Jurisdiction over parents' claim for bad faith falls with board

In Indiana, the workers' compensation board has jurisdiction to hear claims of bad faith brought by an injured worker's guardians.

Case name: Amerisafe Risk Services, Inc. v. Estate of Wadsack, No. 88A01-1204-CT-144 (Ind. Ct. App. 11/09/12).

Ruling: The Indiana Court of Appeals held that it did not have jurisdiction over a suit brought by an injured worker's parents against the employer's workers' compensation insurer alleging bad faith in handling his claim.

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What it means: In Indiana, the workers' compensation board has jurisdiction to hear claims of bad faith brought by an injured worker's guardians.

Summary: A 19-year-old worker for a tree service was electrocuted and severely burned when a tree limb came into contact with a power line. He was hospitalized and in a coma for an extended period of time. His parents were appointed as his temporary guardians. The parents sued the employer's workers' compensation insurer, alleging that its case worker intentionally or recklessly undertook conduct that was designed to deny the worker benefits, deprive him of necessary medical care, and interfere with the parents' obligations as guardians. The parents claimed that the case worker's actions caused them to suffer extreme emotional distress, and the worker's mother died as a result of the distress. The Indiana Court of Appeals held that it did not have jurisdiction over the suit.

The parents argued that the workers' compensation board did not have jurisdiction over their suit because their claims were not on behalf of the worker or directly based on his injuries but were based on the handling of his claim. The court explained that the exclusivity provision of workers' compensation extends to bad-faith claims brought by an injured worker's personal representatives and next of kin. The court said that the parents' suit was a derivative of the worker's claims for benefits.

The court also explained that, contrary to the parents' arguments, they were not denied access to the courts. The parents had to present their claim first to the board and could appeal to the court if they received an adverse ruling.

Read more at the WorkersComp Forum homepage.

March 11, 2013

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