Hauter v. Coeur D'alene Antimony Mining Co.

• Decision Date: 10 August 1923
• Citation: 39 Idaho 621,228 P. 259
• Parties: ALICE M. HAUTER et al., Appellants, v. COEUR D'ALENE ANTIMONY MINING COMPANY, a Corporation, and AETNA LIFE INSURANCE COMPANY, a Corporation, Respondents
• Court: Idaho Supreme Court

228 P. 259

39 Idaho 621

ALICE M. HAUTER et al., Appellants, v. COEUR D'ALENE ANTIMONY MINING COMPANY, a Corporation, and AETNA LIFE INSURANCE COMPANY, a Corporation, Respondents

Supreme Court of Idaho

August 10, 1923

WORKMEN'S COMPENSATION ACT-EMPLOYER'S INSURANCE-HOW CANCELED-WHEN IN FORCE-WHEN EMPLOYEE EXCLUDED FROM TERMS OF ACT-NOTICE TO INSURED IS NOTICE TO INSURER.

1. An insurance policy insuring an employer under the Workmen's Compensation Act which contains a recital that such policy covers the entire liability of the insured for compensation to its employees can only be canceled by the insurance company strictly complying with the conditions of the policy relating to the manner of canceling the same.

2. Where a hearing was had before the Industrial Accident Board and it made findings, conclusions and an award based thereon and also found that the employer did not have its employees insured, where the undisputed facts show that a policy had been issued to the employer to cover its liability to its employees, that such policy had not been canceled in accordance with the terms of the policy, the question as to whether the employer has insurance is one of law, and a contrary finding of the board is ineffectual to relieve the insurance company from liability to employees of such company who have been injured in the course of such service.

3. The provision in C. S., sec. 6321, of the Workmen's Compensation Act, which excludes from the benefits of the act persons whose remuneration exceeds $2,400 a year, does not apply to an employee who, at the time of the injury, is not employed under a definite, certain contract for a full year or more, at a determined or determinable wage amounting to more than $2,400.

4. A claim made against an insurance company is not barred under either C. S., sec. 6243 or 6612, because the insurance company was not made a party to the original proceedings before the Industrial Accident Board against the employer since by C. S., secs. 6282 and 6283, every policy of insurance issued under this act must contain a condition that notice to the assured shall be deemed notice to the insurance company.

APPEAL from the District Court of the First Judicial District, for Shoshone County. Hon. Albert H. Featherstone, Judge.

Action on an insurance policy under Workmen's Compensation Act. From judgment of nonsuit, plaintiff appeals. Reversed.

Reversed and remanded, with instructions. Costs to appellants.

James F. Ailshie, James F. Ailshie, Jr., and Carlton Fox, for Appellant.

Insurance policies will be strictly construed against the insurer and liberally construed in favor of the insured. (Sweaney & Smith Co. v. St. Paul Fire Ins. Co., 35 Idaho 303, 206 P. 178; Taylor v. Insurance Co. of North America, 25 Okla. 92, 138 Am. St. 906, 105 P. 354; Grant Lumber Co. v. North River Ins. Co., 253 F. 83; Commercial Union Fire Ins. Co. v. King, 108 Ark. 130, 156 S.W. 445; Rawl v. American Central Ins. Co., 94 S.C. 299, Ann. Cas. 1913A, 1231, 77 S.E. 1013; American Fire Ins. Co. v. Brooks, 83 Md. 22, 34 A. 373; Bradshaw Brothers & Co. v. Fire Ins. Co., 89 Minn. 334, 94 N.W. 866.)

A clause in an insurance policy which is either uncertain, ambiguous or susceptible of more than one construction will be given a construction most favorable to the insured. (Sweaney & Smith Co. v. St. Paul Fire Ins. Co., supra; German Union Fire & Ins. Co. v. Fred G. Clarke Co., 116 Md. 622, Ann. Cas. 1913D, 488, 82 A. 974.)

Courts will seize hold of and give effect to slight circumstances in order to prevent the forfeiture or cancelation of an industrial accident policy given under a workmen's compensation law in order to protect the innocent workmen and beneficiaries who had no chance to protect themselves. (Public Sav. Ins. Co. v. Manning, 61 Ind.App. 239, 111 N.E. 945.)

The question is whether the policy issued by respondent was still in force on the date of Hauter's injury or had been previously canceled in accordance with the terms of the contract. It was clearly a liability contract. (Fenton v. Poston, 114 Wash. 217, 195 P. 31; Maryland Casualty Co. v. Peppard, 53 Okla. 515, 157 P. 106, L. R. A. 1916E, 597.)

James A. Wayne, for Respondent.

