Russell v. Drivers Leasing Services, Inc.

• Decision Date: 15 May 1984
• Docket Number: No. 0221,0221
• Citation: 318 S.E.2d 579,282 S.C. 358
• Court: South Carolina Court of Appeals
• Parties: Willard Larry RUSSELL, Blondell M. Russell, Barbara Lynn Russell and Larry Lavon Russell, Plaintiffs, v. DRIVERS LEASING SERVICES, INC., Employers of Wausau, A & B Trucking, and American Insurance Company, Respondents, Southern Intermodal Logistics, and Travelers Insurance Company of Rhode Island, Appellants. . Heard

Page 579

318 S.E.2d 579

282 S.C. 358

Willard Larry RUSSELL, Blondell M. Russell, Barbara Lynn Russell and Larry Lavon Russell, Plaintiffs, v. DRIVERS LEASING SERVICES, INC., Employers of Wausau, A & B Trucking, and American Insurance Company, Respondents Southern Intermodal Logistics, and Travelers Insurance Company of Rhode Island, Appellants.

No. 0221.

Court of Appeals of South Carolina.

Heard May 15, 1984.

Decided July 24, 1984.

Thomas J. Wills, IV, and Robert A. Patterson, both of Barnwell, Whaley, Stevenson & Patterson, Charleston, for appellants.

Stephen E. Darling, of Sinkler, Gibbs & Simons, and Wallace G. Holland, of Young, Clement, Rivers & Tisdale, Charleston, for respondents.

Allen C. Pate, Florence, for plaintiffs.

CURETON, Judge:

The dependents of Willard Larry Russell initiated this claim pursuant to S.C.Code Ann. Section 42-1-10 (1976), et seq. (South Carolina Workers' Compensation Law), for compensation for the work-related death of Russell, their decedent. ¹ The dispositive issue resolved itself on a finding of which company was Russell's employer. The single commissioner held that Southern Intermodal Logistics (SIL) was the employer and Travelers Insurance Company, the liable carrier. The full commission held that Drivers Leasing Services was Russell's employer and its carrier, Employers of Wausau, was liable for payment of the claim. On appeal, the circuit court held that SIL and Travelers Insurance were the liable employer and carrier, respectively, and they appeal. We reverse the judgment against Travelers Insurance.

SIL is a common carrier whose drivers and rigs, for the most part, are leased through independent contractors. Drivers Leasing Services is a corporate independent contractor that procures drivers and equipment for carriers. A & B Trucking employs tractor-trailer drivers who, along with the company's rigs, are leased to carriers. A & B Trucking hired Russell as a driver in November, 1978.

In May, 1979, Russell was killed while operating a tractor-trailer for SIL. Drivers Leasing had procured the rig and Russell's services from A & B Trucking for the benefit of SIL. The contract between A & B Trucking and Drivers Leasing provided that A & B Trucking would maintain workers' compensation insurance on the drivers. The contract between Drivers Leasing and SIL provided that the drivers themselves must agree to pay workers' compensation insurance.

Although it appears that A & B Trucking carried workers' compensation insurance on its employees through American Insurance Company, the parties agreed in practice to additional measures to insure continuous coverage of drivers leased by SIL from A & B. Drivers Leasing Services paid the premium for and secured a workers' compensation insurance policy from Employers Insurance of Wausau covering the drivers SIL leased from A & B Trucking. Instead of paying A & B for its drivers and equipment, directly, SIL passed the weekly lump-sum payment to Drivers Leasing Services. Drivers Leasing then deducted from this sum, among other things, an amount for each drivers' workers' compensation insurance before passing the remaining money to A & B Trucking. The deduction for workers' compensation insurance either reimbursed Drivers Leasing for premiums paid to Employers Insurance of Wausau or was paid directly to the insurance company.

SIL maintained a workers' compensation policy with Travelers Insurance which only covered SIL's non-driver employees. Travelers Insurance received no premium for coverage of the drivers.

On appeal, SIL concedes that it may be considered Russell's employer for purposes of applying the Workers' Compensation Law since it controlled his activities. SIL nevertheless argues that Employers Insurance of Wausau is estopped to deny that it is the liable carrier because it both accepted premiums to provide coverage and paid the claims of two SIL drivers similarly situated as Russell.

As succinctly stated by our Supreme Court in Palmer v. Sovereign Camp, W.O.W., 197 S.C. 379, 391, 15 S.E.2d 655, 661 (1941), "The principle of estoppel in equity stands upon the very foundations of right and fair dealing. It considers and weighs the conduct of men in their dealings with each other, and gives that effect ... to their actions which ... justice dictate[s]." It arises when a person, in reliance on what another has done or said, changes...