Loading...
HomeMy WebLinkAbout47-Risk Management C I T Y DIN 0 flEe'o.-ADMI". OFF. Y ... ll,l ,:' "3 \5B1 MA -::: ",'j ,,- ~. {!tfi'- c.~ V RAYMOND D. SCHWEITZER. CITY ADMINISTRATOR ^Ai~ E. M. LIGHT. DIRECTOR OF RISK MANAGEMENT (I. IV o 0 o F SAN B ERN A R INTEROFFICE MEMORANDUM 8705-1501 o o TO: FROM: SUBJECT: MANZER VS. CITY OF SAN BERNARDINO DATE: May 4. 1987 (7064) COPIES: ------------------------------------------------------------- CONFIDENTiAL. On June 16. 1982. a part-time employee. hired just two months previously. sustained serious injuries when he somehow ended up in the packing mechanism of a rear loader refuse truck. One leg had to be amputated at the knee; and his other knee was crushed, causing serious incapacity to his remaining leg. Since that time. Mr. Manzer has been in and out of the hospital due to subsequent complications, specifically per- taining to repeated infections in the stump of the amputated leg. As of March 13, 1987. total workers' compensation expenditures by the City amounted to $163.771.48. This doesn't include any expenditures for permanent disability, except for a $1,250 advance. since Mr. Manzer's condition had not yet become permanent and stationary. Mr. Manzer's only recourse against the City was through the workers' compensation system: however. he did file a civil action against Pac Mor. the manufacturer of the hopper, and also an action against Ray Gaskin, who purchased the hopper from Pac Mor and installed it on the International truck. His civil action was predicated on the allegation of product liability. The City intervened in this civil action in an attempt to recover some or all of its workers' compensation expenditures: however. on the contrary. due to the following reasons, it does not appear likely that the City will be successfu 1 in its endeavor. 1. Certain safety not ordered by vehicle. devices available from Pac Mor were the City when purchasing the 2. The City maintained very poor maintenance records. Specifically, there were no records regarding a "pop-et" screw. The failure of this screw al- legedly caused a malfunction in the packing mech- anism. contributing to the seriousness of this 11 If1 o o o o INTEROFFICE MEMORANDUM: 8705-1501 MANZER VS. CITY OF SAN BERNARDINO May 4, 1987 Page 2 fnjury. There was no scheduled perfodfc mafnten- ance on this device. 3. A City employee operated the compaction device the day before the incident and noticed that the device did not work. It was either not reported; or ff it was, nothing was done. 4. Other employees noticed the malfunction several days before the incident and reported it to their leadman, who made it known to a mechanic. Here again, evidently nothing was done to correct the situation. 5. There was a lack of training complicated by Mr. Manzer's inability to read the training manual. He suffers from dyslexia. There was no oral or wrftten test given, although he did spend a whole day at the Orange Show Grounds and was shown how the unit operated. 6. Thfs vehfcle was outdated and used as a backup. Normally, another vehicle was used, and ft is not even known if Mr. Manzer was trained on the specific vehicle involved in this incfdent. As fndfcated prevfously, a permanent disabflity rating has yet to be determined; however, the attorney representing the City, Philip Mark, feels that that a workers' compensation judge would probably find 100 percent permanent disability. Assumfng a normal life expectancy, this would cost the Cfty approxfmately an additional $350,000. There is a slim chance that a workers' compensation judge might only find 80 percent disabflfty. Even in this case, the total fncremental expenditure to the Cfty would be approximately $150,000. Fortunately, ft appears that we now have a rather unexpected but most desirous alternatfve. I met last Wednesday wfth Gary Carpenter, the attorney representing the City in the fnterventfon complaint, and Philfp Mark, the City's workers' compensation attorney. The insurance companies representing Pak Mor and Ray Gaskin are attempting to settle the product liabflfty case wfth Mr. Manzer. However, they are falling somewhat short fn what they are able to offer under their polfcy limits insofar as Manzer's demand. This opens the opportunity for the Cfty to attempt to put forth some money toward the settlement package in return for a "Third Party Compromise and Release." which is a complete release for any o o 0 INTEROFFICE MEMORANDUM: 8705-1501 MANZER VS. CITY OF SAN BERNARDINO May 4, 1987 Page 3 o future permanent disability, medical, and any and all other workers' compensation items. Due to a rather apparent aura of urgency by the other parties and the fear of having them settle around us, I instructed Mr. Carpenter to attempt to negotiate a settlement with Mr. Manzer's attorney. Even though we initially thought it might take as much as $40,000, Mr. Carpenter initially suggested $10,000; and Mr. Manzer's attorney came back with a request for $20,000. In further conversation, it was agreed that the City could obtain a Third Party Compromise and Release (complete release) for a $15,000 contribution to the total settlement package. This is to be compared to the alternative potential payment under the workers' compensation system of $150,000 to $350,000. Incidently, Mr. Gaskin's insurance carrier is tendering its policy limits of $300,000 toward the settlement, and it is anticipated that Pak Mor is tendering somewhere between $75,000 and $150,000 toward this package. BE.QMMENDATION: Settle all aspects of the Arthur D. Manzer Bernardino workers' compensation lawsuit Party Compromise and Release for the sum of vs. City of San through a Third $15,000. ?~.~ E. M. L1 g ht Director of Risk Management EL/sf cc: Gary Carpenter, Attorney at Law, Middlebrook & kaiser Philip A. Mark, Attorney at Law Mark & Bolson