Wisconsin Mutual Liability Co. v. Industrial Commission

CrownhaRt, J. The respondent, an employee of the Oshkosh Motor Truck Company, while in the course of his employment, accidentally received personal injuries for [600] which he was awarded compensation by the Industrial Commission, pursuant to the workmen’s compensation act, ch. 102, Stats. The appellant was the insurance carrier of the employer. It paid the award to Perkins and thereby became subrogated under its policy of insurance to the rights of the employer against any third party liable for damages to Perkins on account of such injuries. The employer became the assignee of any such claim of Perkins by virtue of sec. 102.29, Stats. The injuries.of Perkins were received by him while he was attempting to drive a motor truck of his employer across the railroad track of the “Soo” Railway, when the truck wras struck by the engine of said railway company. While such was the status, the railroad company denied any liability to Perkins, but paid him $1,000, taking from him an acknowledgment of settlement of his claim for damages by reason of the accident. Some time thereafter the appellant insurance company petitioned the Industrial Commission to make an order approving the settlement of the claim of Perkins with the railroad company, and for an order of distribution of the proceeds. The Commission thereupon held a hearing, took testimony, and entered an order directing Perkins to account to the insurance company for $666.67. The appellant insurance company then brought action in the circuit court to review, the order of the Industrial Commission, and demanding judgment that the “Soo” Railway Company be directed to pay the insurance company the $666.67 which the insurance company claimed as its share of the settlement. The circuit court held that the Commission had no jurisdiction over the railroad company, and the court got no jurisdiction on review' under the statute. The court therefore affirmed the order of the Commission and denied further relief. From such judgment the insurance company appealed to this court. An unusual, though simple, question is thus presented. [601] The compensation act, sec. 102.29 of the Statutes, provides that the making of a lawful claim against the employer or compensation insurer for compensation shall operate as an assignment of any cause of action in tort which the employee may have against any other person on account of the accident, and the employer or insurer may enforce such liability in its own name, the employee to have one third the recovery, less the reasonable costs of the action. Any settlement of any such claim, if in litigation, must have the approval of -the court in which the matter is pending, otherwise the settlement must be approved by the Industrial Commission. The Commission draws its jurisdiction exclusively from the statute. Clearly it had no jurisdiction over the railroad company. It rightly declined to assume any such. The settlement of Perkins was null so far as his employer or the appellant was concerned, because his claim against the railroad company was assigned by operation of the statute to the employer, as soon as he made a valid claim for compensation against the employer. This being so, there was no settlement so far as the appellant or the employer was concerned, and there was nothing upon which the Industrial Commission could act. It follows that its order was void. The jurisdiction of the circuit court to review the proceedings of the Commission likewise depends on the statute, sec. 102.23. By its judgment it could only affirm said order or set it aside. The circuit court was therefore in error in affirming the order of the Commission. The appellant claims there was a valid settlement between the railroad company and Perkins. We have seen that there could be no settlement of such claim because any such claim had previously been legally assigned to the employer of Perkins. The appellant, upon payment of compensation, had the right to sue the railroad company or make a settlement of its claim with the railroad company, with the ap [602] proval of the court if in litigation, or with the approval of the Industrial Commission if the claim was not in litigation. The matter of approval is solely for the protection of the injured workman, who, under the statute, is the beneficiary of any recovery to the extent of not less than one third thereof. But it is claimed by the appellant in effect that Perkins was induced by way of a gift to become partisan of the “Soo” railroad and hostile to the interests of the appellant. This question is not properly before us. By the Court. — The judgment of the circuit court is reversed, with directions to enter judgment setting aside the order of the Industrial Commission, appellant to pay clerk’s fees. Eschweilek, ]., dissents. Stevens, J., took no part.