The policy of insurance issued by respondent had been canceled before the accident to Hauter. The fixing of a shorter time limit in the notice of cancelation than that required by the policy did not render the cancelation notice void, but said cancelation became effective upon the expiration of the time fixed by the policy--in this case, thirty days from August 10, 1918. (Commercial Union F. Ins. Co. v. King, 108 Ark. 130, 156 S.W. 445; Ralston v. Royal Ins. Co., 79 Wash. 557, 140 P. 552; Davidson v. German Ins. Co., 74 N.J.L. 487, 12 Ann. Cas. 1265, 65 A. 996, 13 L. R. A., N. S., 884; American Glove Co. v. Pennsylvania Fire Ins Co., 15 Cal.App. 77, 113 P. 688; Schwarschild & Sulzberger Co. v. Phoenix Ins. Co., 124 F. 52, 59 C. C. A. 572.)

The finding of the Industrial Accident Board that this policy had been canceled, and that the defendant mining company did not have its employees insured at the time of the Hauter accident, no appeal having been taken therefrom, is a final and conclusive adjudication of the fact that said policy was canceled. (Skoczlois v. Vinocour, 221 N.Y. 276, 16 N.E. 1004.)

WILLIAM A. LEE, J. McCarthy, C. J., Dunn, Wm. E. Lee, JJ., and Budge, JJ., concurring. WM. E. LEE, J., Dissenting.

OPINION

WILLIAM A. LEE, J.

--This action grows out of proceedings originally instituted by the appellant Alice M. Hauter on behalf of herself and her minor son Granville Hauter, before the Industrial Accident Board of the state of Idaho, against the Coeur d'Alene Antimony Mining Company, a corporation engaged in operating its property near Kellogg, Idaho, to recover compensation on account of the death of her husband, who died as the result of an injury received by him while an employee of that company on the 17th day of November, 1918. The Industrial Accident Board on October 6, 1920, made certain findings of fact and rulings of law thereon, and ordered, adjudged and decreed that the claimant Alice M. Hauter receive from said Coeur d'Alene Antimony Mining Company the sum of $ 12 per week for a period of 400 weeks, unless she should die or remarry prior to the expiration of such time, together with $ 100 for funeral expenses of her deceased husband, and that said minor son, Granville Hauter, receive $ 10.80 per week for a period of four years, two months and fourteen days, the total award being $ 7,261.60. This award having been certified to the district court in and for Shoshone county, Idaho, in accordance with C. S., sec. 6271, a judgment was made and entered thereon by said court March 25, 1921, affirming said award against said company in the sum of $ 7,261.60.

June 30, 1921, Alice M. Hauter was appointed guardian ad litem for the infant Granville Hauter, and on the same day she petitioned the court for a writ of execution supplementary to judgment, alleging that respondent Aetna Life Insurance Company was a Connecticut corporation, organized for the purpose of selling life, accident and liability insurance, surety bonds covering the liability of employers under said compensation act, and various other forms of insurance and indemnity bonds, and that respondent in this capacity was carrying on a general insurance business in this state; that Alice M. Hauter is the surviving widow of Arthur F. Hauter, deceased; that she was wholly dependent upon him for support at the time of his death, as was also the minor son, Granville Hauter; that she had been appointed his guardian ad litem, and had qualified and was acting as such; that about January 1, 1918, respondent Aetna Life Insurance Company entered into a contract of insurance with the other respondent Coeur d'Alene Antimony Mining Company, made exhibit "A" of the petition; that it was in full force and effect in November, 1918, at the time of the injury and death of Arthur F. Hauter, who was at the time of the injury which resulted in his death working for the Coeur d'Alene Antimony Mining Company in its mining operations at Pine Creek, Shoshone County, Idaho; and that while in such employment, and in the course of the same, he was fatally injured.

It is further alleged that on March 24, 1921, the district court in and for the county of Shoshone duly gave and entered its judgment in favor of petitioner and against the mining company for the sum of $ 7,261.60, as compensation to petitioner for the death of Arthur F. Hauter, the same to be paid to appellant Alice M. Hauter at the rate of $ 12 per week and to the minor son at the rate of $ 10.80 per week; that respondent Aetna Life Insurance Company, pursuant to its contract with respondent mining company, promised and agreed to pay this judgment as the same became due and payable, and all liability arising therefrom or thereunder, and that by reason thereof respondent life insurance company was and is liable to appellant for the sum now due and to become due upon said judgment, under and pursuant to the laws of the state of Idaho; that it is a proper and necessary party to this action; that appellant Alice M. Hauter has not remarried since the death of her husband, and that neither the whole nor any part of said judgment has been paid; that the amount is due and payable according to the terms of the award to herself and minor child. Appellant prays that an order issue directing said Aetna Life Insurance Company to appear and show cause why execution should not be issued against it for the payment of said award.

The court issued a citation to the insurance company, directing that it be made a party to said action for all purposes, the same as if it had been...