Hawaii Workers’ Compensation Subrogation At A Crossroads

We are at the precipice of a potential upheaval in workers’ compensation recovery rights in the Aloha State.

The Hawaii Supreme Court is about to decide whether equitable considerations and defenses to subrogation—such as the common law Made Whole Doctrine or Common Fund Doctrine—are to be applied to statutory workers’ compensation liens.

If the court decides they apply, effectively destroying workers’ compensation reimbursement rights, the significant additional cost in the form of workers’ compensation insurance premiums will fall squarely on Hawaii businesses, large and small.

The case of Moranz v. Harbor Mall, LLC has been pending before the State’s highest court since May 13th and was submitted without oral argument. Moranz was a restaurant employee who slipped and fell at Harbor Mall in Lihue, Kaua’i.

She filed for and received $63,245.41 in benefits from her employer’s workers’ compensation carrier and stipulated to a settlement of her future benefits in the amount of $125,816.72 for a total of $189,062.12 in benefits. Moranz later filed suit and ultimately arrived at a settlement with the mall in the amount of $200,000, general damages only.