Kroemer v. Omaha Track Equip.
296 Neb. 972
| Neb. | 2017Background
- Kroemer, an employee, sustained a 95% vision loss from a tool injury at OTE’s shop leased by Ribbon Weld.
- Ribbon Weld’s subrogation interest against third-party recovery totaled about $207,555 after a prior settlement.
- Kroemer and OTE settled third-party claims for $150,000; Ribbon Weld contested the allocation and payment order.
- District court allocated $94,834.27 to Kroemer, $55,165.73 for fees, and $0 to Ribbon Weld.
- The court found the settlement fair and reasonable but Ribbon Weld appealed the zero-allocation to it.
- Nebraska statute § 48-118.04(2) requires a fair and equitable distribution of third-party proceeds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the settlement fair and reasonable? | Kroemer argues factors supported a reasonable settlement given liability and damages. | OTE argues the settlement was fair despite liability uncertainties; risk favored a compromise. | Settlement found fair and reasonable. |
| Was allocation to Ribbon Weld proper under § 48-118.04(2)? | Kroemer contends some proceeds should compensate Ribbon Weld for subrogation. | Ought to protect Kroemer’s recovery; no allocation to Ribbon Weld was justified by the court’s view. | Zero allocation to Ribbon Weld was untenable; must allocate fairly. |
| What governs distribution of third-party proceeds under the statute? | Distribute to employee excess after employer’s subrogation, with fair and equitable considerations. | Statutory framework allows flexible, fair distribution balancing employee and employer interests. | Distribution must be fair and equitable to both employee and employer; prior approach flawed. |
Key Cases Cited
- Bacon v. DBI/SALA, 284 Neb. 579 (2012) (liberal construction of subrogation rights; beneficent purpose of act)
- Burns v. Nielsen, 273 Neb. 724 (2007) (subrogation and distribution principles under § 48-118)
- Turco v. Schuning, 271 Neb. 770 (2006) (made-whole considerations and distribution factors)
- In re Estate of Evertson, 23 Neb. App. 734 (2016) (allocation of proceeds; court’s approach criticized)
- Sterner v. American Family Ins. Co., 19 Neb. App. 339 (2011) (equity considerations in subrogation allocations)