Aaron E. Mosley, an employee of Mobile Public Library (the Library), encountered an automobile accident during his employment caused by an uninsured motorist. He received uninsured-motorist benefits through a third-party action, which included the Library’s insurance carriers. Subsequently, the circuit court decided that the Library should be reimbursed with the money Mosley had recovered, from the compensation and medical benefits it had paid to Mosley. However, the Court of Civil Appeals reversed this judgment, and the Library petitioned for a writ of certiorari.
The legal contest is primarily around the employer’s right to reimbursement when an employee, after receiving workers' compensation benefits, recovers damages in a third-party action for the same injuries. The Library argued that it was entitled to be reimbursed from Mosley's recovery of uninsured-motorist benefits, citing Ala. Code 1975, § 25-5-11(a). However, the prevailing interpretation of the statute, as established in the precedent case of Cahoon, holds that an employer can't be reimbursed for uninsured-motorist benefits an employee recovers as those benefits are contractual and not tortious, and the statute, as interpreted in Cahoon, allowed reimbursement only in cases of tortious liability. This means the Library's appeal for reimbursement from the contractual recovery of uninsured-motorist benefits was not allowed under the existing interpretation of § 25-5-11.
The Library’s alternative plea was to distinguish Cahoon and allow reimbursement in this specific context, where the employer is seeking reimbursement for the amount of uninsured-motorist benefits paid under its own policy. However, the existing statute under the Cahoon interpretation didn’t allow drawing such a distinction, thereby pushing the Library into the contractual bucket, where no reimbursement is allowed.
The Library’s recourse, under the current statutory framework and prevailing interpretations, is to persuade the Legislature to amend the statute if it desires relief in similar future cases.
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