Opinion
Rehearing Denied April 22, 1929
Hearing Granted by Supreme Court May 21, 1929
Proceedings under the Workmen’s Compensation Act by William Jones, claimant, for compensation for injuries, opposed by the American Mercury Corporation, employer, and the Ocean Accident & Guarantee Corporation, Limited, insurer. From an order of the Industrial Accident Commission awarding compensation, the insurer brings certiorari. Affirmed.
COUNSEL
R.P. Wisecarver and Redman & Alexander, all of San Francisco, for petitioner.
Daniel W. Burbank, C.F. Laumeister, and Orrick, Palmer & Dahlquist, all of San Francisco, amici curiae.
G.C. Faulkner, of San Francisco, for respondents.
OPINION
STURTEVANT, J.
This is a proceeding under title 1, part 3, Code of Civil Procedure. The case presents two questions regarding the construction of an insurance policy. The American Mercury Corporation is a corporation engaged in operating mines. Prior to October, 1927, it had a contract on a mining property located in Kern county. By the terms of that contract it was to install certain machinery and thereafter operate the mine. It is clear that the machinery had not been installed and that the mine had not been operated, but some surface work was done. In the month of October, William Jones, with some others, was engaged in removing the surface covering so as to expose the vein. At other times the employees were engaged in making alterations and repairs to some roads appertaining to the mine. While so engaged William Jones was in an accident and suffered a broken leg. On that date the petitioner was the insurance carrier of American Mercury Corporation. On an application made to it, in due time the Industrial Accident Commission made an award in favor of William Jones, and the petitioner has applied for a writ of review for the purpose of having it declared that under the terms of its policy no liability attached to the petitioner. Before proceeding further it should be stated that American Mercury Corporation was also operating the Oceanic mine three miles from Cambria, San Luis Obispo county, Cal. The petitioner calls to our attention certain passages contained in the policy, and thereupon it contends that it insured the employees of American Mercury Corporation who might be in its service at Oceanic mine in San Luis Obispo county, but did not insure employees working for that corporation in any other county. The respondents make two major replies. They contend that, if the policy attempted, by any provision therein contained, to limit the liability of the carrier to employees serving the employer at Oceanic mine, then and in that event the limitation was ineffective, because the carrier did not comply with the provisions of subdivision (a) of section 31 of the Workmen’s Compensation Act (St.1917, p. 860). The second reply is that, taking up the policy by its four corners, it appears that the carrier did not attempt to limit its liability, but by the terms of its policy the carrier became liable for injuries to employees working at Oceanic mine, and also to those working at the mine in Kern county. We will discuss the second contention first.
The policy consists of one sheet which when folded makes four pages of the size of foolscap. To the policy there are attached six separate riders. The first two pages purport to be the covenants and conditions on the part of the carrier. The third page purports to be the covenants on the part of the insured. The covenants of the carrier include, among other things, the following (all italics below are ours):
"1. (a) To pay promptly to any person entitled thereto, under the Workmen’s Compensation Law and in the manner therein provided the entire amount of any sum due. ***
"(d) The obligations of paragraph 1(a) foregoing are hereby declared to be the direct obligations and promises of the company to any injured employee covered hereby. ***
"1. (b) To indemnify this employer against loss by reason of the liability imposed upon him by law for damages on account of such injuries to such of said employees as are legally employed wherever such injuries may be sustained within the territorial limits of the United States of America or the Dominion of Canada. ***
"5. This agreement shall apply to such injuries sustained by any person or persons employed by this employer and entire remuneration shall be included in the total actual remuneration for which provision is hereinafter made, upon which remuneration the premium for this policy is to be computed and adjusted. ***
"6. This agreement shall apply to such injuries so sustained by reason of the business operations described in said declarations which, for the purpose of this insurance, shall include all operations necessary, incident or appurtenant thereto, or connected therewith, whether such operations are conducted at the work places defined and described in said declarations or elsewhere in connection with, or in relation to, such work places.
"7. This agreement shall apply only to such injuries sustained by reason of accidents occurring during the policy period limited and defined as such in Item 2 of said declarations.
