Automobile Insurance SubrogationAutomobile Total Loss ThresholdsDeductible ReimbursementDiminution of ValueFirst Come, First Served: Subrogating Multiple Claims in Excess of Policy LimitsFuneral Procession Traffic LawsImputing Contributory Negligence of Driver to Vehicle OwnerLaws Regarding Using Cell Phones/Headphones/Texting While DrivingLoss Of UseMed Pay/PIP SubrogationOwner Liability For Stolen VehiclesPayment of Sales Tax After Vehicle Total LossPedestrian and Crosswalk LawsRental Car Company Physical Damage and Loss of Use ClaimsRental Car Company’s Liability Insurance Primary or ExcessSlower Traffic Keep RightSudden Medical Emergencies While DrivingSuspension of Drivers’ LicensesUse of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Federal , State, and Local Governmental EntitiesMunicipal/County/Local Government Immunity and Tort LiabilityState Sovereign Immunity And Tort Liability
General Tort Laws/StatutesAnti-Indemnity StatutesContribution ActionsContributory Negligence/Comparative FaultDog Bite LawsEconomic Loss DoctrineParental ResponsibilitySpoliationStatute of LimitationsStatute of Limitations Exceptions
Health Insurance SubrogationHealth and Disability Insurance
InvestigationAdmissibility of Expert TestimonyPre-Suit Disclosure of Liability Policy Limits in Third-Party ClaimsRecording Conversations
Product Liability SubrogationProduct Liability Law
Property Subrogation“Matching Regulations” And Laws Affecting Homeowners Property ClaimsCondominium/Co-Op Waiver of Subrogation LawsDamage to Property Without Market ValueGeneral Contractor Overhead And Profit Payments In First-Party ACV Property Damage ClaimsLandlord/Tenant Subrogation
Subrogation GenerallyAnti-Subrogation RuleCriminal RestitutionMade Whole DoctrineMedical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Workers’ CompensationEmployee Leasing LawsHospital Lien LawsOCIP/CCIP Subrogation In Workers’ Compensation Construction CasesRecovery Of Increased Workers’ Compensation Premiums By EmployerWhich Workers’ Compensation “Benefits” Can Be Subrogated?Workers’ Compensation Subrogation Waiver EndorsementsWorkers’ CompensationWorkers’ Compensation Claims by Undocumented Employees
Automobile Insurance Subrogation
Automobile Total Loss Thresholds
Total Loss Formula (See here for definition).
Insurer must use NADA average and one additional approved source and constructive total loss is when cost to repair or salvage damage equals or exceeds the total value. Once it is declared a “total loss” by the insurer, it is a “salvage vehicle.” C.G.S.A. § 38a-353.
Automobile and Property: Pro-Rata. Collision deductible included in subrogation demand. Conn. Gen. Stat. Ann. § 38a-351a. Effective January 1, 2010. Except as prohibited by § 38a-336b of the general statutes, if an insurer chooses to exercise its right of subrogation pursuant to the terms of an automobile liability insurance policy, such insurer shall include in such subrogation demand the amount of any collision deductible paid by such insured, unless such insured requests such insurer not to include such amount. The insurer shall share subrogation recoveries with the insured on a proportionate basis.”
While there is no specific statute or case law governing the duty of a subrogated insurer to reimburse the insured’s deductible, the Connecticut Supreme Court has held that an insured need not be reimbursed its deductible in order to be “made whole.” Fireman’s Fund Ins. Co. v. TD Banknorth Ins. Agency, Inc., 309 Conn. 449, 72 A.3d 36 (2013).
Deductible must be included in any subrogation demand.
Diminution of Value
First Party: The court has discretion to select the repair measure which stands in as a substitution for diminution in value caused by damage to property. There are currently no cases available dealing with insurance recovery as differentiated from tort recovery. Willow Springs Condominium Ass’n, Inc. v. Seventh BRT Dev. Corp., 245 Conn. 1 (Conn. 1998).
“When a vehicle is damaged in an accident and repaired, its resale value may be less than that for a comparable vehicle that has not been damaged. Thus, the damage, even though repaired, causes a reduction-or “diminution”-of the vehicle’s resale value. In Connecticut, a claim under a person’s personal auto insurance policy (“first-party claim”) for diminution of value is typically not covered. The policy language specifies that the insurance covers the cost of repairing the vehicle or, if considered a total loss, the actual cash value. It does not specify payment for lost market value. The policy may even include specific language excluding coverage for diminution in value.”
Insurance Claim for Car’s Diminished Value. Janet Kaminski, Assoc. Legis. Atty. No. 2007-R-0011 (Jan. 3, 2007).
Third Party: Plaintiff is entitled to recover the reasonable repair costs and any residual diminution in value. Littlejohn v. Elionsky, 36 A.2d 52 (Conn. 1944); Stults v. Palmer, 141 Conn. 709 (1954); Damico v. Dalton, 1 Conn. App. 186 (1984); Papenheim v. Lovell, 530 N.W.2d 52 668, 672 (Iowa 1995); Alexander v. Bailey, 55 Conn. L. Rptr. 653 (2013); Chenevert v. Turek, 2013 WL 6671512 (Conn. 2013); Corridino v. Kovaks, et al., 2013 WL 8118969 (Conn. 2013); Sheldon v. Soucy, 2014 WL 1814279 (Conn. 2014); Bartnick v. Stehr, 2014 WL 5094332 (Conn. 2014).
The measure of damages is the difference between the value of the vehicle immediately before the damage occurred and the value after the damage occurred, plus a reasonable amount of damages for loss of use of the vehicle. Ark. Code Ann. § 27-53-401.
First Come, First Served: Subrogating Multiple Claims in Excess of Policy Limits
A third-party liability insurance company can settle less than all multiple claims brought against it on a first come, first served basis, without committing bad faith. Bartlett v. Travelers Ins. Co., 167 A. 180 (Conn. 1933).
Funeral Procession Traffic Laws
There are no state laws governing funeral processions.
Imputing Contributory Negligence of Driver to Vehicle Owner
Imputed Contributory Negligence Law: Contributory negligence of driver is not imputed to owner of vehicle in action for recovery of damages to vehicle against third-party defendant resulting from negligence of third party. Levy v. Senofonte, 204 A.2d 420, 426 (Conn. Cir. Ct. 1964).
However, when Family Car Doctrine is in effect, action for property damage resulting from collision between owner’s wife and third party will be defeated by imputed contributory negligence of wife. Ustjanauskas v. Guiliano, 225 A.2d 202 (Conn. 1966).
Vicarious Liability/Family Purpose Doctrine: Driver is presumed to be the agent and servant of the owner of vehicle and operating it in the course of his employment. The defendant shall have the burden of rebutting the presumption. C.G.S.A. § 52-183.
