§71.5 Recoverability of Monies From Loss of Consortium Plaintiff

The Case: Hunley v. Silver Furniture Mfg. Co., 38 S.W.3d 555 (Tenn. 2001).

The Basic Facts: Man injured at work filed products liability claim and his wife asserted a loss of consortium claim. Each of them recovered money from the product manufacturer. The two of them then filed a declaratory judgment action asking the court to declare that the wife's settlement was not subject to the workers compensation lien.

The Bottom Line:

  • "A worker who has been injured by a third-party tortfeasor may receive workers' compensation benefits from the employer and also may maintain an action against the third-party tortfeasor. See Tenn. Code Ann. § 50‑6‑112. In the event of the worker's recovery from the third party, Tenn. Code Ann. § 50‑6‑112(c) provides a subrogation lien in favor of an employer against any amounts recovered by the worker from the third party 'by judgment, settlement or otherwise.' Tenn. Code Ann. § 50‑6‑112(c); see also Castleman v. Ross Eng'g, Inc., 958 S.W.2d 720 (Tenn. 1997)." 38 S.W.3d at 557.
  • "The employer's subrogation lien extends only to amounts recovered by 'the worker, or by those to whom such worker's right of action survives.' Tenn. Code Ann. § 50‑6‑112(c). Because this is not an action brought by a party surviving the worker, the statutory language, 'by those to whom such worker's right of action survives' is not implicated.FN3 The question remaining for our determination is whether the settlement amount allocated to Mrs. Hunley was an amount recovered by 'the worker.'
    FN3 This claim is not one for wrongful death. We, therefore, express no opinion as to the extent to which damages awarded pursuant to a claim for wrongful death are subject to subrogation under Tenn. Code Ann. § 50‑6‑112(c). See Jordan v. Baptist Three Rivers Hosp., 984 S.W.2d 593 (Tenn. 1999) (holding loss of consortium damages constitute a portion of the pecuniary value of the decedent's life)."
    Id .
  • "It is derivative in the sense that Mrs. Hunley's loss of consortium claim originates from Mr. Hunley's claim for his personal injuries." Id.
  • "We have held, however, that loss of consortium is ''a separate claim from that of an injured spouse.'' Tuggle, 922 S.W.2d at 108 (Tenn. 1996) (quoting Jackson v. Miller, 776 S.W.2d 115, 117 (Tenn. Ct. App. 1989)). The Court of Appeals has also held that '[t]he right to recover for loss of consortium is a right independent of the spouse's right to recover for the injuries themselves.'Swafford v. City of Chattanooga, 743 S.W.2d 174, 178 (Tenn. Ct. App. 1987); see also Tuggle, 922 S.W.2d at 108 (citing Swafford with approval). These cases recognize that a spouse's loss of consortium claim is a distinct cause of action vested solely in the spouse." Id.
  • "The status of the worker's spouse's cause of action for loss of consortium as a distinct claim is further supported by the lack of a remedy for the worker's spouse under our workers' compensation law. The workers' compensation statutes make no provision for compensating a worker's spouse for loss of consortium damages. Indeed, we have held that a worker's spouse has no right to bring suit against the employer for loss of consortium. Napier v. Martin, 250 S.W.2d 35, 36 (Tenn. 1952). The spouse's remedy for loss of consortium exists only against a third-party tortfeasor. Equating the worker's spouse with the worker for purposes of Tenn. Code Ann. § 50‑6‑112(c) would require us to ignore the substance of a statutory scheme that regards a spouse's claim for loss of consortium as separate from the worker's claim. Accordingly, we join the majority of jurisdictions that hold an employer's right to subrogation does not extend to amounts recovered by the worker's spouse for loss of consortium against a third-party tortfeasor and that amounts collected by a spouse for a cause of action vested solely in that spouse are beyond the reach of the statutory subrogation lien." Id. at 558 (footnote omitted).
  • "One consideration remains. Clearly, workers in Tennessee are authorized to settle claims against third-party tortfeasors. See Millican v. Home Stores, Inc., 270 S.W.2d 372, 374 (Tenn. 1954). Further, '[t]he Tennessee statute does not require the employee to obtain the ratification of the employer before making a settlement.' Aetna Cas. & Sur. Co. v. Gilbreath, 625 S.W.2d 269, 273 (Tenn. 1981). Nevertheless, we recognize, as have other jurisdictions, the risk that workers, their spouses, and third-party tortfeasors may structure a settlement in such a way that the employer's subrogation right is effectively circumvented." Id. (footnote omitted).
  • "We find it appropriate, however, to clarify that trial courts have the power to ensure the continued honesty of workers' settlements with third-party tortfeasors when loss of consortium damages are apportioned to a spouse as an adjunct to the worker's personal damages." Id. at 559.
  • "We hold that an injured worker, the injured worker's spouse, or a third-party tortfeasor may seek court approval of a settlement. Reasonable notice of the action in which approval is sought shall be provided to the employer or its carrier. The trial court having jurisdiction over the third-party claim shall then review the allocation of damages to the injured worker and to the injured worker's spouse. We believe that the trial court is in the best position to review the allocation of damages between the plaintiffs. In the trial of personal injury cases, juries determine the amount of damages awarded to the parties for their claims. In the absence of a jury demand, the trial court makes those determinations as the trier of fact. Moreover, trial courts have the authority to accept settlements and to give effect to them." Id.
  • "When presented with a motion to approve a settlement between a third-party tortfeasor and the worker and the worker's spouse, the trial court having jurisdiction over the third-party claim shall review the settlement to ensure that the allocation of settlement proceeds between the worker and the worker's spouse is fair and reasonable. See, e.g., Blagg v. Ill. F.W.D. Truck & Equip. Co., 572 N.E.2d 920, 924 (Ill. 1991). The court should consider both the need to protect the statutory subrogation rights of the employer and the need to encourage good faith settlement of third-party claims. In determining the reasonableness of the allocation of the total damages, the trial court should consider 'the nature and extent of the claimed loss of consortium, the potential value of the dismissed claim, and the expectations and motivations of the settling parties.' Rains v. Kolberg Mfg. Corp., 897 P.2d 845, 848 (Colo. Ct. App. 1994). If any portion of the settlement allocated for loss of consortium damages is determined not to be fair and reasonable, that portion shall be made subject to subrogation in favor of the employer. See id. The trial court's ruling shall be upheld unless an abuse of discretion is shown." Id. (footnote omitted).

