Am. Candy Co. v. Ætna Life Ins. Co.

• Decision Date: 14 November 1916
• Citation: 164 Wis. 266,159 N.W. 917
• Parties: AMERICAN CANDY CO. v. ÆTNA LIFE INS. CO.
• Court: Wisconsin Supreme Court

164 Wis. 266

159 N.W. 917

AMERICAN CANDY CO.

v.ÆTNA LIFE INS. CO.

Supreme Court of Wisconsin.

Nov. 14, 1916.

Appeal from Circuit Court, Milwaukee County; Oscar M. Fritz, Judge.

Action by the American Candy Company against the Ætna Life Insurance Company. From a judgment for defendant, plaintiff appeals. Affirmed.

This action was brought against the defendant to recover the amount of two judgments recovered against the plaintiff for injuries received by one Michael Kowalski, a minor 15 years of age, while in the employ of plaintiff, together with costs and attorneys' fees. One of the judgments was recovered by the minor, and the other by the minor's father. The plaintiff paid the judgments, and in the present action seeks to recover the amount from the defendant under a policy of employers' liability insurance.

When the plaintiff rested its case, the court below granted a nonsuit, and ordered judgment for defendant. Judgment was entered accordingly, from which this appeal was taken.Lawrence A. Olwell, of Milwaukee (C. H. Van Alstine, of Milwaukee, of counsel), for appellant.

Quarles, Spence & Quarles, of Milwaukee (J. V. Quarles, of Milwaukee, of counsel), for respondent.

KERWIN, J. (after stating the facts as above).

The controverted questions upon this appeal are: (1) Whether the accident which was the basis of the judgments paid by the plaintiff was covered by the policy, and (2) Whether the judgments are a bar to this action.

1. On the 25th of August, 1910, defendant issued to plaintiff its policy of manufacturers' employer's liability insurance. This policy continued in force up to and including April 7, 1913. The liability of the insurer under the policy was limited on account of accidents resulting in injuries to one person to $10,000. There was excepted by the terms of the policy liability for injuries received by any person employed in violation of law as to age, or of any age under 14 years where there is no legal restriction as to age of employment.

On October 9, 1912, the injured minor applied at plaintiff's plant for work, produced a permit in proper form under the statute, was hired and put at work in the starch room of plaintiff's factory on the sixth floor. The permit was duly filed. Afterwards the minor was called to the fourth floor to work, where one Bennett was foreman, and, as claimed by plaintiff, was put at work in a safe place, while defendant claims he was put at work on a sizer, a dangerous machine, where he was injured April 7, 1913.

In the actions brought by the minor and his father against the plaintiff the jury found in substance that the minor was directed by the foreman Bennett to work upon the sizer; that Bennett permitted or suffered him to work upon the sizer; that the sizer was dangerous to life and limb of a person under 16 years of age; that at the time of the injury the minor was engaged in a work that he was directed or permitted to pursue.

The plaintiff duly tendered the defenses in both actions against plaintiff to the defendant, respondent here, and it refused to assume the defense except on condition that it be not bound by the result, for the reason that it claimed the minor was employed by appellant contrary to law; hence the policy did not cover the injury to the minor complained of.

The plaintiff replied to the communication of defendant, saying that it would not consent to any defense under the reservation stated, but insisted that the defendant defend absolutely or not at all, since it did not admit that the minor was employed contrary to law. The plaintiff further notified the defendant that if it did not defend without reservation plaintiff would defend in its own protection and look to the defendant to pay the judgment, if any rendered, expenses and counsel fees attendant upon the defense. The plaintiff in its communication to defendant regarding the tender of defense said that it would insist that the defendant be bound, and concluded by such judgment as might be rendered in the actions on the defense made by plaintiff. The defendant refused to defend and waive its rights, and the plaintiff defended the two actions with the result before stated. It is without dispute that the minor was 15 years of age at the time of injury.

The appellant contends that assuming the facts found in the actions by the minor and his father against the plaintiff, the minor was not “employed” in violation of law because the original employment under the permit was lawful, and that the policy of insurance covered all cases where the person came legally into the employ of the assured, and that the exception in the policy whereby the defendant excepted from its assumed liability injuries caused to any person employed in violation of law as to age, included only injuries sustained by persons so young that they could not contract, or who had contracted to do work which the law prohibited.

[1] The argument is that if the contract between the minor and employer at the date of the employment was legal, no subsequent use of the minor by putting him to work at a prohibited employment would be an employment in violation of law as to age within the meaning of the policy.

We think the construction contended for by appellant is too narrow. The statute as it stood at the time of the issuance of the policy (St. 1911, § 1728a2, as added by Laws 1909, c. 338) read:

“No child under the age of 16 years shall be employed in adjusting any belt or in oiling or assisting in oiling, wiping or cleaning any machinery when the same is in motion. * * * Nor shall any such child be employed at or assist in sewing belts in any capacity, or...