ANNE WINELAND v. ESCHER S.R.O. PROJECT

(NOTE: The status of this decision is .)
 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-4974-07T14974-07T1

ANNE WINELAND,

Plaintiff-Respondent,

v.

ESCHER S.R.O. PROJECT, RONALD

BROWN, individually and as

President of Escher S.R.O.

Project, RONALD PAUL, CLASSIC

DESIGN & CONSTRUCTION, INC.,

STALLONE ELECTRICAL CONTRACTORS,

JS MECHANICAL INC.,

Defendants,

and

ALLIED CONSTRUCTION SERVICES,

INC. and INTEGRATED

CONSTRUCTION COMPANY,

Defendants-Appellants.

__________________________________

 

Submitted: May 20, 2009 - Decided:

Before Judges Axelrad, Parrillo and Kestin.

On appeal from the Superior Court of New Jersey, Law Division, Mercer County, Docket No. L-1980-98.

Kent & McBride, P.C., attorneys for appellants (Debra S. Fascia and Nicholas J. Sansone, on the briefs).

Levinson Axelrod, P.A., attorneys for respondent (Adam L. Rothenberg, on the brief).

PER CURIAM

Defendant, Allied Construction Services, Inc. and Integrated Construction Company (Allied), appeal from an order for judgment denying it a setoff against an arbitration award for monies paid by a co-defendant for workers' compensation benefits following our limited remand. We affirm.

We briefly recite the facts and prior procedural history of this case as it is more fully set forth in our previous per curiam opinion, Wineland v. Escher S.R.O. Project, No. A-0926-03T3 (App. Div. December 30, 2004). During the course of her employment, plaintiff sustained injuries while visiting a construction site owned by defendant, Escher S.R.O. Project, on which Allied was the general contractor. Liberty Mutual, the workers' compensation carrier for plaintiff's employer, had a lien of $100,324. When plaintiff's personal injury complaint against Escher and Allied went to arbitration, the arbitrator awarded plaintiff $400,000 in damages, finding Escher and Allied each 50% liable. The award further stated "[$100,000 Worker Comp. lien - not considered in award]."

Pursuant to plaintiff's motion, the court entered judgment confirming the arbitration award, which included an offset of the amounts plaintiff recovered against Escher and received in workers' compensation benefits. On cross-appeals, we reversed the Escher setoff, and as to Allied's argument that it was entitled to a setoff for the amount plaintiff received from workers' compensation, we held:

if the arbitration award included the amount of medical expenses and wage loss paid by workers' compensation, in addition to an award of pain and suffering, the entire workers' compensation . . . should be setoff against the $246,304.25 awarded plaintiff against Allied when pre-judgment interest is added. On the other hand, if the arbitration did not include in the $400,000 award any amount for wage loss and medical expenses paid by workers' compensation, we are likewise of the view that there should be no setoff at all.

[Slip op. at 26.]

However, because we were unable to determine what the arbitrator meant by the bracketed language in the award, i.e., whether the $400,000 award was for pain and suffering alone or included medical benefits and lost wages paid by workers' compensation, we directed the following limited remand:

We remand this matter to the trial court with directions to seek clarification from the arbitrator as to what he intended by the language "[$100,000.00 Worker Comp. Lien - not considered in award][]" inserted in the August 20, 2002 Report and Award of Arbitration. Upon receipt of the arbitrator's clarification of his intention, the trial court should require plaintiff to amend her complaint to join the workers' compensation carrier as a party to this litigation. After conducting whatever proceedings it deems necessary, the court should determine the validity of and/or the extent of any lien asserted by the workers' compensation carrier, any subrogation rights the carrier may have, and enter an appropriate amended order. . . .

[Id. at 27-28.]

The Supreme Court denied Allied's petition for certification. Wineland v. Escher S.R.O. Project, 183 N.J. 217 (2005).

Before the case was heard on remand by the trial court, it was learned that the arbitrator who drafted the report and award of arbitration had passed away. The trial court attempted to reconstruct the record by directing depositions of the attorneys who represented plaintiff and Escher at the arbitration, Gerald B. Schenkman and Christopher Carlson, respectively. Judge Innes then summarized the deposition testimony and explained the basis for his finding that the wage loss and medical expenses were not included in the $400,000 arbitration award and thus, under our prior decision, Allied was not legally entitled to deduction of the workers' compensation lien amount. The court stated:

[T]he language that I'm relying upon is the testimony by Mr. Schenkman . . . . He was asked: "Do you remember any discussion[s] occurring at the arbitration hearing?["] concerning the workers' compensation lien and his response . . . was "I don't remember it clearly, I do recall the arbitrator not giving any time to the discussion of the workers' compensation lien, although he did make reference to it in a dismissive way, to say that he was not going to address it."

