Martin v. C.A. Productions Co.

• Decision Date: 08 July 1960
• Citation: 8 N.Y.2d 226,203 N.Y.S.2d 845
• Parties: , 168 N.E.2d 666 In the Matter of the Claim of John MARTIN, Respondent, v. C. A. PRODUCTIONS COMPANY et al., Appellants. Workmen's Compensation Board, Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 845

203 N.Y.S.2d 845

8 N.Y.2d 226, 168 N.E.2d 666

In the Matter of the Claim of John MARTIN, Respondent, v. C. A. PRODUCTIONS COMPANY et al., Appellants Workmen's Compensation Board, Respondent.

Court of Appeals of New York.

July 8, 1960.

Edwin D. Kyle and William F. Hanson, New York City, for appellants.

Louis J. Lefkowitz, Atty. Gen. (Gilbert M. Landy, New York City, Paxton Blair, Albany, and Roy Wiedersum, New York City, of counsel), for respondent.

BURKE, Judge.

The sole issue to be determined is whether the prior successful prosecution and settlement of a claim in an action at law against the employer is a bar to a subsequent compensation claim against the same employer, for the same injury, now found to have been acquired during the course of employment.

Claimant was employed by C. A. Productions Company, a partnership, as a dancer in the musical show 'Where's Charley'. At the close of the final performance he attended a cast party by invitation of Ray Bolger (star of the show) and his wife Gwen Rickard (a partner in the employer company). There was evidence that these closing night parties were frequent and customary and claimant himself felt that it was part of his job and that it was 'good business' and he was 'expected to be there'. At the party, which was held on the theatre premises, claimant was assaulted and struck in the face by an intoxicated visitor.

A claim for compensation was initially filed on September 18, 1950. A notice of controversy, alleging that the accident did not arise out of and in the course of employment, was thereafter filed by claimant's employer. Claimant subsequently commenced a personal injury action in the Supreme Court, Queens County, against Ray Bolger, Gwen Rickard, C. A. Productions Company, his assailant, and the owner of the theatre.

On February 21, 1951, at the request of claimant's attorney, the compensation case was closed 'pending the outcome of 3rd party action'. The personal injury action was subsequently settled for $7,500. Of this amount appellant carrier paid $2,500 on behalf of its insured, C. A. Productions Company, and the balance of $5,000 was paid by another carrier on behalf of its insured, Gwen Rickard.

Subsequent to this settlement the compensation proceeding was reopened on claimant's application. The board panel affirmed the Referee's award, and found that the accident arose out of and in the course of employment and that claimant is not estopped from bringing compensation proceedings. The only question reviewed by the full board was 'whether claimant having instituted an action against the employer and others and having recovered, should now be permitted to proceed with his compensation claim.' The Appellate Division has affirmed the board's finding that 'claimant is not precluded from proceeding with his claim.'

On this appeal appellants contend that since there has been a successful personal injury settlement the claimant should be barred from instituting a compensation proceeding. They rely on Russell v. 231 Lexington Ave. Corp., 266 N.Y. 391, 195 N.E. 23, 98 A.L.R. 413. The Russell case compels a reversal.

In our view, since the rule of Russell has been recognized and followed (Ryan v. Sheffield Farms Co., 256 App.Div. 867, 9 N.Y.S.2d 8 (deficiency award to widow made subsequent to settlement of action was thereafter rescinded on authority of Russell case)), and has not met with the apparent disapproval of the Legislature, it does not seem appropriate to consider a reversal of the policy announced in that case.

In Russell the deceased employee died from injuries arising out of and in the course of her employment as an elevator operator in a building owned by 231 Lexington Avenue Corporation. '(T)here was some doubt as to whether the deceased was in the employ of Hopkins (the superintendent) or of 231 Lexington Avenue Corporation.' 266 N.Y. 391, 394, 195 N.E. 23, supra; matter in brackets supplied. Decedent's administrator brought an action at law against Lexington and Nelson, a third party. This action was settled before trial by payment of $5,000 by Lexington and $750 by the third party. Decedent's mother and father shared equally in the proceeds, but the mother, being dependent, instituted a compensation proceeding in order to recover the deficiency between this amount and the amount she would have been entitled to under the Workmen's Compensation Law. The board, as here, ignored the settlement and made an award. This court reversed the award and dismissed the claim, stating that '(t)he action at law brought against 231 Lexington Avenue Corporation could be maintained only if the defendant was not the employer, and a judgment in the action in favor of the plaintiff would have constituted an adjudication that the defendant's affirmative defense that it was the employer and was covered by insurance was without substance. The settlement of the action, though not a formal adjudication of the issues, constitutes a bargain between the parties that the claim against the defendant should be satisfied by payment of the sum of $5,000.' 266 N.Y. 391, 395-396, 195 N.E. 23, 24; emphasis supplied.

It is to be noted that the Russell case is in substance almost factually identical to the case at bar except that in the former it was the employer-employee relationship which was doubtful, while in the latter it is the occurrence of an industrial accident. Both factors are, of course, jurisdictionally vital to the maintenance of a workmen's compensation proceeding, and the absence of either would relegate a claimant to an action at law.

It is our opinion, therefore, that the claimant cannot have the benefit of both remedies. A party should not be permitted to experiment with an action at law for the purpose of ascertaining how much he can get, and then, if dissatisfied, repudiate the recovery and seek to claim the benefits of workmen's compensation. Although section 32 of the Workmen's Compensation Law (prohibiting compromise and waiver) is intended to protect a claimant from his own improvidence and folly, it was certainly not intended to permit harassing and inconsistent actions resulting in unnecessary and prolonged litigation and possibly multiple recoveries. If we were to allow claimants to so proceed, via this...