Gleason v. Alfred I. DuPont Hosp. for Children, 260 A.3d 256 (August 5, 2021) Pellegrini, J.
The Hartford Insurance Group, workers’ compensation lienholder, (The Hartford) appeals from the order entered in the Court of Common Pleas of Philadelphia County (trial court) denying its second petition to intervene in this personal injury action between John and Elaine Gleason, H/W (collectively, the Gleasons) and Alfred I. DuPont Hospital for Children, et al. (Dupont Hospital). The Hartford challenges the trial court’s determination that this appeal is premature and claims that the court erred in denying it party status. We reverse the trial court’s order and remand with instructions to allow the requested intervention.
The relevant facts and procedural history of this case are as follows. Mr. Gleason was employed as an MRI Field Service Technician by Medical Imaging Group (MIG). The Hartford provides workers’ compensation insurance to MIG. On May 29, 2015, while Mr. Gleason was performing maintenance on an MRI machine at Dupont Hospital, a fire and explosion occurred in the main distribution panel. Mr. Gleason’s hair, skin and clothing caught fire and he suffered severe burns, scarring, disfigurement and temporary blindness. The Gleasons filed two actions against various defendants in 2016 and 2017, alleging negligence and loss of consortium. The defendants answered the complaints and filed cross-claims and the actions were consolidated in February 2018.
The Gleasons reached a proposed settlement agreement with the defendants, and they filed a petition seeking the trial court’s approval of its terms on December 12, 2019. The agreement provided for a total settlement payment of $1.45 million dollars. That sum was allocated between the Gleasons, with $580,000 to Mr. Gleason and $870,000 to Mrs. Gleason for the loss of consortium claim. On December 25, 2019, all defendants joined in support of the Gleasons’ petition without taking a position on the allocation between the spouses. The trial court approved the unopposed settlement on January 27, 2020, after oral argument. Because the cross-claims were not disposed of by the settlement agreement, the case remained listed for trial.
The Hartford has paid $988,474 to and on behalf of Mr. Gleason in medical expenses, wage loss benefits and to fund a medical set aside account for his future medical expenses. The Gleasons offered to pay The Hartford $352,287, representing the amount remaining from Mr. Gleason’s settlement after deduction of attorneys’ fees and costs.
On April 20, 2020, The Hartford filed a petition to intervene, seeking protection of its statutory lien interest under Section 319 of the Pennsylvania Workers’ Compensation Act (WCA). The trial court entered an order denying The Hartford’s request to intervene on May 14, 2020.
The Hartford filed a second petition to intervene, which the trial court denied on August 20, 2020. This timely appeal followed. The trial court filed a Rule 1925(a) opinion on February 9, 2021, stating that The Hartford’s appeal is premature and not ripe for our review. See Pa.R.A.P. 1925. The court requested that the appeal “be suspended until the conclusion of trial on the outstanding cross-claims.”
On appeal, The Hartford contends that the trial court’s order denying intervention is final and appealable because the ruling denies it party status and prevents it from receiving notice of all filings in this case. It maintains that the order has the practical effect of denying it the ability to fully protect its subrogation rights, and that it impacts its standing to appeal the January 2020 order approving settlement. The Hartford argues that party status is necessary to adequately protect its lien rights by challenging the unfair 40/60% apportionment of the settlement proceeds between Mr. and Mrs. Gleason. It claims that the higher allocation to Mrs. Gleason for her loss of consortium claim is designed to shield the settlement proceeds from its recovery of the statutory lien.
As we previously noted, under Section 319 of the WCA, an employer or insurance carrier that pays workers’ compensation benefits to an injured employee is entitled to recover a portion of the benefits from any award of money the employee receives in a civil lawsuit. Section 319 provides specific direction for the distribution of an employee’s settlement from a third-party tortfeasor between the employee and the employer or insurance carrier. See Dep’t of Labor & Indus. Bureau of Workers’ Comp. v. Workers’ Compensation Appeal Board (Excelsior Ins.), 619 Pa. 29, 58 A.3d 18, 20 (Pa. 2012). “At its most basic, Section 319 provides that the employer [or carrier] shall recover from the settlement the amount it previously paid to the claimant, minus the claimant’s legal costs of recovering that amount.” Id.
Additionally, Pennsylvania Rule of Civil Procedure 2327 governs intervenor status. This Rule provides: “At any time during the pendency of an action, a person not a party thereto shall be permitted to intervene therein [if] . . . (2) such person is so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof; or . . . (4) the determination of such action may affect any legally enforceable interest of such person whether or not such person may be bound by a judgment in the action.” Pa.R.C.P. 2327 (emphasis added).
In sum, based on the foregoing legal authority and our review of the certified record, we conclude that the trial court’s order denying The Hartford intervention in this action was final and appealable as a collateral order. We further conclude that the trial court abused its discretion when it disallowed intervention by The Hartford, which was necessary to fully protect its subrogation rights and to challenge the apportionment of the settlement proceeds between Mr. and Mrs. Gleason for the loss of consortium claim.
Order reversed. Case remanded with instructions to allow the requested intervention. Jurisdiction relinquished.
