Opinion
July 20, 1970
Appeal from a decision of the Workmen's Compensation Board, filed July 24, 1968, which found that the carrier was prejudiced by the dismissal of a third-party action without its consent and that claimant is no longer entitled to payment of death benefits. Claimant's husband, a taxi-driver died as a result of injuries sustained in an automobile accident while in the course of his employment. A third-party action was commenced by the service of a summons on June 9, 1961. A compensation proceeding was also commenced, and on September 5, 1961 an award was made pending the outcome of the third-party action. The defendant in the third-party action requested a complaint but none was ever served. After the Statute of Limitations had run a motion was made to dismiss for failure to prosecute, and after several adjournments of the motion an order of dismissal was granted on October 19, 1964. The carrier subsequently stopped payments. The board found that the carrier had been prejudiced by the dismissal of the third-party action without its consent. Claimant's chief contention is that the discontinuance was wholly involuntary, since it was solely due to the actions of her attorney. She relies on Matter of Ostolski v. C.M.H. Co. ( 28 A.D.2d 1036) and Matter of Husing v. Medical Labs. ( 285 App. Div. 13). These cases are readily distinguishable. In Husing the board found that the carrier was offered the prosecution of the third-party action prior to its dismissal and failed to accept the offer. Further, there was no finding by the board that claimant was physically and mentally incapable of proceeding with the trial of the case although there was proof of such in the record. The court, therefore, remitted the matter to the board. In Ostolski, the claimant was physically and mentally incapable of proceeding with the trial, and the case was dismissed for failure to prosecute after a refusal by the carrier to consent to settlement or take over the prosecution of the case. We held in that case that the issue of prejudice is a question of fact, and found substantial evidence to sustain the finding of the board on that issue. It is true here that claimant herself did not voluntarily discontinue the action; it was, however, brought about by the negligence of her then attorney, and not by any acts of the carrier. We cannot say that the conduct of claimant's attorney could not be imputed to her such that the dismissal would be wholly involuntary as a matter of law. Moreover, there is sufficient evidence to sustain the board's finding of prejudice to the carrier. Decision affirmed, without costs. Reynolds, Greenblott, Cooke and Sweeney, JJ., concur in memorandum by Sweeney, J. Herlihy, P.J., dissents and votes to reverse, in a memorandum.
Upon the present record it appears that the claimant made such efforts as were reasonably consistent with an attorney-client relationship to prosecute her third-party action and/or properly protect her right to workmen's compensation. Under such circumstances it would be difficult to hold that the termination of the third party action was in any sense a voluntary discontinuance or compromise of it (cf. Cohn v. Borchard Affiliations, 30 A.D.2d 74, dissenting opinion 78, rev'd. 25 N.Y.2d 237). There is no reason to assume that employers and their carriers cannot adequately keep themselves apprised of the status and process of third-party actions maintained by claimants and, under the present circumstances, it appears that all of the equities are with the claimant-appellant. The fact that a third-party action was dismissed or discontinued without notice to the compensation insurance carrier is not per se prejudice and it appears that the claimant, apparently without notice of the original dismissal, did everything possible to vacate the said dismissal. There is no evidence that the compensation insurance carrier in any way tried to assist or aid in reopening the dismissal. This record factually or legally does not justify a finding of prejudice in favor of the insurance carrier and against the claimant. The present findings defeat the purpose and intent of workmen's compensation.