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MATTER CLAIM MARY RYAN v. GENERAL ELECTRIC COMPANY ET AL. (12/27/68)

SUPREME COURT OF NEW YORK, APPELLATE DIVISION, THIRD DEPARTMENT 1968.NY.44094 <http://www.versuslaw.com>; 296 N.Y.S.2d 17; 31 A.D.2d 191 December 27, 1968 IN THE MATTER OF THE CLAIM OF MARY RYAN, APPELLANT,v.GENERAL ELECTRIC COMPANY ET AL., RESPONDENTS. WORKMEN'S COMPENSATION BOARD, RESPONDENT Appeal from a decision of the Workmen's Compensation Board, filed April 15, 1966. Smith, Leasure, Gow & Cahill (James N. Cahill of counsel), for appellant. Fraser, McDonough & Digby (Bouck & Holloway and Warner M. Bouck of counsel), for General Electric Company and another, respondents. Louis J. Lefkowitz, Attorney-General (Ruth Kessler Toch and Daniel Polansky of counsel), for Workmen's Compensation Board, respondent. Herlihy, J. Reynolds and Aulisi, JJ., concur with Herlihy, J.; Gibson, P. J., concurs in the result, in a memorandum. Gabrielli, J., dissents and votes to reverse and remit, in an opinion. Author: Herlihy


Appeal from a decision of the Workmen's Compensation Board, filed April 15, 1966.

Herlihy, J. Reynolds and Aulisi, JJ., concur with Herlihy, J.; Gibson, P. J., concurs in the result, in a memorandum. Gabrielli, J., dissents and votes to reverse and remit, in an opinion.

Author: Herlihy

 The claimant appeals from a decision of the Workmen's Compensation Board which determined that a recovery by the claimant under the Military Claims Act (U. S. Code, tit. 10, § 2733) must be applied in reduction of an award of death benefits under the Workmen's Compensation Law.

The facts in this case are stipulated. On October 2, 1962, John B. Ryan, the decedent, was killed in a midair collision between the Beechcraft plane he was piloting for the employer-respondent and a Navy jet. The accident occurred near St. Augustine, Florida, and the occupants of both planes were killed. The Navy jet, which was engaged in maneuvers, had previously reported difficulties in winding in its practice targets. The Civil Aeronautics Board's investigation of the accident disclosed that the Navy jet was in a steep dive when it collided with the Beechcraft.

The decedent left a wife (the claimant) and three children to whom an award of death benefits was made by the Workmen's Compensation Board on March 1, 1963. The widow also submitted a claim under the Military Claims Act (U. S. Code, tit. 10, § 2733), and she received an award of $5,000 from the Department of the Navy on January 7, 1964, and the further sum of $120,000 appropriated by Congress on July 2, 1965.

The employer's insurance carrier mailed a notice of lien to claimant, seeking to impose a lien on the $125,000 awarded under the Military Claims Act. The board held that the carrier was "entitled to credit for the net proceeds received".

The parties have stipulated that the issue before this court is: "Whether the settlement of this case under the Military Claims Act, 10 U. S. C. A. § 2733 et seq., constitutes a settlement of the third-party action within the meaning of Section 29 of the Workmen's Compensation Law."

The claimant contends that section 29 of the Workmen's Compensation Law gives the carrier a lien only on recoveries in tort which the claimant obtains against a third party, and thus not against an award under the Military Claims Act, which, the claimant contends, is not premised on negligent conduct by the Government.

The respondent carrier contends that subdivision 1 of section 29 was broadly conceived by the Legislature to prevent a double recovery by the claimant for the same injuries -- workmen's compensation benefits and then a second payment stemming from either the judicial or administrative process.

To paraphrase the issue, the appellant opines that the present settlement was for all intents and purposes a gift. (Matter of Schneider v. Baxter's Flying Serv., 266 App. Div. 1037, mot. for lv. to app. den. 292 N. Y. 726.)

The Military Claims Act permits a settlement by the Secretary and Congress regardless of a legal cause of action, provided only that the injury (death) was caused by the armed services and not caused by a wrongful or negligent act of the claimant (decedent). Subdivision 1 of section 29 of the Workmen's Compensation Law provides that the claimant, having been "injured or killed by the negligence or wrong of another", may elect to "pursue his remedy" against third persons. In the present case it appears that the factual pattern of the accident was sufficiently established to plead a negligence action against the United States. Upon the present record, the fact of negligence on the part of the Navy pilot could be inferred upon the same basis as that of an operator of an automobile. (See Pfaffenbach v. White Plains Express Corp., 17 N.Y.2d 132, 135.)

The remedy provided by the Military Claims Act to some extent overlaps with that provided by the Federal Tort Claims Act (U. S. Code, tit. 28, § 1346 et seq.) so that a suit predicated on governmental negligence under the latter also could be administratively adjusted under the former. It is similar to an automobile accident case where the prospective plaintiff writes to the insurance carrier and suggests a settlement. The carrier then has the option of electing to settle -- regardless of negligence -- or refuses such offer, in which event the plaintiff could start an action in negligence seeking to recover. In such a situation the insurance carrier is in the same relative position as the United States in this action where it could elect under the Military Claims Act to settle, regardless of the issue of its negligence, or deny such claim, in which event an action in negligence could be instituted under the Federal Tort Claims Act. There was a cause of action available to the claimant and it does not appear, as a matter of law, that such remedy could not be pursued. Under the circumstances, when claimant settled the same by the execution of releases, the board had the right factually to determine that the provisions of section 29 were applicable.

It is not the type or kind of forum or the pleadings therein that control, but, rather, whether the "remedy" that flows therefrom is such as that contemplated by section 29 of the Workmen's Compensation Law.

The intent and purpose of the legislation will be best served, under the present facts, by making section 29 applicable and thus prevent a double recovery and double payment. (See General Aniline & Film Corp. v. Schrader & Son, 13 A.D.2d ...


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