Connecticut adheres to the Family Car Doctrine. Operation by family member raises presumption that vehicle was family vehicle and was being operated as such within the scope of general authority from the owner, which the defendant must rebut. C.G.S.A. § 52-182. Vicarious liability imputed to owner on basis of agency and is applicable equally to all parties whether they are plaintiffs or defendants. Ustjanauskas v. Guiliano, 26 Conn. Supp. 387, 225 A.2d 202 (Super. Ct. 1966); Hunt v. Richter, 163 Conn. 84, 88, 302 A.2d 117, 119 (1972).
Sponsor Liability for Minor’s Driving: No Sponsorship Liability Statute.
Laws Regarding Using Cell Phones/Headphones/Texting While Driving
Cell Phone/Texting: Hand-held phone use is prohibited, but hands-free phone use is allowed. C.G.S.A. § 14-296aa(b)(2).
Drivers under the age of 18 may not use a cell phone in any capacity, hand-held or hands-free. C.G.S.A. § 14-296aa(d).
No person may operate a vehicle, and use their cell phone to send, read, or type a text message. C.G.S.A. § 14-296aa(b)(1).
Other Prohibitions: No Applicable Laws
Loss Of Use
Loss of Use: Yes. Loss of use is considered an element of property damage (“property damage means injury to or destruction of tangible property, including loss of use thereof”). Conn. Agencies Regs. § 38a-334-2. However, “rental value will not furnish the measure of damages for loss of use of an automobile. For the rental value of an automobile includes necessarily a substantial sum for wear and tear and depreciation. No definite general rule can be laid down except that the award by verdict or judgment should be for fair and reasonable compensation, according to the circumstances of each case.” Hawkins v. Garford Trucking Co., 114 A. 94, 95 (Conn. 1921), citing Cook v. Packard Motor Car Co. of New York, 92 A. 413 (Conn. 1914). Rental value is not a generally accepted measure of loss of use, though actual expenditure (from actual rental) may be used as a persuasive value of loss of use. Hansen v. Costello, 5 A.2d 880 (1939). There is no caselaw expressly disallowing recovery for loss of use on a total loss claim. Accordingly, there is a strong argument that such a claim can be sustained.
Lost Profits: No authority beyond precedent to look at each case individually.
Med Pay/PIP Subrogation
Med Pay: Unclear. Nuzzo v. Nationwide, 1997 WL 790651 (Conn. Super. 1999) prohibits mere equitable subrogation in light of Anti-Subrogation Rule of C.G.S.A. § 52-225c. However, the Collateral Source Rule (C.G.S.A. § 52-225c) prohibits subrogation of collateral source unless “a right of subrogation exists.” Clemens v. Graham, 2003 WL 22961336 (Conn. Super. 2003) (unreported trial court decision). Argument can be made for Med Pay subrogation where the policy contains subrogation language because § 38a-334-7(c)(3) allows auto policy to contain subrogation clause for medical payment benefits and § 52-225c prevents a reduction for Med Pay benefits if a right of subrogation exists. This is especially true if the policy is issued in another state that allows for subrogation of benefits similar to Connecticut’s Med Pay benefits. However, It is possible that Connecticut will ultimately hold that unless the “right of subrogation” exists under a separate body of law (e.g., ERISA, workers’ compensation, etc.), Med Pay benefits are considered a “collateral source” under § 52-225c and no subrogation will be allowed. In one case, the court held that a subrogation provision in a health insurance policy was not sufficient to avoid the prohibition against recovery of collateral sources in § 52-225c. Pajor v. Town of Wallingford, 704 A.2d 247 (Conn. App. 1997).
Related Case Law: Alfred Chiulli & Sons v. Hanover Ins. Co., 2007 WL 4239788 (Conn. Super. 2007).
PIP: Coverage not applicable since 1993.
Made Whole: Can be overridden with Plan language. The Automobile Ins. Co. of Hartford v. Conlon, 216 A.2d 828 (Conn. 1966).
Adopted no-fault in 1973 but repealed it in 1993.
Statute of Limitations: Two (2) year statute of limitations runs from date of insured’s accident. C.G.S.A. § 52-584; Alfred Chiulli & Sons v. Hanover Ins. Co., 2007 WL 4239788 (Conn. Super. 2007).
Owner Liability For Stolen Vehicles
Key In The Ignition Statutes: N/A
Common Law Rule: A vehicle owner may be liable for injuries caused by a thief to a third party if the theft could be anticipated by the vehicle owner. Consiglio v. Ahern, 251 A.2d 92 (Cir. Ct. A.D. 1968), Alberone v. King, 213 A.2d 534 (Conn. 1965).
Payment of Sales Tax After Vehicle Total Loss
First-Party Claims: Insurer must pay an amount equal to (A) the settlement amount on such vehicle plus, (B) whenever the insurer takes title, an amount determined by multiplying the settlement amount by the current tax rate percentage. C.G.S.A. § 38a-816.
Third-Party Claims: No authority requiring payments of sales tax to third-party total loss claims. Insurers have no duty of good faith to third parties since their relationship is adversarial and not fiduciary in character. Asmus Elc., Inc. v. G.M.K. Contractors, LLC, WL 758126 (2005); Sherrick v. Belanger, 43 Conn. L. Rptr. 878 (2007).
Pedestrian and Crosswalk Laws
C.G.S.A. § 14-300: Vehicles must yield to pedestrians in crosswalk.
C.G.S.A. § 14-300b: Pedestrians must yield right-of-way to vehicles if not in crosswalk. No crossing diagonally.
Summary: Pedestrians have a duty to exercise reasonable care to avoid known dangers and discover those to which his conduct might expose him. Drivers don’t have the same degree of care to anticipate pedestrians in roadway outside of crosswalks. Schupp v. Grill, 607 A.2d 1155, 27 Conn. App. 513 (1992).
Rental Car Company Physical Damage and Loss of Use Claims
Recovery From Renter: Recovery of physical damage and loss of use are not prohibited or otherwise regulated. Terms of rental agreement control. Collision Damage Waivers not regulated. CDW which states that renter is responsible for part of the damage is enforceable. Charging the renter’s credit card for damage done to the rental car is not allowed under the state consumer protection act (CUTPA). Votto v. American Car Rental, Inc., 871 A.2d 981 (Conn. 2005).
Recovery From Third-Party: Loss of use damages exist to compensate for the deprivation of the owner’s right to use its chattel as the owner sees fit. This right has a value, and its deprivation necessarily entails what economists call “opportunity cost.” Any particular allocation of a resource necessarily costs the owner the opportunity to put that resource to other, competing uses. When a tortfeasor by its negligence forces a thing’s owner to allocate that chattel to the singularly unsatisfying use of sitting in a repair shop for a while, that tortfeasor forecloses the owner’s opportunity to put the chattel to some productive use. The opportunity cost exists irrespective of the normal use to which the owner allocates the damaged item. Cook v. Packard Motor Car Co. of New York, 92 A. 413 (Conn. 1914). It is possible that compensation for the damage to the car plus loss of use could exceed the value of the vehicle. Dolittle v. Otis Elevator Co., 118 A.818 (Conn. 1922). Rental value is not a generally accepted measure of loss of use, though actual expenditure (from actual rental) may be used as a persuasive value of loss of use. Hansen v. Costello, 5 A.2d 880 (1939).
