Maryland Casualty Co. v. Pioneer Seafoods Co.

HANEY, Circuit Judge.'

A declaratory judgment construing an employers’ liability policy issued by appellant to appellee, Pioneer Sea Foods Company, was sought in this action brought by appellant.

In December, 1936, appellant issued an employers’ liability policy to Pioneer Sea Foods Company, hereafter called the company, wherein appellant agreed

“I. To insure said named Assured against loss from liability imposed by law upon the Assured for damages (direct or consequential) on account of bodily injuries, including death resulting therefrom, accidentally suffered or alleged to have been suffered by any employee of the Assured * * * provided such bodily injuries or death are suffered as the result of accident occurring within the term of this insurance ❖ * *

“Til. To defend in the name and on behalf of the Assured any claims, suits or other proceedings which may at any time be instituted against the Assured on account of such injuries or death resulting therefrom, including claims, suits or other proceedings alleging such injuries or death and demanding damages therefor, although such claims, suits, proceedings, allegations and demands may be wholly groundless, false or fraudulent; * * * ”

On April 12, 1938, appellee Hanseth, who was employed by the company as a gill netter and seaman, filed an action in a state court of Washington to recover damages, and alleged that the company furnished him sleeping quarters on a boat which “were improperly, carelessly and negligently constructed, equipped and maintained” in nine particulars, and that as a result of such negligence, his “health was so weakened and undermined that * * * (he) became physically weakened and his ability to resist germ invasion was almost completely destroyed; that by reason of said weakening * * * (his) ’susceptibility to the attack of the tubercular germ was raised to a high point” and that he contracted tuberculosis. The company tendered the defense of the action to appellant. Appellant declined to defend on the ground that Hansefh’s affliction was not within the‘terms of the policy because not a “bodily injury accidentally suffered”.

On December 16, 1938, appellant commenced this action for a declaratory judgment that it was not liable under the policy for Hanseth’s-injury. The company answered praying for a judgment to the contrary.

On September 25, 1939, the court below found that “the contracting of tuberculosis in the manner and form alleged in Hanseth’s said complaint was a ‘bodily injury * *, * accidentally suffered’ within the meaning of said policy of insurance, as to ¹ which a declaratory judgment is sought in this action”, and entered judgment that appellant was liable to the company. Appellant brought this' appeal.

On November 17, 1939, the company entered into a stipulation with Hanseth that a judgment for $2,500 might be entered against the company in the state court action. The state court thereupon found, upon Hanseth’s testimony, that Hanseth “was accidentally injured * * * by the accidental discharge of gas fumes and oil from the engine of said boat into his quarters thereon and by the negligent failure of (the company) to supply proper, warm, dry and adequately ventilated sleeping quarters for (Hanseth) thereon, and by (the company’s) negligent failure to furnish plaintiff with proper and sufficient food and nourishment”. Judgment was entered on November 17, 1939, in favor of Hanseth and against the company. The company then moved this court to dismiss appellant’s appeal on the ground that the state court judgment settled the issues in this appeal, that the controversy has become moot, and that this court is bound by the judgment in the state court.

The motion to dismiss the appeal is denied because the issues in the state court were not the same as those in the court below. In the state court, the issue was whether Hanseth was injured as a result of the company’s negligence. In this action, the issue is whether the injury was sustained by Hanseth as a result of “accident” as that term. is used in the policy in question.

Appellant contends that Hanseth’s injury or disease was not sustained by “accident” within the meaning of the policy. Appellant insured the company “against loss from liability imposed by law upon the Assured for damages * * * on account of bodily injuries * * * accidentally suffered or alleged to have been suffered by any employee of the • Assured * * *” In simpler language, appellant is liable if (1) liability for damages was imposed by law upon the company for “bodily injuries * * * accidentally suffered”; or (2) liability for damages was imposed by law upon the company for “bodily injuries * * * alleged to have been suffered”. Whether the injuries resulted from “accident” is therefore immaterial under these provisions. However, the proviso requires such bodily injuries to be “suffered as the result of accident occurring within the term of this insurance”. Therefore, since liability was imposed by law upon the company for Hanseth’s bodily injuries, appellant is liable if such injuries were suffered “as the result of accident”.

