60 N.Y.2d 22 (1983)
While the Workers’ Compensation Board generally has primary jurisdiction to determine the applicability of workers’ compensation law, a trial court abuses its discretion by granting a stay of a common-law action on the eve of trial pending the Board’s determination when the defendant unduly delayed asserting the workers’ compensation defense and the plaintiff would suffer prejudice as a result of the delay.
Summary
This case concerns a wrongful death action arising from a gasoline terminal explosion. The defendant, Duncan Petroleum, sought a stay of the trial on the morning jury selection was to begin, arguing that the Workers’ Compensation Board should first determine if the decedents were also employees of Duncan, which would bar the common-law action. The Court of Appeals reversed the lower courts’ grant of the stay, holding that Duncan’s delay in raising the workers’ compensation defense until the eve of trial, coupled with the prejudice to the plaintiffs who were prepared for trial, constituted an abuse of discretion. The court emphasized that Duncan’s management was the same as another company that had already participated in workers’ compensation proceedings related to the same incident.
Facts
William Shine and Charles Rittenhouse died from injuries sustained in an explosion at a gasoline terminal. Their estates filed workers’ compensation claims, alleging employment by Five Boro Fuel Transport, Inc. The Workers’ Compensation Board determined that the decedents were employees of Five Boro and made awards. Subsequently, the estates filed common-law actions against several defendants, including Duncan Petroleum Transport, Inc. On the morning of jury selection, Duncan Petroleum moved for a stay pending a determination by the Workers’ Compensation Board as to whether the decedents were also employees of Duncan.
Procedural History
The Supreme Court granted Duncan Petroleum’s motion for a stay pending the Workers’ Compensation Board’s determination. The Appellate Division affirmed the Supreme Court’s order. The New York Court of Appeals reversed the Appellate Division’s order, denying the motion for a stay and remitting the case to the Supreme Court for trial.
Issue(s)
Whether the trial court abused its discretion by granting a stay of the common-law action pending a determination by the Workers’ Compensation Board as to whether the decedents were employees of Duncan Petroleum, when Duncan raised the issue on the eve of trial after considerable delay?
Holding
No, because Duncan’s delay in asserting the workers’ compensation defense until the eve of trial, coupled with the prejudice to the plaintiffs, constituted an abuse of discretion. The court found Duncan’s actions unacceptable, particularly given its prior knowledge of the facts and legal issues and its participation (through a related company) in prior workers’ compensation proceedings arising from the same incident.
Court’s Reasoning
The Court of Appeals acknowledged the Workers’ Compensation Board’s primary jurisdiction in determining the applicability of the Workers’ Compensation Law, citing O’Rourke v. Long. However, the Court distinguished this case, focusing on Duncan’s unreasonable delay and the resulting prejudice to the plaintiffs. The Court noted that Duncan’s officers and management were the same as Five Boro’s, and Duncan had been aware of the claims for several years. The Court stated that allowing the stay at such a late stage would unfairly prejudice the plaintiffs who were prepared to proceed with the trial. The court reasoned that Duncan, having been fully acquainted with the factual and legal aspects of the claims since the explosion in 1976, waited unacceptably long to seek the stay. The Court emphasized the “operative prejudice” suffered by the plaintiffs, referencing Murray v. City of New York, where the court discussed amending pleadings to include a workers’ compensation defense. Chief Judge Cooke, in his concurrence, argued that the central issue was the legal identity of the two corporations, which is a matter for the courts to decide, not the Board. Judge Jasen dissented, arguing that the courts below did not abuse their discretion given the Workers’ Compensation Board’s primary jurisdiction. Judge Jasen relied on O’Rourke v. Long, stating that preliminary factual questions determining the proper forum should be resolved prior to a plenary trial. He further argued that, absent a showing of prejudice, the defendant should be allowed to raise the workers’ compensation defense immediately before trial, citing Murray v City of New York.