Carrera Ex Rel. Department of Labor & Industries v. Olmstead
196 Wash. App. 240
| Wash. Ct. App. | 2016Background
- In 2009 Basilio Carrera, a seasonal worker at Brent Hartley Farms (part of Sunheaven), suffered severe injuries from a conveyor belt accident; allegations included lack of training and inadequate safety features.
- Carrera’s negligence suit against his employer was barred by the Industrial Insurance Act (IIA); L&I identified Sunheaven and others as potential third-party defendants.
- Carrera failed to elect to pursue a third-party action; by statute his claim was assigned to the Department of Labor & Industries (L&I) when he did not respond to L&I’s notice within 60 days.
- L&I filed an amended, assigned third-party complaint more than four years after the injury seeking economic and noneconomic damages; Sunheaven moved for summary judgment asserting the three-year statute of limitations and arguing L&I could only recover benefits it had paid.
- The superior court granted partial summary judgment: L&I could pursue only economic damages up to the benefits L&I paid (about $788,418) and was barred from seeking noneconomic damages as time‑barred.
- L&I appealed, arguing it may seek noneconomic damages (though not retain them) and that sovereign immunity (RCW 4.16.160) prevents statutes of limitation from applying when L&I sues in the State’s interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| May L&I seek noneconomic damages in an assigned third‑party action? | L&I: Yes — it may pursue all available damages even if statute limits retention. | Sunheaven: No — Flanigan/Tobin bar L&I from obtaining noneconomic damages under chapter 51.24. | L&I may seek and recover noneconomic damages in assigned actions but may not retain them; recovered proceeds must be distributed per RCW 51.24.050. |
| May L&I retain noneconomic damages it recovers? | L&I: It should be able to retain damages necessary to compensate benefits and costs. | Sunheaven: L&I may only be reimbursed for benefits paid; noneconomic damages are not compensable to L&I. | L&I may not retain noneconomic damages (apply Flanigan/Tobin reasoning to RCW 51.24.050). |
| Does the three‑year statute of limitations (RCW 4.16.080(2)) bar L&I’s assigned action or parts of it? | L&I: The statute should not be used to split the action; sovereign immunity applies when L&I acts for the State. | Sunheaven: The statute bars recovery of noneconomic damages because the underlying worker claims were time‑barred. | The court erred to allow the statute to bar only some damages; you cannot split the cause—if timely, the whole assigned cause proceeds. |
| Is L&I subject to statutes of limitation when prosecuting assigned third‑party claims? | L&I: No — when acting for State interests (deterrence, replenishing the fund) sovereign immunity prevents limitation defenses (RCW 4.16.160). | Sunheaven: L&I stands in the injured worker’s shoes and is subject to the worker’s limitations defenses. | L&I acts in part for the State when prosecuting assigned third‑party claims and is therefore immune from statutes of limitation under RCW 4.16.160; the limitations defense was inapplicable. |
Key Cases Cited
- Flanigan v. Dep’t of Labor & Indus., 123 Wn.2d 418 (supersede by legislative amendment discussed) (Department not entitled to recover noneconomic damages such as loss of consortium)
- Tobin v. Dep’t of Labor & Indus., 169 Wn.2d 396 (interpreting Flanigan and holding chapter 51.24 does not authorize L&I to include pain and suffering in reimbursement)
- Duskin v. Carlson, 136 Wn.2d 550 (approving settlement structure where L&I reimbursement and larger injured‑worker payment coexist)
- Wash. State Major League Baseball Stadium Pub. Facilities Dist. v. Huber, Hunt & Nichols‑Kiewit Constr. Co., 165 Wn.2d 679 (sovereign immunity applies to statutes of limitation when entity acts in sovereign capacity)
- Herrmann v. Cissna, 82 Wn.2d 1 (public official suing can be exempt from limitations when action benefits the public and deters misconduct)
- Vinther v. State, 176 Wash. 391 (State not bound by statutes of limitations when recovering statutorily authorized repayment under workers’ compensation scheme)