King v. O.P. Baur Confectionery Co.

• Citation: 68 P.2d 909,100 Colo. 528
• Decision Date: 17 May 1937
• Docket Number: 14016.
• Parties: KING v. O. P. BAUR CONFECTIONERY CO.
• Court: Colorado Supreme Court

68 P.2d 909

100 Colo. 528

KING v. O. P. BAUR CONFECTIONERY CO.

No. 14016.

Supreme Court of Colorado

May 17, 1937

Rehearing Denied June 7, 1937.

In Department.

Error to District Court, City and County of Denver; James C Starkweather, Judge.

Action by W. S. King against the O. P. Baur Confectionery Company. To review judgment for defendant on a directed verdict plaintiff brings error.

Reversed.

Isaac Mellman, of Denver, for plaintiff in error.

William E. Hutton and B. B. McCay, both of Denver, for defendant in error.

KNOUS Justice.

The parties here are in the same position as in the court below and we shall refer to them as plaintiff and defendant. Plaintiff, on November 9, 1934, while employed by the American District Telegraph Company, to whom we shall hereafter refer as the employer, in the course of checking certain apparatus of his employer, on the premises of the defendant, fell into an unguarded ashpit thereon and received critical burns. He was immediately taken to a hospital for treatment. Plaintiff and his employer were both subject to the provisions of the Workmen's Compensation Act (C.L. § 4375 et seq., as amended) and, pursuant to the requirements of this act, in apt time the employer reported the accident to the Industrial Commission. Thereafter the employer prepared the plaintiff's wage history on the form prescribed by the commission, which form was presented to the plaintiff for his signature, and signed by him. This wage history, together with an admission of liability, signed by the employer and the employer's insurance carrier Hartford Accident & Indemnity Company, were filed with the commission on November 22, 1934. The admission of liability was forthwith stamped: 'Approved, subject to further claim according to law,' and initialed by the statistician for the Industrial Commission. Pursuant to the admission of liability the insurance carrier paid to the plaintiff the sum of $12.97 per week, being 50 per cent. of the average weekly wage shown by the wage history. These payments commenced as of November 19, 1934, and continued until May 6, 1935, and were regularly received and receipted for by the plaintiff. The insurance carrier also paid all medical and hospital bills contracted in connection with plaintiff's injury in the total sum of $688.80. On May 9, 1935, the plaintiff wrote a letter to the Industrial Commission stating that it was his intention to pursue his remedy against the defendant and that notice of his intention was given to the commission in accordance with the provisions of the act and particularly section 4461, C.L.1921. On May 10, the commission, through one of its referees, upon the basis of plaintiff's letter, wrote to the insurance carrier as follows: 'We are advised that the claimant is electing to pursue his remedy against the third party. We are closing this case.' No further action was taken by the Industrial Commission, no further payments were made by the insurance carrier, and the plaintiff at no time filed a claim for compensation with the Industrial Commission. On June 26, 1935, the plaintiff commenced this action for damages in tort against the defendant. On the trial of the cause the court directed a verdict for the defendant upon its motion on the ground that, under the provisions of section 4461, supra, any cause of action the plaintiff might have against the defendant, by operation of law, had been assigned to the insurance carrier and thereby the plaintiff had no right to maintain this action in his own name and right.

Under the pleadings and a stipulation of the parties as to the essential facts, the correctness of the ruling of the trial court is the only question to be determined.

Section 4461, supra, in so far as it is material here, reads as follows: 'If any employe entitled to compensation under this act be injured or killed by the negligence or wrong of another not in the same employ, such injured employe, or in case of death, his dependents, shall Before filing any claim under this act, elect in writing whether to take compensation under this act or to pursue his remedy against such other. Such elections shall be evidence in such manner as the commission may by rule or regulation prescribe. If such injured employe, or in case of death, his dependents, elect to take compensation under this act, the awarding of compensation shall operate as and be an assignment of the cause of action against such other to the industrial commission of Colorado if compensation be payable from the state compensation insurance fund, and otherwise to the person, association, corporation, or insurance carrier liable for the payment of such compensation.'

Before the claim of a compensable employee against a third person is assigned by operation of law to the insurance carrier under the provisions of section 4461, supra, there must first have been an election in writing by the employee to the effect that he will take compensation under the act, and secondly, the awarding of compensation to him. The defendant contends that the acts of the plaintiff in signing the wage history form, accepting and receipting for the payments made by the insurance carrier, constituted an election on his part to come under the act and that the approval of the admission of liability on the basis of the wage history furnished by the employer and signed by the plaintiff constituted an awarding of compensation within the meaning of the statute, and thereby effectuated a complete assignment of the alleged cause of action to the insurance carrier.

The defendant also asserts that, by receiving and receipting for the payments mentioned, the plaintiff is estopped to deny that the action of the commission in approving the admission of liability was not an awarding of compensation.

In the consideration of these questions it must be borne in mind that a different situation exists here, especially with reference to election and estoppel, than would be the case where an injured employee sought to enforce his common-law liability against his employer after the transactions here disclosed with the Industrial Commission and insurance carrier had transpired. As the matter stands the defendant is a third party to the proceeding. This distinction is well pointed out by Mr. Justice Hilliard, who delivered the opinion of this court in the case of Froid v. Knowles, 95 Colo. 223, at page 226, 36 P.2d 156, 158, in the following words: 'What plaintiff received from or through his employer resulted from relation; what he seeks from defendant is based on the latter's alleged fault. To the Workmen's Compensation Act, the purpose of which is 'to determine, define and prescribe the relations between employer and employe,' defendant was as a stranger. 'An outsider does not share the burdens of the act imposed upon the employer, and he is entitled to none of its benefits.' Hotel Equipment Co. v. Liddell, 32 Ga.App. 590, 124 S.E. 92, 94.'

The general rule on this subject is stated in 71 C.J. p. 1547, § 5187, as follows: 'Where the act provides that the injured workman shall elect whether to take under the act or to seek a remedy against a person not in the same employ whose negligence was the cause of the injury and that such election shall be in advance of suit, the provision for election in advance of suit is for the benefit of the state in the administration of the accident fund, and not for the benefit of the third person, * * *.'

Numerous cases have been decided by courts of last resort on questions of the procedure to be followed in the enforcement of third party liability, but the statutes of the various states differ so widely in their terms and provisions that the decisions based upon such statutes...