Rental Car Company’s Liability Insurance Primary or Excess
Summary: Each policy issued to an individual covering an auto shall contain a conspicuous statement specifying whether the policy provides liability, collision or comprehensive coverage for damage to a rented private passenger motor vehicle and, where the policy provides such coverage, the limit of the coverage and whether any deductible amount applies. Conn. Stat. § 38a-335(b). The car rental agreement can shift primary liability to the renter. Where the rental agreement says that if SLI is not purchased, this effectively makes the renter’s personal liability coverage primary. Self-insurance can be “other insurance.” Hertz Corp. v. Federal Ins. Co., 713 A.2d 820 (Conn. 1998); Farmers Texas County Mutual v. Hertz, 923 A.2d 673 (Conn. 2007).
Slower Traffic Keep Right
Statute: C.G.S.A. § 14-230 (a) and (b)
Summary: Drivers must drive in the right lane except when overtaking and passing another vehicle proceeding in the same direction; overtaking and passing pedestrians, parked or standing vehicles, animals, bicycles, mopeds, scooters, vehicles moving at a slow speed, or obstructions on the right side of the highway; when the right side of the highway is closed; upon a highway divided into three or more traffic lanes; or on a highway designated for one-way traffic. Slower traffic must keep right. Operators of vehicles with commercial registration, motor bus, trailer, or school bus are prohibited from far-left lane on designated highways with more than two lanes. All vehicles driving at less than normal speed of traffic must use right-hand lane except when passing or turning left. Any vehicle proceeding at less than the normal speed of traffic shall be driven in the right-hand lane available for traffic, or as close as practicable to the right-hand curb or edge of the highway.
Sudden Medical Emergencies While Driving
Sudden Emergency Doctrine. Negligence is not to be imputed to the driver of an automobile merely because he suddenly blacks out, faints, or suffers a sudden attack, losing consciousness or control of the car, when he is without premonition or warning of his condition. Bushnell v. Bushnell, 131 A. 432 (Conn. 1925); Caron v. Guiliano, 211 A.2d 705 (Conn. Super. Ct. 1965).
The Connecticut Supreme Court has not considered the Sudden Emergency Doctrine since 1925. Criticism of the doctrine has arisen with regard to the confusion of the doctrine with respect to the standard of care and its effect on the application of comparative negligence.
Suspension of Drivers’ Licenses
Administrative Suspension: Each automobile insurance carrier reports its policy inceptions and cancellations to the DMV. Drivers who are identified as uninsured will receive a warning notice from the DMV, followed by a suspension of vehicle registration, and after 30 days, driver’s license suspension. C.G.S.A. § 14-12g. Suspensions remain until the driver complies with automobile insurance requirements, completes compliance form and pays all compliance and reinstatement fees. C.G.S.A. § 14-12g3.
Contact Information: State of Connecticut, Department of Motor Vehicles, Driver Services Division, 60 State Street, Wethersfield, CT 06161-2525, (860) 263-5700, http://www.ct.gov/dmv/site/default.asp.
Use of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Authority: C.G.S.A. § 38a-355.
Summary: Insurer must provide a written estimate of repairs that clearly identity OEM or non-OEM parts. Connecticut law also requires the attachment of a disclosure statement to the repair estimate, as specified by the statute.
Federal , State, and Local Governmental Entities
Municipal/County/Local Government Immunity and Tort Liability
Liability of Political Subdivisions: C.G.S.A. § 52-557n. (codified qualified immunity established by common law). Connecticut in minority of states that still make distinction between governmental acts (qualified immunity from discretionary acts requiring judgment or discretion) and proprietary functions (no immunity for ministerial acts performed in a prescribed manner without judgment or discretion).
Exceptions to qualified immunity:
(1) failure to act leads to imminent harm;
(2) statute provides for cause of action; and
(3) intentional act.
Notice Deadlines: Written notice must be filed with the clerk of such municipality within six (6) months after such cause of action has accrued.
Statute of Limitations: An action against municipality must be commenced within two (2) years after the cause of action. C.G.S.A. § 7-101a(d). Claims for injuries resulting from defective highways, sidewalks, roads, or bridges must be brought within two (2) years and notice within ninety (90) days. C.G.S.A. §§ 13a-149, 13a-144. Section 13a-149 has savings clause which forgives inaccuracy in notice if no intent to mislead.
Claims/Actions Allowed: Municipalities generally are liable for damages to persons or property caused by:
(1) Negligent acts by employees within the scope of their employment or official duties;
(2) Negligence in operation of enterprise for “special corporate benefit or pecuniary profit” (e.g., water supply, sewer, municipal parking garage, or golf course); and
(3) Creation or participation in the creation of a nuisance.
C.G.S.A. § 52-557n(a)(1).
However, this liability is significantly limited by several exceptions. Suits can be brought against state or municipality for defective or poorly maintained roads and bridges. C.G.S.A. § 13a-149.
For additional liability statutes, see C.G.S.A. §§ 13a-144 to 13a-153e.
Comments/Exceptions: No liability for acts which require the exercise of judgment or discretion as an official function of authority granted by law. C.G.S.A. § 52-557n(a)(2). Other statutory exceptions covering particular activities or conditions are set forth in C.G.S.A. § 52-557n(b).
No immunity when performing following governmental functions:
(1) maintenance of a park system;
(2) construction of storm water sewers (a governmental function because it is a duty imposed by the state on municipalities to maintain highways within its limits);
(3) use of municipal property as a public park; and
(4) traditional governmental functions such as the operation of jails, public libraries, and city garbage services.
Damage Caps: None.
State Sovereign Immunity And Tort Liability
Tort Claims Act: Claims Against The State.
No State officer or employee shall be personally liable for damage or injury, not wanton, reckless or malicious, caused within the scope of his or her employment or duties. C.G.S.A. § 4-165 (1959).
Notice Deadlines: Claims against the State shall be presented within one year after it accrues. C.G.S.A. § 4-148.
General Assembly may, through special act, authorize a person to present a claim after one year if:
(1) just and equitable; and
(2) express finding of compelling equitable circumstances that would serve a public purpose.
Claims for injuries resulting from defective highways, sidewalks, roads, or bridges must be brought within two (2) years and notice within ninety (90) days. Inaccuracy in notice will preclude recovery. C.G.S.A. §§ 13a-149, 13a-144.
Claims/Actions Allowed: Connecticut’s doctrine of sovereign immunity does not allow the State to be sued without its consent. The Claims Commissioner was created to process claims and grant consent for claims against the State. C.G.S.A. §§ 4-142 and 4-160. Commissioner can approve the immediate payment of “just claims” not exceeding $7,500. “Just claims” are those that in equity and justice the State should pay, as long as it caused the damage or injury. C.G.S.A. §§ 4-141, 158.
