Hawaii Court Says Insurer Acted in Bad Faith when it Denied Death Benefits to Mother of Fatally Injured Worker
Chief Judge Randal Valenciano of Hawaii’s Fifth Circuit Court (Kauai) today announced a verdict in favor of the plaintiff, Esmeralda Ordonez, following a September, 2008 trial. Ms. Ordonez, an elderly widow who lived in Venezuela, filed suit against Hawaii’s dominant workers compensation insurance carrier, Hawaii Employer’s Mutual Insurance Co. (HEMIC). Ms. Ordonez alleged delays in payment of her survivor’s benefits after her daughter, Mayra Rodriquez, was fatally injured while working at Gay and Robinson Tours in 2005.
Mrs. Ordonez’s attorneys presented evidence at trial that she lost virtually all her income when her daughter died. She was forced to survive on meager handouts from neighbors for over a year. Under the law, Mrs. Ordonez, as the sole surviving parent, was entitled to at least $48,000 in death benefits from HEMIC. HEMIC, however, delayed payment and forced the case to a hearing before an Administrative Law Judge, claiming that it wasn’t clear that the death was “compensable” under the statute. The Judge noted that HEMIC’s attorney had concluded in a matter of weeks that the claim was probably compensable, and acted without legal justification over the next 9 months when it refused to contact Mrs. Ordonez or offer her the benefits flowing from her daughter’s death.
Mrs. Ordonez eventually hired attorney David Robinson of the Honolulu firm of Robinson & Chur to pursue her claim. A year after her daughter’s death, a Hearing Examiner ruled that the claim was indeed work related and that the long overdue death benefits should be paid to Mrs. Ordonez. After payment was finally made, Robinson & Chur filed a civil lawsuit in Circuit Court alleging HEMIC acted in bad faith in seeking to avoid payment to Mrs. Ordonez. Plaintiff’s attorneys presented evidence at trial that the employer (G & R Tours) and the Insurance agent (Marsh USA) unsuccessfully tried to prod HEMIC into making payments after Ms. Rodriquez’s accident.
The Court awarded Mrs. Ordonez $75,000 in compensatory damages and $250,000 in punitive damages from HEMIC, finding that the insurer’s conduct was motivated by a desire to avoid paying a legitimate claim. Judge Valenciano also stated that HEMIC’s conduct during the workers compensation claim was oppressive, willful, and in reckless disregard to the rights of the claimant.
Mrs. Ordonez was represented at trial by Ken Friedman, of Friedman | Rubin (Bremerton, WA) and Dan Chur of Robinson & Chur (Honolulu, HI). To see a copy of the Findings of Fact, Conclusions of Law and Judgment entered by the Court on April 9, 2009, click here.