Bankers Indemnity Insurance v. Cleveland Hardware & Forging Co.

This cause comes to this court on appeal on questions of law. The plaintiff brought this action in the Common Pleas Court, seeking judgment against the defendant in the sum of $9,933.70.

The facts which are the foundation of plaintiff's claim are as follows:

The plaintiff issued a policy of insurance to indemnify The Burdett Oxygen Company against loss because of injuries sustained by any one other than an employee through its negligence in the conduct of its business. The Cleveland Hardware Forging Company, defendant herein, required the use of nitrogen gas as a part of one of its manufacturing processes in its die casting department. The Cleveland Hardware Forging Company claimed to have ordered from The Burdett Oxygen Company, just prior to the accident hereinafter described, two tanks of nitrogen gas. The Burdett Oxygen Company claims that oxygen was ordered. The Burdett Oxygen Company delivered oxygen gas and when it was put into use by The Cleveland Hardware Forging Company's employees a severe explosion occurred and three of its employees were killed. The Cleveland Hardware Forging Company was a subscriber to the state industrial employees insurance fund; and the dependents of the three deceased employees were paid the full benefits provided for by the workmen's compensation law in a total sum exceeding $20,000. Thereafter the dependents of the three deceased employees brought separate wrongful death actions against The Burdett Oxygen Company claiming that the company was negligent in delivering oxygen, a highly dangerous and explosive gas, instead of nitrogen; and that as a proximate result of such negligence the deceased employees came to their death.

The plaintiff herein was called upon, because of its insurance contract with The Burdett Oxygen Company, to defend such actions. After investigating the cases it concluded that the negligence of the defendant in the instant action was the primary cause of the death of its employees, and that if there was any negligence on the part of The Burdett Oxygen Company it was secondary to that of such defendant. The plaintiff thereupon notified the defendant in the instant case of its intention to hold it responsible to the full extent of the plaintiff's losses arising out of the wrongful death actions. The plaintiff then compromised such actions, paying out on behalf of The Burdett Oxygen Company $9,933.70 and upon being subrogated to the rights of The Burdett Oxygen Company instituted this cause seeking judgment against the defendant for the full amount which plaintiff was compelled to expend to settle the wrongful death cases.

Upon trial to the court, the right to a jury having been waived, the case was submitted upon an agreed statement of facts which in substance sets forth the facts as above stated and further provided that the plaintiff could introduce further evidence to support its contentions. The court refused to hear further evidence and upon motion by the defendant entered judgment for the defendant on the ground that the defendant, having complied with the Workmen's Compensation Act, was by the Constitution of the state of Ohio relieved of any further liability arising out of the injury or death of any of its employees while at work and acting within the scope of his employment.

There are two questions presented for our consideration. The first question is: If it be admitted that both the hardware company and the oxygen company were liable to the next of kin of the deceased employees of the hardware company, then, as between the hardware company and the oxygen company is there any ground upon which it could be found that the hardware company was primarily liable and the oxygen company secondarily liable for such damages, so that if the oxygen company was compelled to pay such damages it would have a right to recover the damages thus paid from the hardware company?

The first cause of action of the petition of the plaintiff does not allege facts which, if established by the evidence, would give the oxygen company the right to judgment upon the theory that the hardware company was primarily liable and the oxygen company secondarily liable for the deaths of the hardware company's employees.

The basis of the claim of the plaintiffs in the wrongful death actions was that the defendant therein, The Burdett Oxygen Company, negligently supplied oxygen gas in containers, that failed to disclose the kind of gas contained therein, instead of nitrogen gas which The Cleveland Hardware Forging Company claims to have ordered. If these facts were established and they were found to be a proximate cause of the deaths of The Cleveland Hardware Forging Company's employees, The Burdett Oxygen Company would be liable to the full extent of the pecuniary loss sustained by the next of kin. And this would be true even though The Cleveland Hardware Forging Company was also negligent in permitting its employees to use the gas and such negligence was also a direct and proximate cause of the deaths.

The rule to be applied under such circumstances is stated in 30 Ohio Jurisprudence, 769, Section 46, as follows:

"Stated broadly, the rule in Ohio is that if an injury is the result of neglect to perform a common duty resting on two or more persons, the injured party may, at his election, sue all of the parties owing the common duty jointly, or sue each separately, although there may have been no concert of action between them." See, also, Village of Mineral City v. Gilbow,81 Ohio St. 263, 90 N.E. 800, 25 L.R.A. (N.S.), 627; North AmherstHome Telephone Co. v. Jackson, an Infant, 4 C.C. (N.S.), 386, 16 C.D., 89.

Under these circumstances, if one of the tort-feasors fully compensates the person injured, such tort-feasor can not recover from the other tort-feasor on the basis that the negligence of the former was more remote in point of time or was comparatively of less consequence in causing the accident. Once it is determined that a person was negligent and that such negligence was a proximate cause of an injury, the right of a recovery against him is complete and is independent of the active negligence of any other person that may assist in causing the same injury.

