On Appeal from Commissioner of Labor
The opinion of the court was delivered by: Reiber, C.J.
Estate of Dunn (2011-419)
PRESENT: Reiber, C.J., Dooley, Skoglund, Burgess and Robinson, JJ.
¶ 1. This case asks us to determine whether a workers' compensation insurer is entitled to reimbursement*fn1 of death benefits it has paid when a claimant's beneficiary also receives proceeds from a life-insurance policy. We hold that under 21 V.S.A. § 624(e) a workers' compensation carrier cannot seek reimbursement from life-insurance payments because such proceeds are not "damages," as contemplated by the statute, paid because of a third party's tortious actions. We therefore affirm the Commissioner of Labor's grant of summary judgment to the estate of claimant, Monica Dunn.
¶ 2. The underlying facts are not disputed. Claimant was an employee of Windham Northeast Supervisory Union. In October 2009, claimant died of complications from surgery to treat a work-related knee injury. Windham's workers' compensation insurer, the Vermont School Boards Insurance Trust, began paying workers' compensation death benefits to her estate. Claimant also held a life insurance policy, which named her husband as her beneficiary. The plan provided for a lump-sum payment upon proof of her death, as well as payments of $3000 a year per child for up to four years while the children attended college.
¶ 3. Windham/VSBIT sought reimbursement of the death benefits it had paid, and a credit against future benefits, to the extent of claimant's husband's receipt of life-insurance proceeds. The parties agreed to submit cross-motions for summary judgment following an informal conference at the Department of Labor in June 2011. The motions sought to settle the preliminary issue of whether Windham/VSBIT could claim reimbursement of the benefits pursuant to 21 V.S.A. § 624(e). Windham/VSBIT argued that claimant's receipt of both workers' compensation and life-insurance proceeds was the type of double recovery § 624(e) was designed to prevent. Claimant's estate, meanwhile, contended that the reimbursement provisions apply only to money employees recover from third parties who are responsible for their injuries. The Commissioner, agreeing with claimant's estate, concluded an employer's right to workers' compensation reimbursement under § 624(e) attaches only to damages received from a third party tortfeasor. The Commissioner reasoned that any right to reimbursement to prevent double recovery "is specifically tied to the 'recovery against the third party for damages' " as discussed in the reimbursement provision. Even if the statute were construed to permit reimbursement out of proceeds from any third party, including a life insurer, life-insurance payments made to claimant's beneficiaries did not constitute "damages," which the Commissioner defined as "a sum of money awarded to a person injured by the tort of another." Windham/VSBIT now appeals.
¶ 4. The Department of Labor certified the following question:"Is [Windham/VSBIT] entitled to an offset under 21 V.S.A. § 624(e) for the workers' compensation benefits paid and/or payable on account of Claimant's death from the proceeds of a life insurance policy?" See 21 V.S.A. § 672 ("The jurisdiction of [the Supreme Court] shall be limited to a review of questions of law certified to it by the commissioner.").
¶ 5. We review questions of law de novo. See Smith v. Desautels, 2008 VT 17, ¶ 12, 183 Vt. 255, 953 A.2d 620 (noting statutory construction "is a pure question of law"). "If the meaning of the disputed statutory language is unambiguous and resolves the conflict without doing violence to the legislative scheme, we accept the plain meaning as the intent of the Legislature without looking further." Town of Killington v. State, 172 Vt. 182, 188, 776 A.2d 395, 400 (2001) (quotations omitted). We will affirm the Commissioner of Labor's conclusions regarding the workers' compensation statutes when they "are supported by the findings and reflect the correct interpretation of the law." Morin v. Essex Optical, 2005 VT 15, ¶ 4, 178 Vt. 29, 868 A.2d 729 (citation omitted).
¶ 6. Vermont's workers' compensation reimbursement statute provides, in relevant part, that:
(a) Where the injury for which compensation is payable under the provisions of this chapter was caused under circumstances creating a legal liability to pay the resulting damages in some person other than the employer, the acceptance of compensation benefits or the commencement of proceedings to enforce compensation payments shall not act as an election of remedies, but the injured employee or the employee's personal representative may also proceed to enforce the liability of such third party for damages in accordance with the provisions of this section. If the injured employee or the employee's personal representative does not commence the action within one year after the occurrence of the personal injury, then the employer or its insurance carrier may, within the period of time for the commencement of actions prescribed by statute, enforce the liability of the third party in the name of the injured employee or the employee's personal representative.
(e) In an action to enforce the liability of a third party, the injured employee may recover any amount which the employee . . . would be entitled to recover in a civil action. Any recovery against the third party for damages resulting from personal injuries or death only . . . shall first reimburse the employer or its workers' compensation insurance carrier . . . . Reimbursement required under this subsection, except to prevent double recovery, shall not reduce the employee's recovery of any benefit or payment provided by a plan or policy that was privately ...