Laffoon v. Bell & Zoller Coal Co.

327 N.E.2d 147, 27 Ill. App. 3d 472, 1975 Ill. App. LEXIS 2089

• Court: Appellate Court of Illinois
• Decided: March 21, 1975
• Docket: 73-158
• Status: Published

Opinions

Mr. PRESIDING JUSTICE JONES

delivered the opinion of the court:

This is an appeal from a judgment of the trial court granting a motion for summary judgment in favor of the defendant-appellee and against the plaintiff-appellant.

The defendant contracted with John Refieuna of Refieuna Salvage Company for the dismantling of certain of its mining properties located at Mine No. 3 in Franklin County, Illinois. Plaintiff was an employee of Refieuna Salvage Company and was injured while working on the dismantling job. He filed an application for adjustment of claim with the Industrial Commission seeking workmens compensation benefits. The Refieuna Salvage Company carried no workmen’s compensation protection. The defendant, assuming that under section 1(a)(3) of the Workmen’s Compensation Act (Ill. Rev. Stat., ch. 48, par. 138.1(a) (3)) it had an obligation to pay such benefits, paid $9,218.19 which the plaintiff, accepted. Plaintiff then commenced an action for damages against the defendant alleging violation of the Structural Work Act of Illinois (Ill. Rev. Stat., ch. 48, par. 60 et seq.). The defendant moved for summary judgment, and it is from an order granting such judgment that this appeal was taken.

Summary judgment should have been entered only if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment or decree as a matter of law. Ill. Rev. Stat., ch. 110, par. 57(3).

The issue presented is whether defendant is an employer of plaintiff within the purview of the Workmen’s Compensation Act (Ill. Rev. Stat. 1969, ch. 48, par. 138.1 et seq.) so as to be immune from liability for an alleged violation of the Structural Work-Act as provided in section 5(a) of the Workmen’s Compensation Act.

Initially, defendant contends that-failure of the plaintiff to filé a counteraffidayit admits the facts contained in its affidavit submitted in support of a motion for summary judgment. We agree. (Fooden v. Board of Governors of State Colleges and Universities, 48 Ill.2d 580, 272 N.E.2d 497; St. Louis Fire & Marine Insurance Co. v. Garnier, 24 Ill.App.2d 408, 164 N.E.2d 625.) The defendant’s motion for summary judgment and an attached affidavit asserted that defendant had contracted with Refieuna Salvage Company to demolish a building on mining premises, that plaintiff was an employee of Refieuna Salvage and sustained injuries in the performance of his work, that plaintiff filed a workmen’s compensation claim against Refieuna Salvage which company carried no workmen’s compensation insurance and did not pay workmen’s compensation to plaintiff, and that defendant was compelled to and did pay-plaintiff workmen’s compensation benefits in accordance with the provisions of section 1(a)(3) of the Illinois Workmen’s Compensation Act and accordingly defendant was “an employer” and pursuant to section 5(a) of the Workmen’s Compensation Act was immune from plaintiff’s suit. The affidavit attached to the motion indicated that defendant had paid plaintiff workmen’s compensation benefits totaling $9,218.19.

Section 1(a)(3) of the Illinois Workmen’s Compensation Act provides in part:

“Any one engaging in any business or enterprise referred to in subsections 1 and 2 of Section 3 of this Act who undertakes to do any work enumerated therein, is liable to pay compensation to his own immediate employees in accordance with the provisions of this Act, and in addition thereto if he directly or indirectly engages any contractor whether principal or sub-contractor to do any such work, he is liable to pay compensation to the employees of any such contractor or sub-contractor unless such contractor or subcontractor has insured, in any company or association authorized under the laws of this State to insure the liability to pay compensation under this Act, or guaranteed his liability to pay such compensation.”

Two questions of interpretation are presented by this section. Under its provisions, was defendant as a matter of law required to pay compensation; and if so, was defendant an “employer” entitled to the immunity provisions of section 5(a) of the Workmen’s Compensation Act?

Since it was uncontradicted that Refieuna carried no workmen’s compensation insurance, and it is implied in defendant’s affidavit that Refieuna also did not guarantee its liability, and since defendant did “directly or indirectly” engage “any contractor # * * to do any such work,” there was an obligation on the part of defendant to pay workmen’s compensation to the plaintiff.

Did, then, defendant’s obligation to pay workmen’s compensation under section 1(a)(3) of the Act make it an employer entitled to the immunity from action provided in section 5(a) of the Act. Defendant concedes that it was not the direct employer of plaintiff but argues that by reason of its payments of workmen’s compensation benefits under section 1(a)(3) of the Act it became the “statutory employer” of plaintiff and as such it is entitled to the immunity from common law or statutory action provided to employers by section 5(a) of the Act. Section 5(a) (par. 138.5(a)) provides in part:

“No common law or statutory right to recover damages from the employer, * * * for injury or death sustained by any employee while engaged in the line of his duty as such employee, other than the compensation herein provided, is available to any employee who is covered by the provision of this Act #

