Employers Mut. Liability Ins. Co. of Wis. v. Merrimac Mills Co.

• Decision Date: 27 April 1950
• Citation: 325 Mass. 676,92 N.E.2d 256
• Parties: EMPLOYERS MUT. LIABILITY INS. CO. OF WISCONSIN v. MERRIMAC MILLS CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

325 Mass. 676

92 N.E.2d 256

EMPLOYERS MUT. LIABILITY INS. CO. OF WISCONSIN v. MERRIMAC MILLS CO.

Supreme Judicial Court of Massachusetts, Suffolk.

April 27, 1950

Argued Feb. 10 1950.

E Martin, Abington, for plaintiff.

No argument nor brief for defendant.

Before QUA, C. J and LUMMUS, RONAN, SPALDING and COUNIHAN, JJ.

SPALDING, Justice.

The plaintiff, an insurance company, issued two workmen's compensation policies to the defendant. One of the policies was for the period beginning on May 31, 1944, and ending on May 31, 1945 and the other ran from the latter date to May 31, 1946. This action of contract, in two counts, is brought to recover balances of premiums alleged to have been earned by the plaintiff. That certain employees of the defendant were covered by the policies and that the premiums for this coverage have been paid is not disputed. The present controversy arises with respect to a group of employees which the plaintiff contends was covered by the policies in question, and which the defendant contends was not covered.

The defendant operates a woolen mill in Methuen. During the period for which the above-mentioned policies were issued it undertook an extensive construction project which consisted in building a new plant for carrying on its mill operations. It was to be a 'new brick and glass block mill, part of which was to surround the old mill and part of it was a new construction of itself.' It was 'part replacement and part extension.' One Naylor, who was employed by the defendant as superintendent of construction and maintenance in the mill, was put in charge of this work, the cost of which was to be about $100,000. The judge found, as he could have on the evidence, that the 'construction work was done by the defendant and not by an independent contractor,' and that 'the workmen engaged in the construction were employees of the defendant.' Finding that the 'only binder attached to each policy with the consent of the assured and accepted by it is the one entitled 'Standard Workmen's Compensation and Employers' Liability Insurance Declarations'' ^[1] and that 'the construction workers were not engaged in the business operations described in said 'Declarations' or in operations necessary, incident and appurtenant thereto, or connected therewith,' he concluded that these employees were not covered by the policies, and found for the defendant.

The plaintiff excepted to this finding and to the judge's denial of numerous requests for rulings. Since the question of law which the plaintiff seeks to present is adequately raised by the exception to the finding, it will not be necessary to deal with the requests. ^[2] This exception must be sustained. From the evidence, which included the policies in question, and the subsidiary findings of the judge, a finding for the defendant was not warranted. The extent of the coverage of the policies is not to be found only in the declarations attached to the policies. Other clauses in the policies and the rovisions of the workmen's compensation act must be considered.

Pertinent provisions of the policies are as follows: The plaintiff agreed 'One (a) To pay promptly to any person entitled thereto, under the workmen's compensation law and in the manner therein provided, the * * * amount * * * due, (1) To such person because of the obligation for compensation for any such injury imposed upon or accepted by this employer under such of certain statutes, as may be applicable thereto, cited and described in an endorsement attached to this policy, each of which statutes is herein referred to as the workmen's compensation law, and * * * It is agreed that all of the provisions of each workmen's compensation law covered hereby shall be and remain a part of this contract as fully and completely as if written herein, so far as they apply to compensation or other benefits for any personal injury or death covered by this policy, while this policy shall remain in force. * * * One (b) To indemnify this employer against loss by reason of the liability imposed upon him by law for damages on account of such injuries to such of said employees as are legally employed wherever such injuries may be sustained within the territorial limits of the United States of America or Dominion of Canada. * * *' The policies also contained a provision that 'This agreement shall apply to such injuries so sustained by reason of the business operations decribed in said declarations which, for the purpose of this insurance, shall include all operations necessary, incident or appurtenant thereto, or connected therewith * * *.' (Emphasis supplied.) It is plain that under the foregoing provisions the coverage was intended to be coextensive with the requirements of G.L. (Ter.Ed.) c. 152. Indeed, it is not open to an employer to provide less. Cox's Case, 225 Mass. 220, 225, 114 N.E. 281; Wright's Case, 291 Mass. 334, 335, 197 N.E. 5.

Under G.L. (Ter.Ed.) c. 152, § 1(4), as appearing in St. 1943, c. 529, § 3, and § 25A, as inserted by St. 1943, c. 529, § 7, an employer, with exceptions not here material, is required to insure his employees for compensation provided for by c. 152 either through an insurer or by becoming a self-insurer. See Friend Brothers, Inc. v. Seaboard Surety Co., 316 Mass. 639, 642, 56 N.E.2d 6, 153 A.L.R. 962. For failure to do so criminal sanctions are imposed by § 25C. An employee is defined under § 1(4) as 'every person in the service of another under any contract of hire, express or implied, oral or written, except * * * one whose employment is not in the usual course of the trade, business, profession or occupation of his employer.' These provisions make it clear that the Legislature intended to provide employees to the fullest extent with the protection afforded by the compensation act.

We have no doubt that had any of the workmen engaged in the contruction project received injuries arising out of and in the course of their employment the plaintiff would have been held to have insured them and would have been liable for the compensation awarded them. The judge, as stated above, found that they were employees of the defendant. It is reasonable to infer that if the policies in question did not cover these employees they would not have been protected by any compensation insurance, for it does not appear that the defendant was either a self-in-surer or had insured them elsewhere, and no contention has been made...