1. If an employee entitled to compensation under this chapter be injured or killed by the negligence or wrong of another not in the same employ, such injured employee, or in case of death, his dependents, need not elect whether to take compensation and medical benefits under this chapter or to pursue his remedy against such other but may take such compensation and medical benefits and at any time either prior thereto or within six months after the awarding of compensation or within nine months after the enactment of a law or laws creating, establishing or affording a new or additional remedy or remedies, pursue his remedy against such other subject to the provisions of this chapter. If such injured employee, or in case of death, his dependents, take or intend to take compensation, and medical benefits in the case of an employee, under this chapter and desire to bring action against such other, such action must be commenced not later than six months after the awarding of compensation or not later than nine months after the enactment of such law or laws creating, establishing or affording a new or additional remedy or remedies and in any event before the expiration of one year from the date such action accrues. In such case, the state insurance fund, if compensation be payable therefrom, and otherwise the person, association, corporation or insurance carrier liable for the payment of such compensation, as the case may be, shall have a lien on the proceeds of any recovery from such other, whether by judgment, settlement or otherwise, after the deduction of the reasonable and necessary expenditures, including attorney’s fees, incurred in effecting such recovery, to the extent of the total amount of compensation awarded under or provided or estimated by this chapter for such case and the expenses for medical treatment paid or to be paid by it and to such extent such recovery shall be deemed for the benefit of such fund, person, association, corporation or carrier. Should the employee or his dependents secure a recovery from such other, whether by judgment, settlement or otherwise, such employee or dependents may apply on notice to such lienor to the court in which the third party action was instituted, or to a court of competent jurisdiction if no action was instituted, for an order apportioning the reasonable and necessary expenditures, including attorneys’ fees, incurred in effecting such recovery. Such expenditures shall be equitably apportioned by the court between the employee or his dependents and the lienor. Notice of the commencement of such action shall be given within thirty days thereafter to the chairman, the employer and the insurance carrier upon a form prescribed by the chairman. Any of the foregoing providers of compensation and/or medical benefits which has recovered a lien pursuant to the provisions hereof against the recovery of a person injured on or after February first, nineteen hundred seventy-four and before July first, nineteen hundred seventy-eight, through the use or operation of a motor vehicle in this state, shall notify such person by certified mail in a manner to be approved by the chairman and the superintendent of financial services of the responsibility of an “insurer” (as defined in subsection (g) of section five thousand one hundred two of the insurance law), to reimburse such person under such circumstances to the extent that the recovered lien represent first party benefits as defined in article fifty-one of the insurance law.

1-a. Notwithstanding any other provision of this chapter, the state insurance fund, if compensation and/or medical benefits be payable therefrom, or otherwise the person, association, corporation, insurance carrier or statutory fund liable for the payment of such compensation and/or medical benefits shall not have a lien on the proceeds of any recovery received pursuant to subsection (a) of section five thousand one hundred four of the insurance law, whether by judgment, settlement or otherwise for compensation and/or medical benefits paid which were in lieu of first party benefits which another insurer would have otherwise been obligated to pay under article fifty-one of the insurance law. The sole remedy of any of the foregoing providers to recover the payments specified in the preceding sentence shall be pursuant to the settlement procedures contained in section five thousand one hundred five of the insurance law.

1-b. Notwithstanding any other provision of this chapter to the contrary, the state insurance fund, if compensation and/or medical benefits be payable therefrom, or otherwise the person, association, corporation, insurance carrier or statutory fund liable for the payment of such compensation and/or medical benefits: (a) shall not have a lien on the proceeds of any award from the September eleventh victim compensation fund of two thousand one established pursuant to title IV of the federal air transportation safety and system stabilization act, public law 107-42, as amended; and (b) shall not terminate or reduce such compensation and/or medical benefits based upon the submission of a claim for an award from such federal fund, and/or the waiver or compromise of any cause of action resulting from such submission.

