Court Opinion

ID: 7813962
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:28:28.855902+00
Date Added: 2024-06-11T16:28:35.026255
License: Public Domain

Griffin Smith, Chief Justice. Our first problem is to determine whether the circuit court correctly found that there was substantial evidence upon which Workmen’s Compensation Commission made its award to W. H. Bailey and that Great America’s policy of insurance comprehended coverage in the unusual circumstances attending the controversy. A secondary issue is the Commission’s right to direct payment of emergency treatment when an award has been made and before the primary right to compensation has been judicially concluded. Day and Nite Cleaners, now incorporated, operated for many years in Fort Smith as a personal enterprise owned by William H. Carter. One establishment is on Rogers street. A second plant is on Grand avenue and a pickup office is maintained at Camp Chaffee. Personnel employment varies from 33 to more than forty and a quarterly payroll copied in the transcript discloses employment expenditures in excess of $17,000. This includes Carter’s salary. Carter owned 18 acres on Highway 22 east of Ft. Smith where he resides, and where tenant quarters appropriate to operational necessities are provided. The place has long been known as Circle C Ranch. Following the incorporation of .Day and Nite Cleaners Carter transferred the so-called ranch property and it became a part of the corporate entity. By § 81-1302 (c) (1), agricultural farm labor is excepted from the definition of employment, although the exclusion may be waived. See § 81-1307, Ark. Stat’s. In the case at bar it is conceded that the notice mentioned in § 81-1307 and more particularly set out in § 81-1308 was not given. Appellant believes Bailey was an agricultural farm laborer and points to the fact that he resided on the ranch, attended stock, made incidental repairs to fences and minor equipage, and was required to report for duty at the cleaning plants only when accumulated work suggested that course to the management. Bailey was paid with Day and Nite checks at $100 per month, but was allowed free use of ranch facilities equal, as the Commission found, to an additional $40 per month. Bailey’s connection with Carter and his enterprises began June 2, 1952, when he replaced L. H. Davis, resigned. Davis had been preceded by Rolen Slaten whose working conditions were substantially the same as those under which Davis and Bailey rendered service accountability, and pay was the same. Under “ Classification” in the insurance policy cleaning or dyeing is covered, including repairing or pressing. Route supervisors, salesmen, drivers, chauffeurs and their helpers, are under Code No. 2586. A subsection (b) includes a risk not pertinent to our review. The total estimated advance premium was $243.15. Item 5 reads: ‘ ‘ This employer is conducting no other business operations at this or any other location not herein disclosed — except as herein stated: — No exceptions.” The injury for which compensation was awarded occurred June 10th when Bailey fell from a tree while working under Carter’s supervision on the 18-acre tract. The accident happened eight days after Bailey succeeded Davis and the injured man had not done any work in the cleaning establishments. It was shown, however, that Davis and Slaten had received periodic calls to work in the cleaning plants. The evidence is that Bailey’s duties were not different from those to which Davis had responded; so the issue is whether, as a matter of law, Bailey’s assignment to the ranch excluded him from the insurance coverage pertaining to Day and Nite employes. The problem is not without its perplexing phases and no case absolute in factual structure has been cited. Quite clearly the coverage contracted for is that itemized on the first page of the policy as 1 (a), hence the term “such injuries” frequently found in the policy was no doubt intended by the insurer to limit recovery to that class. But we are met with other language that is susceptible of a broader connotation — a construction the insured might with reason have thought to be more embracive than the restrictive verbiage of Item 1 (a). Section 6 expresses the insurer’s purposes to make the agreement applicable “to such injuries sustained by any person or persons employed by this employer whose 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”. Appellant’s custom was to check the quarterly returns made by the employer in withholding federal tax estimates, a report that is combined with federal insurance contributions and deductions. For the period ending Sept. 30, 1951, Slaten was listed as an employe. For the quarter closing June 30,1952, Davis is shown to have been entitled to taxable wages amounting to $343.50. Davis testified that he frequently received overtime payment. Bailey testified that he was to be available for work at Day and Nite six hours a day — “That’s what I was supposed to do, but I hadn’t done any work yet because it was the slack season”. The Commission seemingly attached importance to Carter’s explanation of ranch operations and why the property