The Supreme Court has clarified the long debated question of whether an employer or insurer can bring a cause of action in its own name in order to enforce its right to subrogation. The short answer: they can’t. In Liberty Mutual v Domtar which was decided by the Supreme Court on April 27, 2015, Liberty Mutual commenced a cause of action as “subrogee of George Lawrence” against the tortfeasors who were arguably responsible for Claimant’s injuries. The defendants filed preliminary objections arguing that the claim had to be brought in the name of the claimant in order to be viable. The preliminary objections were sustained by the trial court. Liberty Mutual appealed and both the Superior Court and the Supreme Court affirmed.
The Court held that “the employer/insurer’s right of subrogation under Section 319 must be achieved through a single action brought in the name of the injured employee or joined by the injured employee.” The court rationalized its decision that “preventing the employer/insurer from asserting an independent cause of action against the tortfeasor eliminates the possibility that the third-party tortfeasor could be exposed to multiple suits filed by both the employer and the injured employee and will preserve the preferred rights of the injured employee who retains a beneficial interest in the cause of action against the tortfeasor.”
Accordingly, the employer/insurer must ride the coattails of the injured worker, or at least get the injured worker to agree to allow the employer/insurer to file the lawsuit in the claimant’s name. Either way, the Claimant must be an active participant in the action. Think about it though – isn’t the claimant the star witness in the third party claim? If a claimant will not cooperate, chances of success are nil anyway.