In the case of Wery v. Seff, 136 Ohio St. 307,25 N.E.2d 692, the fifth paragraph of the syllabus is as follows:

"When two or more persons, under circumstances creating primary accountability, directly produce a single, indivisible injury by their concurrent negligence, they are jointly and severally liable, even though there is no common duty, common design or concerted action."

In that case the negligence of a father and son was involved. The father negligently put his automobile in the hands of his son, a minor under sixteen years of age, in violation of a city ordinance, and the son while thus in charge of the motor vehicle, negligently injured the wife of plaintiff. On page 312, the court said:

"In the present case no primary and secondary liability is involved. Under the averments of the petition, father and son are primarily liable, because the alleged injuries were attributable to their coexisting and combined negligence; the wrongful conduct of the one coupled with that of the other brought about the result complained of. Consequently, they are properly joinable in one action. 30 Ohio Jurisprudence, 769, Section 46.

"Should the elder Seff pay the damages he could not recover over against his son. ``There is no right of contribution between persons whose concurrent negligence has made them liable in damages.' Royal Indemnity Co. v. Becker, 122 Ohio St. 582,173 N.E. 194, 75 A.L.R., 1481. See, also, U.S. Casualty, Co. v.Indemnity Insurance Co., 129 Ohio St. 391, 397, 195 N.E. 850, 853."

The exception to be found to this rule is where a party by his affirmative act negligently injures another under such circumstances that because of the responsibilities of a third party under the law, although such third party committed no affirmative act of negligence, such third party may also be held responsible for such injury. Under such circumstances the person who created the dangerous condition is said to be primarily liable and the other is secondarily liable. In the event the one secondarily liable is compelled to respond in damages to the injured party, he may recoup his loss from the one who actually created the danger. Such wrongdoers are not joint tort-feasors and cannot be joined as defendants in the same action by the party injured.

Herron v. City of Youngstown, 136 Ohio St. 190,24 N.E.2d 708, is a leading case on this question. The plaintiff there was injured while walking over a steel trapdoor which was a part of the sidewalk covering a basement entrance to the abutting property. The steel door sagged under the weight of Herron when he stepped upon it, causing the handle on the door to protrude upward above the surface of the door and the walk, so that his foot caught in the stirrup-handle, throwing him to the ground and fracturing his leg. The door was maintained for the exclusive benefit of the property owner and lessees. It was claimed that the door had been in a state of disrepair and in a dangerous condition for a number of years and although the city of Youngstown had nothing to do with its construction or maintenance, it had full notice of its defective condition.

The court in that case held:

"1. When a city becomes liable in damages by reason of the sole negligence of an owner of abutting property on a public street in creating and maintaining for his own use and benefit a trapdoor in a sidewalk, the property owner is primarily liable and the city secondarily liable to the injured party, and, if the city is obliged to respond in damages to the injured party under its liability, it will be subrogated to the right of the injured party and may recover over its loss from the property owner, the one primarily liable.

"2. Where a liability arises against both a city and an owner of property abutting in a public street in favor of a party injured by the sole negligence of such property owner in creating and maintaining for his own use and benefit a trapdoor in a sidewalk, such injured party may sue either the property owner, primarily liable, or the city, secondarily liable, or both in separate actions, as a judgment against one, until satisfied, is no bar to an action against the other, the injured party being entitled to satisfaction from either the city or property owner, or from both."

And on page 195, the court said:

"It is not important as to how the liability of the owner and the lessees to the plaintiff, if any, for the creation or maintenance of the nuisance which caused the injury to plaintiff, shall be shared or allocated between them; but it is important that the owner or lessees, singly or in combination, were the actual wrongdoers in the maintenance of this nuisance in the sidewalk. If it was wrongfully maintained, they became liable to plaintiff for all actionable negligence and all the damages to the plaintiff arising from such negligent acts. That they were the actual wrongdoers, if the plaintiff suffered any legal wrong, cannot be questioned. They were the only actors who could be chargeable with any actual wrongdoing.

"But because of the responsibility of a municipality under the law, for the safe condition of its streets and alleys, it may also become liable to persons who are injured upon them through defects which were not created or maintained by the municipality itself. Section 3714, General Code." See, also, Morris v.Woodburn, 57 Ohio St. 330, 48 N.E. 1097; Bello v. City ofCleveland, 106 Ohio St. 94, 138 N.E. 526; Canton Provision Co. v. Gauder, a Minor, 130 Ohio St. 43, 196 N.E. 634; First Natl.Bank of Warren v. Gillen, 73 Ohio St. 394, 78 N.E. 1125.

The same result may obtain where one is injured by a servant and his master's liability is created solely by the doctrine of"respondeat superior." Losito v. Kruse, Jr., 136 Ohio St. 183,24 N.E.2d 705, 126 A.L.R., 1194.

