Travelers Ins. Co. v. U.S. Fidelity & Guaranty Co.
| Decision Date | 27 October 1964 |
| Docket Number | No. 1251,1251 |
| Citation | 168 So.2d 439 |
| Parties | The TRAVELERS INSURANCE COMPANY, Third-Party Plaintiff and Appellee, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, Third-Party Defendant and Appellant. |
| Court | Court of Appeal of Louisiana — District of US |
Falkenheiner & Calhoun, by Nathan M. Calhoun, Vidalia, for third-party defendant-appellant.
Parker & Parker, by Elodie K. Parker, Jena, for plaintiff-appellee .
Theus, grisham, Davis, Leigh & Brown, by J. C. Theus, Monroe, for third-party plaintiff-appellee.
Before FRUGE, HOOD and CULPEPPER, JJ.
The principal demand in this case, a workmen's compensation claim, was concluded by court approved compromise agreement. The Travelers Insurance Company as workmen's compensation insurer of the principal contractor, Catahoula Construction Company, having paid the compensation claim of an employee of a subcontractor, now through third party demand seeks reimbursement from United States Fidelity & Guaranty Company, the workmen's compensation insurer of the subcontractor, B. & L. Construction Company.
The district court sustained the plea of The Travelers that U.S.F. & G. be estopped to deny that it provided workmen's compensation coverage to the subcontractor. Accordingly, judgment was rendered against U.S.F. & G. in favor of The Travelers in the amount of $4,299.00. Third party defendant, U.S.F. & G., has taken this appeal.
The facts of this case have been stipulated. According to the stipulation, R. G. Cruse, d/b/a Catahoula Construction Company, having been awarded a contract for certain highway construction work in Catahoula Parish, entered into a subcontract with B & L Construction Company. The written subcontract required B & L to carry in force workmen's compensation insurance and to furnish Cruse with a certificate of proof of such insurance 'Prior to moving on the job.'
B & L Construction Company obtained workmen's compensation coverage for its Louisiana activities from U.S.F. & G. and received a 'Certificate of Insurance' addressed to Catahoula Construction Company. The certificate showed that a workmen's compensation policy was issued to B & L by U.S.F. & G., the effective date of the policy being October 6, 1961, and the expiration date October 6, 1962, a period of one year. The certificate states, 'This is to certify that the following policies, subject to their terms, conditions, and exclusions, have been issued by this company.' It further states that U.S.F. & G. 'will make every effort to notify the holder of this certificate of any material change in or cancellation of these policies, but assumes no responsibility for failure to do so.' A similar certificate addressed to the Highway Department of the State of Louisiana was also delivered to B & L.
As a result of B & L's failure to pay the premiums for the workmen's compensation coverage, U.S.F. & G. on May 4, 1962 mailed notice of cancellation of the policy to B & L, cancellation to be effective June 3, 1962. Although a copy of the certificates addressed to Catahoula Construction Company and the Highway Department was in the files of U.S.F. & G.'s agent, no notice of cancellation was sent to either.
On June 12, 1962, Odom v. Chevallier, an employee of B & L Construction Company, was injured while working within the scope and during the course of his employment. The injury was disabling. There having been no question of liability, The Travelers settled the claim for the amount of $4,250.00 and incurred court costs of $49.00. It is agreed that this amount was legally due Chevallier.
The stipulation provides that if the legal representative of R. G. Cruse were to testify, his testimony would be that one consideration for his entering the contract with B & L was the agreement of B & L to carry in full force at all times workmen's compensation insurance . He would further testify that he received the 'Certificate of Insurance' prior to the date B & L Construction Company commenced work under the subcontract; and that he received no notice or had no knowledge of the cancellation prior to the filing of this suit. He would also testify that because of the necessity of Traveler's payment to Chevallier his compensation rates have been adversely affected.
Third party plaintiff, The Travelers, contends that U.S.F. & G. should be estopped to deny workmen's compensation coverage as insurer of B. & L. Construction Company because of their failure to notify Catahoula Construction Company of cancellation of the policy. It is argued that U.S.F. & G., having issued the certificate addressed to Catahoula Construction Company, incurred a duty of notification of any material change in or cancellation of the policy. Furthermore, it is argued that had such notice been given, the loss could have been avoided.
Third party defendant maintains that the workmen's compensation policy was properly cancelled and that there are insufficient grounds for an estoppel. Specifically, it is...
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