Ponce v. Hanes L'Eggs Products, Inc.

• Decision Date: 04 October 1977
• Docket Number: No. 2930,2930
• Citation: 570 P.2d 943,91 N.M. 112,1977 NMCA 114
• Parties: Victor M. PONCE, Plaintiff-Appellant, v. HANES L'EGGS PRODUCTS, INC., Hartford Insurance Company and Liberty Mutual Insurance Co., Defendants-Appellees.
• Court: Court of Appeals of New Mexico

Page 943

570 P.2d 943

91 N.M. 112

Victor M. PONCE, Plaintiff-Appellant, v. HANES L'EGGS PRODUCTS, INC., Hartford Insurance Company and Liberty Mutual Insurance Co. Defendants-Appellees.

No. 2930.

Court of Appeals of New Mexico.

Oct. 4, 1977.

[91 NM 113] Anthony F. Avallone, Las Cruces, for plaintiff-appellant.

Ray O. Sage, Sage & Reese, Las Cruces, for defendants-appellees.

OPINION

LOPEZ, Judge.

The plaintiff filed suit for workmen's compensation against his employer, Hanes L'Eggs Products, Inc. and against two insurance companies, to-wit: Hartford Insurance Company and Liberty Mutual Insurance Company. The plaintiff's employer will hereinafter be referred to as Hanes; the two insurance companies will be referred to as Hartford and Liberty Mutual respectively. The trial court dismissed with prejudice Liberty Mutual as a party-defendant. The plaintiff appeals and we affirm.

The issue presented in this case is whether the trial court committed reversible error by dismissing with prejudice Liberty Mutual, the successor insurance company in this workmen's compensation case.

The complaint filed on December 7, 1976 contains the following allegations which, for purposes of appellate review, are considered as admitted as far as Liberty Mutual's motion to dismiss is concerned. See Villegas v. American Smelting & Refining Company, 89 N.M. 387, 552 P.2d 1235 (Ct.App.1976).

Hartford and Liberty Mutual are insurers under the New Mexico Workmen's Compensation Act. On or about August 11, 1973, the plaintiff sustained injuries in an on-the-job accident during the course of his employment. Hartford's coverage was effective at the time of the accident, and Liberty Mutual, the present insurer, had coverage when the disability allegedly arose.

The plaintiff had been continuously employed by the defendant Hanes until October, 1976, at which time he became disabled. His disability resulted from the accident of August 11, 1973. The plaintiff in his complaint asked for workmen's compensation benefits from the employer, Hanes, Hartford and Liberty Mutual. During January, 1977, Liberty Mutual filed a motion to dismiss the action with prejudice, because the complaint failed to state a claim upon which relief could be granted. Liberty Mutual's motion stated that the complaint on its face showed that all disability sustained by plaintiff occurred when Hartford and not Liberty Mutual had coverage.

A hearing on the motion to dismiss was held on February 14, 1977. The complaint was not amended and no motion to amend the complaint was made by the plaintiff. The court entered an order dismissing Liberty Mutual as party-defendant on the ground that the complaint failed to state a claim against this defendant. Subsequently, this appeal arose.

In this appeal we are presented with a legal issue involving the responsibility, rights and duties of two successor insurance companies covering an employer under the Workmen's Compensation Act of the State of New Mexico.

Point I

Under Point I the plaintiff states that this is a case of first impression, but he refers us to two New Mexico cases. De La Torre v. Kennecott Copper Corporation, 89 N.M. 683, 556 P.2d 839 (Ct.App.1976) and Moorhead v. Gray Ranch Co., 90 N.M. 220, 561 P.2d 493 (Ct.App.1977), cert. denied, 90 N.M. 254, 561 P.2d 1347 (1977). In analyzing these two cases we conclude that they are inapplicable to the case at bar. De La Torre held that the applicable statute of limitations was in force when the disability arose. It had nothing to do with two successor insurance companies. Moorhead held that the rate of compensation was a rate applicable on the date of disability. Neither of these two cases gives us any authority to hold Liberty Mutual responsible. The plaintiff, however, does refer us to 8 J. Appleman, Insurance Law and Practice, § 4916 (1942) and 4 A. Larson, The Law of Workmen's Compensation, § 95.00 (1976). 8 Appleman § 4916 states as follows:

