Opinion
No. CV 04 041 22 11 S
February 24, 2005
MEMORANDUM OF DECISION RE: MOTION TO DISMISS
Before the court is the defendant's Motion to Dismiss wherein the defendant has alleged that the plaintiff Edward Groth's complaint is barred by the terms of the Connecticut Workers' Compensation Statute.
I. Statement of the Case
The plaintiff Edward Groth commenced this tort action against the defendant Sedgwick Claims Management Services, Inc. to recover damages relating to the defendant's handling of the plaintiff's workers' compensation claims.
The plaintiff was employed by Frito-Lay Inc. for whom the defendant issued a workers' compensation insurance policy. That policy provided coverage for injuries arising out of and in the course of employment. The plaintiff has alleged that he sustained an injury on May 21, 2003, a time during which the defendant's policy was in force.
Pursuant to the terms of the compensation policy, the defendant paid workers' compensation benefits to the plaintiff. The defendant allegedly terminated benefits.
On May 25, 2004, while his compensation claim was still pending, the plaintiff filed a seven-count amended complaint against the defendant alleging negligence, intentional tortious conduct, reckless conduct, intentional infliction of emotional distress, negligent infliction of emotional distress, "breach of implied covenant of good faith bad faith claim," and a "CUPTA" claim.
A core allegation in each count is that "the employer was obligated under the [Workers Compensation] Act to conform its conduct to the provisions of the Act and its Regulations." (Counts 1-7, paragraph 19.) Citing selectively the remedial nature of the compensation act, its general purpose and underlying principles; (Counts 1-7, paragraphs 20-23); the plaintiff further alleges that the defendant unreasonably denied and contested the plaintiff's claims. (Counts 1-7, paragraph 25.)
In particular the plaintiff alleges that under the terms of the act the defendant could not (a) unduly delay payments, (b) file baseless claim denials, (c) discharge or discriminate against an injured employee, (d) intentionally misrepresent a material fact, (e) fail to provide medical reports, (f) fail to pay wages and benefits in a timely fashion, (g) fail to file a timely agreement and (h) discontinue or reduce benefits without prior commission approval. Connecticut General Statutes §§ 31-288, 21-290, 31-290a, 31-290c, 31-294f, 31-295, 31-296-1 and 31-296a, respectively.
The plaintiff's seven counts are all based on allegations that the defendant (a) acted in violation of statutory duties, (b) failed to comply with the express terms of the underlying terms of its contract with the plaintiff's employer, (c) disregarded the plaintiff's physical, mental and financial condition, (d) disregarded the plaintiff's psychological and emotional condition, (e) "acted, and continued to act, unfairly and unreasonably regarding its duties and obligations . . .", (f) failed to properly administer the plaintiff's claim, (g) failed to properly investigate the plaintiff's claim, (h) failed to provide a proper basis for contesting the plaintiff's claim, and (i) withheld material facts, in particular "that it had no reasonable basis for contesting the Plaintiff's Workers' Compensation claim as found by the Workers' Compensation Commissioner . . ." (Counts 1-7, paragraph 26). There is no allegation that the plaintiff sought a finding that the defendant acted in bad faith.
The defendant moves to dismiss the entire complaint on the ground that the plaintiff's claims are barred by the exclusivity provision of the Workers' Compensation Act, General Statutes § 31-284(a). That statute provides:
An employer who complies with the requirements of subsection (b) of this section shall not be liable for any action for damages on account of personal injury sustained by an employee arising out of and in the course of his employment or on account of death resulting from personal injury so sustained, but an employer shall secure compensation for his employees as provided under this chapter, except that compensation shall not be paid when the personal injury has been caused by the wilful and serious misconduct of the injured employee or by his intoxication. All rights and claims between an employer who complies with the requirements of subsection (b) of this section and employees, or any representatives or dependents of such employees, arising out of personal injury or death sustained in the course of employment are abolished other than rights and claims given by this chapter, provided nothing in this section shall prohibit any employee from securing, by agreement with his employer, additional compensation from his employer for the injury or from enforcing any agreement for additional compensation.
The defendant asserts that the act provides adequate remedies for claims against an insurer for alleged failure to pay benefits or noncompliance with the act's requirement and that the court lacks jurisdiction because the plaintiff has failed to exhaust the act's administrative remedies.
II. Standard of Review
A motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Blumenthal v. Barnes, 261 Conn. 434, 442, 804 A.2d 152 (2002). "The motion to dismiss shall be used to assert (1) lack of jurisdiction over the subject matter . . ." (Internal quotation marks omitted.) Sadloski v. Manchester, 235 Conn. 637, 645-46 n. 13, 668 A.2d 1314 (1995).
