Flamm v. Bethlehem Steel Co.

• Citation: 185 N.Y.S.2d 136,18 Misc.2d 154
• Parties: Charles FLAMM v. BETHLEHEM STEEL COMPANY and Arthur A. Michele.
• Decision Date: 11 March 1959
• Court: New York Supreme Court

Page 136

185 N.Y.S.2d 136

18 Misc.2d 154

Charles FLAMM v. BETHLEHEM STEEL COMPANY and Arthur A. Michele.

Supreme Court, Special Term, Kings County, Part I.

March 11, 1959.

Dora Aberlin, New York City, for plaintiff.

Martin, Clearwater & Bell, New York City, for defendant Arthur A. Michele.

Evans, Orr, Gourlay & Pacelli, New York City, for defendant Bethlehem Steel Co. JACOB. J. SCHWARTZWALD, Justice.

By the instant motion, under Rule 107, subdivision 1, Rules of Civil Practice, to dismiss the complaint on the ground that the court lacks jurisdiction over the subject matter of the action, it appears that a matter of first impression has been presented to the court for determination.

In short, the court is called upon to determine if the Federal Compensation Statute, known as Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C.A. § 901 et seq., bars a former employee from bringing a common law action to recover damages from his former employer based upon the employer's alleged fraudulent conspiracy with a physician to deprive the employee of his statutory rights under the Act to obtain compensation and to obtain further medical aid for his injuries, which were sustained during the course of employment.

The motion to dismiss is being made by the Bethlehem Steel Co., the plaintiff's former employer.

The facts recited in the complaint are brief. The plaintiff was injured in March, 1950 while in the course of his employment as a caulker. A claim for compensation was made under the Longshoremen's and Harbor Workers' Compensation Act (U.S.C.A., Title 33, § 901 et seq.). In April, 1952 the defendant employer and the co-defendant wilfully and maliciously conspired to deprive the plaintiff 'of his right to compensation.' The defendants deliberately proposed to mislead the Deputy Commissioner of Compensation so as to cause plaintiff to be denied further compensation. In pursuance of the conspiracy defendants submitted to the Commissioner a false and fraudulent medical report, which had been prepared by the defendant physician, as to plaintiff's physical condition. Submission of the false report was calculated to and did deprive plaintiff of his rights under the Act.

It is claimed that on the basis of the fraudulent report the plaintiff was denied a further hearing, was deprived of his rights to compensation under the Act and was deprived of further medical attention which he sorely needed, all for which damages in the sum of $100,000 are claimed.

Defendant's single contention on this application is that plaintiff's only remedy lies within the provisions of the Compensation Act. Section 905 thereof provides that the liability imposed by law upon the employer shall be exclusive and in place of all other liability of the employer to the employee 'to recover damages from such employer at law * * * on account of such injury.' It is defendant's position that to allow the present suit would be tantamount to permitting a collateral attack upon the findings of the Workmen's Compensation Commission.

The court does not so construe the complaint. The tort charged against defendant employer occurred in April, 1952 when defendant wrongfully interfered with plaintiff's right to be compensated for his injuries by causing a false report of plaintiff's physical condition to be prepared and submitted to the Commissioner with the sole purpose of defeating the plaintiff's right to compensation.

The plaintiff does not sue for the tort which occurred in 1950 and which came within the purview of the Federal Compensation Act. He sues for the wrong which was inflicted upon him in 1952 'for the deprivation of the statutory right by a fraudulent device.' Racanati v. Black Diamond Stevedoring Co., 132 N.J.L. 250, 39 A.2d 91, 93. He is entitled to recover such damages as proximately result from the fraud. Kujek v. Goldman, 150 N.Y. 176, 44 N.E. 773, 34 L.R.A. 156. Damages resulting from the loss of the right to compensation can reasonably 'be defined and ascertained. The mere difficulty of estimation of injury does not bar recovery.' Racanati v. Black Diamond Stevedoring Co., 39 A.2d at page 93, supra.

While the same question of exclusiveness of jurisdiction as a bar to the action was also presented to the New Jersey Court of Errors and Appeals in the Racanati case, the point, unfortunately, was not reached by the court.

The wrongful interference with and the resultant deprivation of plaintiff's statutory rights constitute a wilful tort against the plaintiff, separate and distinct from the original wrong. The injury sustained was the loss of the right to compensation. The damages flowing from the injury quite naturally will include, among other things, the value of the compensation plaintiff would have received under the statute.

This being an injury wilfully inflicted, and not an 'accidental injury * * * arising out of and in the course of employment,' as specified in the Federal Compensation Act, it must follow, and it is not otherwise contended, that plaintiff would not be entitled to obtain compensation therefor under the statute. The Compensation Law is exclusive only where it in fact provides a remedy. Schwartz v. Queensboro Farm Products, Inc., 191 Misc. 778, 78 N.Y.S.2d 863.

Furthermore, an employer is relieved of common law liability by complying with the statute requiring coverage for disability from injuries arising out of and in the course...