Southwest Co-op. Wholesale v. Superior Court In and For Maricopa County

• Decision Date: 10 December 1970
• Docket Number: CA-CIV,No. 1,1
• Parties: SOUTHWEST COOPERATIVE WHOLESALE, United Producers and Consumers Cooperative, Arizona corporations, Petitioners, v. The SUPERIOR COURT of the State of Arizona, IN AND FOR the COUNTY OF MARICOPA, the Honorable Thomas Tang, Judge, Larry Berry and Arnold Rivera, Respondents. 1519.
• Court: Arizona Court of Appeals

Page 572

477 P.2d 572

13 Ariz.App. 453

SOUTHWEST COOPERATIVE WHOLESALE, United Producers and Consumers Cooperative, Arizona corporations, Petitioners, v. The SUPERIOR COURT of the State of Arizona, IN AND FOR the COUNTY OF MARICOPA, the Honorable Thomas Tang, Judge, Larry Berry and Arnold Rivera, Respondents.

No. 1 CA-CIV 1519.

Court of Appeals of Arizona, Division 1, Department B.

Dec. 10, 1970.

Rehearing Denied Feb. 23, 1971.

Robert K. Park and Cecil A. Edwards, Jr., Phoenix, for petitioners.

Charles M. Brewer and James D. Lester, Phoenix, for respondents.

HAIRE, Judge.

The question before us in this special action proceeding is whether an industrially injured workman who accepts workmen's compensation benefits Ipso facto waives the right to bring an action against what we will refer to as an 'allegedly noncomplying employer'--i.e., an employer who has prior to the time of the injury in question allegedly failed to keep posted notices of the right of a workman to reject the provisions of the Workmen's Compensation Law and thereby retain the right to sue the employer. See A.R.S. § 23--906, subsecs D and E. It is contended on behalf of the injured workman that the acceptance of compensation must, in order to constitute a binding election, be accompanied by actual knowledge on the part of the injured employee that he has a possible alternative remedy against the employer and knowledge that the right to assert such remedy is lost if compensation is accepted.

All of the following pertinent events took place in 1970. Larry Berry, the respondent real party in interest, sustained a workrelated injury on February 2, while in the course of his employment with one of the two petitioning employers, who were covered by valid policies of workmen's compensation insurance issued by the State Compensation Fund. Employer's and physician's reports of injury were received by the Fund shortly thereafter. On February 17, Berry executed a 'Workman's Report of Injury and Application for Benefits', which was forwarded to the Fund. The claim was accepted for benefits by the Fund on February 18, 1970, and on the same date the Fund issued its check in the amount of $59.84 to Berry for temporary total disability benefits for the period of February 3 through February 16. On February 27, the Industrial Commission received a letter signed by Berry informing the Commission that he had retained his present attorneys 'to represent me in connection with the above captioned claim.' On March 3, March 5, and March 18, the Fund issued checks payable to Berry, in amounts of $64.11, $73.69, and $102.23, for compensation payable through March 18. On March 24, Berry signed and sent to the Fund a 'Workman's Monthly Claim Form'. On April 2, the Fund issued another check payable to Berry in the amount of 102.23, for compensation through April 2. Berry cashed each of the five checks issued to him, which totalled $402.10. It also appears that the Fund was billed for and paid Berry's medical expenses in the amount of $2,208.75.

On or about April 13, Berry filed an 'Application for Award' with the Industrial Commission, requesting that proceedings on his claim be held in abeyance. At the same time, Berry filed an action in the Superior Court against the two petitioners and another individual, alleging that he was engaged in a hazardous employment, and seeking recovery for his injury under the Employers' Liability Law, A.R.S. § 23--801 et seq. After some discovery proceedings, petitioners moved for summary judgment on the ground that Berry, having accepted compensation, waived any right he may have had to bring an action against his employer. Berry opposed the motion on the ground that his attorneys did not know until April 9 that his employer may not have complied with the notice posting requirements of § 23--906, subsec. D, and that he himself did not know until April 10 that he had the possible alternative remedy of bringing suit against the employer instead of receiving workmen's compensation benefits. The petitioners conceded for the purpose of their motion for summary judgment that there may have been a failure to comply with the statutory notice-posting requirements. The motion was denied by the respondent trial judge, and petitioners seek to have this ruling reversed by this special action.

