A federal court in Arkansas recently denied an insured’s motion to dismiss a complaint for declaratory judgment action where the insured argued the Arkansas Workers’ Compensation Commission had exclusive jurisdiction over an injured worker’s claim. Atl. Cas. Ins. Co. v. CM Sellers, LLC, 2016 WL 1735574 (W.D. Ark. Apr. 5, 2016), report and recommendation adopted sub nom., Atl. Cas. Ins. Co. v. CM Sellers, 2016 WL 1717223 (W.D. Ark. Apr. 28, 2016).
A worker sued the insured, claiming he was injured on a worksite after his employer dispatched him to work at the insured's worksite. Thereafter, the insured’s CGL insurer sought a declaration that it owed no coverage under its policy. The insured filed a motion to dismiss, arguing the court is without subject matter jurisdiction to consider the case because the primary issue is whether the worker was an employee of the insured at the time of the accident for which the Workers’ Compensation Commission has exclusive jurisdiction.
The court found that the Workers’ Compensation Commission did not have exclusive jurisdiction. The court reasoned that the relevant provisions of the policy are not limited to a determination of the worker’s employment status, noting that none of the provisions relied on by the insurer required a determination of the worker’s employment status. The court stated that the issue was whether there was an employer-employee relationship between two of the defendants, and thus a determination by the Workers’ Compensation Commission is “instructive” but not controlling.