Hagen v. Koerner, A--793

• Decision Date: 27 December 1960
• Docket Number: No. A--793,A--793
• Citation: 166 A.2d 784,64 N.J.Super. 580
• Parties: Mary HAGEN, Executrix under the Last Will and Testament of Kenneth C. Hagen, Deceased, Plaintiff, v. Bernard R. KOERNER, Defendant and Third-Party Plaintiff, Appellant, v. WILLIAM F. HEGARTY, INC., a corporation of New Jersey, Third-Party Defendant, Respondent.
• Court: New Jersey Superior Court — Appellate Division

Page 580

64 N.J.Super. 580

166 A.2d 784

Mary HAGEN, Executrix under the Last Will and Testament of

Kenneth C. Hagen, Deceased, Plaintiff, v. Bernard R. KOERNER, Defendant and Third-Party Plaintiff, Appellant, v. WILLIAM F. HEGARTY, INC., a corporation of New Jersey,

Third-Party Defendant, Respondent.

No. A--793.

Superior Court of New Jersey

Appellate Division.

Argued Dec. 12, 1960.

Decided Dec. 27, 1960.

Lester Sandles, Newark, for appellant (Sandles & Sandles, Newark, attorneys).

Thomas E. Durkin, Jr., Newark, for respondent (Gregory J. Castano, Newark, on the brief).

Before Judges CONFORD, FREUND and KILKENNY.

The opinion of the court was delivered by

KILKENNY, J.A.D.

Plaintiff, as executrix of the estate of her late husband, Kenneth C. Hagen, sued the defendant, Bernard R. Koerner, and nine other defendants, in negligence for the wrongful death of her husband. The decedent died on November 17, 1958, at Westwood, New Jersey, while working for William F. Hegarty, Inc., by whom the defendant Koerner was also employed at the time and place of the fatal accident. Hagen allegedly died as a result of a charge of electricity emanating from high tension wires during the course of his employment. This action in the Superior Court, Law Division, has not yet been tried.

Pursuant to leave granted by court order of January 22, 1960, Koerner filed and served a third-party complaint against his employer, William F. Hegarty, Inc. In this pleading Koerner denies that he was negligent in any manner whatsoever. He then claims that, should it be determined that he is liable to the plaintiff executrix by reason of the fact that he was acting as an employee for and in behalf of William F. Hegarty, Inc. 'pursuant to specific instructions by servants and agents of the said William F. Hegarty, Inc., and in obedience to said instructions and directions,' he is entitled to be indemnified from all such liability by his said employer.

The third-party defendant, William F. Hegarty, Inc., moved without affidavits or other proofs, for entry of a judgment dismissing the third-party complaint, as upon a motion for judgment on the pleadings, pursuant to R.R. 4:12--3. It relied upon the law as stated in Farren v. New Jersey Turnpike Authority, 31 N.J.Super. 356, 106 A.2d 752 (App.Div.1954). On May 9, 1960 the trial court ordered the third-party complaint dismissed with prejudice. Koerner appeals from that order of dismissal.

In its opinion the trial court properly noted that the action was brought for damages for Negligence against the named defendants; and that the plaintiff could not bring a negligence action against decedent's employer, William F. Hegarty, Inc., Directly. The trial court also stated:

'Under the Workmen's Compensation Act the Only liability of Hegarty is for the payment of the benefits specified in that act.' (Emphasis supplied.)

That statement is true under New Jersey law, so far as the injured Employee is concerned. But the exclusiveness of the workmen's compensation remedy in actions brought on behalf of the injured employee does not preclude others from bringing a common law action against the employer on proper grounds. See Cafone v. Spiniello Construction Co., 42 N.J.Super. 590, 127 A.2d 441 (App.Div.1956); Cozzi v. Owens Corning Fiber Glass Corp., 59 N.J.Super. 570, 158 A.2d 231 (Cty.D.Ct.1960), affirmed 63 N.J.Super. 117, 164 A.2d 69 (App.Div.1960); Metzenbaum v. Golwynne Chemicals Corp., 159 F.Supp. 648 (D.C.S.D.N.Y.1958).

