KATHLEEN MUELLER PLAINTIFF RESPONDENT v. MARCUS ELLIOTT ET AL DEFENDANTS (2016)

MEMORANDUM AND ORDER

SEDGWICK CLAIMS MANAGEMENT, INTERESTED

PARTY–APPELLANT.

HAMBERGER & WEISS, BUFFALO (SUSAN R. DUFFY OF COUNSEL), FOR INTERESTED PARTY–APPELLANT.

It is hereby ORDERED that the order so appealed from is unanimously reversed on the law without costs and the matter is remitted to Supreme Court, Erie County, for further proceedings in accordance with the following Memorandum:  Plaintiff was injured while working as a school bus driver when a driver lost control of his vehicle on a slippery road and struck the bus, causing plaintiff to be thrown from her seat into the bus stairwell.  Plaintiff commenced this action against both the driver and the owner of the vehicle that struck the bus, but subsequently discontinued the action.  Interested party Sedgwick Claims Management (Sedgwick), the workers' compensation administrator for plaintiff's employer, notified plaintiff that future workers' compensation benefits would be denied on the ground that Sedgwick did not consent to the stipulation of discontinuance.  Sedgwick now appeals from an order granting plaintiff's application for judicial approval of the discontinuance, nunc pro tunc.

We agree with Sedgwick that, pursuant to Workers' Compensation Law § 29(5), either carrier consent or judicial approval is required where, as here, a plaintiff voluntarily discontinues a third-party action (see Matter of Duffy v. Fuller Co., 21 A.D.2d 725, 726;  see generally Matter of Roach v Hastings Plastics Corp., 57 N.Y.2d 293, 295–296;  Shumski v. Loya, 55 AD3d 716, 717).  We further agree with Sedgwick that plaintiff failed to include an affidavit of a physician and omitted certain required information in her application seeking judicial approval (see Workers' Compensation Law § 29[5] [a]—[e] ), but we conclude that such omissions did not require denial of the application (see generally Manning v. Peerless Ins. Co., 265 A.D.2d 900, 901;  Merrill v. Moultrie, 166 A.D.2d 392, 392, lv denied 77 N.Y.2d 804).

Sedgwick further contends that Supreme Court's approval of the voluntary discontinuance was not reasonable and was prejudicial to Sedgwick.  It is well settled that “[a] motion for judicial approval pursuant to Workers' Compensation Law § 29(5) is addressed to the sound discretion of the ․ [c]ourt” (Shumski, 55 AD3d at 717).  The court must determine whether the carrier was prejudiced by the settlement or discontinuance, which depends on whether the settlement or discontinuance was “reasonable” (Buchanan v. Scoville, 241 A.D.2d 965, 965;  see McNally v. Workers' Compensation Bd., 103 AD3d 1236, 1236;  Matter of Gregory v. Aetna Ins. Co., 231 A.D.2d 906, 906).  On this record, however, we cannot determine whether Sedgwick was prejudiced by the discontinuation or otherwise assess the reasonableness of the discontinuation (see McNally, 103 AD3d at 1236;  Buchanan, 241 A.D.2d at 965–966;  Matter of Dauenhauer v. Continental Cas. Ins. Co., 217 A.D.2d 943, 944).  We therefore reverse the order and remit to Supreme Court for a hearing on that issue (see Buchanan, 241 A.D.2d at 965;  Dauenhauer, 217 A.D.2d at 944;  see also McNally, 103 AD3d at 1236–1237).

Frances E. Cafarell

Clerk of the Court