Bor-Son Construction, Inc., and CNA-RSKO appeal the compensation judge’s finding that they are liable to the employee for all the employee’s medical expenses.  We reverse.

On March 8, 1989, David K. Seehus, the employee, sustained an injury to his low back arising out of his employment with Bor-Son Construction, Inc., then insured by Artex, Inc.^[1]  The employer and its insurer admitted liability and paid workers’ compensation benefits.  Thereafter, the parties entered into a settlement in which the employee was paid $86,500.00 in exchange for a full settlement of all claims with the exception of future non-chiropractic medical expenses, which remained open.  An Award on Stipulation was served and filed on September 19, 1990.

On March 19, 2001, the employee was working for Wesley Residence, Inc., then insured by Meadowbrook Insurance Group.  On that date, the employee sustained a personal injury to his low back for which the employer and insurer admitted liability.  Thereafter, the parties entered into a settlement in which the employer and insurer agreed to pay certain medical expenses incurred by the employee as a result of his personal injury.  An Award on Stipulation was served and filed on July 9, 2003.

In June 2007, the employee filed a claim petition seeking wage loss and medical benefits from Wesley Residence alleged to be caused by the March 19, 2001, personal injury.  At the time the claim petition was filed, workers’ compensation claims against Wesley were being administered by the Minnesota Insurance Guaranty Association (MIGA) because Meadowbrook Insurance Group was no longer solvent.  Wesley/MIGA filed an answer to the employee’s claim petition admitting the employee sustained an injury to his back on March 19, 2001, but denying liability for the claimed benefits and alleging the employee’s injury was a temporary aggravation of a preexisting condition.  In October 2007, Wesley/MIGA filed a Motion for Joinder/Petition for Contribution and/or Reimbursement seeking the joinder of Bor-Son and Artex, Inc.  Wesley/MIGA contended that Bor-Son may be liable in full or in part for the medical expenses claimed by the employee and sought an order directing Bor-Son and its insurer to pay their proportionate share of the employee’s medical expenses.  Bor-Son and CNA-RSKCO filed a response to the Motion for Joinder denying liability and requesting the order for joinder be denied.  An Order for Joinder was served and filed on November 1, 2007.

In September 2008, the employee, Wesley, and MIGA entered into a Partial Stipulation for Settlement in which the employee was paid $55,000.00 in exchange for a full and complete settlement of all claims against Wesley/MIGA with the exception of the employee’s current claims for non-chiropractic medical expenses.  An Award on Stipulation was served and filed on September 23, 2008.

The employee’s remaining claim for medical expenses was heard before a compensation judge on September 23, 2008.  In Findings and Order served and filed January 30, 2009, the compensation judge found the employee’s injury of March 19, 2001, was a substantial contributing cause of the progressive deterioration of the employee’s low back condition and ultimately the need for surgery.  The compensation judge found the injuries of March 8, 1989, and March 19, 2001, were each substantial contributing causes to the employee’s condition, including his need for medical care and treatment, and the judge apportioned liability equally between the two injuries.  No party appealed these findings.  The compensation judge further found he lacked jurisdiction to order MIGA to make payment of its proportionate share of the medical benefits due.  Accordingly, the compensation judge ordered Bor-Son/CNA to pay to the employee and/or the intervenors 100 percent of the medical expenses at issue.  Bor-Son/CNA appealed.

On appeal, Bor-Son/CNA contend the compensation judge lacked jurisdiction to order them to pay any portion of the employee’s claim.  The appellants contend the compensation judge’s assumption of jurisdiction required an application of the Minnesota Insurance Guaranty Association Act, Minn. Stat. § 60C.01 et seq. (1990).  Since the compensation judge lacked jurisdiction to interpret or apply Chapter 60C, Bor-Son/CNA assert, the compensation judge’s order constitutes reversible error.

