Search Site
Menu

The Workers' Compensation Lienholder

You may recall in the past that I have spoken about the situation where workers who have been injured on the job have two kinds of claims. The first is a workers’ compensation claim which is lodged or brought against the employer, either an insurer or, occasionally, a self-insurer. The second is a claim for negligence against a party who is not the employer.

It is the claim for negligence that is heard in the Massachusetts Superior Court. The other claim, for workers’ compensation, is heard before the Division of Industrial Accidents, formerly known as the Industrial Accident Board. The tort claim, or personal injury claim, which is brought in the court, is done so under Massachusetts General Law c. 152, sec. 15 and that statute has requirements for what must happen at the end of the case. There needs to be a hearing in the Superior Court or a petition filed at the Division of Industrial Accidents to have the settlement approved. A real thorn in the side, and I have spoken about this, is the lien(s).

In this instance, in this situation, I do not mean lien holders who are medical providers, but rather the workers’ compensation insurer. It is the workers’ compensation insurer who has an automatic lien on the third party case and any ultimate recovery. Therefore, an allocation has to be made at the conclusion of the case in either forum (the Superior Court or the Division of Industrial Accidents) and all relevant parties must agree to the distribution, including the amount to be paid back to the lien holder, i.e. the workers’ compensation insurer. (There are times where all parties don’t agree and the Motion/Petition can nevertheless be brought. Those relatively rare circumstances where there is no agreement will be the subject of another blog.)

In the Court’s view, liens are no small matter so they are not to be easily dismissed. Now in recent years, there have been things known, and some of you will have heard of this, the Curry case as well as other cases which allow the employee to insulate some of the proceeds from the workers’ compensation insurer. Curry v. Great American Insurance Company, 80 Mass. App. Ct. 592 (2011). Allocations in the petition for pain and suffering are the so-called Curry allocations. Allocations that are done for loss of consortium also avoid the harshness of the lien because a wife’s or children’s claims for loss of consortium are not subject to the workers’ compensation lien either.

In DiCarlo v. Suffolk Construction Co., 86 Mass. App. Ct. 589 (2014), Justice Agnes stated, “Legislative recognition of an insurer’s right to be made whole . . . By electing to receive workers’ compensation benefits, an injured employee is relieved of the need to bring a lawsuit, to prove negligence, and to risk suffering the consequences of comparative negligence and a reduction or loss of the right to recover any damages which may result if a tort action was brought instead of a claim for benefits under G.L. c. 152. . . Instead, the Supreme Judicial Court has written that the goal of §15 is to provide workers’ compensation insurers with first priority in the allocation of third-party recoveries.”

You can see the sentiment expressed in the above. Appellate Courts have not confined themselves to weighing in on Curry’s pain and suffering exemption either. “Where in the bulk of the settlement proceeds has been allocated to claims which the insurer may not be reimbursed [speaking in that instance of loss of consortium claims], those allocations must be eyed by the court with a healthy dose of skepticism”. Hultin v. Francis Harvey & Sons, Inc., 40 Mass. App. Ct. 692, 699 (1996). Thus getting approval for a third-party settlement can be difficult if your lawyer is overzealous in attributing too much to pain and suffering and/or loss of consortium.

However, that is not to say that your lawyer cannot attempt, assuming the fact situation supports it, to make an allocation for consortium and to make the allocation, now done automatically, for the Curry pain and suffering. Again, the effect of that will be to protect the employee, the client from having to pay that portion at all towards the lien.This advantage can be illusory, however, depending on the numbers involved. For example, in a situation where the lien holder has compromised quite a bit but wants a certain amount back, allocations may not help. If the amount to be paid to the lien holder is for substantially less than they could have insisted upon -that is, where they are already reducing their lien- I am afraid that those allocations will not advantage the employee. Why? The lien holder could then say that they want everything back and that their compromise, which is voluntary, will be pulled back once they see allocations that raise their eyebrows. However, to be sure, in many instances, allocations for pain and suffering and loss of consortium are useful and should be attempted in the right fact situation.

Feinberg & Alban, P.C. fervently protects your rights
  • The Boston firm of Feinberg & Alban, P.C. specializes its practice in the area of personal injury.

    The attorneys serve the entire state of Massachusetts in addition to affiliating with lawyers in other states to handle cases outside of Massachusetts.

  • $7.7 Million Award for Feinberg & Alban Client in Personal Injury Trial

    Boston Attorneys Win Highest Injury Verdict in Massachusetts in 2011 & 2012.

Client Reviews
  • google
    5.0/5.0

    I suffered injuries and total loss if my car last year in a head on collision. Colleen Santora took my case and fought well on my behalf. She thoroughly answered all my questions and concerns, always responding in a quick and timely manner. She helpe...

    Read more

    Jessica Matt

  • google
    5.0/5.0

    Choosing Feinberg & Alban was probably one of the best decisions I ever took. Robert Feinberg and Perry Feinberg are amazing in their professionalism as well as in compassion. Perry was the lead attorney for me. He was always responsive to any questi...

    Read more

    Raja Bhattacharyya

  • google
    5.0/5.0

    I would like to express my gratitude to Feinberg & Alban PC. They are great people and professionals. If you need an attorney these are your guys. Thank you so much! Tatiana

    Read more

    Tatiana Andreeva

  • google
    5.0/5.0

    It was unbelievable!! I got into a motorcycle accident didn’t remember a thing when I woke up I was in the hospital and very terrified I thought to myself I think I need a lawyer I started looking online and I came across this law firm let me tel...

    Read more

    Vin Loco

  • google
    5.0/5.0

    Colleen Santora helped immensely in every step along the way of my fight against the insurance company regarding my property damage and injuries sustained. I'm grateful and would recommend Colleen to anyone! Thanks

    Read more

    DatDude Lex

See all reviews
Awards & Affiliations
Contact us

Quick Contact Form