"Where the disability occurs at some time subsequent to the injury, the policy provisions must be examined to determine which insurer is liable. Generally, the insurer covering the risk at the date of the accident, rather than the insurer at the date when the disability began, is held to be liable. And to render the new insurer liable, it is necessary to show a causal relation between the work done during the period of the new policy and the injury, even though the injury was an accumulation of foreign matter which resulted in an incapacity to labor during that period. . . . "

4 Larson, § 95.00, supra, states:

"When a disability develops gradually, or when it comes as the result of a succession of accidents, the insurance carrier covering the risk at the time of the most recent injury or exposure bearing a causal relation to the disability is usually liable for the entire compensation. . . . "

The defendant cites Hanks v. Walker, 60 N.M. 166, 288 P.2d 699 (1955) as authority that Liberty Mutual is not liable to the plaintiff for his disability.

In Hanks, supra, at 173, 288 P.2d at 703, the Supreme Court of New Mexico accepted the Massachusetts rule as follows:

" 'Where there have been several compensable injuries received by employee during the successive periods of coverage of different insurers, the subsequent incapacity must be compensated by the one which was the insurer at the time of the most recent injury that bore causal relation to the incapacity.' "

Therefore, based upon Hanks v. Walker, supra, 4 Larson, supra, and 8 Appleman, supra, the rule in New Mexico is that to hold the second insurer liable, it is necessary to show a causal connection between the work done during the period of the new policy (in this case, Liberty Mutual) and the injury or disability.

Applying this rule of law to the case at bar, we conclude that Liberty Mutual is not liable.

In the instant case, the complaint alleges that the injury and the disability took place during the time the plaintiff was covered by Hartford. Plaintiff does not allege any causal connection between the work done during the period the employer was covered by Liberty Mutual and plaintiff's disability. On the contrary, the complaint only alleges that the disability was caused by the original accident when Hanes was covered by Hartford. Therefore, Liberty Mutual is not liable.

We now discuss Point II, because if the complaint had been amended, perhaps a different situation would have been presented to us.

Point II

Under this point the plaintiff is asking this Court to order the trial court to allow an amended complaint to conform to Hanks v. Walker, supra, Appleman, supra, and Larson, supra. For authority plaintiff refers to Peoples v. Peoples, 72 N.M. 64, 380 P.2d 513 (1963). We do not believe that this case is applicable. In Peoples the plaintiffs filed a motion for leave to amend which the court denied, thus preserving the question for review on appeal. Plaintiff argues that he should be allowed to amend his complaint to state that the injury was aggravated during the period of coverage with Liberty Mutual and that the disability arose as a result of the aggravation.

" . . . Certainly it was never the intention of the statutes or rules regulating appeals that one meeting with adverse rulings on his pleadings could withdraw from the combat below, bring his pleadings here, have us point out the deficiencies, and then return, amend the defective pleading and resume the battle with his adversary." Martinez v. Cook, 57 N.M. 263, 258 P.2d 375, 376 (1953).

We have searched the record and have been unable to find any motion by the plaintiff requesting leave to amend either before the motion to dismiss or after the order of dismissal was entered for Liberty Mutual. The plaintiff's proposed amendment was never even mentioned in the proceedings below and no ruling was obtained from the trial court.

Although amendments are liberally allowed, there are limitations on this right to amend, and this right cannot be raised in the appellate court for the first time. Bounds v. Carner, 53 N.M. 234, 205 P.2d 216 (1949).

In the case at bar nothing was raised in the trial court. Therefore, the matter of amending the workmen's compensation complaint cannot be reviewed on appeal.

We conclude that the trial court committed no error in entering an order to dismiss with prejudice for Liberty Mutual.

The order and the judgment of the trial court are hereby affirmed.

IT IS SO ORDERED.

HERNANDEZ, J., concurs.

SUTIN, J., dissents.

SUTIN, Judge (dissenting).

I dissent.

It is a sad commentary to write that a workman ofttimes...