411.22 - LIABILITY OF THIRD PARTIES -- SUBROGATION.

        411.22  LIABILITY OF THIRD PARTIES -- SUBROGATION.         1.  If a member receives an injury or dies for which benefits are      payable under section 411.6, subsection 3, 5, 8, or 9, or section      411.15, and if the injury or death is caused under circumstances      creating a legal liability for damages against a third party other      than the retirement system, the retirement system is subrogated to      the rights of the member or the member's beneficiary entitled to      receive a death benefit and may maintain an action for damages      against the third party for lost earnings and lost earnings capacity.      If the retirement system recovers damages in the action, the court      shall enter judgment for distribution of the recovery as follows:         a.  A sum sufficient to repay the retirement system for the      amount of such benefits actually paid by the retirement system up to      the time of the entering of the judgment.         b.  A sum sufficient to pay the retirement system the present      worth, computed at the interest rate assumption adopted by the system      pursuant to section 411.5, subsection 9, of the future payments of      such benefits, for which the retirement system is liable, but the sum      is not a final adjudication of the future payments which the member      is entitled to receive.         c.  A sum sufficient to repay the retirement system for the      costs and expenses of maintaining the action.         d.  Any balance remaining after the repayments provided by      paragraphs "a" through "c" shall be paid to the injured      member, or the beneficiary under section 411.6, subsection 8 or 9,      whichever is applicable.         2.  If the system, after receiving written notice of the      third-party liability, declines in writing to maintain an action      against the third party or fails to maintain an action within one      hundred eighty days of receiving written notice of the third-party      liability, the member, the member's estate, or the legal      representative of the member or the member's estate, may maintain an      action for damages against the third party.  If such an action is      commenced, the plaintiff member, estate, or representative shall      serve a copy of the original notice upon the retirement system not      less than ten days before the trial of the action, but a failure to      serve the notice does not prejudice the rights of the retirement      system, and the following rights and duties ensue:         a.  The retirement system shall be indemnified out of the      recovery of damages to the extent of benefit payments paid or awarded      by the retirement system, with legal interest, except that the      plaintiff member's or estate's attorney fees may be first allowed by      the district court.  For purposes of this paragraph, "benefit      payments paid or awarded" means the sum of the following amounts:         (1)  The amount of benefits actually paid by the retirement system      up to the time of the entering of the judgment.         (2)  The present worth, computed at the interest rate provided in      section 535.3 for court judgments and decrees, of the future payments      of such benefits, for which the retirement system is liable, but the      sum is not a final adjudication of the future payments which the      member is entitled to receive.         b.  The retirement system has a lien on the damage claim      against the third party and on any judgment on the damage claim for      benefits for which the retirement system is liable.  In order to      continue and preserve the lien, the retirement system shall file a      notice of the lien within thirty days after receiving a copy of the      original notice in the office of the clerk of the district court in      which the action is filed.         3.  Before a settlement is effective between the retirement system      and a third party who is liable for an injury or death, the member or      beneficiary must consent in writing to the settlement; and if the      settlement is between the member or the member's estate and a third      party, the retirement system must consent in writing to the      settlement; or on refusal to consent, in either case, the district      court in the county in which either the city or the retirement system      is located must consent in writing to the settlement.         4.  For purposes of subrogation under this section, a payment made      to an injured member, a member's estate, or the legal representative      of the member or member's estate, by or on behalf of a third party or      the third party's principal or agent, who is liable for, connected      with, or involved in causing the injury or death of the member, shall      be considered paid as damages because the injury or death was caused      under circumstances creating a legal liability against the third      party, whether the payment is made under a covenant not to sue,      compromise settlement, denial of liability, or is otherwise made.  
         Section History: Recent Form
         86 Acts, ch 1203, § 5; 88 Acts, ch 1158, §71; 98 Acts, ch 1183,      §95, 96; 2000 Acts, ch 1077, §109; 2000 Acts, ch 1232, §69; 2004      Acts, ch 1103, §68