AN ACT Relating to
third party recoveries in workers' compensation cases; amending RCW 4.22.070
and 51.24.060; creating a new section; providing an effective date; and
declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 4.22.070 and 1986 c
305 s 401 are each amended to read as follows:
(1) In all actions
involving fault of more than one entity, the trier of fact shall determine the
percentage of the total fault which is attributable to every entity which
caused the claimant's damages((, including)) except entities immune
from liability to the claimant under Title 51 RCW. The sum of the percentages
of the total fault attributed to at-fault entities shall equal one hundred
percent. The entities whose fault shall be determined include the claimant
or person suffering personal injury or incurring property damage, defendants,
third-party defendants, entities released by the claimant, entities with any
other individual defense against the claimant, and entities immune from
liability to the claimant ((and entities with any other individual defense
against the claimant)), but shall not include those entities immune from
liability to the claimant under Title 51 RCW. Judgment shall be entered
against each defendant except those who have been released by the claimant or
are immune from liability to the claimant or have prevailed on any other
individual defense against the claimant in an amount which represents that
party's proportionate share of the claimant's total damages. The liability of each
defendant shall be several only and shall not be joint except:
(a) A party shall be
responsible for the fault of another person or for payment of the proportionate
share of another party where both were acting in concert or when a person was
acting as an agent or servant of the party.
(b) If the trier of
fact determines that the claimant or party suffering bodily injury or incurring
property damages was not at fault, the defendants against whom judgment is
entered shall be jointly and severally liable for the sum of their
proportionate shares of the claimants total damages.
(2) If a defendant is
jointly and severally liable under one of the exceptions listed in subsections
(1)(a) or (1)(b) of this section, such defendant's rights to contribution against
another jointly and severally liable defendant, and the effect of settlement by
either such defendant, shall be determined under RCW 4.22.040, 4.22.050, and
4.22.060.
(3)(a) Nothing in this
section affects any cause of action relating to hazardous wastes or substances
or solid waste disposal sites.
(b) Nothing in this
section shall affect a cause of action arising from the tortious interference
with contracts or business relations.
(c) Nothing in this
section shall affect any cause of action arising from the manufacture or
marketing of a fungible product in a generic form which contains no clearly
identifiable shape, color, or marking.
Sec. 2. RCW 51.24.060 and 1987 c
442 s 1118 are each amended to read as follows:
(1) If the injured
worker or beneficiary elects to seek damages from the third person, any
recovery made shall be distributed as follows:
(a) The costs and
reasonable attorneys' fees shall be paid proportionately by the injured worker
or beneficiary and the department and/or self-insurer: PROVIDED, That the
department and/or self-insurer may require court approval of costs and
attorneys' fees or may petition a court for determination of the reasonableness
of costs and attorneys' fees;
(b) The injured worker
or beneficiary shall be paid twenty-five percent of the balance of the award:
PROVIDED, That in the event of a compromise and settlement by the parties, the
injured worker or beneficiary may agree to a sum less than twenty-five percent;
(c) The department
and/or self-insurer shall be paid the balance of the recovery made, but only to
the extent necessary to reimburse the department and/or self-insurer for ((compensation
and)) benefits paid;
(i) The department
and/or self-insurer shall bear its proportionate share of the costs and
reasonable attorneys' fees incurred by the worker or beneficiary to the extent
of the benefits paid ((or payable)) under this title: PROVIDED, That
the department's ((or)) and/or self-insurer's ((may
require court approval of costs and attorneys' fees or may petition a court for
determination of the reasonableness of costs and)) proportionate share
shall not exceed one hundred percent of the costs and reasonable attorneys'
fees((.));
(ii) ((The sum
representing the department's and/or self-insurer's proportionate share shall
not be subject to subsection (1) (d) and (e) of this section.)) The
department's and/or self-insurer's proportionate share of the costs and
reasonable attorneys' fees shall be determined by dividing the gross recovery
amount into the benefits paid amount and multiplying this percentage times the
costs and reasonable attorneys' fees incurred by the worker or beneficiary;
(iii) The
department's and/or self-insurer's reimbursement share shall be determined by
subtracting their proportionate share of the costs and reasonable attorneys'
fees from the benefits paid amount;
(d) Any remaining balance
shall be paid to the injured worker or beneficiary; and
(e) Thereafter no
payment shall be made to or on behalf of a worker or beneficiary by the
department and/or self-insurer for such injury until the amount of any further
compensation and benefits shall equal any such remaining balance minus the
department's and/or self-insurer's proportionate share of the costs and
reasonable attorneys' fees in regards to the remaining balance. This
proportionate share shall be determined by dividing the gross recovery amount
into the remaining balance amount and multiplying this percentage times the
costs and reasonable attorneys' fees incurred by the worker or beneficiary.
