Arizona Court of Appeals Division One Holds That the 2007 Amendments to A.R.S. § 23-1023(B) Eliminated the Automatic Assignment of a Claim to an Insurance Carrier That Used to Occur if an Injured Employee Fails to Bring a Claim Under § 23-1023(A) More Than One Year After the Injury.

Alvaro Acosta was injured in the scope of his employment on March 17, 2010, while working for Contractors West, a subcontractor for Kiewit-Sundt.  Acosta received worker’s compensation benefits from Contractors West’s insurer SCF.  Although Acosta was permitted to sue Kiewit-Sundt directly under A.R.S. § 23-1023(A), he did not do so.  That statute allows a person entitled to workers’ compensation who is injured by the conduct of another person not in the same employ to sue that other person.  Under the pre-2007 version of the statute, if a person failed to sue within one year, the person’s claim was automatically assigned to the carrier.  On March 14, 2011, Acosta (believing his claim had been assigned to SCF) asked SCF to reassign him the claim in order to allow him to sue Kiewit-Sundt.  SCF refused.  Acosta then filed suit on March 15, 2012, and Kiewit-Sundt moved for summary judgment, claiming that § 23-1023(B) required Acosta to obtain a reassignment before filing suit.  The trial court granted the motion and this appeal followed. 

The Court of Appeals explained the parties and the trial court all relied on the pre-2007 version of § 23-1023(B).  In 2007, the legislature amended the statute by deleting language in subsection (B) that stated if an employee fails to bring a suit within one year of his or her injury that “the claim against such other person shall be deemed assigned to the insurance carrier, or to the person liable for the payment thereof.”  Because a claim no longer passes to the insurance carrier by operation of law, Acosta was not required to receive a reassignment before filing his claim.  The Court of Appeals rejected Kiewit-Sundt’s arguments that the amended statute merely expanded the carrier’s rights without removing the automatic assignment to the carrier and that the use of the word “reassignment” in the amended statute necessitated an assignment to the carrier in the first place.  The Court of Appeals explained that neither argument is inconsistent with the clear deletion of the “deemed assigned” language, and, therefore, under the current language, Acosta’s claim was not deemed assigned and prohibited under § 23-1023(B). 

Presiding Judge Howe authored the opinion; Judge Thumma and Judge Orozco concurred.