MIGA, on the other hand, maintains the appellants’ assertion that the present case is a contribution and reimbursement claim by MIGA against CNA is inaccurate.  Rather, the respondents contend Bor-Son/CNA were joined because they were necessary parties to the direct claim by the employee for payment of medical expenses in that they were potentially liable for the employee’s medical expenses.  The respondents assert that apportionment of liability between the two injuries was a collateral dispute related to the employee’s direct claim because MIGA denied liability for the employee’s medical expenses.  Once the compensation judge found that both injuries were substantial contributing causes of the employee’s need for medical care and treatment, MIGA contends the compensation judge then lacked jurisdiction to order MIGA to pay apportionment.  Accordingly, MIGA argues Bor-Son/CNA is liable for all the claimed medical expenses and the compensation judge’s findings and order should be affirmed.

In 1971, the legislature enacted the Minnesota Insurance Guaranty Association Act, Chapter 60C.  The purposes of the act are to “provide a mechanism for the payment of covered claims” and to “minimize excessive delay in payment and to avoid financial loss to claimants or policy holders because of the liquidation of an insurer.”  Minn. Stat. § 60C.02, subd. 2.  The Guaranty Association is “deemed the insurer to the extent of its obligation on the covered claims.”  Minn. Stat. § 60C.05, subd. 1(a).  The Board of Directors of the Association “shall determine whether claims submitted for payment are covered claims.”  Minn. Stat. § 60C.1, subd. 1. If a claimant is dissatisfied with a decision of the Board of Directors, the act establishes a procedure for administrative and judicial review.

The jurisdiction of a compensation judge and this court does not extend to interpretation or application of the provisions for the handling of claims under the Minnesota Insurance Guaranty Act.  Accordingly, neither a compensation judge nor this court has subject matter jurisdiction over a claim by a workers’ compensation insurer against MIGA for reimbursement of benefits paid on behalf of an insolvent insurer.  Taft v. Advance United Expressway, 464 N.W.2d 725, 44 W.C.D. 35 (Minn. 1991); Ast v. Har Ned Lumber, 483 N.W.2d 66, 46 W.C.D. 495 (Minn. 1992).

In Wiss v. Advance United Expressway, 488 N.W.2d 802, 47 W.C.D. 260 (Minn. 1992), the employee sustained personal injuries while working for Advance United while the employer was insured by National Union Fire Insurance Company, and sustained other injuries while the same employer was insured by an insurance company that later became insolvent.  The claims against the insolvent insurer were assumed by MIGA.  National accepted liability for the employee’s injury and paid workers’ compensation benefits.  Initially, National filed a Petition for Contribution or Reimbursement against MIGA, but withdrew this claim when MIGA challenged the jurisdiction of the workers’ compensation system over National’s claim.  Thereafter, the employee filed a claim petition naming both National and MIGA as parties.  National then filed a Petition to Discontinue Benefits requesting its liability be reduced by the proportionate share of liability attributable to the MIGA injuries.  The compensation judge dismissed National’s petition concluding the judge had no jurisdiction.  National appealed the judge’s decision.  Citing Taft, the Supreme Court stated that

In Gerads v. Bernick’s Pepsi-Cola, 486 N.W.2d 433, 46 W.C.D. 704 (Minn. 1992), the employee also sustained multiple injuries with the employer while it was insured by two solvent insurers and one insolvent insurer.  MIGA took over the liability of the insolvent insurer, paid benefits to the employee and then filed a Petition for Contribution/Reimbursement against the employer and the solvent insurers.  The compensation judge dismissed MIGA’s petition concluding the court lacked jurisdiction over the claim.  On appeal, the Supreme Court stated the “basis for MIGA’s payments to an injured worker - - as distinguished from the amount and period of compensation due the worker - - rest in Chapter 60C, not Chapter 176.  MIGA’s rights against relators [the solvent insurers] also rest in Chapter 60C, not Chapter 176.”  Accordingly, the court held that the compensation judge properly dismissed MIGA’s petition for Contribution/Reimbursement because the court lacked jurisdiction over the claim.  Rather, the court stated MIGA’s remedy was with the district court.

