Richard v. U.S. Fidelity & Guaranty Co.
| Decision Date | 03 May 1965 |
| Docket Number | No. 47547,47547 |
| Citation | 247 La. 943,175 So.2d 277 |
| Parties | Sam RICHARD v. UNITED STATES FIDELITY & GUARANTY COMPANY and Landreneau Enterprises, et al. |
| Court | Louisiana Supreme Court |
Preston N. Aucoin, Ville Platte, Daniel J. McGee, Mamou, for plaintiff-appellee-applicant.
Gist, Gist, Methvin & Trimble, by DeWitt T. Methvin, Jr., Alexandria, Donald Soileau, Mamou, for defendants-appellants-respondents.
In the exercise of our supervisory jurisdiction (Art. VII, Sec. 11, La.Const. of 1921, LSA), we directed certiorari to the Court of Appeal, Third Circuit, in order that we might review its judgments in the cases of Richard v. Landreneau Enterprises, Et Al., and Richard v. United States Fidelity & Guaranty Company, which reversed the judgments of the trial court rendered in favor of plaintiff. La.App., 167 So.2d 827; La.App., 167 So.2d 840; 247 La. 254, 170 So.2d 510. The cases were consolidated for trial and appeal, but separate judgments were rendered. Certiorari having been granted at the instance of plaintiff-relator, the matter has been consolidated in this Court and one judgment will be rendered herein.
This matter involves workmen's compensation. Sam Richard filed suit against United Stated Fidelity & Guaranty Company, in which he alleged that while in the course and scope of his employment with Landreneau Enterprises, Adraste Landreneau Gins, Inc., and/or the Estate of Adraste Landreneau, on November 19, 1962, he suffered a myocardial infarction (heart attack) with superimposed pneumonitis, as well as a stroke, from which he became permanently and totally disabled. Plaintiff further alleged that he was informed and believed that the defendant had insured his employers and that the insurance covered the alleged liability. By supplemental and amending petition, plaintiff alleged that the policy sued upon erroneously and through inadvertence named only Adraste Landreneau Gins, Inc. as insured, whereas, it was the true intention of the parties that the policy should cover the employees of Landreneau Enterprises, Adraste Landreneau Gins, Inc., and the Estate of Adraste Landreneau; he prayed for reformation of the policy.
The defendant insurer denied liability and filed a Third Party Complaint against Adraste Landreneau Gins, Inc. It alleged that the policy of workmen's compensation insurance it had issued to Adraste Landreneau Gins, Inc. did not cover the work being performed by plaintiff at the time he suffered his heart attack.
Landreneau Enterprises, Semantha Vidrine, Widow of Adraste Landreneau, Joseph Gibbons Landreneau, Louis Calvin Landreneau, Charles Edward Landreneau, Annabelle Landreneau, and Adraste Landreneau Gins, Inc. denied the allegations of the Third Party Complaint.
After filing the above suit, Sam Richard filed a workmen's compensation suit against Landreneau Enterprises, Adraste Landreneau Gins, Inc., and the Succession of Adraste Landreneau. He alleged the accident, supra, and made a demand against the defendants for total disability, penalties and attorney's fees, and medical expenses, said demands being the same as those prayed for in his suit against the insurer.
These defendants denied liability and filed a Third Party Complaint against United States Fidelity & Guaranty Company. They alleged that they were insured by United States Fidelity & Guaranty Company on and prior to the date of plaintiff's alleged accident, against liability to their employees, including Sam Richard, under the provisions of the Louisiana Workmen's Compensation Laws, and that this insurance was in full force and effect when Richard was injured. The third party defendant prayed for rejection of the third party plaintiffs' demands.
For a complete understanding of this matter, we repeat the following facts correctly found by the Court of Appeal:
'* * * we start with the business activities of Mr. Adraste Landreneau before his death in 1960. He was engaged in several businesses in and around the town of Mamou, Louisiana. He owned two cotton gins, as an incident to which he sold cottonseed, fertilizer and insecticides and also financed farmers; he owned a farm with about fifteen tenant houses for individuals who farmed the land on a sharecrop basis; he raised cattle; he operated a rice irrigation well; he owned an insurance agency; he also owned four or five rent houses in the town of Mamou.