"A court does not truly lack subject matter jurisdiction if it has the competence to entertain the action before it . . . Once it is determined that a tribunal has authority or competence to decide the class of cases to which the action belongs, the issue of subject matter jurisdiction is resolved in favor of entertaining the action . . . [I]n determining whether a court has subject matter jurisdiction, every presumption favoring jurisdiction should be indulged." (Citations omitted.) Connor v. Statewide Grievance Committee, 260 Conn. 435, 442-43, 797 A.2d 1081 (2002). "The plaintiff bears the burden of proving subject matter jurisdiction, whenever and however raised." Fink v. Golenbock, 238 Conn. 183, 199 n. 13, 680 A.2d 1243 (1996).
III. Scope of the Workers' Compensation Remedies CT Page 2866
Connecticut General Statutes § 31-284(a), is generally viewed as a total bar to common-law actions brought by employees against employers for job-related injuries. There is a narrow exception that exists when the employer has committed an intentional tort or where the employer has engaged in wilful or serious misconduct. Suarez v. Dickmont Plastics Corp., 229 Conn. 99, 106, 639 A.2d 507 (1994); Brosnan v. Sacred Heart University, No. 333544, Superior Court, judicial district of Fairfield at Bridgeport, (October 21, 1997, Levin, J.) (20 Conn. L. Rptr 509).
Similarly, the Connecticut Supreme Court "recognizes an independent cause of action in tort arising from an insurer's common law duty of good faith. This cause of action is separate and distinct from the plaintiff's statutory claims . . . An implied covenant of good faith and fair dealing has been applied by this court in a variety of contractual relationships, including . . . insurance contracts . . ." (Citations omitted; internal quotation marks omitted.) Buckman v. People Express, Inc., 205 Conn. 166, 170, 530 A.2d 596 (1987).
"There is currently a split of authority [in the Superior Court] as to whether a beneficiary of a workers' compensation award can sue an insurance carrier for bad faith handling of the worker's claims. One line of reasoning holds that the exclusivity principle of workers' compensation does not apply because the alleged intentional bad faith handling of a workers' compensation claim by an insurance company does not arise during the course of employment, but rather occurs after the injury for which the worker is being compensated . . . This line of cases also generally holds that since the remedies provided for by workers' compensation do not provide redress for consequential damages suffered as a result of an insurer's bad faith handling of a workers' compensation award, further administrative remedies would be inadequate and exhaustion futile." (Citations omitted.) Moran v. Travelers Property Casualty, Docket No. 350319, Superior Court, judicial district of Fairfield at Bridgeport, (October 23, 1998, Stodolink, J.) ( 23 Conn. L. Rptr. 383); see Brosnan v. Sacred Heart University, No. 333544, Superior Court, judicial district of Fairfield at Bridgeport (October 21 1997, Levin, J.) ( 20 Conn. L. Rptr. 509); Nicoletti v. Continental Casualty Co., No. 414441, Superior Court, judicial district of New Haven (October 13, 1999, Levin, J.).
However, a majority of the courts have held that allegations of bad faith "are not governed by the provisions of the Workers' Compensation Act. Even though the Workers' Compensation Act makes reference to instances of `undue delay' of payment, the Workers' Compensation Act does not adequately address instances where the insurer or employer deliberately and intentionally acts in bad faith in failing to compensate the injured employee." Moran v. Travelers Property Casualty. See also Orr v. Hartford Accident Indemnity Co., No. CV 97 0482838 S, Superior Court judicial district of New Britain at New Britain (July 12, 1999, Robinson, J.); Silano v. Hartford Underwriters Insurance Company, No. CV96 32 93 88, Superior Court, judicial district of Fairfield at Bridgeport (September 18, 2000, Rush, J.).
Several states recognize that the exclusive remedy doctrine does not preclude all allegations of improper conduct. See Serna v. Kingston Enterprises, 72 P.3d 376 (Colo.App. 2002) (distinguishes financial interests and personal injury); Sims v. United States Fidelity Guaranty, 730 N.E.2d 232 (Ind. 2000) (bad faith claims and independent torts allowed); Hawkes v. Commercial Union Insurance Co., 2001 ME 8, 764 A.2d 258 (2001); Burlew v. American Mutual Insurance Co., 63 N.Y.2d 412, 472 N.E.2d 682 (1984); Johnson v. First Union Corp., 128 N.C. App. 450, 496 S.E.2d 1 (1998) (fraud, civil conspiracy and punitive damages not part of the statutory scheme); American Motorists Insurance v. Fodge, 63 S.W.3d 801 (Tex. 2001) (plaintiff can pursue claim of improper delay). Still others rely on the exclusive remedy doctrine. Hughes v. Argonaut Insurance Co., 88 Cal.App.4th 517, 105 Cal.Rptr.2d 877 (2001); Deanda v. AIU Insurance, 2004 OK 54, 98 P.3d 1080 (2004); Cianci v. Nationwide Insurance Co., 659 A.2d 662 (R.I. 1995); Davis v. Alexsis, Inc., 2 S.W.3d 228 (Tenn.App. 1999); Savage v. Educators Insurance Co., 908 P.2d 862 (Utah 1995) (contains a useful breakdown of relevant state trends).
