Pacific Employers Insurance v. Arenbrust, Farahan & Loran

KNIGHT, J.

An award was made by the Industrial Accident Commission in favor of respondent Emily Jane Moffett and against petitioner Pacific Employers Insurance Company on account of the accidental death of Mrs. Moffett’s son, the award being based upon a finding that on September 2, 1926, at Stockton, California, “while in the employ of the defendant Dennis Loran, named herein as one of the firm of Arenbrust, Farahan and Loran, at which time the employer was insured against liability,” the deceased sustained injuries arising out of and in the course of said employment which proximatcly caused his immediate death. Said insurance company now seeks by this proceeding in

certiorari

to have the award annulled, the main contention being that the contract of insurance under which its liability attaches was vitiated by false representations made by the assureds as to the existence of said firm as a co-partnership.

The policy was issued by the company at its San Francisco office, upon a written application prepared by or under the direction of Alan B. Hicks, the company’s licensed agent at Stockton, and forwarded by him to the San Francisco office, the assureds taking no part in the preparation except to give the information upon which the answers contained therein were based. When completed said application set forth the following questions and answers: “Name of this Employer......Armbrust Farnham and Loran P. O. Address......712 East Jackson Street — Stockton — California Individual, Co-partnership, Corporation or Estate?...... A Co-partnership.”

With reference to the business relationship of the individuals named, as it existed at the time of the insurance was applied for, Loran, who was the sole witness on the subject, testified that Arenbrust, Farahan, and himself had been separately engaged in the trucking business in and around Stockton, each owning and operating Ms own truck and hiring and paying Ms own men; that at a hearing of the Railroad Commission in Stockton “it was deemed advisable for men who had a single truck to form sort of a combination for the reason [that] when one truck was in operation we had to find some means of taking care of sometMng that

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might turn up otherwise”; that thereafter their trucks were operated under such an agreement, whereby jobs were taken care of jointly, providing one truck could not handle the work alone, and that when so operated each owner was paid for the amount of work his truck had done, each owner taking care of his own expenses, and there being no division of income or expenses; that common headquarters were maintained at Farahan’s home, 712 East Jackson Sreet, Stockton.