'Mr. Adraste Landreneau died on July 13, 1960 leaving a widow and four children. His succession was opened on July 18, 1960 and his two sons, Mr. Louis Calvin Landreneau and Mr. Joseph Gibbons Landreneau, were appointed co-administrators. These administrators managed the various interests of the estate until the heirs were placed in possession by judgment dated March 24, 1961. Then the heirs decided they would separate the cotton gin from the remaining business interests. Accordingly, as of January 1, 1962, a corporation was formed under the name 'Adraste Landreneau Gins, Inc.' The two gins, as well as the cottonseed, fertilizer, insecticide and farm financing businesses, were transferred to this corporation which was wholly owned by the heirs. On or about the same date the widow and heirs also formed a partnership known as 'Landreneau Enterprises' for the operation of the remaining interests of the estate, including the farm properties and the rental properties in town. Separate sets of books and separate bank accounts were created for the corporation and the partnership.
The Landreneau Estate owned a mortgage on a dilapidated house and a lot located in the town of Mamou, which property was turned over to the Estate by the mortgagor. The Estate also owned another dilapidated house which had belonged to the Landreneau grandmother. The Estate employed Marcel Guillory as foreman to oversee the tearing down of these two houses and, from the same lumber, the reconstruction of one house on one of the loss; Guillory was paid by the Landreneau Enterprises. The reconstruction was the first in which the Landreneaus had engaged. They owned four other houses in Mamou; two were rented for cash, one was occupied by a Landreneau, and the other was occupied by a farm manager. Plaintiff Sam Richard worked at the gin on November 17, 1962. On November 19, 1962, he worked as a carpenter's helper on the reconstruction project and suffered his heart attack while performing carpentry work; he thereafter instituted the two proceedings supra.
At the time plaintiff suffered his heart attack, the Landreneaus carried workmen's compensation insurance with United States Fidelity & Guaranty Company. The policy was an alleged renewal of the insurance carried by the deceased Adraste Landreneau. The policy recited that it expired on July 3, 1963, and the name of the insured was listed as 'Adraste Landreneau Gins, Inc., Mamou, Louisiana.' (The previous policy, which expired July 2, 1962, named the insured as 'Landreneau Gin.') The declarations on the back of the policy recited, under Locations, '2 Gins-Mamou, Louisiana.' The following appeared under classification of Operations:
"Premium Basis Rates Per
Estimated Total $100 of Estimated
Annual Remuneration Remuneration Annual premiums
"Cotton Gin Operation
including local manager
drivers $12,300 9.09 1118.07
"Farms--all employees
other than inservants--
including drivers 1,200 5.56 66.72"
Adraste Landreneau desired to increase his coverage while he was alive; the following is a file memorandum of the insurer with respect thereto:
'Alexandria, La.,
'6--18--58
'File Memorandum: Adraste Landreneau.
'Mr. Landreneau telephoned this afternoon that he had received our letter with which we had enclosed renewal workmen's compensation and general liability policy covering his gin at Mamou. He has requested that we extend this policy to also cover employees on his farm. He has approximately 15 or 16 tenant dwellings and the farm is operated on a share crop basis, which he referred to as a 1/3 basis. He is interested in having labor covered under our compensation policy, which performs maintenance work on the tenant dwellings and other property, such as barns, fencing, etc. He states that he would estimate the payroll for these maintenance employees to be approximately $1,000 a year. We should add to our policy by endorsement as of its effective date, as well as the current policy which has not yet expired, the classification of Farms with an 'If any' payroll, and also the classification of Residence Carpentry, unless the latter classification carries a lower rate than for farms, in which event we should only show a farm classification and rate.
'He stated that he was mailing to us today the General Liability Policy which we asked be returned for cancellation.'
Having the above facts before it, the trial court...
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