Now, in addition to that we have the language from the testimony of Mr. Carlson. . . . "Based upon practicing law since 1993, 1994, primarily in a defense role since 1996, handling a fair number of arbitrations, what the award, . . . to me indicates [is that] the parenthesis or the brackets around the $100,000 workers' comp. lien [were] not considered an award. The first thing that suggests to me, as i[t] often happens, after an arbitrator initially writes up an award I know, as I make it a practice before signing, I make sure that it's clear to me, based on what I just saw and what I had just heard, and many a time, if I believe that it's not clear, that if it doesn't reflect my understanding at the time of what the arbitrator is ruling, then I will often ask for a clarification, or an addition to the award and the fact that the brackets are there, and the fact that this is the last thing there, that suggests to me, and to be clear, I have no specific recollection of this, but that clearly suggests to me that the issue of the workers' compensation lien was discussed and the fact that the arbitrator wrote in $100,000 workers' . . . comp. lien not considered [i]n award[] [t]hat tells me it was discussed and it was considered, but it was not included in the award. That's how I would interpret it today and I would assume that I would have interpreted it that way five years ago."

. . . .

"I would interpret this as it's a $400,000 award based, again, upon the language in the award and no specific recollection. There was discussion of a workers' compensation lien. Clearly the arbitrator knew that it was a $100,000 lien, that would lead me to believe that it was discussed at some point and this is the arbitrator saying that within that $400,000, he's not folding in that 100. So, it would be 400 plus 100."

That is consistent with Mr. Schenkman's testimony. So, under the circumstances I think it's clear, based upon the only evidence before this Court, that the arbitrator did not include in the $400,000 award, any amount for wage loss and medical expense paid by the workers' compensation protection and as directed by the Appellate Division, if the Court were of that view, then there should be no setoff at all and, again, I'm using the language at Page 26 of the court's decision.

Under that circumstance, I find that the wage loss and medical expenses were not included in the $400,000 award and, therefore, based upon the Appellate Division decision, there's no setoff that Allied is entitled to.

This appeal ensued.

On appeal, Allied argues the trial court erroneously failed to deduct the workers' compensation recovery from the arbitration award, which it claims included the wage loss and medical expenses paid by workers' compensation. According to Allied, Judge Innes' decision was incorrect because: (1) absent any clear evidence to the contrary, where the claim for medical expenses and wage loss was made and not withdrawn, the setoff applies; (2) plaintiff did not sustain her burden of proof; and (3) the testimony of plaintiff's former attorney that the arbitrator "was going to leave that to other courts" requires the conclusion that while the damages were included in the award, the arbitrator appropriately decided to leave the issue of the effect of the lien and the statutory setoff to the courts in molding the judgment. In its reply brief, Allied further argues the trial court erred in failing to consider the testimony of Nick Sansone, the attorney for Integrated Construction Company, who was also present at the arbitration hearing. In light of the record and applicable law, we are not persuaded by appellant's arguments and affirm substantially for the reasons articulated by Judge Innes.

In our prior opinion we explicitly held there would be no setoff if the arbitration award did not include amounts received in workers' compensation for medical expenses and lost wages. We remanded solely for a clarification by the arbitrator as to whether the arbitration award was for pain and suffering alone or included the benefits paid by workers' compensation; in other words, a factual determination.

Our scope of review of a trial court's factfinding function is limited; such findings of fact should not be disturbed on appeal unless they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence so as to offend the interests of justice. Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474 (1974).

Considering the circumstances, we are satisfied Judge Innes followed our instructions on remand and appropriately tried to glean insight into the arbitration award through deposition testimony of the parties' former counsel. Allied did not present any evidence that would dispute the interpretation ultimately adopted by Judge Innes. Allied had the opportunity to present the testimony of Sansone in a timely manner to the trial court if it believed his testimony would contradict that of Carlson and Schenkman. As Judge Innes noted, there was plenty of time prior to oral argument for counsel to have deposed Sansone if they so chose. Allied's counsel neither did so nor submitted Sansone's affidavit, instead waiting until oral argument to suggest she could obtain an affidavit if the court deemed it appropriate before rendering a decision.

There was ample evidence in the record on remand for the trial court's determination, which was based on a reasonable interpretation of the testimony of the attorneys who participated in the arbitration proceeding and was consistent with the plain language of the statement at issue. We thus discern no basis to disturb that finding. Accordingly, pursuant to the law of the case, Allied is not entitled to a setoff for the amount plaintiff received from workers' compensation.

Affirmed.

 

According to plaintiff's counsel, Sansone had clearly indicated to him during prior discussions his disinclination to be deposed or provide an affidavit. Judge Innes decided, however, he would not draw any conclusions, one way or the other, based on Sansone's non-participation, commenting that "[i]t may be he just doesn't want to be involved [or] he may not have any recollection . . . ."

(continued)

(continued)

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A-4974-07T1

June 17, 2009