2. If such injured employee, or in case of death, his dependents, has taken compensation under this chapter but has failed to commence action against such other within the time limited therefor by subdivision one, such failure shall operate as an assignment of the cause of action against such other to the state for the benefit of the state insurance fund, if compensation be payable therefrom, and otherwise to the person, association, corporation, or insurance carrier liable for the payment of such compensation. Except as hereinafter provided, the failure of the injured employee or his dependents to commence an action pursuant to the provisions of subdivision one of this section, shall not operate as an assignment of the cause of action as provided herein, unless the insurance carrier shall have notified the claimant in writing by personal service or by certified or registered mail, return receipt requested, at least thirty days prior to the expiration of the time limited for the commencement of an action by subdivision one, that such failure to commence such action shall operate as an assignment of whatever cause of action may exist to such insurance carrier. If the insurance carrier shall fail to give such notice, the time limited for the commencement of an action by subdivision one shall be extended until thirty days after the insurance carrier shall have notified the claimant in writing that failure to commence an action within thirty days after the mailing of such notice shall operate as an assignment of the cause of action to such carrier, and in the event the claimant fails to commence such action within thirty days after the mailing of such notice, such failure shall operate as an assignment of such cause of action to such carrier. If such fund, person, association, corporation or carrier, as such an assignee, recover from such other, either by judgment, settlement or otherwise, a sum in excess of the total amount of compensation awarded to such injured employee or his dependents and the expenses for medical treatment paid by it, together with the reasonable and necessary expenditures incurred in effecting such recovery, it shall forthwith pay to such injured employee or his dependents, as the case may be, two-thirds of such excess, and to the extent of two-thirds of any such excess such recovery shall be deemed for the benefit of such employee or his dependents. When the compensation awarded requires periodical payments the number of which cannot be determined at the time of such award, the board shall, when the injury or death was caused by the negligence or wrong of another not in the same employ, estimate the probable total amount thereof upon the basis of the survivorship annuitants table of mortality, the remarriage tables of the Dutch Royal Insurance Institution and such facts as it may deem pertinent, and such estimate shall be deemed the amount of the compensation awarded in such case, for the purpose of computing the amount of such excess recovery, subject to the modification thereof as hereinafter provided. If any of the foregoing providers, having paid benefits under this chapter to an injured employee, who is also a “covered person” (as defined in subsection (j) of section five thousand one hundred two of the insurance law), and who was injured in a motor vehicle accident in this state on and after February first, nineteen hundred seventy-four and before July first, nineteen hundred seventy-eight, maintains an action, as assignee, against such third party, who is also a “covered person”, and recovers, whether by judgment, settlement or otherwise, it shall advise the injured employee, by certified mail, in a manner to be approved by the chairman and the superintendent of financial services, of the responsibility of an “insurer” (as defined in subsection (g) of section five thousand one hundred two of the insurance law) to further compensate such injured employee.

2-a. Notwithstanding any other provisions of this chapter, the failure of a “covered person” (as defined in subsection (j) of section five thousand one hundred two of the insurance law), who has taken compensation and/or medical benefits under this chapter for injuries arising out of the use or operation of a motor vehicle in this state, to commence an action against such other within the time limited therefor by subdivision one of this section shall not operate as an assignment of the cause of action to the provider thereof for their recovery when such benefits were paid in lieu of first party benefits which another insurer would have otherwise been obligated to pay under article fifty-one of the insurance law, unless such other is not a “covered person”. The sole remedy of any of the foregoing providers to recover the payments specified in the preceding sentence when the other party is a “covered person” shall be pursuant to the settlement procedures contained in section five thousand one hundred five of the insurance law.

3. In the event of a modification of an award increasing the compensation previously awarded or in the event that the total amount of periodical payments made pursuant to an award under which the number of such payments could not be determined at the time of the award, shall exceed the total thereof as estimated by the board, the principal of any of such excess recovery theretofore paid to such injured employee or his dependents shall be credited against such increase or such excess. In the event of a modification of an award ending or diminishing the compensation previously awarded or in the event that the total amount of periodical payments made pursuant to an award under which the number of such payments could not be determined at the time of the award, shall be less than the total thereof as estimated by the board, such fund, person, association, corporation or carrier shall forthwith pay to such injured employee or his dependents, as the case may be, any additional amount of such excess recovery to which such injured employee or his dependents may be entitled by reason of such modification or such deficiency, determined as hereinbefore provided.

4. If such injured employee, or in case of death, his dependents, proceed against such other, the state insurance fund, person, association, corporation, or insurance carrier, as the case may be, shall contribute only the deficiency, if any, between the amount of the recovery against such other person actually collected, and the compensation provided or estimated by this chapter for such case.