Suits can be brought against state for defective or poorly maintained highways, bridges, and sidewalks. Not limited to roads within the state highway system, but no liability for sidewalks maintained by a municipality. Government must have actual or constructive notice. C.G.S.A. § 13a-144.
Comments/Exceptions: There are certain claims which may be brought directly against the State:
(1) Any person injured through the negligence of any State official or employee when operating a motor vehicle owned and insured by the State shall have a claim against the State. C.G.S.A. § 52-556 (not subrogation claims);
(2) Claims for the periodic payment of disability, pension, retirement or other employment benefits;
(3) Claims upon which suit otherwise is authorized by law (injured by defective bridge/road. C.G.S.A. § 13a-144) (not subrogation claims); and
(4) Claims for which an administrative hearing procedure otherwise is established by law.
NOTE: Subrogation claims under C.G.S.A. § 52-556 and § 13a-144 may not be brought by subrogated carrier because they are not a “person”. Nationwide Gen. Ins. Co. v. Colon, 2016 WL 3391622 (Conn. Super. 2016).
Damage Caps: None.
General Tort Laws/Statutes
Prohibits Intermediate Indemnity. Applies to Construction Contracts or Agreements. Conn. Gen. Stat. § 52-572k.
Applicable to contracts entered into after October 1, 1977.
Pure Several Liabiity. Several liability, generally, but there is joint and several liability for actions not based in negligence. C.G.S.A. 925 § 52-572(h); Allard v. Liberty Oil Equip. Co., Inc., 756 A.2d 237 (Conn. 2000).
A right of contribution exists in favor of a defendant required to pay more than his proportionate share of a judgment. A contribution plaintiff who pays or agrees to pay a settlement or judgment can commence a separate action for contribution by other tortfeasors. C.G.S.A. § 52-572h (1986).
The statute of limitations is one (1) year after judgment final. C.G.S.A. § 52-572(o). If no judgment, contribution plaintiff must discharge common liability within the applicable limitations period and initiate contribution action within one (1) year of payment. C.G.S.A. § 52-572(e).
Contributory Negligence/Comparative Fault
Modified Comparative Fault: 51% Bar. Damaged party cannot recover if it is 51% or more at fault. If 50% or less at fault, it can recover, although its recovery is reduced by its degree of fault. If a particular defendant is uncollectable, their portion of the damages may be reapportioned among the remaining defendants – in the same portion as their share of the liability. C.G.S.A. § 52-572(h).
Dog Bite Laws
Dog owner/keeper will be strictly liable for damages, unless victim committed a trespass, tort, or was abusing the dog. If victim is under the age of 7-years-old, there is a presumption against trespass/tort. Section 22-357 reads, “If any dog does any damage to either the body or property of any person, the owner or keeper, or, if the owner or keeper is a minor, the parent or guardian of such minor, shall be liable for the amount of such damage, except when such damage has been occasioned to the body or property of a person who, at the time such damage was sustained, was committing a trespass or other tort, or was teasing, tormenting or abusing such dog.” Conn. Gen. Stat. Ann. § 22-357.
Economic Loss Doctrine
Minority Rule (via statute for consumer claims only). Connecticut’s Product Liability Law displaces the common law of products liability. Conn. Gen. Stat. §§ 52-572m(b), 52-572n(a). Under the statutory scheme, the victims of defective products may recover for “harm,” Conn. Gen. Stat. § 52-572n(a), which is defined to include “damage to property, including the product itself, and personal injuries including wrongful death.” Conn. Gen. Stat. § 52-572m(d). The definition of harm itself states that “[a]s between commercial parties, ‘harm’ does not include commercial loss.” As between commercial parties, commercial loss caused by a product is not harm and may not be recovered by a commercial claimant in a product liability claim. An action for commercial loss caused by a product may be brought only under, and shall be governed by, Title 42a, the Uniform Commercial Code (U.C.C.). Therefore, economic loss recovery is allowed in noncommercial product liability claims. Chiang v. Pyro Chemical, Inc., 1997 WL 330622 (Conn. Super. 1997). The ELD is a bar to tort actions where the relationship between the parties is contractual and the damages are economic in nature.
Willful Misconduct. Liability imposed on parents when child’s actions are willful or malicious; negligence of child is sufficient to impose liability on parents when child harms person or property while operating motor vehicle without permission of vehicle’s owner. C.G.S.A. § 52-572.
The limits of liability are $5,000.
Child must be under 18-years-old.
Adverse Inference: Although Connecticut has recognized that an adverse inference may be drawn when relevant evidence is intentionally destroyed, the courts have also recognized as a general rule that the inference is a permissive one. Leonard v. Commissioner of Revenue Services, 264 Conn. 286, 306, 823 A.2d 1184, 1197 (Conn. 2003). An adverse inference may be drawn against a party who has destroyed evidence only if the trier of fact is satisfied that the party who seeks the adverse inference has proven three things: (1) the spoliation must have been intentional; (2) the destroyed evidence must be relevant to the issue or matter for which the party seeks the inference; and (3) the party who seeks the inference must have acted with due diligence with respect to the spoliated evidence. Beers v. Bayliner Marine Corp., 236 Conn. 769, 777-78, 675 A.2d 829 (Conn. 1996).
Statute of Limitations
Personal Property2 YearsC.G.S.A. § 52-584
Personal Injury/Death2 YearsC.G.S.A. § 52-584
Breach of Contract/Written6 YearsC.G.S.A. § 52-576
Breach of Contract/Oral3 YearsC.G.S.A. § 52-581
Breach of Contract/U.C.C./Goods4 YearsC.G.S.A. § 42a-2-725
Statue of Repose/Products/Can Be Extended By Warranty10 YearsC.G.S.A. § 52-577(a)*
Statute of Repose/Real Property7 YearsC.G.S.A. § 52-584a**
Breach of Warranty3 YearsC.G.S.A. § 52-577(a)
Workers’ Comp Third Party Case2 YearsC.G.S.A. § 31-293
Statute of Limitations Exceptions
*10 years from date of sale – can be extended by warranty. C.G.S.A. § 52-577(a).
**7 years from substantial completion to improvement to real property for actions brought against any architect, professional engineer or land surveyor. C.G.S.A. § 52-584a. If claim arises during 7th year after substantial completion, action can be brought within one (1) year of date of injury, but no more than eight (8) years post substantial completion.
Health Insurance Subrogation
Health and Disability Insurance
Statute of Limitations: 2 Years. C.G.S.A. § 52-584.
