Divided R.I. High Court Says Workers’ Comp Release Was Sufficiently Broad to Bar Discrimination Claim Against Employer

The Supreme Court of Rhode Island, with two justices dissenting, reversed a decision of a county Superior Court judge that had granted summary judgment to a former employee who contended a release he had earlier signed in connection with his workers’ compensation claim was sufficiently ambiguous so as not to bar his subsequent discrimination claim filed against his former employer with the state’s Commission for Human Rights. The majority held the terms of the release signed by the injured worker were unambiguous and clearly released the employer from all claims that the worker might be able to file against the employer, including those that might be filed with the state’s Human Rights Commission.

Background

On January 18, 2012, Araujo filed a workers’ compensation claim against his employer, Family Dollar, alleging that he had been injured on January 17, 2012 during the course of his employment. Araujo began to receive weekly workers’ compensation benefits from January 18, 2012 to August 12, 2012 and then beginning again on April 4, 2013—both periods of benefits relating to the same January 17, 2012 injury. Thereafter, on September 12, 2014, Araujo’s attorney sent a letter to Family Dollar in which he alleged that Araujo had been constructively discharged from his employment with Family Dollar on February 12, 2014. The letter also informed Family Dollar of Araujo’s intent to “file a complaint with the Rhode Island Human Rights Commission” because Family Dollar had discriminated against him on the basis of an illness completely unrelated to his workers’ compensation injury.

On September 23, 2014, Araujo entered into a written settlement agreement with Family Dollar and Sedgwick Claims Management Services, Inc. In exchange for the payment of $20,000, Araujo signed a broadly worded release favoring Family Dollar. Two months after signing the release, Araujo filed a charge of discrimination with the Rhode Island Commission for Human Rights, alleging that Family Dollar had discriminated against him on the basis of the above-referenced illness that was completely unrelated to his workers’ compensation injury. The charge of discrimination alleged that the final discriminatory act had taken place on February 12, 2014 (i.e., several months before Araujo signed the release).

Family Dollar subsequently filed a complaint in the Superior Court seeking a declaration that the parties had “entered into a valid and enforceable settlement agreement” which released Family Dollar from all claims that Araujo had set forth in his charge of discrimination. Family Dollar also alleged that, by filing his charge with the Commission, Araujo had materially breached the terms of the Release and, therefore, was also liable for breach of contract.

Motion for Summary Judgment

Family Dollar then filed a motion for summary judgment, asserting that the Release, by virtue of its explicit and broad language, encompassed not only Araujo’s workers’ compensation claim, but also “any other claims” that Araujo could make against Family Dollar—including, inter alia, claims within the jurisdiction of the Rhode Island Commission for Human Rights. The hearing justice ruled that the release was ambiguous and on that basis denied Family Dollar’s motion for summary judgment. Later, the hearing justice granted summary judgment in favor of Araujo and entered a judgment declaring that the release did not cover Araujo’s claims of discrimination.

R.I. Supreme Court’s Findings

Speaking for the majority of the Supreme Court of Rhode Island, Justice Robinson said the plain language of the release dealt with two separate matters. The first sentence unambiguously waived Araujo’s right to bring against Family Dollar any claim that he might have relative to workers’ compensation or under the provisions of the Rhode Island Workers’ Compensation Act.

Justice Robinson noted that the second sentence of the release, in equally unambiguous language, similarly waived Araujo’s right to assert “any other claims” against his “employer” “including, but not limited to, claims under the Americans with Disabilities Act, claims with the Rhode Island Governor's Commission on the Handicapped, Rhode Island Commission for Human Rights, Equal Employment Opportunity Commission, FETA [sic], United States Department of Labor, United States Department of Justice, Workers' Compensation Court, or any other agencies, tribunals, commissions, or courts.” (Emphasis added by court.)

Justice Robinson concluded that, based on the unambiguous language of the release, Araujo had waived his right to assert all claims that he could make against Family Dollar. The majority added that, significantly, none of the “other claims” set forth in the release were cognizable in the Workers’ Compensation Court. Accordingly, the majority of the court reversed the judgment of the Superior Court, and ordered that judgment be entered in favor of Family Dollar on its declaratory judgment claim.

Dissent

Justice Long, joined by Chief Justice Suttell, dissented. Justice Long said that in her view, the language in the release waiving was reasonably susceptible of different constructions and was therefore facially ambiguous. Justice Long indicated the undisputed extrinsic evidence, properly considered in light of the facial ambiguity of the release, demonstrated that Family Dollar paid $20,000 in consideration of the workplace injury and the commutation of future weekly indemnity benefits. The parties agreed to include in the waiver any potential claims arising under the Workers' Compensation Act only. Justice Long indicated, therefore, that the hearing justice’s decision should be affirmed.