Legal Malpractice

Subrogation Rights in Legal Malpractice

By (Andrew Lavoott Bluestone)

Insurers who pay insureds for medical costs, or for damages sometimes seek the right to share in the proceeds of the insured's cases.  If an insured gets medical insurance coverage after an accident,] the insurance company would like to be reimbursed from the proceeds.

The right arises from the insurance contract, and sometimes by statute,  Other times, the insurance company asserts an equitable right to subrogation.  Here is a North Dakota case which illustrates the statutory variety.

IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2008 ND 78
Robert N. Haugenoe, Claimant and Appellant
v.
Workforce Safety and Insurance, Appellee
and
Earl's Electric, Respondent

"Robert Haugenoe appeals from a district court judgment affirming an agency order granting Workforce Safety and Insurance ("WSI") a subrogation interest in a legal malpractice settlement. The legal malpractice action concerned Haugenoe's attorney's failure to properly prosecute a medical malpractice claim related to a physician's aggravation of a work-related injury suffered by Haugenoe. Haugenoe asserts that N.D.C.C. § 65-01-09, the subrogation provision of the workforce safety and insurance law, does not grant WSI a subrogation interest in the legal malpractice settlement. We agree. We hold that N.D.C.C. § 65-01-09 does not grant WSI a subrogation interest in an injured worker's legal malpractice claim against a third-party tortfeasor. We, therefore, reverse the order of WSI and the district court judgment. "

Full post as published by New York Attorney Malpractice Blog on April 23, 2008 (boomark / email).