Industrial Indemnity Co. v. Industrial Accident Commission

VAN DYKE, P. J. This is a proceeding to review an award of the respondent commission purporting to reform, and enforce as reformed, a workmen’s compensation insurance policy issued by petitioner to respondent E. W. Simpson as of July 1,1958, so as to make petitioner liable for an award in favor of respondent Wayne Endicott, an employee of Simpson, who suffered industrial injury July 11, 1958. Petitioner challenges the sufficiency of the evidence to sustain the reformation, which consisted in a determination that Endicott was covered by the policy.

The evidence presents little, if any, conflict upon the issue as to coverage. That policy contained a clause excluding from coverage any relative of the employer or the employer’s spouse unless named in the policy as not excluded. Endicott was Simpson’s brother-in-law, being a brother of Simpson’s wife and his name did not appear. Petitioner had for many years been Simpson’s insurer against liability for workmen’s compensation. The first policy referred to in the record was issued in 1947 and contained, as did all the succeeding policies, a standard provision excluding relatives unless specifically named in the policy. The policies were renewed year by year as of July 1st. Not only did the policies contain the specific relatives’ exclusion provisions but they also contained a space for the designation of included relatives, and affixed to each policy as issued was a conspicuous yellow sticker calling attention to the exclusion clause. The first relative to be designated as covered by the policy was the father of respondent Simpson, whose name at the request of Simpson was added to the policy issued in 1947. Later, again at the written request of Simpson, his father’s name was excluded. Applicant Endicott’s name was added to the then current policy by endorsement December 7,1949, at the request of Simpson. When that policy was renewed he was named in the policy as a covered relative. During the life of that policy his name was deleted pursuant to an endorsement effective October 6, 1950. On January 31, 1951, petitioner, on request, again included Endicott by endorsement. Applicant was named as a covered relative in the 1951-1952 policy, and in the 1952-1953 policy, but he was not named as a covered relative in the 1953-1954 policy and there appeared on that policy in the space provided for exceptions to the relatives’ exclusion clause the words “No Exceptions.” The final audit of the petitioner with respect to the 1952-1953 policy showed that no payroll was reported [424]or premium collected with respect to Endicott, and on July 20, 1953, Simpson reported that Endicott was no longer his employee. With respect to subsequent policies, including the one reformed, Endicott was not shown as a covered relative, and each policy indicated no exceptions to the relatives’ exclusion clause. It appears without conflict that during this period, after expiration of the 1952-1953 policy, Endicott was not an employee of Simpson at any time until March of 1958, and in fact for most of that period was outside the State of California. In summation, it can be stated from the record that he had never been listed as a covered relative in the policies since the 1952-1953 policy and was not listed in the policy in force on the date of his injury. Endicott was reemployed by Simpson in March of 1958 and he continued to be employed up to the time of his injury. No notice was given petitioner of his reemployment until after the occurrence of his injury and the making of his claim.