Respondents first argue that this Court should not review by special action the denial of a motion for summary judgment. As we have observed, the denial of a motion for summary judgment is a nonappealable order which '* * * decides only one thing--that the case should go to trial.' Navajo Freight Lines, Inc. v. Liberty Mutual Ins. Co., 12 Ariz.App. 424, 471 P.2d 309, 313 (1970). Our Supreme Court has indicated, however, that this lack of final adjudicatory effect does not preclude (and, by its nonappealable character, permits) review of the negative ruling by means of a special action. See Kilpatrick v. Superior Court, 105 Ariz. 413, 466 P.2d 18 (1970), and Renck v. Superior Court of Maricopa County, 66 Ariz. 320, 187 P.2d 656 (1947). In our view, our jurisdiction to review by special action the denial of a motion for summary judgment should be sparingly exercised, and principally in cases where the critical issue is one of broad public interest, where judicial error is plainly apparent, and where review might terminate or importantly affect a number of litigants or similar litigations. ¹ We think that special action review is appropriate in the present case.

We first set forth the constitutional and statutory provisions which bear upon the legal issue before us. A proviso in Article 18, § 8 of our constitution, A.R.S., which mandated enactment of a Workmen's Compensation Law, states as follows:

'* * * provided that it shall be optional with any employee engaged in any such private employment to settle for such compensation, or to retain the right to sue said employer as provided by this Constitution; * * *.'

A further proviso, immediately following the foregoing, reads as follows:

'* * * and, provided further, in order to assure and make certain a just and humance compensation law in the State of Arizona, for the relief and protection of such workmen, their widows, children or dependents, as defined by law, from the burdensome, expensive and litigious remedies for injuries to or death of such workmen' now existing in the State of Arizona, and producing uncertain and unequal compensation therefor, such employee, engaged in such private employment, may exercise the option to settle for compensation by failing to reject the provisions of such Workmen's Compensation Law prior to the injury.'

A.R.S. § 23--906 was obviously enacted to implement the foregoing provisions. It reads, in full, as follows:

' § 23--906. Liability under chapter or or under common law of employer securing compensation; right of employee to make election; procedure for making election

'A. Employers who comply with the provisions of § 23--961 as to securing compensation shall not be liable for damages at common law or by statute, except as provided in this section, for injury or death of an employee wherever occurring, but it shall be optional with employees to accept compensation as provided by this chapter or to reject the provisions of this chapter and retain the right to sue the employer as provided by law.

'B. The employee's election to reject the provisions of this chapter shall be made by a notice in writing, signed and dated by him and given to his employer, in duplicate in substantially the following form:

'To (name of employer):

You are hereby notified that the undersigned elects to reject the terms, conditions and provisions of the law for the payment of compensation, as provided by the compulsory compensation law of the state of Arizona, and acts amendatory thereto.'

'C. The notice shall be filed with the employer prior to injuries sustained by the employee, and thereafter within five days the employer shall file with the commission the duplicate of the notice so served by the employee. All employees shall be conclusively presumed to have elected to take compensation in accordance with the terms, conditions and provisions of this chapter unless the notice in writing has been served by the employee upon his employer prior to injury.

'D. Every employer engaged in the occupations designated in this chapter shall post and keep posted in a conspicuons place upon his premises, in all languages spoken by his employees and available for inspection by all workmen, a notice in substantially the following form:

'All employees are hereby notified that in the event they do not specifically reject the provisions of the compulsory compensation law they are deemed by the laws of Arizona to have accepted the provisions of such law, and to have elected to accept compensation under the terms of such law, and that under the terms thereof employees have the right to reject the same by written notice thereof prior to any injury sustained, and that blanks and forms for such notice are available to all employees at the office of this company.'

'E. If an employer fails to post and keep posted the notice as required by this section, or fails to keep available at the place where the employees are hired the blank forms of notice to be signed by the employee, no employee who thereafter engages in employment for such employer, during the time that the notices are not posted or during the time that the blanks are not available, shll be deemed to have accepted the provisions of this chapter, and it shall be optional for such employee, if injured during the period when blanks were not available or the notice was not posted, to accept compensation under the provisions of this chapter or maintain other action against the employer.'

The other key statutory provision in the problem before us is A.R.S. § 23--1024, subsection A. Prior to January 1, 1969, this statutory subsection read as follows:

' §...