There is another claim set forth in the plaintiff's petition which should be noticed. The plaintiff charged that the actions for wrongful death of the three employees of The Cleveland Hardware Forging Company were brought against The Burdett Oxygen Company because the defendant in the instant action wrongfully informed the legal representatives of the deceased employees that the employees came to their death as a result of the negligence of The Burdett Oxygen Company, when in truth, the accident causing the deaths resulted from the sole negligence of The Cleveland Hardware Forging Company. Even if these facts be admitted, there could be no recovery from the defendant either by The Burdett Oxygen Company or by any one who has succeeded to its rights by subrogation.

If The Burdett Oxygen Company was not negligent or if there was negligence on its part which was not a proximate cause of the explosion, then certainly the actions for wrongful death could not have succeeded. Under such a state of facts, The Burdett Oxygen Company could not recover from The Cleveland Hardware Forging Company money paid in settlement of a claim for which it was not legally liable. The allegation that The Cleveland Hardware Forging Company wrongfully told the representatives of the deceased employees that The Burdett Oxygen Company's negligence caused the accident, is a mere expression of opinion and standing alone does not state a cause of action for the return of money expended in the settlement of such cases.

The second question presented is: Do the provisions of the Workmen's Compensation Act and constitutional provisions in relation thereto, providing against the common-law liability of an employer who is a contributor to the insurance fund as provided by law, protect such employer from further liability to a third person who has been sued by the representative of a deceased employee of such employer, such employee having been killed while acting in the course and scope of his employment, where the action against such third person is founded on alleged acts of negligence on his part as a proximate cause of such employee's death and where such third person then brings action against the employer to recoup what he paid in settlement of such claim against him on the theory that the negligence of the employer was the primary cause of the employee's death and that such third person was only secondarily liable?

We find no decided cases in Ohio on this question. The constitutional provision (Section 35, Article II) is as follows:

"For the purpose of providing compensation to workmen and their dependents, for death, injuries or occupational disease, occasioned in the course of such workmen's employment, laws may be passed establishing a state fund to be created by compulsory contribution thereto by employers, and administered by the state, determining the terms and conditions upon which payment shall be made therefrom. Such compensation shall be in lieu of all other rights to compensation, or damages, for such death, injuries, or occupational disease, and any employer who pays the premium or compensation provided by law, passed in accordance herewith, shall not be liable to respond in damages at common law or by statute for such death, injuries or occupational disease. * * *"

Section 1465-70, General Code, provides in part as follows:

"Employers who comply with the provisions of Section 1465-69 shall not be liable to respond in damages at common law or by statute, for any injury, disease or bodily condition, whether such injury, disease or bodily condition is compensable under this act or not, or for any death resulting from such injury, disease or bodily condition, of any employee, wherever occurring, during the period covered by such premium so paid into the state insurance fund, or during the interval of time in which such employer is permitted to pay such compensation direct to his injured or the dependents of his killed employees as herein provided."

The constitutional provision for an insurance fund for the benefit of injured workmen, passed to support and strengthen the statutes then in effect, and statutes on the subject of workmen's compensation completely changed the theory of liability of an employer to his employees for injuries sustained by them while acting in the course and scope of their employment, from the common-law doctrine of negligence, modified in some respects by the employer's liability acts passed in the late nineties, to the theory that compensation shall be paid upon a limited basis, regardless of fault to all employees injured while acting within the course and scope of their employment except where such injuries are purposely inflicted. This change in employer-employee relationship constituted one of the greatest beneficial social developments of modern times. In order to accomplish its purpose of protecting the injured employee it was found necessary to make a complete change in the theory of the employer's responsibility. The employer, except in the case of a self-insurer, is compelled to contribute designated sums based upon the amount of his payroll to maintain the insurance fund. This fund is under the complete control of the Industrial Commission, a state agency, and the employer has no power whatever in the matter of determining whether one of his employees is entitled to share in the fund because of injuries sustained. In an action by an employee seeking the right to participate in the fund, the employer is not a proper party to the action.

For the obligations thus imposed upon the employer under the Workmen's Compensation Act the employer is relieved of any liability at common law because of injuries, death or occupational diseases that befall his employees while acting in the course and scope of their employment, and it makes no difference whether the claim is presented by the employee or one who claims the right of retribution because of damages which he has been compelled to pay to such employee.

There is another section in the act which supports the theory that the Legislature intended to relieve the complying employer from all common-law liability. That is Section 1465-93, General Code, which provides that a minor is deemed sui juris "for the purposes of this act, and no other person shall have any cause of action or right to compensation for an injury to such minor workman * * *."

The courts have held that such provision is an absolute bar to a loss of service action by a parent. 42 Ohio Jurisprudence, 592, Section 19.

We conclude, therefore, that the plain intention of the Legislature was to provide against any liability at common law of a complying employer because of the death or injury of its employees. The trial court was correct in ruling for the defendant on its motion for judgment upon the pleadings, the opening statement and the agreed statement of facts, and such judgment is affirmed.

Judgment affirmed.

LIEGHLEY, J., concurs in judgment.