was maintained. Prior to 1940 Carter had been connected with Sears-Roebuck Company, but suffered a nervous breakdown and was advised by Mayo Clinic physicians to adopt a hobby. Horseback riding in particular was recommended. The acreage was acquired with this purpose in view. After entering the cleaning business it occurred to Carter that good will would be promoted by making the ranch facilities available to friends and customers. He specialized in Palomino horses and kept from, eight to twelve. These were sometimes taken out of the state and entered in stock shows. To some extent the expense of operating the ranch was met in this manner. Perhaps a little profit had been realized, but in the main the undertaking had just about broken even. Financial matters connected with the ranch were handled through Day and Nite. During summer months some cows were bought and they grazed on pasture lands, but no attendant looked after them except when incidental services were required. It was Carter’s belief that the advertising value resulting from maintenance of the ranch more than justified its retention. No crop of any kind — not even a garden — was cultivated. Appellee calls attention to the fact that all information required by the insurer was procurable by agents who annually checked payrolls in order to determine what additional premium should be charged, and included in such primary and secondary payments was the name of at least one of Bailey’s predecessors. We agree with appellant that the expressions exempting agricultural farm labor is broader than mere cultivation of the soil. But in the case here there was substantial evidence for the Commission’s finding, and circuit court’s affirmation, that Carter’s corporation was not engaged in an agricultural pursuit within the meaning of the law; and, while the worker whose hack was broken when he fell from the tree had not reported at the cleaning establishment, the insurance company with available means for determining classifications and the nature of all risks assumed was willing to rely upon federal tax reports which carried the names of persons whose salaries were included in fixing premiums. We have therefore concluded that the fact-finding agency was not without warrant in holding that appellant had not overcome the verity attaching to the payroll reports and testimony showing business methods and the responsibility of employees. On November 24th this court entered an order of remand permitting circuit court to reinvest the Commission with jurisdiction to exercise its discretion in directing or declining to direct immediate payment of emergency treatment costs, pursuant to § 81-1311, Ark. Stat’s. The Commission took the view that express language of the statute — that is, § 11 of the initiated Act of 1948- — • deprives it of any authority to require the employer to furnish medical, surgical, hospital, or nursing services before final court adjudication of liability for compensation has been had. The pertinent paragraph is: “The employer shall not be liable for any of the payments [provided for in the section] in case of a contest of liability where the Commission shall decide that the injury does not come within the provisions of the Act”. It is our view that the purpose of the statute was to invest the Commission with discretion to direct immediate assistance when, as in this case, the primary question of compensation had been decided in favor of the claimant. It may be argued that, in the event of appeal and reversal of the Commission’s findings, interim expenditures by the employer or its insurance carrier would in many instances be a loss. This, however, does not render the Act invalid for want of due process. In California State Auto. Ass’n Inter-Insurance Bureau v. Maloney, Insurance Commissioner, 341 U. S. 105, 71 S. Ct. 601, 95 L. Ed. 788, the IT. S. Supreme Court said that the power of a state is broad enough to take over the whole insurance business, leaving no part for private enterprise. It also said that a state’s police power extends to all the great public needs, and may be utilized in aid of what the legislative judgment deems necessary to the public welfare, “ [and this is] peculiarly apt when the business of insurance is involved.” The court was considering the California Compulsory Assignment Bisk Law that provided for approval by the insurance commissioner of a reasonable plan for equitable apportionment among insurers of automobile insurance applicants who are in good faith entitled to, but are unable to procure, insurance through ordinary methods. The plan made it mandatory for all insurers to subscribe to the plan, and the court held that the subject-matter was within the state’s police power. The reasoning of the Maloney case when applied to the state’s right to require injured employees to be given medical treatment is quite clear. The circuit court’s judgment upholding the Commis-. sion’s determination that Bailey is entitled to compensation is affirmed. Its holding that the Commission is without power to direct emergency treatment is reversed. Mr. Justice Ward dissents; Mr. Justice George Bose Smith concurs.