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OCCUPATIONAL EXPOSURE TO ASBESTOS, WHO PAYS?
James P. Backenson, Esquire and Kimberly A. Jubanyik, Esquire
In the world of workers' compensation law in New Jersey, the question at hand, in every matter when there are multiple insurance carriers or multiple respondents, is who pays on the award. Well, that question may become either clearer or more confusing in the coming months and years for claims of occupational exposure to asbestos.
As of January 14, 2004, the amendment to N.J.S.A. 34:15-33.3 became effective, which arguably indicates that the employer or carrier for the employer who was the last exposure to what caused, or could have caused, the asbestos related condition (including death) is liable for the award. Unfortunately, at this time there have been no published opinions providing any insight into the interpretation of this amendment that the Courts are going to take on this issue. At the present time, it is a general practice amongst the practitioner's of workers' compensation that any awards for asbestos claims are divided amongst the several respondents and/or insurance carriers based on exposure period and time frame of exposure. This has generally been done based on a well established latency period for asbestos conditions of around 20 years.
It will be interesting to see how this amendment to the statute affects the resolution of these claims, as the current practice does in fact seem to be directly opposite to the Falcon v. American Cyanamid decision. This stands for the proposition that in the case of occupational exposures with latency periods, the carrier/employer on the risk at the time of the last exposure would be liable for the award. The decision was directly in line with the findings in Bond v. Rose Ribbon, and in fact was based in part on Bond.
We now have the revised statute which based on the language allows the Uninsured Employers Fund to be brought into a claim should the last employer/carrier at the time of last exposure be found. Based on the language of the amendment, it would appear as though the legislature was attempting to clarify both the Bond and Falcon decisions when it comes to asbestos cases. We will have to wait to see how the courts will interpret this amendment to the Worker's Compensation Statute, but if it is interpreted as a clarification as to liability for awards, it may very well lead to additional defenses in asbestos cases.
Obviously, if that is the case, the current practice of arbitrarily chopping up the award on an asbestos claim amongst all the employers/carriers that can be identified by the petitioner or one of the co-respondents, will no longer exist. In doing so, the litigation of these types of claims will be changed in two ways. First, there can be significantly reduction in the time that it will take to bring these claims to resolution as there will not be finger pointing amongst respondents as long as the last carrier/employer can be determined. Secondly, the cost of the award on one of these claims will increase as you will not have contribution from other employers/carriers.
Therefore, it would appear as though there is a classic "catch 22" type of situation that may have been created through this amendment. On the one hand claims will theoretically move faster and the exposure will be limited to only one carrier/employer, while on the other hand the employer/carrier that gets stuck with it will be paying significantly more than in the current system. We must therefore ask ourselves if we want less claims or lower payments on more claims. Unfortunately, it would appear that the courts will make that decision for us in the coming months and/or years when this amendment is considered and interpreted.
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