Case Name: Before State Industrial Commission, Respondent. In the Matter of the Claim of John Kolb, Respondent, for Compensation under the Workmen's Compensation Law, v. Meta Brummer, Employer, and New Amsterdam Casualty Company, Insurance Carrier, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1918-11-22
Citations: 185 A.D. 835
Docket Number: 
Parties: Before State Industrial Commission, Respondent. In the Matter of the Claim of John Kolb, Respondent, for Compensation under the Workmen’s Compensation Law, v. Meta Brummer, Employer, and New Amsterdam Casualty Company, Insurance Carrier, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 185
Pages: 835–840

Head Matter:
Before State Industrial Commission, Respondent. In the Matter of the Claim of John Kolb, Respondent, for Compensation under the Workmen’s Compensation Law, v. Meta Brummer, Employer, and New Amsterdam Casualty Company, Insurance Carrier, Appellant.
Third Department,
November 22, 1918.
Workmen’s Compensation Law — provision of insurance policy as to consent to assignment — transfer of policy to wife of employer who continued business after his death — when collection of premium does not estop insurer from contesting liability under policy — what does not constitute cancellation of insurance contract within meaning of section 64.
An employer having a policy of insurance with a casualty company for one year, providing that no assignment or change of interest under said policy should bind the company unless its consent should be indorsed thereon or attached thereto, signed by a duly authorized officer of the company, died prior to the expiration of the policy, leaving all of his property to his wife who took charge of and continued the business in the same way, and before the expiration of the policy requested the company, through a broker, to transfer the insurance to her, and said company attached a writing prior to the expiration of the policy as follows: “ The interest in this policy is hereby transferred from twelve o’clock noon ol this date to Meta Brummer.” On the preceding day an employee of the wife suffered an accidental injury and on the next day the wife, as employer, filed a claim for compensation. More than two months thereafter, the original policy having expired, the casualty company presented a bill for additional insurance premium which the wife paid in full. The company claims it was not notified of the accident until more than a month after the payment of said premium.
Held, that an award against the wife and the casualty company as insurer should be reversed so far as it is against the latter.
The performance of the condition of the policy as to assignment was essential to create liability against the insurer to another.
The collection of the balance of the earned premium did not estop the casualty company from contesting liability under the policy.
There was not a cancellation of an insurance contract within the meaning of subdivision 5 of section 54 of the Workmen’s Compensation Law. Kellogg, P. J., and Woodwabd, J., dissented, with opinion.
Appeal by the defendant New Amsterdam Casualty Company from an award of the State Industrial Commission, made on the 10th day of May, 1918.
Frederick Mellor, for the appellant.
Merton E. Lewis, Attorney-General [E. C. Aiken, Deputy Attorney-General, of counsel], and Robert W. Bonynge, counsel to the State Industrial Commission, for the respondents.

Opinion:
Lyon, J.:
Richard Brummer, the husband of the defendant Meta Brummer, was engaged in the business of trucking. He held a policy issued by the defendant New Amsterdam Casualty Company of date August 31, 1916, which ran for one year and upon which he had paid the estimated premium. He died June 28, 1917, leaving a will by which he gave all his property to his wife. His wife took charge of and conducted his business for about two weeks during his last sickness, and after Ms death continued the business in the same way. About the middle of July, 1917, as she testifies, she informed the broker through whom the insurance was procured of the death of her husband, and delivered to him the policy to mail the same to the insurer. He wrote on the outside of the policy the words, " Kindly transfer this insurance to Meta Brummer, and return the policy to me, Buxbaum," and mailed the policy to the insurance company, as he testifies. The insurer attached to the policy a writing dated August 22, 1917, as follows: " The interest in this policy is hereby transferred from twelve o'clock noon of this date to Meta Brummer." On the preceding day, August 21, 1917, the claimant was in the employ of Meta Brummer and about nine o'clock in the morning suffered an accidental injury to the index finger of his right hand which resulted in the loss of the finger.
On August 23, 1917, Meta Brummer, as employer, filed a claim for compensation. On October 8, 1917, the company presented a bill to her for additional insurance premium under said policy, which she paid in full. The policy had expired the August preceding. The insurance company claims it was not notified of the accident until November 12, 1917. She made a report of the injury August 23, 1917, as the employer, and thereafter an award of compensation was made to the claimant against her as an employer. On her application the award was opened, a rehearing had, and an award made against her and the New Amsterdam Casualty Company, as insurer, from which tMs appeal has been taken.
The policy contained the following condition: "Assignment. Condition J. No assignment or change of interest under tMs policy shall bind the Company unless its consent shall be indorsed hereon or attached hereto signed by a duly authorized officer of the Company." No act was done by Meta Brummer in reliance upon the belief that the company had consented to the transfer of the policy to her, which would estop the appellant. The liability of the insurer did not exist as to Meta Brummer until it had made a binding contract with her. It was not an insurance of property but against personal liability and hence the insurance was personal. The performance of tMs condition of the policy was essential to create liability against the insurer to another than the person to whom the policy was issued. An application for insurance to secure compensation would not charge the insurer until a contract was made. I do not think the collection of the balance of the earned premium estops the insurer from contesting liability under the contract. The bill was not presented until October eighth, and the company had no knowledge of the accident until November twelfth. Nor do I think that subdivision 5 of section 54 of the Workmen's Compensation Law is effective. This was not a cancellation of an insurance contract within the meaning of that term as used in that section. The parties had the right to insert any lawful conditions in the contract. (Allen v. German American Ins. Co., 123 N. Y. 6, 13; Dwight v. Germania Life Ins. Co., 103 id. 341; Gans v. Ætna Life Ins. Co., 214 id. 326.)
The defendant insurance company might have had a good reason for not assenting to a transfer of interest. The management of the business had changed and they were no longer protected by the oversight of the husband. While the Commission has the power to determine whether the policy still existed it must determine that question on recognized principles of law. (Matter of Skoczlois v. Vinocour, 221 N. Y. 276.)
The award must be reversed so far as it is against the New Amsterdam Casualty Company.
All concurred, except John M. Kellogg, P. J., dissenting, with an opinion in which Woodward, J., concurred.