Be careful what you wish for: Collateral Estoppel

In a decision dated November 17, 2015, the Delaware Supreme Court affirmed the Superior Court’s dismissal of Plaintiff Charles Crosnan’s declaratory judgment complaint on the basis of collateral estoppel.

In short, Mr. Crosnan was performing work on a garage for Apex Contracting, which was owned by Anthony Chambers.  During the course of such work, Mr. Crosnan fell and was injured and thereafter filed a petition with the Industrial Accident Board for worker’s compensation benefits.  At the IAB hearing, Crosnan argued that he was an employee of Apex Contracting, despite Mr. Chambers’ contention that Crosnan was working for free.  The IAB agreed with Crosnan and found that he was eligible for worker’s compensation benefits.  Unfortunately, Apex did not have a worker’s compensation policy.

Scaffolding

Crosnan then filed a declaratory judgment action against Travelers Insurance Company in an effort to obtain proceeds from the Chambers’ homeowners insurance policy.  The Delaware Superior Court found that, because the homeowners insurance policy contained a workers compensation exclusion (i.e., no proceeds if claimant eligible to receive worker’s comp benefits), Crosnan’s case was dismissed on the grounds of collateral estoppel.

On appeal, the Delaware Supreme Court agreed with the Superior Court and found that, because the IAB determined, at Crosnan’s insistence, that he was an employee of Apex, Crosnan was collaterally estopped from re-litigating the issue of whether or not he was actually an employee of Apex.

Read the opinion here.

Chris Lee

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