2 Conn. Cir. Ct. 664 | Conn. App. Ct. | 1964
In this action the plaintiff seeks to recover premiums due and owing on workmen’s compensation insurance policies issued to the defendants. The policy issued by the plaintiff to
The defendants were engaged in the retail business of selling aluminum storm windows and doors, jalousies and other allied aluminum products and of contracting with homeowners for the installation of the same. The method employed by the defendants in obtaining orders for installations was to send their salesmen to the prospective customer’s home for the purpose of ascertaining just what was
The defendants claim that the installers were independent contractors; that, as such, they were
The plaintiff contends that it had a right to charge a premium as to the installers (1) because they were in fact employees; (2) by the contractual right reserved under the policy, since there was a possibility that liability might be imposed on the plaintiff; and (3) because of its contractual obligation to defend any action instituted by the installers. The pertinent provisions of the policies follow.
Under the designation “Conditions,” paragraph 1: “When used as a premium basis, ‘remuneration’ means the entire remuneration, computed in accordance with the manuals in use by the company, earned during the policy period by (a) all executive officers and other employees of the insured engaged in operations covered by this policy, and (b) any other person performing work which may render the company liable under this policy for injury to or death of such person in accordance with the workmen’s compensation law. ‘Remuneration’ shall not include the remuneration of any person within division (b) foregoing if the insured maintains evidence satisfactory to the company that the payment of compensation and other benefits under such law to such person is secured by other valid and collectible insurance or by any other undertaking approved by the governmental agency having jurisdiction thereof.” (Italics supplied.)
Under the designation “Insuring Agreements,” paragraph 2: The plaintiff shall “(a) defend any proceeding against the insured seeking such benefits and any suit against the insured alleging such injury and seeking damages on account thereof, even if such proceeding or suit is groundless, false or fraudulent; but the company may make such investi
Prior to the final audit, which was started after the termination of the policy period, the plaintiff requested Mr. Goldbloom, who was the treasurer and secretary as well as the manager of each defendant corporation, to furnish proof that the installers were covered by other insurance during such policy period. In fact, the plaintiff, through Mr. Lyons, its payroll auditor, on one occasion, together with Goldbloom, attempted to ascertain whether there was such other coverage. There was none; nor did the defendants furnish the plaintiff any evidence that the payment of compensation and other benefits under the Workmen’s Compensation Act to such person was secured by other valid and collectible insurance or by any other undertaking approved by the governmental agency having jurisdiction thereof. The defendants knew that in the absence of evidence of such coverage they would be charged a premium for the installers. Although the plaintiff never knew, during the period of each policy and prior to the final audit, who and how many installers were employed by the defendants, such installers were included in the coverage under the policies and the plaintiff assumed such coverage.
Policies of compensation insurance, including the insurance policies in question, are written contracts, to be interpreted by the same general rules
As noted hereinbefore, the policies provide, under the designation “Conditions,” for the right of the plaintiff to charge a premium computed on the basis of remuneration to “(a) all executive officers and other employees of the insured... and (b) any other person performing worh which may render the company liable . . . .” (Italics supplied.) This was a contractual right (a right which the plaintiff could and did provide for in the policies) to be compensated for the possibility that a claim or suit may render the plaintiff liable. The existence of the possibility of such liability and the assumption of such a risk, aside from the question of, or a final adjudication as to, whether or not the installers were independent contractors, entitled the plaintiff to charge a premium therefor. It is the assumption of this burden of paying possible compensation that gives the plaintiff the right to charge premiums. Commissioners of State Ins. Fund v. Riving-
As noted hereinbefore, by the terms of the policies the plaintiff agreed to defend any proceeding instituted against the defendants by installers seeking benefits thereunder. This is a positive undertaking by the plaintiff requiring it to expend funds in so doing. The plaintiff’s duty to defend has a broader aspect than its duty to indemnify. There is a distinction between liability and coverage. The obligation of the plaintiff to defend does not depend on whether the injured party will successfully maintain a cause of action. The policy requires the plaintiff to defend irrespective of the ultimate outcome. Smedley Co. v. Employers Mutual Liability Ins. Co., supra; Lewis v. Phoenix Mutual Life Ins. Co., supra.
Aside from the reasons already stated by the court entitling the plaintiff to make the disputed premium charges, the court will act upon the additional reason, to wit, that the installers were in fact employees and therefore fell under that classification rather than that of independent contractors under the Workmen’s Compensation Act. The claim of the defendants that they lacked control over the installers and that therefore the installers were not employees but independent contractors cannot be sustained by the evidence. Upon the entire evidence in the case, the court finds as facts that the defendants retained control over the installers and had a right to direct their work, to ask them to correct it and to stop the work if it was not being
In Kaliszewski v. Weathermaster Alsco Corporation, 148 Conn. 624, 629, in which the facts were very similar to those in the instant case, the court stated: “One is an employee of another when he renders a service for the other and when what he agrees to do, or is directed to do, is subject to the will of the other in the mode and manner in which the service is to be done and in the means to be employed in its accomplishment as well as in the result to be attained. Bieluczyk v. Crown Petroleum Corporation, 134 Conn. 461, 465 .... The controlling consideration in the determination whether the relationship of master and servant exists or that of independent contractor exists is: Has the employer the general authority to direct what shall be done and when and how it shall be done — the right of general control of the work? Jack & Jill, Inc. v. Tone, 126 Conn. 114, 119 . . . ; Cumbo v. E. B. McGurk, Inc., 124 Conn. 433, 436 ... . The test of the relationship is the right to control. It is not the fact of actual interference with control but the right to interfere which makes the difference between an independent contractor and a servant or agent. [Italics supplied.] Caraher v. Sears, Roebuck & Co., 124 Conn. 409, 413 .... Certainly Weathermaster, which was bound by contract to perform the work of re-siding in a workmanlike
The issues are found in favor of the plaintiff.
Judgment may enter for the plaintiff to recover from the defendant Capitol Home Improvement Company, Inc., the sum of $838.80, and from the defendant Capitol Home Improvement Company of Hartford, Inc., the sum of $577.70, together with costs.