The difficulty faced in the present case is that the plaintiff's workers' compensation claim is still pending before the compensation commission. The plaintiff has not sought any of the remedies currently asserted, and suggests no reason why those remedies would not be available before the commission.
It is not the function of this court to determine to appropriateness of the penalty provisions of the state's workers' compensation statute. The basis of each of the plaintiff's allegations is that the defendant's conduct before the compensation commission is violative of the statutory directives. Penalties can be imposed for, inter alia, delays; Connecticut General Statutes 31-288(b); late payments; Connecticut General Statutes 31-303; an unreasonable challenge of employer liability; Connecticut General Statutes 31-300; or a discontinuance of payments without commission approval; Connecticut General Statutes 31-296, 31-300. The fact that the penalties might seem moderate is not dispositive. The question is whether "the penalties are so flexible, and the administrative remedies so comprehensive, that the legislature must have intended for them to provide the sole remedy for, or deterrent to, the serious abuses that the common law addresses." Carpentino v. Transport Ins. Co., 609 F.Sup. 556, 561 (D.Conn. 1985) (relatively low penalties are an important factor in determining whether to allow common-law tort actions); Hayes v. Continental Insurance Co., 178 Ariz. 264, 872 P.2d 668 (1994).
In the present case the plaintiff's allegations are all based upon alleged violations of statutory provisions contained in the workers' compensation statute. It would be strain reason to conclude that the plaintiff can rely upon the act for liability, but ignore its penalty provisions. In the present case the exclusive provisions of the workers' compensation statute preclude the remedies now sought by the plaintiff.
This court must also consider the fact that the plaintiff has failed to exhaust available administrative remedies. Indeed, according to the allegations of the complaint, a workers' compensation complaint is still pending before a local commission. If the plaintiff were successful simply by alleging bad faith he would circumvent the statutory framework for compensation claims, rendering the appellate provisions of that statute meaningless.
In the present case all the underlying complaints are still the subject of contested proceedings. As the Connecticut Appellate Court noted in Fenton v. Connecticut Hospital Association Workers' Compensation Trust, 58 Conn.App. 45, 752 A.2d 65 (2000), when addressing an argument that the plaintiff had alternative remedies, the court commented:
It is no answer for the plaintiff to claim, as he does, that the legislature provided the route he sought to take. Rather, it should be pointed out that there are good reasons for exhausting available administrative remedies under the act before seeking judicial review. Foremost among those reasons is the policy of fostering an orderly process of administrative adjudication and judicial review in which a reviewing court will have the benefit of the [workers' compensation commissioner's] findings and conclusions. We have recognized that a party aggrieved by a decision of an administrative agency may be excused from exhaustion of administrative remedies if recourse to the administrative remedy would be futile or inadequate. The plaintiff's remedy offered by § 31-278 was adequate; invoking it would have put him in the position to get the relief he wanted, i.e., money. After all, [I]t is not the [plaintiff's] preference for a particular remedy that determines whether the remedy . . . is adequate . . . and an administrative remedy, in order to be `adequate,' need not comport with the [plaintiff's] opinion of what a perfect remedy would be.
(Internal quotation marks omitted; internal citations omitted.) Fenton, 58 Conn.App. at 556-57.
"The doctrine of exhaustion is grounded in a policy of fostering an orderly process of administrative adjudication and judicial review in which a reviewing court will have the benefit of the agency's findings and conclusions . . . The doctrine of exhaustion furthers the salutary goals of relieving the courts of the burden of deciding questions entrusted to an agency . . . in advance of possible judicial review." (Citations omitted; internal quotation marks omitted.) Fish Unlimited v. Northeast Utilities Service Co., 254 Conn. 1, 12, 756 A.2d 262 (2000).
The plaintiff has not provided any reason for his failure to exhaust available remedies other than indicating that the compensation statute is not an exclusive remedy. Having relied on the statutory provisions, he cannot now reject those same limitations.
The Motion to Dismiss is granted.
Dewey, J.