U.S. Gypsum Co. v. Riley-Stoker Corp.
| Decision Date | 08 July 1959 |
| Docket Number | RILEY-STOKER |
| Citation | 160 N.E.2d 454,6 N.Y.2d 188,189 N.Y.S.2d 145 |
| Parties | , 160 N.E.2d 454 UNITED STATES GYPSUM COMPANY, Appellant, v.CORPORATION, Respondent. |
| Court | New York Court of Appeals Court of Appeals |
Wallace J. Stakel, Batavia, and Wendell J. Brown, Chicago, Ill., for appellant.
Donald F. Hathaway, Rochester, and James A. Reed, Jr., Rochester, for respondent.
An employee of plaintiff United States Gypsum Company, one Thomas G. Steele, was injured in the course of his employment through the negligence of a workman for the defendant, the Riley-Stoker Corporation, while that company was engaged in installing a steam generating unit in the plaintiff's power plant. Steele received an award of compensation in June of 1956. In the following January, the plaintiff, a self-insured employer, notified him that the omission on his part to commence an action against the defendant would operate as an assignment of the cause of action to the plaintiff pursuant to section 29 of the Workmen's Compensation Law, Consol.Laws, c. 67. Steele did not bring suit within the time limited and the plaintiff, as the former's assignee under the statute, instituted the present action to recover damages for his personal injuries. The statute provides, in part, that, if the employer 'recover * * * a sum in excess of the total amount of compensation awarded to such injured employee * * * and the expenses for medical treatment paid by it, together with the reasonable and necessary expenditures incurred in effecting such recovery, it shall forthwith pay to such injured employee or his dependents, as the case may be, two-thirds of any such excess, and to the extent of two-thirds of any such excess such recovery shall be deemed for the benefit of such employee.' § 29, subd. 2.
The complaint before us contains the usual allegations of a cause of action for personal injuries as well as allegations required to show that the plaintiff is entitled to proceed as assignee under section 29. Specifically, after reciting that the plaintiff had paid Steele $930 in compensation and about $1,120 for hospital and medical expenses and after relating the circumstances of the assignment of the cause of action to the plaintiff, the complaint continues:
'18. * * * the said Thomas G. Steele is entitled to the recovery herein a portion thereof (sic) over and above the amounts for compensation, hospital and medical expenses heretofore or hereafter paid by the plaintiff.
The defendant, considering itself prejudiced by the reference to the injured employee's interest, moved, under rule 103 of the Rules of Civil Practice, to strike the quoted and unbracketed, portions of the 18th and 19th paragraphs of the complaint as 'frivolous, irrelevant and redundant'. The Justice at Special and Trial Term, believing that he was concluded by an earlier decision, granted the motion; the Appellate Division affirmed, certifying a question to us for our review.
Simply put, the issue posed is whether or not, in a suit by a carrier or self-insured employer pursuant to section 29 of the Workmen's Compensation Law, the plaintiff is privileged to disclose, by pleadings and proof, the injured employee's interest in the outcome. It is an issue on which the courts throughout the State have differed; the Appellate Division for the Second Department has taken the position that the employee's interest may be alleged and proved (see, e. g., Liberty Mut. Ins. Co. v. American Stevedores, 278 App.Div. 661, 102 N.Y.S.2d 465), while the First and Fourth Departments have held otherwise. See, e. g., Commissioners of State Ins. Fund v. Wilaka Const. Co.,...
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