Other Sources of Note: Correll v. E.I. DuPont de Nemours & Co ., 207 S.W.3d 751 (Tenn. 2006). (workers' compensation statutes do allow for death benefits to be paid, and thus any recovery from a third-party tortfeasor for wrongful death is subject to subrogation liens by the employer but not to that portion reasonably attributable to the loss of consortium claim).

Recent Cases: Correll v. E.I. Dupont Nemours & Co ., 207 S.W.3d 751 (Tenn. 2006) (upholding the trial court's decision that an employer's subrogation right does not extend to the surviving spouse's loss of consortium claim, but does extend to the recovery the employee's surviving spouse received in wrongful death claim).

After an accident, many injury victims and their families want more information on the accident and their legal rights. Consequently, many of them have found their way to these pages. While we are happy you are here, please understand Day on Torts: Leading Cases in Tennessee Tort Law was written to be a quick, invaluable reference for Tennessee tort lawyers. While the book provides the leading case for more than 300 tort law subjects and thousands of related case citations, it is not a substitute for personalized legal advice from a qualified lawyer.

Rather than researching these legal issues alone, we urge you to contact one of our award-winning lawyers who can sit down with you, review your case, answer your questions and clearly explain your rights and your options in a no-cost, no-obligation consultation. Our experienced attorneys handle all personal injury and wrongful death cases on a contingency basis, so we only get paid if we win. If for any reason you are unable to come to our office, we will gladly come to you.

To schedule an appointment, contact us online or call us at 615-742-4880 or toll-free at 866-812-8787.



The foregoing is an excerpt from Day on Torts: Leading Cases in Tennessee Tort Law, published by John A. Day, Civil Trial Specialist, Fellow in the American College of Trial Lawyers, recipient of Best Lawyers in America recognition, Martindale-Hubbell AV® Preeminent™ rated attorney, and Top 100 Tennessee Mid-South Super Lawyers designee. Read John’s full bio here.

To order a copy of the book, visit www.dayontortsbook.com. John also blogs regularly on key issues for tort lawyers. To subscribe to the Day on Torts blog, visit www.dayontorts.com.

Client Reviews
Everything was great. You guys are a great representative. I was satisfied with everything. Truly appreciate John Day and his hard-working staff.
★★★★★
We thought that you did an excellent job in representing us in our lawsuit. We would recommend you to anyone.
★★★★★
The Law Offices of John Day is, without a doubt, the best in Nashville! They treated me with the utmost respect and tended to my every need. No question went unanswered. I was always kept informed of every step in the process. I received phenomenal results; I couldn't ask for more. I would definitely hire the Law Offices of John Day again.
★★★★★
I would definitely recommend to anyone to hire John Day's law firm because everyone was helpful, made everything clear and got the job done. I am satisfied with how my case was handled.
★★★★★
It's been a long battle but this firm has been very efficient and has done a remarkable job for me! I highly recommend them to anyone needing legal assistance. Everyone has always been very kind and kept me informed of all actions promptly.
★★★★★
I had a great experience with the Law Offices of John Day. The staff was very accommodating, and my phone calls/emails were always responded to in a timely manner. They made the entire process very easy and stress-free for me, and I had confidence that my case was in good hands. I am very happy with the results, and I highly recommend!
★★★★★