City of Red Wing v. Eichinger

• Decision Date: 24 April 1925
• Docket Number: No. 24094.,24094.
• Citation: 203 N.W. 622,163 Minn. 54
• Parties: CITY OF RED WING v. EICHINGER et al.
• Court: Minnesota Supreme Court

203 N.W. 622

163 Minn. 54

CITY OF RED WING v. EICHINGER et al.

No. 24094.

Supreme Court of Minnesota.

April 24, 1925.

Appeal from District Court, Goodhue County; Albert Johnson, Judge.

Action by the City of Red Wing against Paul Eichinger and others. After dismissal of action from order denying motion for new trial, plaintiff appeals. Affirmed.

F. M. Wilson, of Red Wing, for appellant.

Thomas Mohn and Ofstedahl & Rockne, all of Red Wing, for respondents.

WILSON, C. J.

The city of Red Wing carried workmen's compensation insurance with the Travelers' Insurance Company. The city employed Ole Haga as a street sweeper. The city and Haga were each subject to the Workmen's Compensation Act (Gen. St. 1923, §§ 4261-4337). While Haga was engaged in his work he was injured by a collision between two automobiles operated on the street by defendants. The Industrial Commission made an award to the employe. The insurance company paid it.

The city now sues the defendants and lays negligence at their door and seeks to recover the amount so received by the employe. The court dismissed the action, and plaintiff has appealed from an order denying its motion for a new trial. Section 4291, G. S. 1923, subd. (2), provides for subrogation.

The insurance policy contains this provision:

"K. The company shall be subrogated, in case of any payment under this policy, to the extent of such payment, to all rights of recovery therefor vested by law, either in this employer, or in any employe; or his dependents claiming hereunder, against persons, corporations, associations, or estates."

Our Compensation Act recognizes the insurer as such. Section 4288, G. S. 1923. It does not compel a municipality, as it does some employers, to carry insurance. Section 4288, G. S. 1923. The municipality, however, may carry such insurance if it so chooses. Nohl v. Board of Education of City of Albuquerque, 27 N. M. 232, 199 P. 373, 16 A. L. R. 1085, note 1089; State ex. rel. Thompson v. Memphis, 147 Tenn. 658, 251 S. W. 46, 27 A. L. R. 1257; Travelers' Insurance Co. v. Wadsworth, 109 Ohio St. 440, 142 N. E. 900, 33 A. L. R. 711. Our statute above quoted in reference to subrogation has had judicial recognition. The Fidelity & Casualty Co. v. St. Paul Gas Light Co., 152 Minn. 197, 188 N. W. 265; Hansen v. Northwestern Fuel Co., 144 Minn. 105, 174 N. W. 726; Metropolitan Milk Co. v. Mpls. St. Ry. Co., 149 Minn. 181, 183 N. W. 830; Carlson v. Mpls. St. Ry. Co., 143 Minn. 129, 173 N. W. 405.

The injured employe had a common-law action, if the facts warranted it, against defendants, under subdivision (2), § 4291, G. S. 1923. He also had his claim against his employer under the Compensation Act. He could pursue both. He claimed and received compensation, and under the statute his common law action at least in part passed to the employer by virtue of subrogation. A statutory subrogation has the same characteristics as if it were a creature of equity. It is enforced solely for the purpose of accomplishing the ends of substantial justice and does not depend upon any contractual relation between the parties. When the employer has paid or obligated himself to pay an award of the Industrial Commission, he is, by virtue of the statutory subrogation, authorized to bring and maintain, in his own name, an action against a third person whose negligence was the proximate cause of the injury to the employe to whom the compensation was awarded, to recover a sum not in excess of the award. Section 4291, G. S. 1923, subd. (2). The payment or obligation to pay the award on the part of the employer is a condition precedent to his right to prosecute such action. Henderson Tel. & Tel. Co. v. Owensboro Home Tel. & Tel. Co., 192 Ky. 322, 233 S. W. 743; Employers' Liability Assur. Corp. v. Indianapolis & C. T. Co. (Ind. App.) 139 N. E. 200; Broderick v. Puget Sound Traction Light & Power Co., 86 Wash. 399, 150 P. 616.

That fundamental element which supports the doctrine of subrogation, namely, the call for substantial justice, is absent. The city has been protected by the insurance company paying the employe. The city has paid nothing. It is not obligated to pay anything. It has not...