Inter-State Oil Co. v. Equity Mut. Ins. Co.

• Decision Date: 05 June 1944
• Docket Number: No. 20431.,20431.
• Citation: 183 S.W.2d 328
• Parties: INTER-STATE OIL CO. v. EQUITY MUT. INS. CO.
• Court: Missouri Court of Appeals

183 S.W.2d 328

INTER-STATE OIL CO. v. EQUITY MUT. INS. CO.

No. 20431.

Kansas City Court of Appeals. Missouri.

June 5, 1944.

Appeal from Circuit Court, Jackson County; Thomas J. Seehorn, Judge.

Suit by the Inter-State Oil Company against Equity Mutual Insurance Company, to recover on a policy of compensation and employers' liability insurance issued by defendant to plaintiff. Verdict for defendant, and from an order granting a new trial, defendant appeals.

Reversed and remanded with directions.

Julian E. Smith, Watson, Ess, Groner, Barnett & Whittaker, Carl E. Enggas, and Douglas Stripp, all of Kansas City, for appellant.

Charles M. Miller, of Kansas City, for respondent.

SPERRY, Commissioner.

This suit was brought by Inter-State Oil Company, plaintiff, against Equity Mutual Insurance Company, defendant, which had issued its policy of compensation and employers liability insurance to plaintiff, to recover fees and expenses paid out by plaintiff in defending itself in a law suit brought against it by an employee. Trial to a jury resulted in a verdict in favor of defendant. Upon motion a new trial was granted and defendant appeals.

Plaintiff, for many years, has been engaged in the business of processing of oil and greases, in the state of Kansas, and defendant was engaged in the insurance business. Defendant issued its policy, denominated "Standard Workmen's Compensation and Employer's Liability Policy," effective May 15, 1936, and containing, among others, the following terms and provisions:

"Does Hereby Agree with this Employer * * * as respects personal injuries sustained by employees, including death at any time resulting therefrom as follows:

"Compensation 1 (a) To Pay Promptly to any person entitled thereto, under the Workmen's Compensation Law and in the manner therein provided, the entire amount of any sum due, and all installments thereof as they become due: * * *

"Liability 1 (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 the Dominion of Canada. In the event of the bankruptcy or insolvency of this Employer the Company shall not be released from the payment of such indemnity hereunder as would have been payable but for such bankruptcy or insolvency. If because of such bankruptcy or insolvency, an execution against this Employer is returned unsatisfied in an action brought by the injured, or by another person claiming by, through or under the injured, then an action may be maintained by the injured, or by such other person claiming by, through or under the injured, against the Company under the terms of this Policy for the amount of the judgment in said action not exceeding the amount of this Policy.

"Service 2. * * *

"Defense 3. To Defend, in the name and on behalf of this Employer, any suits or other proceedings which may at any time be instituted against him on account of such injuries, including suits or other proceedings alleging such injuries and demanding damages or compensation therefor, although such suits, other proceedings, allegations or demands are wholly groundless, false or fraudulent. * * *

"Costs and Expenses 4. To Pay all costs taxed * * *

"Employees Covered 5. * * *

"Operations And Work Places Covered 6. * * *

"Policy Term 7. This agreement shall apply only to such injuries so sustained by reason of accidents occurring during the Policy Period limited and defined as such in Item 2 of said Declarations."

The policy also carried an indorsement excluding liability for claims based on occupational disease.

Thereafter, one LeRoy Potter, an employee of plaintiff, sued plaintiff for damages, alleging the following:

"That on or about January, 1937, and for more than a year prior thereto, plaintiff was in the employ of the defendant at the plant of the defendant located as aforesaid in Wyandotte County, Kansas, during all of which time he was directed and required by the said defendant in the course of his duties and employment to wash and clean certain barrels in gasoline; that in the discharge of said duty and in the performance of said labor and by reason of the gradual and cumulative effect of doing said work from day to day, he received the injuries and conditions herein set out; that all of said injuries were the direct and proximate result of defendant's negligence and wrongful conduct as is hereinafter more fully set out.

