Commercial Casualty Ins. Co. v. Petroleum Pipe Line Co.

• Decision Date: 09 April 1936
• Docket Number: No. 1293.,1293.
• Citation: 83 F.2d 412
• Parties: COMMERCIAL CASUALTY INS. CO. et al. v. PETROLEUM PIPE LINE CO. et al.
• Court: U.S. Court of Appeals — Tenth Circuit

83 F.2d 412 (1936)

COMMERCIAL CASUALTY INS. CO. et al. v. PETROLEUM PIPE LINE CO. et al.

No. 1293.

Circuit Court of Appeals, Tenth Circuit.

April 9, 1936.

James C. Cheek, of Oklahoma City, Okl., for appellants.

M. W. McKenzie, of Oklahoma City, Okl. (J. H. Everest, Robt. K. Everest, and E. E. Gibbens, all of Oklahoma City, Okl., on the brief), for appellees.

Before LEWIS and BRATTON, Circuit Judges, and KENNEDY, District Judge.

BRATTON, Circuit Judge.

Commercial Casualty Company, hereinafter called Commercial, and Fidelity Union Casualty Company, hereinafter called Fidelity, filed this action against R. A. McArthur, Inc., hereinafter called McArthur and Petroleum Pipe Line Company hereinafter called Pipe Line Company, to recover by way of subrogation an amount which Commercial had previously paid in discharge of an award made to an injured workman.

It was alleged in the amended bill that McArthur was engaged in the production of oil and gas; that Pipe Line Company was engaged in the construction, maintenance, and operation of pipe lines, loading racks, and other equipment for the transportation of oil and gas belonging to McArthur; that the two corporations were separate and distinct, having separate and distinct officers and employees and engaged in separate and distinct businesses; that Fidelity executed and delivered to McArthur its policy of workmen's compensation insurance, by the terms of which it became bound and obligated to pay any compensation or benefits to which any employee of McArthur should become entitled for injury sustained in the course of his employment; that thereafter Commercial reinsured the outstanding policy liability of Fidelity, including the policy in question; that in the prosecution of its business Pipe Line Company entered into a contract with Independent Welding Company to do certain work in the construction of a loading rack; that Welding Company employed W. J. Brock on the work and that he was injured in the course of the employment; that a claim for compensation was filed with the State Industrial Commission; that the commission made an award, holding Welding Company primarily liable and Pipe Line Company, McArthur, and Fidelity secondarily liable, and that such award was affirmed by the Supreme Court of the state; that Commercial subsequently paid the full amount thereof, plus expenses and attorney's fees; that plaintiffs agreed to pay only the compensation and benefits which should become due to employees of McArthur; that plaintiffs and McArthur did not contemplate or intend that the coverage should include employees of any independent corporation or of a subcontractor of such independent corporation; that in such circumstances Commercial is subrogated to the right of McArthur against Pipe Line Company for reimbursement of the sum paid.

Defendants interposed separate motions to dismiss the amended bill, for the reason that the facts well pleaded failed to state a cause of action. The court sustained the motions, and this appeal is from that action.

With certain exceptions which do not require discussion here, section 13351, Oklahoma Statutes, 1931, directs that every employer subject to the provisions of the Workmen's Compensation Act shall pay or provide compensation according to the fixed schedule for disability of employees resulting from accidental injury sustained in the course of their employment; that, in the absence of provisions to the contrary, every independent contractor shall be conclusively presumed to have agreed as a part of the contract to comply with the provisions of the act; that, if a principal employer fails to require an independent contractor to comply therewith, he shall be liable for all such injuries to employees of the independent...