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April 13, 1990.


Hizey Well Service & Supply (employer) and U.S.F.&G. Insurance Company (insurer), appeal from the trial court's decision denying their motion to intervene in a malpractice action in which David E. Roberts was the plaintiff and John J. Krupka, a physician, and other health care providers were the defendants.

As we view this appeal, there is one substantive issue and one procedural issue with which this court must deal. The sole substantive issue is whether an employer and its insurer who have paid additional disability benefits and medical expenses under the express order of an administrative law judge (ALJ) in a workers' compensation case are entitled to intervene in the

[13 Kan. App. 2d 693]

      malpractice action filed by an employee against his physician for the purpose of asserting subrogation rights to the proceeds of that lawsuit. A resolution of this particular question depends upon whether this case is controlled by a 1916 Kansas Supreme Court decision, Ruth v. Witherspoon-Englar Co., 98 Kan. 179, 157 P. 403 (1916).

The facts which underlie this controversy are not in serious dispute. The result that is dictated, however, by the application of the doctrine set forth in Ruth is bizarre and catapults the court and the litigants into a kind of "Alice in Wonderland" world in which logic becomes illogic, fiction becomes fact, and success becomes potentially fatal to certain claims by the plaintiff which are the result of an injury sustained in the course of his employment and compensable under the Workers' Compensation Act (Act). In short, we believe the application of Ruth to the facts of this case will give us the type of result that causes laymen to scratch their heads and roll their eyes in bewilderment at what our legal system sometimes dictates. It calls to mind the Dickensian statement that "if the law supposes that, the law is a ass."

  Roberts was employed by Hizey when he was injured on the job in November 1982. He filed a claim under the Act and appellants began to make regular disability and medical payments to and on behalf of Roberts. Subsequent to, but as a direct result of his job-related injury, Roberts sought treatment from Dr. John Krupka, a physician, who performed surgery on Roberts. Roberts alleges this surgery was not performed successfully or skillfully, and that it aggravated and prolonged his original disabilities. He thereupon sued Krupka and eleven other medical care providers for medical malpractice.

  We pause to note that, because of the legal doctrines which we will deal with in this case, it was necessary for Roberts, in order to maximize his recovery, to file two legal proceedings and employ two sets of lawyers. On the one hand, Roberts had and still has his workers' compensation case in which he is represented by one set of lawyers and insists his ailments and disabilities were not caused by malpractice. On the other hand and simultaneously, he has his malpractice lawsuit in which he is represented by another set of lawyers in which he insists those same ailments and disabilities were, indeed, caused by malpractice of his physicians. The fact that Roberts was required to

[13 Kan. App. 2d 694]

      retain two different law firms to maximize damages all directly traceable to one job-related injury while employed by appellant Hizey is one of those "through the looking glass" features of this case that will be discussed later in this opinion.

  Even though Roberts had sued several physicians for malpractice, saying they were responsible by their negligent treatment for aggravating and prolonging his present disabilities, the ALJ in the workers' compensation action ordered appellant U.S.F.&G. to continue to make medical and disability payments to Roberts for those conditions which Roberts was by then claiming were caused by medical malpractice. This left appellants, particularly U.S.F.&G., in a difficult position with little choice but to obey the order of the ALJ and pay out benefits which may have been wrongfully ordered since that order was not appealable but was certainly enforceable. U.S.F.&G. has paid medical and disability benefits on behalf of Roberts, which have accumulated as of August 1988 to an amount in excess of $176,000, for a condition which originated with his on-the-job injury but was aggravated by his medical treatment.

  In its brief, U.S.F.&G. argues it had entered into an agreement with Roberts that it would continue to make all disability and medical payments in consideration of the agreement on Roberts' behalf to repay all amounts received from U.S.F.&G. after January 30, 1985, from the proceeds of Roberts' malpractice action. The existence of this agreement and its binding effect is disputed by Roberts. Had the existence of the agreement been proven, we would be inclined to consider issues such as unjust enrichment and estoppel. However, we do not believe the existence of the alleged agreement was adequately proven, and, as a result, it forms no part of our final decision.

  In August 1988, 38 months after Roberts filed the malpractice suit, appellants moved to intervene. Appellants also moved to implead the Workers' Compensation Fund (Fund) on the theory that the Fund would ultimately be responsible to reimburse appellant U.S.F.&G. for any compensation which it had wrongfully paid by reason of the ALJ's order should it be determined it had no subrogation rights against any recovery or settlement by Roberts in his malpractice action.

  Shortly after the motions by appellants were filed, Roberts settled the malpractice action. The trial court, in a written opinion,

[13 Kan. App. 2d 695]

      denied the motion of appellants to intervene on the basis of the doctrine set forth in Ruth, 98 Kan. 179, and on the grounds that the motion to intervene was not timely filed.

  Appellants have timely appealed that decision to this court, and the Fund has filed an amicus curiae brief supporting the position taken by appellants. The Fund argues that appellants should have been permitted to intervene and should have had subrogation rights to and a lien against any recovery by Roberts in the malpractice action because U.S.F.&G. had paid medical and disability expenses necessitated by aggravation of the original job-related injury by malpractice of the physicians involved.

  The first issue we wish to dispose of on this appeal is a procedural one. Counsel for Roberts argues quite strenuously that the trial court properly held the motion by appellants to intervene was not timely filed and that we should affirm the trial court on that issue, thereby disposing of the entire lawsuit and avoiding a confrontation with the Ruth doctrine. Upon examination of the record, it is our judgment that this case was decided not on the issue of whether the motion was timely filed but on the fact that, under the doctrine set forth in Ruth, appellants had no right to intervene.

  Although appellants waited 38 months while a malpractice suit was being litigated before filing their motion to intervene, it is difficult to see where substantial prejudice was caused to Roberts by the failure of appellants to intervene at an earlier time. From Roberts' point of view, the main thrust of the lawsuit was whether his doctors were negligent in treating him and, if so, what damages he sustained as a result. The interest of U.S.F.&G. in the lawsuit had nothing to do with the nature and extent of Roberts' injuries nor with the issue of malpractice. The interest of U.S.F.&G. in the lawsuit was to attempt to subrogate against the proceeds of the settlement, and, under those circumstances, there was no reason for U.S.F.&G. to act any earlier than it did. The fact is that, unless and until it was determined that Roberts' disabilities were aggravated by negligent medical treatment and he was entitled to recover sums of money for such aggravation, U.S.F.&G. had no reason to even consider intervention. To have attempted to intervene earlier would have complicated the issues and needlessly increased the cost of litigation. We believe that, under the circumstances and facts of this case, the motion to

[13 Kan. App. 2d 696]

      intervene, having been filed shortly before the lawsuit was settled, was timely filed and the trial court erred in concluding it was not. Accordingly, we reverse the ...

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