"Plaintiff further states that the defendant was careless and negligent in failing to provide plaintiff with a reasonably safe place in which to work, in that it failed to provide the said plaintiff with gloves and apparatus and other equipment to protect his hands and arms from constant immersion in said gasoline; that the defendant, knowing of plaintiff's inexperience and ignorance of the likely and probable effects of the work in which he was engaged, carelessly and negligently failed to warn and acquaint the plaintiff with the dangerous and injurious effect of said work, all of which the defendant knew, or should have known; that the defendant carelessly and negligently failed to provide the plaintiff with approved and effective devices, means and methods for the prevention of the injuries which defendant knew, or should have known, plaintiff would sustain as a result of engaging in said line of duty; that the defendant was negligent in assuring the said plaintiff that there was no danger of serious or harmful injury or disease in the discharge of said duty and work when the defendant knew, or should have known, in the exercise of due care that injury would follow from working under such conditions; that the defendant was further negligent in violating a long and well-established custom and practice to provide employees engaged in said work with suitable equipment.

"Plaintiff further states that each and every one of the foregoing negligent acts and omissions of defendant operated jointly and concurrently to cause the plaintiff to contract a severe skin infection upon his hands and arms and forearms in particular as a result of the gradual and cumulative effect of doing said work from day to day without any form of protection by suitable equipment. That he acquired and contracted the industrial disease of dermatitis, causing his right and left hands, arms and forearms to become inflamed, infected and diseased, by reason whereof the plaintiff suffered great physical pain and mental anguish and was unable to engage in any form of remunerative labor * * *"

Plaintiff delivered to defendant a copy of said petition, notified it of the commencement of said action, and demanded that it defend same, which it declined to do. Thereafter, plaintiff filed answer in the nature of a denial, pleaded assumption of risk, and alleged that the damages claimed were governed by the compensation laws of the state of Kansas. Potter filed reply wherein he alleged that the compensation laws of Kansas had no application to his cause of action and pleaded that his rights thereunder were governed by the law of Kansas as declared in "Echord v. Ruch, 124 Kan. 521, 261 P. 820; Taylor v. Swift & Co., 114 Kan. 431, 219 P. 516; and Fritchman v. Chitwood Battery Co., 134 Kan. 727, 8 P.2d 368."

Plaintiff employed the attorney who represents it in this cause, and he successfully defended the action. This suit is brought to recover $1,500, as a reasonable attorney's fee, for which plaintiff became liable in the Potter case, and for $16.05 paid out by it for depositions in said case.

Plaintiff has moved to dismiss this appeal on the ground that it was granted in violation of rule 22 of the circuit court of Jackson County. That rule provides: "Whenever a motion for new trial of any cause is sustained, and the party who would have the right of appeal from such order, waives, during the term, his right of appeal and serves notice of such fact on the opposite party, such cause shall thereupon be returned to the general docket and may on five days notice to the opposite party be included in the list of cases set for trial."

The record shows that defendant's counsel was present in court at the time the motion for new trial was sustained, at which time, then and there, the court ordered the cause returned to the assignment division, and that counsel for defendant raised no objection and made no protest against such action. It is claimed that his silence is equivalent to a waiver of the right of appeal. Defendant contends that, "Under the rules and practice of this court an exception should have been automatically entered as in other circumstances."

However that may be, the rule requires that before this cause could properly have been returned to the assignment division after the motion for new trial was sustained, defendant should not only have waived its right of appeal, but that it must also have served notice thereof on the opposite party. Otherwise the cause could not have been returned to assignment during the term at which the motion for new trial was sustained. The wisdom of requiring both waiver and notice thereof is demonstrated in this case. It is not claimed that any notice of waiver was served by defendant on plaintiff. The order returning the cause to assignment was in violation of the rule.

The cause was later transferred...