund a medical set aside account for his future medical expenses. The Gleasons offered to pay Hartford $352,287, representing the amount remaining from Mr. Gleason’s settlement after deduction of attorneys’ fees and costs.
“On April 20, 2020, Hartford filed a petition to intervene, seeking protection of its statutory lien interest under Section 319 of the Pennsylvania Workers’ Compensation Act. The trial court entered an order denying Hartford’s request to intervene on May 14, 2020. Hartford then filed a second petition to intervene, which the trial court denied on Aug. 20, 2020. This timely appeal followed. The trial court filed a Rule 1925(a) opinion on Feb. 9, 2021, stating that Hartford’s appeal is premature and not ripe for our review. The court requested that the appeal ‘be suspended until the conclusion of trial on the outstanding cross-claims.”
“On appeal, Hartford contends that the trial court’s order denying intervention is final and appealable because the ruling denies it party status and prevents it from receiving notice of all filings in this case. It maintains that the order has the practical effect of denying it the ability to fully protect its subrogation rights, and that it impacts its standing to appeal the January 2020 order approving settlement. Hartford argues that party status is necessary to adequately protect its lien rights by challenging the unfair 40/60 percent apportionment of the settlement proceeds between Mr. and Mrs. Gleason. It claims that the higher allocation to Mrs. Gleason for her loss of consortium claim is designed to shield the settlement proceeds from its recovery of the statutory lien.”
Pellegrini explained that the issue of whether Hartford has the right to be granted party status is a discrete claim that has no bearing on the underlying negligence and loss of consortium dispute, and found that the collateral order doctrine criteria of separability, importance and irreparability dictated that the issue was ripe for review.
Pellegrini added that Section 319 of the Workers Compensation Act stated that an employer or insurance carrier that pays workers’ compensation benefits to an injured employee is entitled to recover a portion of the benefits from any award of money the employee receives in a civil lawsuit, and provides specific direction for the distribution of an employee’s settlement from a third-party tortfeasor between the employee and the employer or insurance carrier – and that Pennsylvania Rule of Civil Procedure 2327 mandates that an insurance carrier who has paid workers’ compensation benefits may intervene in an employee’s third party action, in order to protect and preserve the carrier’s right of subrogation.
“In this case, lack of party status denies Hartford the ability to fully protect its subrogation interest and left it without recourse to effectively challenge the consortium apportionment contained in the unopposed settlement agreement. Although Hartford paid nearly $1 million to and on behalf of Mr. Gleason as a result of the workplace accident, the settlement agreement was structured in a manner that limited its lien to approximately $350,000,” Pellegrini stated.
“In sum, based on the foregoing legal authority and our review of the certified record, we conclude that the trial court’s order denying Hartford intervention in this action was final and appealable as a collateral order. We further conclude that the trial court abused its discretion when it disallowed intervention by Hartford, which was necessary to fully protect its subrogation rights and to challenge the apportionment of the settlement proceeds between Mr. and Mrs. Gleason for the loss of consortium claim.”
The Superior Court then reversed the trial court’s order reversed and remanded the case with instructions to allow the requested intervention.
Superior Court of Pennsylvania case 1872 EDA 2020
Philadelphia County Court of Common Pleas cases 160502115 & 170503992
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com