The problem here is one of interpretation of the contract, a question, the decision of which is controlled by state law. Erie Ry. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, 114 A.L.R. 1487.

In United States Mutual Accident Association v. Barry, 131 U.S. 100, 121, 9 S.Ct. 755, 762, 33 L.Ed. 60, it is said that “'if, in the act which precedes the injury, something unforeseen, unexpected, unusual, occurs which produces the injury, then the injury has resulted through accidental means”. That rule was approved in McNally v. Maryland Casualty Co., 162 Wash. 321, 325, 298 P. 721. A similar statement may be found in Horsfall v. Pacific Mutual Life Ins. Co., 32 Wash. 132, 72 P. 1028, 1029, 63 L.R.A. 425, 98 Am.St.Rep. 846, where it is said that an accidental death is “death from any unanticipated event, which happens as by chance, or which does not take place according to the usual course of things”. Under this broad rule, the physical weakening of Hanseth was unforeseen, unexpected and unusual as to him, and therefore the bodily injuries were accidental. Under such a policy, whether the injury was suffered as a result of accident is to be determined from Hanseth’s standpoint, or in other words, while the event which caused the injury was the company’s negligence, the occurrence of the event as to Hanseth was accidental. Westerland v. Argonaut Grill, 187 Wash. 437, 60 P.2d 228.

In this connection, it was said in Carpenter v. Pacific Mut. Ins. Co., 145 Wash. 679, 684, 261 P. 792, 794: “* * * The germ enters from the outside; therefore it is external. It. is a foreign substance forced into the circulatory system; therefore it enters by violence. Its entry was not intended or expected; therefore it was accidental.”

Appellant contends that the cases decided under the workman’s compensation act are applicable here, and specifically relies on Depre v. Pacific Coast Forge Co., 145 Wash. 263, 259 P. 720, where a workman’s resistance to tuberculosis was lessened by the breathing of fumes, and it was held that he could not recover under the workman’s compensation act for tuberculosis subsequently contracted. Compare: Hadley v. Department of Labor and Industries, 174 Wash. 582, 25 P.2d 1031.

We are of the opinion that such class of cases is not controlling. While cases of that class are controlling in the determination of the question as to the proximate cause of death or injury (Kearney v. Washington National Ins. Co., 184 Wash. 579, 583, 52 P.2d 903), they are not controlling in the determination of the question as to what constitutes an “injury”. Indeed the workman’s compensation act specifically defines “injury”, giving it a much narrower meaning than the meaning which we must attribute to the word in the policy. Howard v. Hollahan, 182 Wash. 693, 48 P.2d 230. We think the real basis of the decision in Depre v. Pacific Coast Forge Co., supra, was that the workman was unable to show the kind of injury required by the act.

There is nothing in the policy in question which limits the meaning of the word injury, and appellant does not contend that Hanseth was not “injured”. Illustrative of state decisions are those in which recovery has been allowed for “accidental” injury or death, where the lifting of a heavy weight caused a heart ailment resulting in death ;¹ where a blow on a person’s back causing a bruise which developed into a carbuncle which became infected causing death ;² where infection entered body through abrasions of skin of knuckles causing death;³ and where one was injured by drinking wood alcohol which he thought was Scotch whiskey.⁴ We think the court below did not err and the judgment is

Affirmed.

1 Horsfall v. Pacific Mutual Life Ins. Co., 32 Wash. 132, 72 P. 1028, 63 L.R. A. 425, 98 Am.St.Rep. 846.

2 Day v. Great Eastern Casualty Co., 104 Wash. 575, 177 P. 650.

3 Carpenter v. Pacific Mut. Ins. Co., 145 Wash. 679, 261 P. 792.

4 McNally v. Maryland Casualty Co., 162 Wash. 321, 298 P. 721.