Lumber Mut. Casualty Ins. Co. v. Stukes

• Decision Date: 17 July 1947
• Docket Number: Civ. A. No. 1608.
• Citation: 72 F. Supp. 463
• Court: U.S. District Court — District of South Carolina
• Parties: LUMBER MUT. CASUALTY INS. CO. OF NEW YORK v. STUKES et al.

72 F. Supp. 463

LUMBER MUT. CASUALTY INS. CO. OF NEW YORK v. STUKES et al.

Civ. A. No. 1608.

District Court, E. D. South Carolina, Columbia Division.

July 17, 1947.

N. A. Turner, of Columbia, S. C., for plaintiff.

Shepard K. Nash, of Sumter, S. C., and James Hugh McFaddin, of Manning, S. C., for defendant Melvin Blease Stukes, as adm'r of Estate of Eugene David Stukes, deceased.

C. M. Edmunds, of Sumter, S. C., for defendant G. N. Marshall, doing business as Carolina Roofing Co.

WYCHE, District Judge.

This is a declaratory judgment action brought by the plaintiff, a New York corporation, against defendants, residents of South Carolina, for the adjudication of plaintiff's liability under a policy of public liability insurance issued by it to the defendant Marshall covering a 1946 Model, one and one-half ton Chevrolet stake-body truck.

At the conclusion of the testimony plaintiff and the defendants made motions for directed verdicts.

The material provisions of the policy of insurance, under the issues made by the pleadings, are as follows: In coverage A the plaintiff agreed with the insured "To pay on behalf of the insured all sums which the insured shall become obligated to pay by reason of the liability imposed upon him by law for damages, * * * because of bodily injury, including death at any time resulting therefrom, sustained by any person or persons, caused by accident and arising out of the ownership, maintenance or use of the automobile." In paragraph II plaintiff agreed to "* * * (a) defend in his name and behalf any suit against the insured alleging such injury * * * even if such suit is groundless, false or fraudulent; * * *."

"Exclusions

"This policy does not apply:

"(d) under coverages A and C, to bodily injury to or death of any employee of the insured while engaged in the employment, other than domestic, of the insured, or while engaged in the operation, maintenance or repair of the automobile".

"Conditions

"7. Assistance and Cooperation of the Insured (Coverages A and B). The insured shall cooperate with the company and, upon the company's request, shall attend hearings and trials and shall assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of suits. The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for such immediate medical and surgical relief to others as shall be imperative at the time of accident."

Before the institution of this action by the plaintiff, the defendant Melvin Blease Stukes, as administrator of the estate of Eugene David Stukes, deceased, had instituted an action in the State Court against the defendant Marshall, the named insured, for damages on account of the wrongful death of Eugene David Stukes, alleged to have been caused by the negligence of the defendant Marshall in the ownership, use and operation of the Chevrolet truck covered by the foregoing described insurance policy, when the truck collided with another truck owned by one D. W. Booth, on or about June 13, 1946, in which Eugene David Stukes received injuries, resulting in his death.

Plaintiff asks this court to declare that the said policy of insurance is not in force, and of effect, as regards the action brought by the administrator of the estate of Eugene David Stukes, upon two grounds: (1) because Eugene David Stukes at the time of his injuries and death was an employee of Marshall, the named insured, and was injured while engaged in the employment of Marshall; (2) because Marshall failed and refused to cooperate with the plaintiff and to divulge full, complete and direct information concerning his employer-employee relationship with Eugene David Stukes and other riders in the insured truck, and for this reason has materially prejudiced the plaintiff under the contract of insurance and constitutes a violation of the provisions of the policy.

The testimony discloses that the defendant Marshall was engaged in the roofing business as the Carolina Roofing Company at Sumter, South Carolina, in which business Marshall employed salesmen to secure contracts to cover roofs and put sidings on buildings. When such salesmen secured such contracts Marshall engaged subcontractors to do the work necessary for the completion of the contracts. The subcontractors in turn employed laborers to help them do the necessary work.