"This agreement is subject to the following conditions:
"A. The premium is based upon the entire remuneration earned, during the policy period, by all employees of this employer engaged in the business operations described in said declarations. *** If any operations as above defined are undertaken by this employer but are not described or rated in said declarations, this employer agrees to pay the premium thereon at the time of the final adjustment of the premium in accordance with condition (C) hereof at the rates and in compliance with the rules of the manual of rates in use by the company upon the date of issue of this policy.
"C. The company shall be permitted at all reasonable times during the policy period, to inspect the plants, works, machinery and appliances covered by this policy, and to examine this employer’s books at any time during the policy period, and any extension thereof, and within one year after its final expiration, so far as they relate to the remuneration earned by any employees of this employer while this policy was in force."
The rider, "Monthly Premium Adjustment Endorsement" provides: "It is hereby understood and agreed that on or before the 10th day of each calendar month, *** the assured shall state to the company in writing the amount of remuneration earned by employees during the preceding calendar month, or such part thereof as is within the policy period and pay to the company the entire premium earned upon such remuneration at the rate or rates named in the policy.
"Declarations
"Item 1. Name of this employer American Mercury Corporation Post Office Address Crocker Building, San Francisco, California.
"Item 2. The period during which the policy shall remain in force, unless cancelled as in the policy provided, shall be from October 26, 1927, at 4 p.m. to October 25, 1928, at 12:01 a.m., standard time as to each of said dates at the place where any operation covered hereby is conducted, as respects that operation, or at the place where any injury covered hereby is sustained as respects that injury.
"Item 3. Location of *** work places of this employer *** Oceanic Mine, three miles from Cambria, San Luis Obispo, California. All business operations including the operative management and superintendence thereof, conducted at or from the locations and premises defined above as declared in each instance by a disclosure of estimated remuneration of employees under such of the following divisions as are undertaken by this employer are divided into
"(1) All industrial operations upon the premises.
"(2) All office forces.
"(3) Operations not on the premises."
(1) Here follows specific enumeration under general heads of Mining, Smelting, Road Construction, and Commissary Work, with the rate set opposite each item.
(2) Clerical office employees (no statement regarding place of service).
(3)(a) Outside salesmen, collectors, and messengers wherever engaged.
(b) Drivers and driver’s helpers wherever engaged, chauffeurs and chauffeur’s helpers wherever engaged.
"Item 4. *** The company shall be permitted to examine the books of this employer at any time during the policy period and any extension thereof and within one year after its final termination so far as they relate to the remuneration earned by any employee of this employer while the policy was in force.
"Item 5. This employer is conducting no other business operations at this or any other location not herein disclosed— except as herein stated: There may be but not covered hereunder."
That the liability of the company is limited to accidents happening within one year from 4 p.m., October 26, 1927, to 12:01 a.m., October 26, 1928, is tersely and clearly stated in two short paragraphs.
That every single employee on the pay rolls of the employer must be reported and a premium on his wages must be paid to the carrier is equally clear.
That industrial operations other than those mentioned in the policy may be conducted at Cambria, whether extra hazardous or otherwise, is expressly authorized by the policy, and the only condition is that premiums on the additional pay roll must be paid.
That injuries suffered at Cambria are not the sole injuries falling within the terms of the policy cannot be gainsaid. The clerical force was at least in part employed at San Francisco and in part at Los Angeles— nevertheless the clerical force is expressly covered. Item 3, subd. 2. Traveling employees wherever engaged are expressly covered by the policy. Item 3, subd. 3. It is not claimed that there is any language contained in the policy which expressly provides that an employee working in Kern county is not included in the terms of the policy. The sole contention in this behalf is the language contained in item 5: "This employer is conducting no other business operations at this or any other location not herein disclosed— except as herein stated: ‘There may be, but not covered hereunder’ ". The latter part of that statement is typewritten. It is patently the language of the carrier and not the language of the insured. Whatever may be its meaning, it is not of such force as to warrant us in saying that the policy did not cover the claim of William Jones.
The terms of the policy are such that it has not been necessary for us to take up the first contention made by the respondents. If it were necessary to discuss the contention, we should hold, for the reasons stated in Zurich General Accident & Liability Insurance Co., Ltd., v. Stadelman et al., No. 6620 (Cal.App.) 276 P. 407, this day filed, that the contention is well founded.
The award is affirmed.
We concur: KOFORD, P.J.; NOURSE, J.