Thereafter, such benefits shall be paid by the department and/or self-insurer
to or on behalf of the worker or beneficiary as though no recovery had been
made from a third person((;
(f) If the employer
or a co-employee are determined under RCW 4.22.070 to be at fault, (c) and (e)
of this subsection do not apply and benefits shall be paid by the department
and/or self-insurer to or on behalf of the worker or beneficiary as though no
recovery had been made from a third person)).
(2) The recovery made
shall be subject to a lien by the department and/or self-insurer for its share
under this section.
(3) The department or
self-insurer has sole discretion to compromise the amount of its lien. In
deciding whether or to what extent to compromise its lien, the department or
self-insurer shall consider at least the following:
(a) The likelihood of
collection of the award or settlement as may be affected by insurance coverage,
solvency, or other factors relating to the third person;
(b) Factual and legal
issues of liability as between the injured worker or beneficiary and the third
person. Such issues include but are not limited to possible contributory
negligence and novel theories of liability; and
(c) Problems of proof
faced in obtaining the award or settlement.
(4) In the case of an
employer not qualifying as a self-insurer, the department shall make a
retroactive adjustment to such employer's experience rating in which the third
party claim has been included to reflect that portion of the award or
settlement which is reimbursed for compensation and benefits paid and, if the
claim is open at the time of recovery, applied against further compensation and
benefits to which the injured worker or beneficiary may be entitled.
(5) In an action under
this section, the self-insurer may act on behalf and for the benefit of the
department to the extent of any compensation and benefits paid or payable from
state funds.
(6) It shall be the
duty of the person to whom any recovery is paid before distribution under this
section to advise the department or self-insurer of the fact and amount of such
recovery, the costs and reasonable attorneys' fees associated with the
recovery, and to distribute the recovery in compliance with this section.
(7) The distribution of
any recovery made by award or settlement of the third party action shall be
confirmed by department order, served by registered or certified mail, and
shall be subject to chapter 51.52 RCW. In the event the order of distribution
becomes final under chapter 51.52 RCW, the director or the director's designee
may file with the clerk of any county within the state a warrant in the amount
of the sum representing the unpaid lien plus interest accruing from the date
the order became final. The clerk of the county in which the warrant is filed
shall immediately designate a superior court cause number for such warrant and
the clerk shall cause to be entered in the judgment docket under the superior
court cause number assigned to the warrant, the name of such worker or
beneficiary mentioned in the warrant, the amount of the unpaid lien plus
interest accrued and the date when the warrant was filed. The amount of such
warrant as docketed shall become a lien upon the title to and interest in all
real and personal property of the injured worker or beneficiary against whom
the warrant is issued, the same as a judgment in a civil case docketed in the
office of such clerk. The sheriff shall then proceed in the same manner and
with like effect as prescribed by law with respect to execution or other
process issued against rights or property upon judgment in the superior court.
Such warrant so docketed shall be sufficient to support the issuance of writs
of garnishment in favor of the department in the manner provided by law in the
case of judgment, wholly or partially unsatisfied. The clerk of the court
shall be entitled to a filing fee of five dollars, which shall be added to the
amount of the warrant. A copy of such warrant shall be mailed to the injured
worker or beneficiary within three days of filing with the clerk.
(8) The director, or
the director's designee, may issue to any person, firm, corporation, municipal
corporation, political subdivision of the state, public corporation, or agency
of the state, a notice and order to withhold and deliver property of any kind
if he or she has reason to believe that there is in the possession of such
person, firm, corporation, municipal corporation, political subdivision of the
state, public corporation, or agency of the state, property which is due,
owing, or belonging to any worker or beneficiary upon whom a warrant has been
served by the department for payments due to the state fund. The notice and
order to withhold and deliver shall be served by the sheriff of the county or
by the sheriff's deputy, or by any authorized representatives of the director.
Any person, firm, corporation, municipal corporation, political subdivision of
the state, public corporation, or agency of the state upon whom service has
been made shall answer the notice within twenty days exclusive of the day of
service, under oath and in writing, and shall make true answers to the matters
inquired of in the notice and order to withhold and deliver. In the event
there is in the possession of the party named and served with such notice and
order, any property which may be subject to the claim of the department, such
property shall be delivered forthwith to the director or the director's
authorized representative upon demand. If the party served and named in the
notice and order fails to answer the notice and order within the time
prescribed in this section, the court may, after the time to answer such order
has expired, render judgment by default against the party named in the notice
for the full amount claimed by the director in the notice together with costs.
In the event that a notice to withhold and deliver is served upon an employer
and the property found to be subject thereto is wages, the employer may assert
in the answer to all exemptions provided for by chapter 6.27 RCW to which the
wage earner may be entitled.
NEW SECTION. Sec.
3. This act is necessary for
the immediate preservation of the public peace, health, or safety, or support
of the state government and its existing public institutions, and shall take
effect July 1, 1993.
NEW
SECTION. Sec. 4. This act applies to all
causes of action that the parties have not settled or in which judgment has not
been entered prior to July 1, 1993.