In 101 C.J.S. Workmen's Compensation § 982(a), p. 454, the principle is set forth as follows:

'Generally, the provisions of the Workmen's Compensation Act, which makes the remedies under the act exclusive, apply to third persons suing in the employee's right, but not to those suing in their own right. Rights to death benefits other than those provided by the compensation act may or may not be affected.

'Provisions of Workmen's Compensation Acts which make the payment of compensation the exclusive remedies, except for other remedies expressly provided, may apply to any person suing in the employee's rights; But not to a person suing in his own right, at least where the right arises from the breach of an independent duty of the employer to the person suing.' (Emphasis supplied.)

The rule of Farren v. New Jersey Turnpike Authority, supra, relied upon by the third-party defendant, provides that when an injured employee sues a third person as tortfeasor to recover damages, that defendant may not join the employer as a third-party defendant, in order to obtain Contribution from him as a joint tortfeasor, even though the employer's negligence was the sole or concurring cause of plaintiff's injuries. The rationale of that decision is that the employer cannot be a joint tortfeasor as to his own employee, within the meaning of N.J.S. 2A:53A--1, N.J.S.A., because he is not 'liable in tort' to his employee. His liability is rather to pay workmen's compensation benefits when the injury results from an accident arising out of and during the course of the employment. The Farren case is inapplicable here because the third-party complaint seeks indemnification by reason of the agency relationship of the parties, and does not seek contribution as against a joint tortfeasor.

It is well established that an employer may be made to respond indirectly for the damages recoverable by the injured employee, beyond his workmen's compensation liability, on principles of express or implied indemnification. Thus, in Cozzi v. Owens Corning Fiber Glass Corp., supra, the employer was held liable under a broad indemnity contract provision to indemnify the defendant for the damages payable by the defendant to the injured employee, even though the accident was due to the sole negligence of the defendant indemnitee.

The trial court in this case reasoned as shown by its opinion, that Koerner's third-party complaint against his employer, claiming indemnification for any damages Koerner might be required to pay to the plaintiff executrix, 'amounts to an indirect negligence action against Hegarty.' In its ultimate result, that may be true. But Koerner's third-party action is grounded on an asserted obligation of indemnification, which springs from his relationship as an agent of William F. Hegarty, Inc. If the employer can be held liable for damages recoverable by his employee from a third-person tortfeasor, where he has made himself liable by his contract of indemnity with that third-person tortfeasor there is no logical reason why the employer cannot be made to answer to his employee, beyond his workmen's compensation liability, for the damages assessed against the employee by a third person, when an implied agreement to indemnify the employee therefor arises by operation of law. As indicated hereafter, such obligation of indemnification exists in a proper case.

The trial court correctly observed that 'if he (Koerner) was not negligent, that is the end of the case insofar as he is concerned.' But then it stated the other alternative: 'If he is guilty of negligence, he cannot have indemnity for that under the cases and authorities.' While we deem the latter statement generally correct, it is subject to an exception hereinafter noted. True, there is a General rule in the law of agency that an employer cannot be compelled to reimburse an employee for damages the employee may be obliged to pay because of personal injuries to others resulting from His own negligent conduct. Brady v. Roosevelt S.S. Co., 128 F.2d 169 (2 Cir., 1942), remanded 317 U.S. 575, 63 S.Ct. 425, 87 L.Ed. 471 (1942), rehearing denied 318 U.S. 799, 63 S.Ct. 659, 87 L.Ed. 1163 (1943), certiorari denied 319 U.S. 763, 63 S.Ct. 1320, 87 L.Ed. 1714 (1943); Herman v. Leland, 84 Misc. 82, 145 N.Y.S. 972 (App.T.1914); Veltum v. Koehler, 85 Minn. 125, 88 N.W. 432 (Sup.Ct.1901).

The Restatement of the Law, 2 Agency 2d, § 440, p. 335 (1958), states the General rule in these words:

'The principal has no duty to indemnify the agent for a loss caused Solely by the agent's negligence, whether or not the negligence constitutes a breach of duty to the principal.' (Emphasis supplied.)

In the Veltum case, supra, at 88 N.W. 433, the same principle is phrased as...