In pursuance of this policy, Marshall contracted with one J. M. Timmons to put roofing and siding on buildings for him. Under the agreement Marshall was to furnish necessary materials for the job and a truck for the transportation of the same to the jobs he had under contract; to furnish gasoline and oil for the truck, and to pay for the upkeep of the same; to pay Timmons $1 a square to put the roofing on the buildings, and $4.50 a square to put on the siding; in consideration of which Timmons agreed to put the roofing and siding upon the buildings and to furnish all tools and labor necessary for the job. Under the agreement Timmons was to hire, without any control, suggestion or recommendation from Marshall, such laborers as he desired for the work, and to fire them, if he saw fit, without consulting Marshall; Marshall had no control over the laborers hired by Timmons; he had no right to control or direct the manner in which the details of the work progressed; Timmons contracted to do the work in accordance with his own judgment and methods and without being subject to Marshall except as to the result of the work; Timmons had the right to employ and direct the action of the laborers, and to decide what amounts they should be paid, without control or suggestion from Marshall, and was free from any superior authority in Marshall to say when the specific work should be done or what the laborers should do as it progressed; Marshall had no right or control or supervision over the work performed by Timmons; if the work performed by Timmons was unsatisfactory, Timmons had to do it over at his own expense to the satisfaction of the owner of the building. Timmons paid his employees by the hour. If Timmons lost money on a contract it was his loss and not Marshall's.

Timmons used the truck furnished him by Marshall to transport materials and his employees from their homes to the different jobs; for such transportation Timmons' employees were charged three per cent. of the amount of their wages.

Employees of Timmons were not paid for the time consumed in riding to and from the place of their work.

On June 13, 1946, Timmons picked up at their homes three of his employees, one of whom was Eugene David Stukes, and they rode in the truck furnished by Marshall to Timmons under the foregoing agreement, and which was covered by the policy of insurance herein involved, to a job in Camden, South Carolina, where they covered a roof, and from there rode to a place approximately five miles from Hartsville, South Carolina, where they started on another job, but when it began to rain at between 4:30 and 5 o'clock p. m. they quit the job to return to their homes. On the way home, about eight or nine miles from the place of work they had quit, and about thirty minutes after they had quit work, the truck in which they were riding collided with a truck owned by D. W. Booth, and Eugene David Stukes received injuries from which he died.

Under the facts in this case, and under the law of South Carolina, I must conclude that Timmons was an independent contractor, and that Eugene David Stukes was an employee of Timmons, and not an employee of Marshall, at the time of his injuries and death, and for that reason he does not come within the exclusion clause of the policy of insurance. McDowell v. Stilley Plywood Co., 210 S.C. 173, 41 S.E.2d 872, 875.

In the McDowell case, supra, the South Carolina Supreme Court decided that "`* * * the retention by the employer of the right to control and direct the manner in which the details of the work are to be executed and what the laborers shall do as the work progresses is decisive, and when this appears it is universally held that the relationship of master and servant or employer and employee is created. Conversely, when one exercising an independent employment contracts to do a piece of work according to his own judgment and methods, and without being subject to his employer except as to the result of the work, and who has the right to employ and direct the action of the workmen, independently of such employer and freed from any superior authority in him to say how the specified work shall be done or what laborers shall do as it progresses, he is clearly an independent contractor. The vital test is to be found in the fact that the employer has or has not retained the right of control or superintendence over the contractor or employee as to details.'"

But, if it be conceded that Eugene David Stukes at the time of his injuries and death was an employee of Marshall, the testimony discloses that he was not at that time "engaged in the employment" of Marshall. At the time of the accident Eugene David Stukes was not engaged in any work, and was not performing any services for Marshall, or for anyone else; he was not entitled to any pay, and was not receiving any pay for any employment. He was merely riding as a fare-paying passenger from the place of his work to his home in a conveyance furnished to Timmons by Marshall. The plaintiff relies upon decisions of the South Carolina Supreme Court construing the Workmen's Compensation Law to sustain its contention that Stukes was injured "while engaged in the employment of the insured". In such cases the State Supreme Court was construing the provisions of the South Carolina Workmen's Compensation Law, Code of Laws of South Carolina, 1942, § 7035-1 et seq. and not an insurance contract. It has been repeatedly held that the Workmen's Compensation Law of South Carolina is a remedial statute,...