Subrogation of Medical Benefits is not allowed. C.G.S.A. § 52-225c (Recovery of collateral source benefits prohibited). Subrogation of Disability Benefits are allowed. Definition of “collateral source” in § 52-225b does not include disability benefits. Friedman v. Stackhouse, 48 Conn. L. Rptr. 699 (Conn. Super. 2009); Schroeder v. Triangulum Associates, 789 A.2d 459 (Conn. 2002) (SSDI); Hassett v. City of New Haven, 49 Conn. Supp. 7, 858 A.2d 922 (Super. Ct. 2004), aff’d, 91 Conn. App. 245, 880 A.2d 975 (2005) (wage replacement). Made Whole Doctrine does not apply. Common Fund Doctrine applies. Town of New Hartford v. Conn. Resources Recovery Auth., 970 A.2d 592 (2009) (recognizing Doctrine in context of class action litigation).
Admissibility of Expert Testimony
Admissibility Standards: Daubert
Case/Statutory Law: State v. Porter, 698 A.2d 739 (Conn. 1997).
Pre-Suit Disclosure of Liability Policy Limits in Third-Party Claims
Duty To Disclose: Yes. Conn. Gen. Stat. Ann. § 38a-335a.
Failure To Disclose A Basis For Bad Faith: No Information.
Comments: Conn. Gen. Stat. Ann. § 38a-335a (a) provides as follows:
“Not later than thirty days after an insurer receives a written request by or on behalf of an individual that alleges the individual has suffered bodily injury or death caused in a motor vehicle collision by an insured under a private passenger automobile liability insurance policy issued by the insurer, the insurer shall provide written disclosure of such insured’s automobile insurance policy limits to the individual making the request. The written request for disclosure shall be sent by certified mail directed to the insurance adjuster or to the insurance company at its last-known principal place of business.”
Mixed Consent: Connecticut is “mixed” in part because criminally, under Connecticut General Statutes § 53a-187, it’s a one-party consent state. It is against the law to record a telephone communication or a communication made by a person other than a sender or receiver, without the consent of either the sender or receiver. For civil cases, however, it is not a one-party consent state. There are also different rules for in-person recording vs. recording telephone conversations. Pursuant to C.G.S.A. § 52-570d, you are not allowed to record an oral private telephone conversation without consent from all parties to the conversation. So, it’s impermissible in a civil context, meaning there’s civil, not criminal, liability. You can also get attorneys’ fees from the eavesdropper. To record a call you must: (1) get consent of all parties in writing before the recording; (2) Recording must include verbal notification which is recorded at the beginning of recording, and (3) You must use automatic tone warning during the call. However, only one person’s consent is needed for recording in-person conversations. C.G.S.A. § 53a-187-189. C.G.S.A. §§ 53a-187, -89; C.G.S.A § 52-570d.
Product Liability Subrogation
Product Liability Law
Statute of Limitations/Repose: 3 years for personal injury and wrongful death. C.G.S.A. § 52-577a. Discovery Rule applies. Statute of Repose is 10 years. C.G.S.A. § 52-577a(a).
Liability Standards: Negligence, Strict Liability, Warranty, Other. C.G.S.A. 52-572m, et seq.
Fault Allocations: Pure Comparative. C.G.S.A. § 52-572(h).
Non-Economic Caps/Limits On Actual Damages: No.
Punitive Y/N and Limits: No.
Heeding Presumption?: No. DeJesus v. Craftsman Machine Co., 548 A.2d 736 (Conn. App. 1988).
Innocent Seller Statute: No. C.G.S.A. § 52-572m(b).
Joint and Several Liability: Yes. C.G.S.A. § 52-572o.
Available Defenses: Assumption of Risk; Misuse; Alteration; Learned Intermediary; Inherently Unsafe Products; State of the Art; Government Contractor Defense; Presumption; Sophisticated User.
Restatement 2nd or 3rd?: Both.
“Matching Regulations” And Laws Affecting Homeowners Property Claims
Statute/Regulation: If replacement parts do not match adjacent items, then insurer is required to replace all such items to create a reasonably uniform appearance. “When a covered loss for real property requires the replacement of an item or items and the replacement item or items do not match adjacent items in quality, color or size, the insurer shall replace all such items with material of like kind and quality so as to conform to a reasonably uniform appearance. This provision shall apply to interior and exterior covered losses.” C.G.S.A. § 38a-316e.
Caselaw: Insured under Replacement Cost policy sued carrier for failure to replace matching siding on garage. Court said the phrase “all such items” in matching statute refers only to those items previously identified in the sentence, specifically the replacement items and the adjacent items involved in the comparison. The court held that replacing all the siding was not required, because it would involve replacing siding which is not “adjacent” to the damaged area. Kamansky v. Liberty Mutual Ins. Co., 2019 WL 2374343 (Conn. Super. 2019).
Condominium/Co-Op Waiver of Subrogation Laws
Associations must maintain property, commercial general liability, fidelity, and sometimes flood insurance, but the insurer must waive its rights to subrogation against a unit owner and any member of his/her household. Connecticut Common Interest Ownership Act, C.G.S.A. § 47-255(d)(2).
Damage to Property Without Market Value
Service Value: “… if there is no market value at the time and place, resort must be had to the actual value at the time and place of delivery.” Pape v. Ferguson, 62 N.E. 712 (Ind. Ct. App. 1902).
Intrinsic Value: “The owner…may recover its usable value to himself…though no sentimental value can be taken into account.” Holmes v. Freeman, 185 A.2d 88 (Conn. App. Ct. 1962).
Sentimental Value: “The owner…may recover its usable value to himself…though no sentimental value can be taken into account.” Holmes v. Freeman, 185 A.2d 88 (Conn. App. Ct. 1962).
General Contractor Overhead And Profit Payments In First-Party ACV Property Damage Claims
Payment And Depreciation Of GCOP/Sales Tax: No applicable case law, statutes, administrative rules, or other guidance with regard to the calculation and/or depreciation of GCOP.
Tenants are co-insureds under a landlord’s fire insurance policy and may not be sued for their negligence as they are an insured under the policy. St. Paul Fire & Marine Ins. Co. v. Durr, 2001 WL 984782 (Conn. Super. 2001) (not reported in A.2d). This holding was first adopted in Sutton v. Jondahl, 532 P.2d 478 (Okla. Ct. App. 1975) (“Sutton Rule”). An exception to this rule exists where there is a lease that addresses the subrogation rights of the landlord. In the absence of a specific agreement to the contrary, there is no subrogation. The reasoning behind this is that the tenant is deemed to be a co-insured of the landlord because: (1) both parties have an insurable interest in the premises, the landlord as owner, and the tenant as possessor, of the fee; and (2) the tenant’s rent presumably includes some calculation of the landlord’s fire insurance premium.
In DiLullo v. Joseph, 792 A.2d 819 (Conn. 2002), the Connecticut Supreme Court established a “default rule of law” where there is no agreement between landlord and tenant as to who bears the risk of loss. The “default” is that, unless the lease refers to a right of subrogation on the part of the landlord or its insurer, no right of subrogation exists. The DiLullo Court specifically noted that “tenants and landlords are always free to allocate their risks and coverages by specific agreements, in their leases and otherwise.” Id.
