Limited Mutual Compensation Insurance v. Billings

BARNARD, P. J. This is an action by the insurance carrier for an employer, to recover amounts paid as compensation and medical benefits to two injured employees, on the ground that their injuries resulted from the negligence of the third party defendants.

This appeal is from a judgment of dismissal after a demurrer to the complaint was sustained. The action was brought more than one year but less than three years after the happening of the accident in which the employees were injured. The sole question presented on this appeal is [882]whether such an action is governed by subdivision (3) of section 340 of the Code of Civil Procedure providing that an action "... for injury to or for the death of one caused by the wrongful act or neglect of another ...” must be commenced within one year, or whether one or more provisions of section 338 of that code are applicable.

The material provisions of the law governing Workmen’s Compensation and Insurance are now set forth in chapter 5 of part 1, division 4, of the Labor Code. Section 3850 provides that the word “employer,” as used therein, includes the insurance carrier for the employer. Section 3851 provides that the death of the employee, or of any other person, does not abate any right of action “established by this chapter.” Section 3852 provides that the claim of an employee for compensation does not affect his right of action for damages against any third person who may have caused his injury. This creates no new right of action but recognizes the continuance of a right which had been long established and which, of course, would be subject to the limitation imposed by section 340, Code of Civil Procedure. Section 3852 then further provides that any employer who becomes obligated to the employee for compensation, or the like, may also bring an action against such a third person and recover therein, among other things, the compensation which he has paid. This right of action, thus given to the employer, is a new one which did not formerly exist, and was created by the Workmen’s Compensation Act and later carrier into the Labor Code. Section 3853 provides that if either the employee or the employer brings an action against such a third person the other may, at any time before trial, join as party plaintiff or shall consolidate his action if brought separately. This latter provision that the other “shall consolidate his action” obviously applies only when two actions have been filed. Section 3854 provides, in effect, that if the action is prosecuted by the employer alone the expenditures which he has become obligated to make because of the disability suffered by the employee shall be considered as proximately resulting from the injury caused by the third party, in addition to any other items of damage proximately resulting therefrom. In other words, the provision is that the injury caused by the third party shall be considered as including the financial injury resulting to the employer in addition to any injury suffered by the employee.