S. R. Zagst & Co., Inc. v. Southern Surety Co
| Decision Date | 03 January 1921 |
| Docket Number | 22906 |
| Citation | 148 La. 328,86 So. 828 |
| Parties | S. R. ZAGST & CO., Inc., v. SOUTHERN SURETY CO |
| Court | Louisiana Supreme Court |
Appeal from First Judicial District Court, Parish of Caddo; J. R Land, Judge.
Suit by S. R. Zagst & Co., Incorporated, against the Southern Surety Company. Judgment for defendant, and plaintiff appeals.
Judgment annulled, and rendered for plaintiff.
Slattery & Slattery, of Shreveport, for appellant.
Thigpen & Herold, of Shreveport, for appellee.
O'NIELL, J.
This is a suit for indemnity under a contract of insurance against loss or liability for personal injury or death of an employee of the insured, under the Workmen's Compensation Law ().
An employee of the plaintiff company was accidentally killed while engaged in taking down a derrick over an oil well, in order to move it to another location. The widow, in her own behalf and for her minor children, claimed compensation under the Workmen's Compensation Law. The surety company was promptly notified of the accident and investigated the case. Finding that the accident had occurred on the Texas side of the state line, the surety company denied liability, on the ground that the policy contract only covered accidents happening in the state of Louisiana.
The widow of the deceased employee, in her own behalf and for her minor children, brought suit against the employer, plaintiff herein, for $ 3,000 compensation, payable in 300 weekly installments of $ 10 each. The assured promptly sent a copy of the petition to the surety company, with a demand that the latter should defend the suit, and the assured obtained an extension of the time allowed for answering. The surety company declined to defend the suit, insisting that the accident, having occurred outside of this state, was not covered by the policy contract. The insured then answered the suit, but did not urge the defense that the accident had occurred outside of the state, or urge any particular defense, as far as the record shows. Judgment was rendered in favor of the widow for the amount claimed. The assured paid the installments as they fell due, and paid the widow also $ 200 for funeral expenses and attorney's fees.
The surety company, in defense of this suit, pleads as an additional reason for denying liability, that the policy contract stipulated, as one of its conditions, that no wrecking or demolition of structures would be done by the assured. That is not the reason for which the company declined to defend the suit of the widow for compensation; and we are of the opinion that it would not have been a valid reason. The work covered by the policy contract, in terms, included "erection of and moving of derricks," with particular reference to the derricks used in the oil fields. The evidence shows that the usual and ordinary method of moving such derricks is to take them down and haul the lumber to the new location and rebuild the derricks there. It is only when the new location is very close by that a derrick can be moved by skidding or sliding the whole structure. It is not reasonable to construe this policy contract, "including erection of and moving of derricks," so as to exclude the work of taking down derricks for the purpose of moving them. The fact that the surety company did not invoke that interpretation of the contract, in denying liability and declining to defend the widow's suit for compensation, is itself evidence that the contract was not susceptible of that interpretation. The word "demolition" in the stipulation in the policy, "No wrecking or demolition of structures will be done," was used as synonymous with "destruction."
It is not disputed that the accident from which this suit arose occurred on the Texas side of the state line. The derrick was to be moved from the Texas side to the Louisiana side of the line, and the accident happened very near the line.
Pretermitting the question whether the fact that the accident happened on the Texas side of the state line would have been a good defense to the widow's suit for compensation, there are two distinct reasons why the defense should not prevail here. Although it was stipulated, in item 4 of the so-called "declarations" in the policy, that the location where the business or work was to be carried on was "state of Louisiana," it was further stipulated that the policy...
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