Aetna Casualty & Surety Co. v. Duckham

Per Curiam.

By leave granted, plaintiff appeals from a circuit court order affirming a prior district court finding that plaintiff had no cause of action against defendant.

Plaintiff is the insurance carrier for Double A Products of Manchester, Michigan. Double A Products and defendant Duckham had entered into an agreement pursuant to which defendant agreed to haul trash from the Double A plant for a price fixed in the agreement. The course of dealing established the method by which the contract was to be carried out, namely, Duckham left a trash compacting truck at the Double A plant and, when it was full, either he himself or an employee of his would drive the truck to the dump, empty it, and return the truck to the Double A plant.

On April 14, 1966, one John Johnson, a part-time employee of the defendant employed on an "as needed” basis, who was a full-time employee of the Dempsey Company in Garden City, Michigan, was unable to report to his regular employment with the Dempsey Company because his automobile broke down. Johnson succeeded in driving his automobile, however, from his home in Jackson to Manchester. He first stopped at a bar and imbibed some alcoholic beverages.

Johnson then proceeded to the Double A plant. A Double A employee was loading defendant’s trash compactor, and Johnson rendered assistance. The truck mechanism was jammed and, in an attempt to free the device, Johnson caught his hand in the machinery and severed three fingers of one hand. The severed fingers were discovered in Johnson’s glove and surgically restored to his hand at the hospital.

Johnson instituted a petition for worker’s disability compensation benefits against defendant Duckham, who, in, violation of statute, carried no workman’s compensation insurance, as well as against Double A and its insurance carrier, Aetna Casualty & Surety Company.

Subsequently, a redemption hearing was held at which all parties were represented. Duckham’s attorney stated that Duckham denied liability under the act in that he denied there was an employment relationship at the time of Johnson’s injury. The attorney then stated that having denied liability on behalf of his client, he would not participate in the redemption hearing. Johnson and Double A then voluntarily entered into a redemption settlement. This was done despite the fact that Duck-ham’s attorney had specifically stated on the record of the redemption hearing that Duckham would deny any liability for reimbursement to Double A or its insurance carrier. Johnson’s petition for compensation against Duckham was not further pursued. Plaintiff thereafter commenced this suit seeking indemnification pursuant to MCL 418.171(2); MSA 17.237(171)(2).

The district court found, and the circuit court affirmed, that on the day in question Johnson was not an employee of defendant and was not injured in the course of his employment. In reaching this conclusion, the court found to be significant the facts that on the date in question Johnson was not requested to come in for work, did not report at defendant’s office nor punch in, was out drinking and decided to voluntarily visit the men at the Double A plant. Once it was determined that the employment relationship was not established, plaintiff’s claim for indemnification necessarily fell.

Four issues are raised in this appeal. Only one is of sufficient significance to merit discussion. Simply stated, we must determine whether the lower court’s decision that Johnson’s injury was not related to his employment with defendant was in error.

In Whetro v Awkerman, 383 Mich 235, 242-243; 174 NW2d 783 (1970), the Supreme Court concluded that in Michigan, if the employment is the occasion of the injury, even though not the proximate cause, compensation should be paid. Thus, in Whetro, the Court held that injuries caused by the devastating Palm Sunday, 1965, tornados were compensable under the worker’s compensation act.

In Nemeth v Michigan Building Components, 390 Mich 734; 213 NW2d 144 (1973), the Court held that where an employee was injured while working after hours with his employer’s equipment on a project with a fellow employee, his injury arose out of the employment relationship. The Court set out a "sufficient nexus” test. If it is possible to say that "but for the employment relationship” the injury would not have occurred, then the injured employee is entitled to compensation.

In a later case, Hicks v General Motors Corp, 66 Mich App 38, 44; 238 NW2d 194 (1975), lv den 396 Mich 838 (1976), this Court held that a plaintiff’s volunteering to do something outside of his working hours which was not a part of his assigned duties did not automatically remove him from the course of his employment.

Most recently, the Supreme Court allowed recovery by an employee who was struck by a car, off-premises, while walking across a street to a restaurant during his lunch break. McClure v General Motors Corp, 402 Mich 392; 262 NW2d 829 (1978). The Court stated, at 395:

"Here, too, 'it was a circumstance of his employment that placed plaintiff in this case where he was when he was accidentally injured’. It was as an incident of the employment relationship that McClure found himself in the traffic lane on the Fleetwood Inn side of Fort Street approximately 50 to 75 yards from the factory during his lunch break on April 14, 1973.”

In the instant case the injured employee’s status as a part-time employee of defendant both before and after his injury is undisputed. His action in helping plaintiff’s insured’s employees load defendant’s garbage truck arose out of his employment relationship with defendant. It is probable that "but for the employment relationship”, the injured employee would not have offered to help plaintiff’s insured’s employees load the garbage truck. It was his familiarity with defendant’s equipment, gained from his employment with defendant, that led the injured employee to offer assistnace on the date of his injury. We hold under these circumstances, therefore, that the injury arose out of an employment relationship with defendant.

By statute, MCL 418.171; MSA 17.237(171), plaintiff has the right to seek indemnification from defendant for the amount paid to the injured employee as a result of the redemption settlement.

The district court’s finding of no cause of action was clearly erroneous and is. reversed. Appellant may tax costs.