Fromer v. John St. Service Center, Inc.

• Decision Date: 30 June 1970
• Parties: Claim of Henriette FROMER, Respondent, v. JOHN STREET SERVICE CENTER, INC., et al., Appellants, and Uninsured Employers'Fund, Respondent, and American Surety Company, Respondent, Workmen'sCompensation Board, Respondent.
• Court: New York Supreme Court — Appellate Division

Page 490

312 N.Y.S.2d 490

34 A.D.2d 1081

Claim of Henriette FROMER, Respondent, v. JOHN STREET SERVICE CENTER, INC., et al., Appellants, and Uninsured Employers'Fund, Respondent, and American Surety Company, Respondent Workmen'sCompensation Board, Respondent.

Supreme Court, Appellate Division, Third Department.

June 30, 1970.

Philip J. Caputo, New York City, for appellants.

Katz, Leidman & Weidman, New York City, for claimant-respondent.

Martin Bergman, New York City, for respondent Fund.

Leonard Linden, New York City, for respondent American.

Louis J. Lefkowitz, Atty. Gen., by Daniel Polansky, Asst. Atty. Gen., for Workmen's Compensation Bd.

Before HERLIHY, P.J., and REYNOLDS, AULISI, STALEY and GREENBLOTT, JJ.

GREENBLOTT, Justice.

Appeal from a decision of the Workmen's Compensation Board, filed February 6, 1969, as amended by a subsequent decision filed August 14, 1969. Decedent was president of the employer corporation. On August 22, 1963 he was assaulted while on the business premises and suffered a cerebral hemorrhage which resulted in his death the following day. The board determined that respondent, American Surety Company, had properly canceled its coverage of appellant employer and, accordingly, discharged it from liability. Appellant, American Insurance Company, was determined to be the carrier on the risk on the date of the accident.

American Surety had issued a policy covering appellant employer for one year effective September 17, 1962. It would therefore be liable for benefits payable to decedent's wife as a result of the August 1963 accident unless the policy was effectively canceled. Proper cancellation of such an insurance contract requires that a notice 'be filed in the office of the chairman and also served on the employer' specifying the date of cancellation which must be at least 10 days after filing and service. (Workmen's Compensation Law § 54, subd. 5.)

For obvious reasons of public policy underlying the very structure of the Workmen's Compensation Law a policy may only be cancelled in strict conformity wity the statute.' (Matter of Horn v. Malchoff, 276 App.Div. 683, 685, 97 N.Y.S.2d 272, 274, mot. for lv. to app. den. 301 N.Y. 814, 95 N.E.2d 827.) Respondent carrier's notice specified January 2, 1963 as the date of cancellation. Since the board found that notice of cancellation was not filed with the board chairmen until January 25, 1963, and not given to the corporate employer until April 17, it was error for it to rule that cancellation had been properly effected. Respondent's notice, by purporting to cancel its policy at a date prior to the tenth day after filing and service gave neither the employer nor the board notice of the time at which a legal termination of coverage would take effect and therefore violated the provisions of the statute.

Furthermore, respondent failed to produce evidence that the notice of cancellation was served on the employer by either of the methods required by subdivision 5 of section 54 of the Workmen's Compensation law. The board also erred in holding that personal notice was properly given to the employer by the independent auditor on April 17, 1963 when an audit of the...