A recent Virginia Circuit Court case raises concern as to the steps required by the employer and carrier to protect a third party lien.

A recent Virginia Circuit Court case, Spicer v. Robinson (Circuit Court of Buckingham County, Case No. 16-99), raises concern as to the steps required by the employer and carrier to protect a third party lien.

In Spicer the Circuit Court Judge held that a voluntary lump-sum settlement payment to the claimant should not be included as part of the employer’s lien under Virginia Code Sections 65.2-309, -309.1 and -310. The Court noted its reliance on Noblin v. Randolph Corp., 180 Va. 345 (1942) and Slusher v. Paramount Warrior, 336 F. Supp. 1381 (W.D. Va. 1971) in reaching this decision.

The Circuit Court’s ruling is not binding on the Commission or other courts. Nonetheless, the Opinion is troubling as to potential arguments made in the future before the Commission by claimants. The Circuit Court’s holding is contained in the form of the attached Final Order as opposed to a written Opinion as is sometimes drafted by Circuit Court judges.

It is advisable that employers and carriers be certain to include express language in settlement documents agreeing that the settlement proceeds constitute compensation and should be included in the lien under Virginia Code Sections 65.2-309, -309.1 and -310.