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How Workers’ Compensation Cases Can Affect Thirty Party Claims

Sometimes injured workers can file a third party claim against a negligent party in addition to a workers' compensation claim against the employer. When a worker files a third party claim, the workers' compensation insurance company usually receives a credit against compensation received from the third party.

The following is a unique case where this did not occur.

In Graham v. Workers' Comp Appeals Board, John B. Graham, employed by the Transit District as a bus driver, suffered injury during his employment. Consequently he filed for workers' compensation for permanent disability benefits. Medical malpractice during his treatment for the work injury exacerbated his condition. Further injury led him to sue the treating doctor, Dr. Peter Mac. The outcome of the malpractice case was:

  • An out-of-court settlement for $150,000
  • Damages limited to pain and suffering
  • Agreement not pursue medical treatment damages and wage loss covered by workers' compensation

Subsequent to his malpractice settlement, the Transit District petitioned the court for credit in the amount of $150,000 (the full malpractice injury settlement amount). It petitioned for this credit against the Transit District's future liability for workers' compensation payments. The company's attorney argued that the extent of the injuries were partly due to the doctor's malpractice. The lower court allowed the Transit District's request for credit and Graham's lawyer appealed for reconsideration.

The worker's compensation judge found the lower court's ruling to be in error and denied the credit request. The reasoning was that malpractice did not cause the initial injury and only enhanced or exacerbated it. The only allowed credit to the employer would be for payments attributable to exacerbation. In this case, Graham was able to retain his medical malpractice settlement and receive workers’ comp benefits.

Work-related injury cases can be complicated. Skilled legal representation from an experienced Orange County workers' compensation law firm is often vital for recovering the compensation you deserve.

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