In Middlesex Mutual Assurance Co. v. Vaszil, 279 Conn. 28 (2006), the Connecticut Supreme Court held that the lease in question did “not remotely inform the defendant that they would be liable to their landlord’s insurer” for fire damages to the landlord’s building, nor did it inform the defendant of the need to obtain fire insurance “to cover the value of the entire multi-unit apartment building.” One of the reasons DiLullo established a “default” rule was to avoid the economic waste of forcing each individual tenant in a multi-unit apartment to insure the whole building. The lease in Middlesex was ambiguous about whether the defendant’s liability was limited to loss of the security deposit, so no subrogation was allowed. However, in Amica Mut. Ins. Co. v. Andresky, 2012 WL 527678 (Conn. Super. Ct. 2012), the lease provided:
(1) that tenant (defendants) would obtain public liability and fire insurance for the benefit of the landlord and the tenant in the amount of $500,000 for liability and $500,000 for fire, and (2) the tenant would pay all costs if repair is required because of misuse or neglect by tenant, his family or anyone else on the premises.
The Superior Court in Andresky said that this language was “far more clear” and informed the defendant/tenant that they would be liable to their landlord’s insurer. The following year, another Superior Court decision stated that a lease must mention subrogation and/or inform the defendant that he may be liable to the landlord’s insurer for any casualty fire damages to the landlord’s building. State Farm Fire & Cas. Ins. Co. v. Rodriguez, 2013 WL 5879514 (Conn. Super. 2013). Like the lease agreement involved in Vaszil, the lease in Rodriguez made no mention of subrogation and did not remotely inform the defendant of liability to the landlord’s insurer for any casualty fire damages to the landlord’s building.
In Amica Mut. Ins. Co. v. Muldowney, 180 A.3d 950 (Conn. 2018), the Connecticut Supreme Court took a fresh look at the issue of a landlord’s property insurer subrogating against tenants. The landlord’s carrier paid for water damage caused by frozen pipes of a tenant who was on vacation. The issue was what sort of “specific agreement” (see DiLullo) was required to expressly state that a landlord’s carrier has a right of subrogation and overcome the DiLullo presumption against subrogation (more precisely, overcomes that “the tenant’s rent presumably includes some calculation of the landlord’s fire insurance premium). The Supreme Court loosened the prohibitions against subrogating against a tenant by stating that the lease doesn’t have to expressly state that a landlord’s insurer has a right of subrogation against the tenant in order for subrogation to be allowed. It is sufficient for the lease to notify the tenant explicitly that he is responsible for any damage to the leased property and to allocate to the tenant the responsibility to provide liability and property damage insurance. Under the lease in that case, the tenants were required to take certain actions designed to guard against frozen pipes and subsequent water damage. The lease also stated that if they breached the lease, the tenant had to pay for repairs if their actions made the premises unfit or unlivable and to hold the landlord harmless for any loss arising out of their use or occupancy of the premises. As a result, subrogation was allowed. The Supreme Court held that (1) the landlord and tenant had a “specific agreement” sufficient to overcome the default presumption that the landlord’s insurer had no right of subrogation against the tenants; and (2) the landlord’s carrier was allowed to pursue subrogation against the tenants and this was fair and consistent with the doctrine of equitable subrogation.
All fire insurance policies issued in Connecticut must conform to. C.G.S.A. § 38a-308. In regard to the insurer’s subrogation rights, the standard form includes a subrogation provision stating: “This Company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefore is made by this Company.” The subrogation clause set forth in C.G.S.A. § 38a-307 fails to provide an insurer with a direct, and inviolate, right of subrogation. It merely provides that an insurer “may require” an insured to assign any rights they have to the insurer. Thus, under this clear language, the right of recovery belongs to the insured, and the insurer can only obtain that right when the insured grants it. Wasko v. Manella, 849 A.2d 777 (Conn. 2004). The policy must contain specific subrogation language.
An individual who contributes to the payments on the premium of a property insurance policy, and who would reasonably not expect to be the target of subrogation, is exempt from subrogation. Allstate Ins. Co. v. Palumbo, 994 A.2d 174 (Conn. 2010). A home insurer can seek equitable subrogation against a houseguest who negligently burns down a home. Wasko v. Manella, 849 A.2d 777 (Conn. 2004). In Palumbo, a woman’s fiancé lived with her in the home that she owned. The fiancé negligently installed a water heater, which resulted in a fire that damaged the home. The court ruled that equitable subrogation against the fiancé was impermissible because the fiancé contributed to payments on the homeowner’s insurance, had lived in the residence for an extended period, and likely would have believed that subrogation against him was impossible. In Wasko, a houseguest negligently burned down a vacation home. The insurer brought a subrogation action against the guest, who argued that he was protected by the ASR because he was an implied co-insured on the homeowners’ policy. The court ruled that although statutory subrogation was barred, equitable subrogation against the houseguest was still permissible.
Connecticut statute allows a court to order criminal restitution if there was damage to person or property as a result of a criminal offense, and if the victim specifically requests it. C.G.S.A. § 53a-28 (West).
Although restitution has been awarded to an insurer as a “victim,” the statute does not specifically qualify an insurer as such. In State v. Jones, the court stated that the criminal defendant must abide by a probation order which included an amount in restitution to an insurer. State v. Jones, 55 Conn. App. 243, 739 A.2d 697 (1999).
Made Whole Doctrine
Until recently, the Made Whole Doctrine had not been applied outside the context of a bankruptcy proceeding in Connecticut. In re DeLucia, 261 B.R. 561 (Banc. Ct. 2001). However, the Connecticut Supreme Court has given us a clue as to how it will treat this issue in the future. The Court has held that while a right of true equitable subrogation may be provided for in a contract, the exercise of that right will have its basis in general principles in equity, rather than in contract, which will be treated as merely a declaration of the principles of law already existing. Wasko v. Manella, 849 A.2d 777 (Conn. 2004). However, the discussion in Wasko v. Manella regarding the Made Whole Doctrine was considered dicta and wasn’t binding. In 2013, however, the Connecticut Supreme Court broadly adopted the equitable Made Whole Doctrine for the first time. Fireman’s Fund Ins. Co. v. TD Banknorth Ins. Agency, Inc., 2013 WL 3818112 (Conn. 2013).
Nonetheless, Connecticut case law intimates that the Made Whole Doctrine can be overridden by contract terms in a Plan or policy and the courts will allow these contract terms to override the application of this equitable Doctrine. Automobile Ins. Co. of Hartford v. Conlon, 216 A.2d 828, 829 (Conn. 1966). In an action for reimbursement of monies paid out on policy of collision insurance, the Court held that the insurer had the burden of proving that the judgment recovered by the insured included compensation for property damage and that as a result the insurer was entitled to recover, either on unjust enrichment theory or on theory that insured had violated his contract by refusing to cooperate with the insurer in effecting recovery. Id.