5. In case of the payment of an award to the commissioner of taxation and finance in accordance with subdivisions eight and nine of section fifteen and in accordance with section twenty-five-a such payment shall operate to give to the employer or insurance carrier liable for the award a cause of action for the amount of such payment together with the reasonable funeral expenses and the expense of medical treatment which shall be in addition to any cause of action by the legal representatives of the deceased. Such a cause of action assigned to the state may be prosecuted or compromised in the name of the state insurance fund by the commissioners of the state insurance fund. A compromise of any such cause of action by the employee or his dependents at an amount less than the compensation provided for by this chapter shall be made only with the written approval of the commissioners of the state insurance fund or such officer thereof designated by them, if the deficiency of compensation would be payable from the state insurance fund, and otherwise with the written approval of the person, association, corporation, or insurance carrier liable to pay the same. However, written approval of the commissioners of the state insurance fund or such officer thereof designated by them or written approval of the person, association, corporation, or the insurance carrier need not be obtained if the employee or his dependents obtain a compromise order from a justice of the court in which the third-party action was pending. The papers upon an application to compromise and settle such a claim shall consist of the petition, the affidavit of the attorney, and the affidavit of one or more physicians.

The petition shall contain the following:

a. The name and residence of the petitioner if the employee, or petitioner’s relationship to the deceased;

b. The date of accident and a general description thereof;

c. The nature and extent of the damages sustained, including the name of the physician or physicians attending or consulting in the treatment and the medical expenses incurred, the period of disability resulting from the accident, the total amount of wages lost thereby, and the present physical condition;

d. The terms of the attorney’s retainer and of the proposed settlement and petitioner’s approval thereof; and

e. Whether any previous application for the settlement of the claim has been made, and if so, the time and the court or justice thereof and the disposition made of same.

The affidavit of the attorney shall set forth by whom, on what date and under what terms he was retained, the services rendered by him, his fee if the settlement is approved, the acts complained of, the terms of the proposed settlement with a statement of his reasons for recommending the same, and shall state that he has not become concerned in the application or its subject matter at the instance of such defendant directly or indirectly and that he has not received and is not to receive any compensation from such defendant directly or indirectly.

The affidavit of the physician in a claim arising from personal injury to the employee, shall set forth his connection with the case; the period covered by the treatment and the nature, duration and extent of the injuries; the date of his last examination and the condition of the employee at that time; whether or not the employee is still suffering any disability or inconvenience as the result of the injury, giving the details thereof; whether or not the accident has left the employee with any permanent disability, defect, scar or impairment; the cost of the treatment and whether or not he expects to be paid or has been paid by the defendant or by anyone acting on the defendant’s behalf. Where the affidavit as to the present condition is not made by the attending physician, the latter’s affidavit setting forth the character of the injuries and treatment should also be attached, or the failure to obtain it explained. Where the employee was confined to a hospital, the court may require the production of hospital records.

A copy of the papers to be used on the application to compromise and settle the claim must be served as directed by the court or in the same manner as provided in the civil practice law and rules for a notice of motion upon the commissioners of the state insurance fund or such officer thereof designated by them or upon the person, association, corporation, or insurance carrier, whose written approval would have been required to compromise such cause of action by the employee or his dependents. This notice shall afford them the opportunity to submit affidavits and to be heard by the court on the application.

If the third-party action is on trial at the time the offer of settlement which is acceptable to the plaintiff, is made and either such written approval or order as provided in this subdivision is required, the action may be marked settled subject to the securing of such written approval or such order. If such written approval or such order is not subsequently secured within three months the action shall be restored to the head of the trial day calendar.

6. The right to compensation or benefits under this chapter, shall be the exclusive remedy to an employee, or in case of death his or her dependents, when such employee is injured or killed by the negligence or wrong of another in the same employ, the employer’s insurer or any collective bargaining agent of the employer’s employees or any employee, of such insurer or such collective bargaining agent (while acting within the scope of his or her employment). The limitation of liability of an employer set forth in section eleven of this article for the injury or death of an employee shall be applicable to another in the same employ, the employer’s insurer, any collective bargaining agent of the employer’s employees or any employee of the employer’s insurer or such collective bargaining agent (while acting within the scope of his or her employment). The option to maintain an action in the courts for damages based on the employer’s failure to secure compensation for injured employees and their dependents as set forth in section eleven of this article shall not be construed to include the right to maintain an action against another in the same employ, the employer’s insurer, any collective bargaining agent of the employer’s employees or any employee of the employer’s insurer or such collective bargaining agent (while acting within the scope of his or her employment).