NEW JERSEY TRANSIT CORPORATION, ETC. VS. SANDRA SANCHEZ AND CHAD SMITH (L-8504-16, BERGEN COUNTY AND STATEWIDE) (A-0761-17T3)
Plaintiff New Jersey Transit Corporation appealed from the summary judgment dismissal of its subrogation action against the tortfeasors for reimbursement of the workers' compensation benefits paid to an injured employee for wage loss and medical expenses resulting from a work-related automobile accident. Plaintiff did not sustain a permanent injury within the meaning of the limitation on lawsuit option under AICRA, and did not seek recovery from the tortfeasors. The motion judge held AICRA trumped the WCA, ruling that N.J.S.A. 39:6A-8(a) barred NJ Transit's claims because NJ Transit, as subrogee, stands in the shoes of the injured employee, and has no rights superior to the injured employee under AICRA. Since the injured worker was compensated by workers' compensation benefits for his medical expenses and wage loss; he suffered no uncompensated economic loss. The motion judge held NJ Transit's claim must be dismissed because AICRA bars claims for compensated economic damages.
The court reverses the summary judgment dismissal, holding the workers’ compensation carrier is permitted to pursue its Section 40 claim for reimbursement of the worker's compensation benefits paid to the injured employee against the third-party tortfeasors. If successful, the workers' compensation carrier would be reimbursed by the tortfeasors, subject to their right to indemnification from their own automotive insurers. Therefore, allowing such recovery does not conflict with AICRA's collateral source rule, N.J.S.A. 39:6A-6.
Regarding the interplay of the WCA and AICRA, where only workers' compensation benefits and PIP benefits are available, the primary burden is placed on workers' compensation pursuant to N.J.S.A. 39:6A-6. Where only PIP benefits and tortfeasor liability are involved, the primary burden is placed on the PIP carrier by N.J.S.A. 39:6A-12. However, where both workers' compensation benefits and the proceeds of a tort action have been recovered, the tort recovery is primary pursuant to N.J.S.A. 34:15-40(f). In turn, where workers' compensation benefits have been paid, but the injured employee has not sought or obtained recovery from the tortfeasor, the primary burden is placed on the tortfeasor.