In 2011, the 2nd Circuit Court of Appeals, interpreting Connecticut law, held that boilerplate subrogation language in a policy does not displace the Make Whole Doctrine in Connecticut. Fireman’s Fund Ins. Co. v. TD Banknorth Ins. Agency Inc., 644 F.3d 166 (2nd Cir. 2011). That Court stated that an insurer’s right of equitable subrogation is subject to the Made Whole Doctrine, which provides that the insurer may enforce its subrogation rights only after the insured has been fully compensated for all of its loss. Id. When insurance coverage compensates a policyholder for less than the full loss, the insurer must first use any recovery from a third-party to compensate the policyholder for the remainder of its loss before keeping anything for itself. Id. On a certified question from the Court of Appeals, the Connecticut Supreme Court, in a footnote, clarified that the Made Whole Doctrine is merely the default rule and that parties are free to provide differently in their insurance contract, provided they do so expressly. Fireman’s Fund Ins. Co. v. TD Banknorth Ins. Agency, Inc., 2013 WL 3818112 (Conn. 2013).
A 2022 Superior Court decision has confirmed that there is no such thing as “wrongful subrogation” stemming from a subrogation demand made prior to a determination that the insured has been made whole. Davis v. Adeoye, 2022 WL 16570653 (Conn. Super. 2022). In Davis v. Adeoye, Erin Davis was in an accident with Christine Adeoye and filed suit against Adeoye. While Davis’ insurer, Liberty Mutual, had paid repair costs for Davis’ vehicle, the lawsuit also claimed diminution in value to her vehicle, loss of use thereof, out of pocket expenses, inconvenience, lost time, loss of life’s enjoyment and annoyance. The lawsuit also named Liberty Mutual, alleging “wrongful subrogation” by Liberty for making a property subrogation recover from Adeoye’s liability carrier. The court rejected any notion that Connecticut recognized a tort for “negligent subrogation”, acknowledging that the Made Whole Doctrine does not prevent an auto insurer who has paid for repairs under a policy from pursuing its subrogation rights until after the plaintiff has fully recovered from the tortfeasors. Rather, the court indicated that the Made Whole Doctrine merely stands for the proposition that an insured enjoys a priority of recovery in a scenario where the total amount of damages awarded is insufficient to satisfy both an insured’s claim and an insurer’s subrogation claim.
Medical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Collateral Source Rule: Connecticut had common law CSR since 1891. Regan v. New York & N. Eng. R.R., 22 A. 503 (Conn. 1891). In 1986, Connecticut enacted statute that altered and rejected common law CSR. Section 52-225a requires post-verdict reduction of the economic damages awarded by the amount of collateral sources received. Hernandez v. Marquez, 2004 WL 113616 (Conn. Super. 2004). It authorizes reducing economic damages award by an amount equal to the sum of collateral source payments received, less any amount paid by or on behalf of the plaintiff to secure those payments. Jones v. Kramer, 806 A.2d 606 (Conn. App. 2002). Collateral sources defined as any payment to plaintiff through: (1) any health or sickness insurance, auto accident insurance that provides health benefits, and any other similar insurance benefits, except life insurance benefits available to the claimant, whether purchased by him or provided by others; or (2) any contract or agreement of any group, organization, partnership or corporation to provide, pay for or reimburse the costs of hospital, medical, dental, or other health care services.” C.G.S.A. § 52-225b. Two exceptions. No reduction for (1) any collateral source for which a right of subrogation exists, and (2) the percentage of the plaintiff’s own negligence. C.G.S.A. § 52-225a(a).
Recovery Of Medical Expenses Rule:
Private Insurance: Evidence of billed medical expenses allowed. Voluntary write-offs are not “collateral sources” and, therefore, may not be deducted from a verdict. Id.; McInnis v. Hospital of St. Raphael, 2008 WL 4150056 (Conn. Super. 2008). When medical bills written off involuntarily (i.e., pursuant to the requirements of an insurance contract or agreement), such write-offs do qualify as collateral source payments. No special rules regarding write-offs by private insurers. Whether such write-offs are collateral sources depends upon whether they were forgiven voluntarily or pursuant to a contract.
Medicare/Medicaid: Evidence of billed medical expenses allowed. Medicare write-offs are collateral sources because they are statutorily-required. McInnis, supra. Medicaid write-offs are subject to collateral source reductions. Zogai v. Jacobs, 2019 WL 7630765 (Conn. Super. 2019); Ventura v. Town of East Haven, 2015 WL 1588816 (Conn. Super. 2015), rev’d on other grounds 170 Conn. App. 388 (2017); McInnis v. Hospital of St. Raphael, 2008 WL 4150056 (Conn. Super. 2008). However, a Connecticut Superior Court has held to the contrary. Zhuta v. Zhuta, 2007 2007 WL 2363387 (Conn. Super. 2007). In Hassett v. New Haven, 91 Conn. App. 245 (2005), the court distinguished between voluntary discounts, which are not collateral source “payments,” and involuntary discounts, such as those required by Medicaid and Medicare, which he characterized in dictum as “write-offs of bills beyond the amount paid by Medicare/Medicaid [that] are involuntary statutory/contractual payments which constitute collateral sources which will reduce the plaintiff’s economic damages.” These decisions were all decided before the Supreme Court’s decision in Marciano.
Related Law/Comments: In recent Connecticut Supreme Court decision, jury awarded plaintiff $84,283 in economic damages and $40,000 in non-economic damages, for a total of $124,283. Following trial, the defendants requested a collateral source reduction. The Superior Court calculated the collateral source reduction by subtracting the cost to secure the collateral source benefits ($58,042.43) from payments made to plaintiff by the health insurer ($82,342.18). This amounted to a collateral source reduction of $24,299.75. The court, therefore, reduced the total verdict from $124,283.67 to $99,983.92, plus costs. The health insurance plan at issue was an ERISA plan with a right of subrogation. Prior to the judgment the ERISA insurer had agreed to accept $6,940.19 in full satisfaction of the right of subrogation in the event of a settlement for $120,000. The court held that since there was a right of subrogation under the plain and unambiguous language of § 52-225a, there was no basis for any collateral source reduction of the jury verdict. Marciano v. Jimenez, 151 A.3d 1280 (Conn. 2016). Voluntary write-offs by medical providers are not collateral sources. Hassett v. City of New Haven, 858 A.2d 922 (2004), aff’d, 880 A.2d 975 (Conn. App. 2005). Section 52–225a has been construed to allow only payments specifically corresponding with items of damages included in the jury’s verdict to be deducted as collateral sources from the economic damages award. Jones v. Kramer, 838 A.2d 170 (Conn. 2004).
