Receipt of Benefits Bars Worker and Parents of Deceased Worker From Maintaining Civil Actions Against North Dakota “Employer”

Where one North Dakota worker was killed and another seriously injured in a work-related explosion, neither the deceased worker’s parents nor the injured worker could maintain a civil action against the purported employer since the parents submitted an application for non-dependency benefits to the state’s Workforce Safety and Insurance (WSI), and accepted the benefits awarded, and since the injured worker also sought and received WSI benefits as well, held the Supreme Court of North Dakota [Plains Trucking v. Hagar, 2019 ND 226, 2019 N.D. LEXIS 227 (Aug. 22, 2019)]. The Court held the doctrine of res judicata barred both civil actions. Moreover, arguments that the “employer” had understated its payroll and should not be allowed to hide behind the exclusive remedy defense could not be supported by the record in the case.

Background

Davis was killed, and another worker, Bail, was injured in an explosion that occurred while Davis and Bail were cleaning a crude oil tanker trailer owned by MBI Energy Services. Davis’s parents submitted an application for non-dependency benefits to WSI. WSI accepted the claim, paid the parents benefits, which were accepted. The parents subsequently commenced a civil action against Plains Trucking, the purported employer, and MBI, alleging that Davis had been an independent contractor and asserting claims for negligence, strict liability, and liability.

Bail separately submitted a report of injury and sought WSI benefits. Bail accepted WSI’s payment of benefits, but subsequently also filed a civil action against Plains Trucking. Plains Trucking maintained in both suits that it was immune from suit under the exclusive remedy provisions of the state’s Workers’ Compensation Act. The trial court denied Plains Trucking’s summary judgment motion in the Davis suit, granted it in part in the Bail suit, holding in the later that there was a question as to whether Plains Trucking was in compliance with N.D.C.C. § 65-04-33(2).

Res Judicata

The Court noted that under the Act, an employee gives up the right to sue the employer in exchange for sure and certain benefits, regardless of fault. Neither the parents of Davis nor Bail could not now argue that the workers were independent contractors; both had applied for and been awarded WSI benefits. The Court stressed that the doctrine of res judicata prohibited re-litigation of claims that were raised or could have been raised in a prior proceeding between the same parties or their privies, and which were resolved by a final judgment in a court of competent jurisdiction.

Here, when WSI issued its decisions accepting the claims and awarding benefits, WSI necessarily decided both Davis and Bail were Plains Trucking’s employees and had sustained compensable injuries. The Court continued that the failure of anyone to request timely reconsideration of those decisions rendered them final, entitled to the same faith and credit as a judgment of a court of record.

Other Violations

As to violations of N.D.C.C. §§ 65-09-01 and 65-04-33, the record was silent. Under some circumstances, an employer who willfully misrepresents to WSI the amount of its payroll upon which its premium is based is liable to the state and, again in some circumstances, could be sued by the injured worker. No such evidence had been introduced in the case; violations could not be presumed.

Plains Trucking was immune from suit, concluded the Court.