Minn. Stat. § 60C.11, subd. 1, states, “the rights under the policy of a person recovering under this chapter shall be deemed to have been assigned by the person to the Association to the extent of the recovery.”  In Wirth v. M.A. Mortenson/Shal Assocs., 520 N.W.2d 173 (Minn. App. 1994), the court held that under this provision of the Guaranty Act, MIGA has statutory authority to pursue subrogation claims.  It is clear, however, from the Gerads case that any claim by MIGA for contribution or reimbursement is governed by Chapter 60C, not Chapter 176.  Thus, the compensation judge and this court lack jurisdiction over a contribution or reimbursement claim by MIGA.  That claim must be asserted by MIGA in the district court.

MIGA, however, argues the assertion that the instant case involves a contribution or reimbursement claim by MIGA is inaccurate.  MIGA asserts CNA was joined as a necessary or essential party because MIGA had denied liability for the employee’s claims and Bor-Son/CNA needed to be joined as parties potentially liable for the employee’s claims.  Thus, MIGA argues, apportionment of liability between the CNA injury and the MIGA injury was only a collateral dispute in relation to the employee’s direct claim for payment of medical expenses.  We reject this argument.

In Martagon v. Minnesota Brewing Co., slip op. (W.C.C.A. Mar. 21, 2002), the employee sustained two admitted personal injuries, the first with an employer whose insurer later became insolvent and the second with Minnesota Brewing Company, then insured by Fireman’s Fund Insurance Company.  Minnesota Brewing and Fireman’s Fund admitted liability for a temporary aggravation and paid certain medical expenses but denied the employee’s ongoing condition was causally related to their personal injury.  The employee then filed two medical requests seeking payment of medical expenses from Minnesota Brewing/Fireman’s Fund.  Minnesota Brewing/Fireman’s Fund filed a motion requesting joinder of MIGA as a necessary party.  The compensation judge initially granted the motion, but after further proceedings, dismissed the first employer and MIGA.  Following a hearing, the employee’s injury with Minnesota Brewing/Fireman’s Fund was found to be a substantial cause of his need for the claimed medical expenses.  Accordingly, the compensation judge ordered Minnesota Brewing/Fireman’s Fund to pay the medical expenses.  On appeal, Minnesota Brewing/Fireman’s Fund asserted the Taft and Wiss cases were distinguishable and did not compel a dismissal of MIGA.  They contended there was no claim for contribution or reimbursement at issue against MIGA and the Motion for Joinder was not an attempt to recoup payment from or apportion liability to MIGA.  Rather, the appellants asserted MIGA was a necessary party because Minnesota Brewing/Fireman’s Fund denied all liability for the claimed medical expenses.  In our decision, this court found the appellants’ attempt to distinguish Taft and Wiss unpersuasive.  The court stated:

Initially, we note that in neither Martagon nor this case did MIGA contend the employee’s claim was not a covered claim under Minn. Stat. § 60C.09.  Had it done so, this court would have no jurisdiction.^[2]  Further, as in Martagon, had MIGA prevailed on its defense that its injury was not a substantial contributing cause of the employee’s need for medical expenses, MIGA would have had absolutely no interest in whether or not Bor-Son/CNA were parties to the proceeding.  Rather, the only reason for MIGA to join Bor-Son/CNA would be to lessen its liability in the event that both injuries were found to be substantial contributing causes of the employee’s need for medical care.  Thus, the essential nature of the relief sought by MIGA was contribution and/or reimbursement and the compensation judge lacked jurisdiction over that claim.

The compensation judge, therefore, lacked jurisdiction to order the joinder of Bor-Son and CNA.  Accordingly, the judge’s Order for Joinder filed November 1, 2007, is vacated.  The compensation judge’s January 30, 2009, Findings and Order ordering Bor-Son/CNA to pay the medical costs at issue are reversed.  Wesley Residence, Inc., and MIGA are ordered to pay the medical expenses set forth in the judge’s Findings and Order.