Employee Leasing Laws
The Connecticut statute provides that the employer who originates a contract where an employee is loaned to another employer is ultimately responsible to the worker for all benefits. C.G.S.A. § 31-292. Section 31-284 provides:
“… 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 in claims given by this chapter …” C.G.S.A. § 31-284.
Hospital Lien Laws
Statute: C.G.S.A. § 49-73. Liens on Accident and Liability Policies in Favor of Hospitals and Ambulance Services.
Perfecting Lien: To protect a lien in Connecticut, a provider must:
(1) Serve notice upon insurer by certified mail at its principal home office or any other branch office, if the company is located in the state, and upon the Insurance Commissioner if the insurer is located out of state. § 49-73 (a).
(2) The notice shall contain name of the injured person, name of company issuing the policy, and amount expended and an estimate of the amount of services. § 49-73 (a).
Comments: There is no mention in the statute about serving notice on the tortfeasor directly. The lien does not attach to any workers’ compensation benefits. § 49-73 (a).
OCIP/CCIP Subrogation In Workers’ Compensation Construction Cases
OCIP Law: Owner granted exclusive remedy protection where member of OCIP which provided benefits to employee and indicated owner was alternate employer. Bishel v. Connecticut Yankee Atomic Power Co., 771 A.2d 252 (Conn. App. 2001). Connecticut’s OCIP statute permits the use of an OCIP for public construction and public works projects. C.G.S.A. § 49-41(E)(1).
Statutory Employer Law: In Connecticut, when any principal employer procures any work to be done wholly or in part for him by a contractor, or through him by a contractor, and the work so procured is to be done as a part of or process in the trade or business of such principal employer, and is performed in, on or about premises under his control, such principal employer will be liable for workers’ compensation to the employees of such contractors or sub-contractors. C.G.S.A. § 31-291. If an owner or contractor becomes a “statutory employer” (known in Connecticut as a “principal employer”), such statutory employer is entitled to immunity under the Exclusive Remedy Rule. Farrell v. L.G. De Felice & Sons, Inc., 42 A.2d 697 (Conn. 1945); Sgueglia v. Milne Constr. Co., 562 A.2d 505 (Conn. 1989); Esposito v. PGP Indus., Inc., 1990 WL 283963 (Conn. Super. 1990) (unreported decision).
Comments: “Statutory employer” is known as a “principal employer” in Connecticut.
Recovery Of Increased Workers’ Compensation Premiums By Employer
Recovery For Increased Premiums? No.
Statute/Case Law: RK Constructors, Inc. v. Fusco Corp., 231 Conn. 381, 650 A.2d 153, 157 (1994).
Rule Summary: Increased workers’ compensation premiums resulting from a third-party tortfeasor’s injuries to employees are harms that are not foreseeable or are otherwise too remote to be subject to liability.
Which Workers’ Compensation “Benefits” Can Be Subrogated?
Connecticut’s § 31-293 gives us only a “clue” as to which benefits can be recovered:
For the purposes of this section, the claim of the employer shall consist of (1) the amount of any compensation which he has paid on account of the injury which is the subject of the suit and (2) an amount equal to the present worth of any probable future payments which he has by award become obligated to pay on account of the injury. The word “compensation,” as used in this section, shall be construed to include incapacity payments to an injured employee, payments to the dependents of a deceased employee, sums paid out for surgical, medical and hospital services to an injured employee, the burial fee provided by subdivision (1) of subsection (a) of section 31‑306, payments made under the provisions of sections 31‑312 and 31-313, and payments made under the provisions of section 31-284b in the case of an action brought under this section by the employer or an action brought under this section by the employee in which the employee has alleged and been awarded such payments as damages.
Therefore, a carrier can recover the following categories of “compensation” paid to or on behalf of an employee:
- Any “compensation” paid to the employee;
- Present value of any probably future payments.
In the definitions section of the statute, the term “compensation” is defined in § 31-275 as:
“Compensation” means benefits or payments mandated by the provisions of this chapter, including, but not limited to, indemnity, medical and surgical aid or hospital and nursing service required under section 31-294d and any type of payment for disability, whether for total or partial disability of a permanent or temporary nature, death benefit, funeral expense, payments made under the provisions of section 31-284b, 31-293a or 31-310, or any adjustment in benefits or payments required by this chapter.
Section 31-294d, referenced above, requires payment of “…any medical and surgical aid or hospital and nursing service, including medical rehabilitation services and prescription drugs, as the physician or surgeon deems reasonable or necessary.” We can argue that the nurse case management fees are necessary to determine which payments qualify to be paid, and that these nurse case management fees benefit the employee by helping to hold down the lien. If we didn’t pay those fees, the lien would be much larger, and the employee would owe us much more out of his third-party recovery. Nonetheless, advocacy will be required to make the case.
Workers’ Compensation Subrogation Waiver Endorsements
Subrogation Statute: C.G.S.A. § 31-293
Waiver Allowed? Nothing in the Connecticut Workers’ Compensation Act or applicable case law prohibits the use or efficacy of a waiver of subrogation.
Effect Of Waiver Endorsement on Carrier’s Right To Assert A Lien On Claimant’s Recovery: The effect of a waiver of subrogation on the carrier’s rights, including its right to enforce its statutory lien, has not yet been decided.
Other Applicable Law: None.
Statute of Limitations: 2 Years. C.G.S.A. § 31-293.
Can Carrier Sue Third Party Directly: Employer can bring suit pursuant to § 31-293. Carrier can bring suit and automatically loses 1/3 of its lien if it waits for employee to file suit.
Right to Intervene: Must intervene or give notice of lien within 30 days after notice of filing suit.
Recovery from UM/UIM Benefits: No.
Subrogation Against Medical Malpractice: Yes.
Subrogation Against Legal Malpractice: No.
Recovery Allocation/Equitable Limitations: (1) Fees, Expenses; (2) 1/3 to Employee (if employee filed – no credit); (3) Carrier Reimbursed; and (4) Balance to Plaintiff. If suit brought by carrier, may be subject to equitable defenses, including the Made Whole Doctrine.
Employer Contribution/Negligence: No.
Attorney’s Fees/Costs: The lien is automatically reduced by 1/3 if plaintiff files suit, unless employer is a state or city. Most likely, suit must be filed to get attorneys’ fees. If suit is brought by carrier, may be subject to equitable defenses, including the Common Fund Doctrine.
Future Credit: Yes.
Auto No-Fault: No.
Workers’ Compensation Claims by Undocumented Employees
Statute: The term “employee” includes every person in service under any contract of hire or other employment avenue. It is silent on “aliens” as employees. Conn. Gen. Stat. § 31-275(9)(A)(i).
Case Law: Dowling v. Slotnik, 712 A.2d 396, 403 (Conn. App. Ct. 1998).
Comments/Explanation/Other: “Examination of legislative history revealed that the legislature did not intend to exclude illegal aliens from coverage under the state’s workers’ compensation laws.”