Subrogation on the part of an employer is a fundamental concept in Pennsylvania workers' compensation law. The underlying principle is that an employer should be entitled to be repaid for the workers' compensation benefits that it paid to an injured worker as a result of the negligence of a third party.
In Pennsylvania, an injured employee is entitled to workers' compensation benefits if he or she is hurt while engaged in an activity at work that promotes the employer's business interests. It does not matter if the injury was caused by a third party - for example, if your boss asks you to go buy something for the job at a nearby store, and you are hit by a car while going to make that purchase, you are entitled to workers' compensation.
In that scenario, however, if you then file a lawsuit against the person who hit you, you have repay your employer the workers' compensation benefits that it paid from any award or settlement that you receive as a result of that lawsuit. (It is not a dollar-for-dollar repayment; rather, there is an intricate formula).
The employer's right of subrogation has largely been found by the courts to be something that cannot be defeated. However, the Workers' Compensation Act provides that a governmental
entity "is immune from claims of subrogation or reimbursement from a claimant's tort recovery."
In Frazier v. W.C.A.B. (Bayada Nurses, Inc.), 52 A.3d. 241 (Pa. 2012), a nurse was on a SEPTA bus while traveling for work. The bus was involved in an accident, and she broke her ankle. She subsequently settled her case against SEPTA for $75,000. As part of the settlement, SEPTA agreed that it would "defend, indemnify
and hold Claimant harmless with respect to any claim, suit, petition or
other action brought against Claimant ... for payment of [the] workers' compensation lien. . ."
Even though SEPTA qualifies as a governmental entity, Bayada Nurses filed for repayment of the workers' compensation benefits that it had paid. The workers' compensation judge found that Bayada was not entitled to subrogation, but the Workers' Compensation Appeal Board ("W.C.A.B.") reversed the judge. The Commonwealth Court affirmed the W.C.A.B. However, the Pennsylvania Supreme Court found that the workers' compensation judge was correct and reinstated the decision of the workers' compensation judge.
Accordingly, if an employee is paid workers' compensation benefits as a result of an accident caused by a governmental entity, the employer is not necessarily entitled to subrogate against a settlement or award between the employee and the governmental entity.
Friday, February 1, 2013
Property taxes on new construction may be too high
Recently, I have been called by a number of people who have just received their assessment after buying a newly built house. The assessments that they are receiving will often lead to high tax bills.
When a new house or other building is completed, the local Board of Assessment will issue what is called an "interim assessment" for that property. Depending upon the county in which the property is located, the assessment should represent a percentage of the combined value of the real estate and the building; the percentage is determined by that county's common level ratio. (The common level ratios for Pennsylvania counties can be found by clicking here).
You typically have 40 days to appeal an interim assessment; if you miss that deadline, you are stuck with that assessment until you can next file an appeal of the annual assessment.
In many cases, the interim assessment is correct since it is based on the purchase price contained in the deed that was filed when you bought the house. However, there are times that the ratio has not been correctly applied and the assessment is too high.
Where it can become difficult for the Board of Assessment to correctly the value the property is when the real estate is purchased, and there is a separate contract for the construction of the house. The construction contract is not filed as a public record, and the Board of Assessment thus does not know how much it cost to build. It thus may put too high a value on the house, inflating your assessment and, thereby, your property taxes.
I thus recommend that any time you get an interim assessment, you carefully review the assessed value to confirm whether it is appropriate.
When a new house or other building is completed, the local Board of Assessment will issue what is called an "interim assessment" for that property. Depending upon the county in which the property is located, the assessment should represent a percentage of the combined value of the real estate and the building; the percentage is determined by that county's common level ratio. (The common level ratios for Pennsylvania counties can be found by clicking here).
You typically have 40 days to appeal an interim assessment; if you miss that deadline, you are stuck with that assessment until you can next file an appeal of the annual assessment.
In many cases, the interim assessment is correct since it is based on the purchase price contained in the deed that was filed when you bought the house. However, there are times that the ratio has not been correctly applied and the assessment is too high.
Where it can become difficult for the Board of Assessment to correctly the value the property is when the real estate is purchased, and there is a separate contract for the construction of the house. The construction contract is not filed as a public record, and the Board of Assessment thus does not know how much it cost to build. It thus may put too high a value on the house, inflating your assessment and, thereby, your property taxes.
I thus recommend that any time you get an interim assessment, you carefully review the assessed value to confirm whether it is appropriate.
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