Kornelik v. Mittal Steel USA, Inc.
2011 Ind. App. LEXIS 1493
| Ind. Ct. App. | 2011Background
- Kornelik was injuryed on June 11, 2005 while performing maintenance at Mittal Steel; Lafarge’s carrier Liberty Mutual paid TTD and medicals totaling $108,253.97.
- In November 2006 Kornelik filed negligence actions against Mittal and Rayson; settlement reached October 2009 for $260,000 without Lafarge or Liberty Mutual’s consent.
- Settlement acknowledged damages could exceed $2 million; mediator noted potential liability defenses and comparative fault affecting damages.
- August 2010 trial court denied adjudication; court held Lafarge’s consent required and dismissed declaratory judgment petition; later amended to protect Lafarge’s lien.
- Kornelik sought to reduce Lafarge’s lien under IC 22-3-2-13 by 33 1/3% attorney fees and pro rata costs and, under IC 34-51-2-19, in the same proportion as recovery was reduced; Lafarge argued no consent, no reduction.
- Trial court decision ultimately held Lafarge not fully protected by court order, thus not reducing lien proportionally; this court affirmed in part, reversed in part, and remanded to reduce the lien by 33 1/3% for attorney fees and pro rata costs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can Lafarge’s lien be reduced by attorney fees and costs under IC 22-3-2-13? | Kornelik contends Lafarge must reduce lien by 33 1/3% plus costs since suit implicates third-party recovery. | Lafarge argues consent was required; without consent the lien cannot be reduced under subsection 22-3-2-13. | Yes; lien must be reduced by 33 1/3% for attorney fees and pro rata costs. |
| Whether lien reduction should mirror the proportional reduction of recovery under IC 34-51-2-19 when consent was lacking. | Kornelik argues the lien should decrease in the same proportion as his recovery was reduced. | Lafarge contends consent issues prevent proportional reduction under 34-51-2-19. | No; proportional reduction does not apply where consent was not obtained; no full protection by court order. |
Key Cases Cited
- Smith v. Champion Trucking Co., Inc., 925 N.E.2d 362 (Ind. 2010) (settlement without consent bars WCA claim; protects employer's lien only with full indemnification or court order)
- Koval v. Simon Telelect, Inc., 693 N.E.2d 1299 (Ind. 1998) (protection by court order requires full indemnification and escrow-like protection to negate consent requirement)
- Department of Public Welfare v. Couch, 605 N.E.2d 165 (Ind. 1992) (historical limitation on applicability of 34-51-2-19 to WCA liens)