Tuesday, January 3, 2017

What if Not a Party to THIS Case

The 2016 holiday season brought me more entreaties regarding identification of carriers. Attorneys are reaching the conclusion of their case, preparing paperwork, and filing it with the Judge's office. They are dismayed, having documented a resolution between "Joe Claimant," and "Sally Employer" and "THIS Insurance Company," to learn that "THIS Insurance Company," is not a party to THIS case!

So, ready for approval and craving speed and finality, the parties awaken to the problem with THIS carrier. They realize that when the case was created, by petition for benefits ("PFB") or request for assignment of case number ("RACN"), it was filed against "THAT insurance company." Later in the case, the parties realized that error and began changing the documents each prepared and traded. They each quietly and unofficially acquiesced in litigating between "Joe Claimant" and "THIS insurance company." But they never bothered to file the simple one-page motion to correct carriers, to substitute THIS for THAT. 

Having sought approval of the fees and child support, seeking the order upon which to close the file, the parties instead receive a response to their filing. They are frustrated to learn the response or order is not an approval. The response or order is merely a reminder that the settlement documents as filed attempt to resolve a case against "THIS carrier" instead of "THAT carrier," which is reflected in the OJCC records. 

One attorney suggested to me that the OJCC should not care. the attorney urges that since the OJCC is not approving the settlement, but merely the fees and child support allocation, that the identity of the carrier does not matter. I wondered at that time about this argument if the ensuing settlement check was late. If "THIS carrier" is expected, upon approval, to issue a check to "Joe Claimant" would it matter to "THIS carrier" if their name or "THAT carrier's" name was on the order? If an attorney were seeking penalties from "THIS carrier" weeks later (for untimely payment pursuant to the order), would it matter if "THIS carrier's" name were on the order? If "THIS carrier" paid a settlement based on an order that instead named "THAT carrier," how would the Division view that in the event of an audit?

Another attorney explained to me that he feels "punished" or "criticized" when he gets such "wrong carrier" notifications or orders. He protested his lack of "fault." He explained to me the process he engages to investigate before filing a PFB. He described a detailed and thorough process of investigation, checking, double checking and verifying. It sounds very careful and very appropriate. But, he lamented, he sometimes ends up with the wrong carrier despite his best efforts. And, when there is an error he takes it personally. I appreciate his pride and professionalism. But, there will be mistakes. When they happen despite thorough and best efforts, do not let it bother you. A mistake is merely a mistake (I already made a dozen of those today). 

There seems is an inclination to ignore potential due process issues throughout a case against "THIS carrier" in a case that really involves "THAT carrier," or vice versa. It actually makes sense to correct such errors early and assuring the right parties are named in the case. 

Counsel should be aware of the details. As a case is litigated, either counsel may realize that there is an issue regarding the appropriate parties. It may be because the wrong party was initially named despite best efforts. It may be because there is a change in parties during the litigation, through mergers, contractual changes, etc. But, what is clear is that the attorneys should notice the need for a correction of a party. From what I am told, they all notice and acknowledge, but there is a failure to file a simple motion to correct the record. 

Defense counsel really should be aware of the parties to the case when she/he files a notice of appearance. That is an ideal time to file a simple motion to correct. There is no reason, with the consent of all true parties, that counsel cannot file an “unopposed motion to substitute parties” when she/he files a notice of appearance. The process is basic: defense counsel notices the error, and makes a quick call “Claimant's counsel, I noticed you listed THIS carrier, I represent THAT carrier and they stipulate that they are on this risk along with Sally Employer. Would you consent to substituting; I will file the motion.” 

As an aside, it is not uncommon at that time for Claimant's counsel and "THIS carrier's" attorney to file a joint motion to substitute "THAT carrier," when an error has occurred. This is unlikely to be procedurally sufficient. In order to substitute "THAT carrier," the parties would need to obtain the agreement of "THAT carrier" or "THAT carrier's" counsel. 

Without such a stipulation from "THAT carrier," the request for removing "THIS carrier" should be by motion. The Claimant can thereafter follow the normal steps to bring "THAT carrier" into the litigation (file a new PFB against "THAT carrier"). There are due process concerns with substituting a carrier into ongoing litigation without its agreement, and perhaps even without its knowledge. 

And, now that everyone is an expert on THIS and THAT, it is important to remember the same analysis applies to all parties. The Claimant must be correct. If something changes, a lack of competency or the Claimant passes, then another person will have to substituted as the Claimant. If the putative Employer turns out to be incorrect (actual employer is a leasing agency, the actual direction and control was possessed by some other entity, the general contractor is actually the employer, etc.), then the documentation must likewise be corrected. 

The ideal time for these corrections is not when the case has resolved and the parties are eager to have approval orders entered and expedite closure of their case. The ideal time to handle such matters is as they arise or are noticed. There are those who see this as a matter of mere formality, and of little importance. But, when the parties are incorrect and it impedes receipt of that needed and desired order, the importance will become clear.

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