Claim of Shiner v. SUNY at Buffalo

Appeal from a decision of the Workers’ Compensation Board, filed May 29, 2015, which ruled that claimant’s failure to obtain the consent of her employer’s workers’ compensation carrier to the settlement of a third-party action barred her from receiving further benefits.

One of claimant’s supervisors, an associate dean, reportedly sexually harassed and groped her at an office holiday party in December 2010. She filed a claim for workers’ compensation benefits, which was established for posttraumatic stress disorder and neck injury. Claimant also commenced an action in federal court against her employer and the associate dean alleging a hostile work environment, discrimination, battery and assault. That action settled in August 2013 for $255,000, with both defendants contributing funds to the settlement and $65,000 specifically allocated for “back and front pay.” Thereafter, the employer’s workers’ compensation carrier, the State Insurance Fund (hereinafter the carrier), asserted that claimant should be barred from future workers’ compensation benefits because she had neither sought nor obtained its consent to the settlement as required by Workers’ Compensation Law § 29 (5). Claimant contended that the carrier’s consent was not required because the federal action was not a third-

We affirm. “Workers’ Compensation Law § 29 (5) requires either the carrier’s consent or a compromise order from the court in which a third-party action is pending for a claimant to settle a third-party action and continue receiving compensation benefits” (Matter of Johnson v Buffalo & Erie County Private Indus. Council, 84 NY2d 13 , 19 [1994]; see Matter of Hulbert v Cortland County Sheriffs Dept., 69 AD3d 987 , 988 [2010], lv denied 14 NY3d 710 [2010]; Matter of Wright v Golden Arrow Line, 206 AD2d 759 , 760 [1994]). Claimant urges that her federal lawsuit was not a third-party action since the statute addresses “the negligence or wrong of another not in the same employ” (Workers’ Compensation Law § 29 [1]) and the associate dean who harassed her had the same employer as her. The Court of Appeals, however, has recently reiterated that Workers’ Compensation Law § 29, “ ‘read in its entirety and in context, clearly reveals a legislative design to provide for reimbursement of the compensation carrier whenever a recovery is obtained in tort for the same injury that was a predicate for the payment of compensation benefits’ ” (Matter of Beth V. v New York State Off. of Children & Family Servs., 22 NY3d 80 , 91 [2013], quoting Matter of Petterson v Daystrom Corp., 17 NY2d 32 , 39 [1966]). The Court reasoned that “‘[i]t would be unreasonable to read the statute as mandating a different result merely because the recovery came out of the pockets of a coemployee [or the employer] and not from the resources of a stranger’ ” (Ronkese v Tilcon N.Y., Inc., 129 AD3d 1273 , 1275 [2015], lv dismissed — NY3d —, 2016 NY Slip Op 90074 [Nov. 1, 2016], quoting Matter of Beth V. v New York State Off. of Children & Family Servs., 22 NY3d at 91 ). The fact that claimant included allegations of intentional conduct by a coemployee in her federal action does not, as urged by claimant, compel the conclusion that it was not a third-party action (see Matter of Beth V. v New York State Off. of Children & Family Servs., 22 NY3d at 91-92 ; Hanford v Plaza Packaging Corp., 2 NY3d 348 , 351 n 3 [2004]; but cf. Matter of Jackson v Richman & Co., 15 NY2d 877 , 878-879 [1965] [exception found where there was a Board finding that an assault by a company/employer president was, under the existent narrow circumstances, tantamount to assault by the employer in furtherance of the employer’s business]).

McCarthy, J.P., Lynch, Devine and Aarons, JJ., concur.

Ordered that the decision is affirmed, without costs.