There are no Illinois cases directly on the issue, but we find the case of Baker & Conrad, Inc., v. Chicago Heights Construction Co., 364 Ill. 386, 4 N.E.2d 953, close and persuasive. That case involved a question of whether a “statutory employer” who had been required to pay workmen’s compensation to a person not directly his employee by reason of the failure of the subcontractor to procure insurance was the “employer” of such person for purposes of subrogation under section 31 (now section 1(a)(3)) of the Act. The Supreme Court held that such person was the employer, stating:

“The employer here contemplated may be the immediate employer or one of a succession of employers engaged in the original undertaking, or some part thereof, who has paid the compensation for the injuries to or death of the workman. For the purpose of the act, if not the immediate employer he may be called a ‘statutory employer.’ * * * If there are employees of a person other than his immediate employees, it must follow that there is an ‘employer’ who is not an ‘immediate employer,’ viz., a contractual one, not supervising or coming in actual contact with the employee and with no primary authority to order his labor nor power to discharge, and not immediately liable for his wages but nevertheless an employer for the purpose of this section of the law. It is immaterial for the aim of the statute whether he be considered an ‘indirect employer’ or a ‘statutory employer.’ ” (364 Ill. 386, 396-97.)

The court also stated:

“It was not the thought of the General Assembly to impose a liability upon an employer for compensation under section 31 regardless of the degree he occupied in the subdivision of contracts under which the work was undertaken, nor how far removed from being the person who in fact employed the laborer, without affording such employer an opportunity for reimbursement and subrogation in those instances where the compensation paid by him arose out of injmies to or death of the workman caused by the negligence of some other contractor or a third person.” 364 Ill. 386, 397-98.

With respect to the question whether or not a “statutory employer” is entitled to the immunity provided in section 5(a), there is again no Illinois authority directly in point, though it might forcefully be argued from Baker that if a “statutory employer” is entitled to the subrogation provision of the Workmen’s Compensation Act, such categorization should also entitle him to the benefits or subject him to the burdens of other provisions of the Workmen’s Compensation Act.

Cases are not wanting from other jurisdictions supporting the theory that a “statutory employer” who has been required to pay workmen’s compensation is entitled to immunity from a common law action. Basically there are two types of statutes imposing liability or potential liability upon the “statutory employer.” In some states the liability imposed is termed “primary” or “concurrent,” and under this type of statute the “statutory employer” is liable for workmen’s compensation equally with the common law employer, and the employee generally has the choice of claiming benefits from either. The cases under such statutes consistently grant immunity from common law suit to the statutory employer. Examples of cases from primary liability states are State ex rel. Hubert v. Benjamin F. Bennett Building Co. (1928), 154 Md. 159, 140 A. 52, 55 (1928); Swartz v. Conradis (1929), 298 Pa. 343, 148 A. 529; Fox v. Dunning, 124 Okla. 228, 255 P. 582 (1927); Evans v. Newport News Shipbuilding & Dry Dock Co. (E.D. Va. 1965), 243 F. Supp. 1017, affirmed (4th Cir. 1966), 361 F.2d 364; Whitaker v. Douglas (1956), 179 Kan. 64, 292 P.2d 688.

The second type of “statutory employer” statute imposes “secondary” liability on the remote or statutory employer. This is the type of statute Illinois has and it imposes liability on the remote employer only if the contractor or subcontractor has in fact failed to provide workmen’s compensation protection. There is a split of authority between the States having secondary liability statutes as to whether the remote employer is immune from common law suit when the contractor or subcontractor does in fact have workmen’s compensation protection and therefore the remote employer does not have to pay workmen’s compensation benefits. There is, however, no disagreement that the remote employer is immune from common law suit under such statutes where he does in fact pay workmen’s compensation benefits. For example, in Burk v. Cities Service Oil Co., 266 F.2d 433 (10th Cir. 1959), construing Oklahoma law, it was held that a secondary liability statute served to bar the remote employer from a common law suit even though the remote player does not pay workmens compensation benefits. But such rule is not followed by all jurisdictions which have secondary liability statutes. Some courts hold that immunity from common law suit attaches only where the statutory employer actually pays workmen’s compensation benefits. For example, in Mosley v. Jones, 224 Miss. 725, 80 So.2d 819 (1955), a case very similar on its facts to this one, the employee of an independent contractor hired by the principal employer was injured and his direct employer had not secured workmen’s compensation coverage. The principal employer was exposed to workmen’s compensation liability and pleaded this fact in bar of a common law suit which was brought by the injured workman against the principal employer. The court held the workmen’s compensation remedy was exclusive and that the principal employer was not a “third person” within the meaning of the workmen’s compensation statute, since, by being required to pay workmen’s compensation, he was the “statutory employer,”

As indicated above, we find no cases under either the primary or the secondary type statutes which deny immunity from common law or statutory liability to a remote employer who has actually paid workmen’s compensation to an injured employee. There is no question that an injured employee can recover workmen's compensation benefits and also recover under the Structural Work Act, but under the law as we perceive it he may not recover both from the same person or entity. The plaintiff here accepted his status as a statutory employee of defendant when he collected workmen’s compensation from defendant. Such benefits were granted him by the statute. The defendant, having paid plaintiff”s workmen’s compensation claim, is now entitled to the immunities from common law or statutory liability afforded by section 5(a) of the Workmen’s Compensation Act.

Workmen’s compensation acts were designed to serve a social and economic purpose. They were intended to eliminate certain common law defenses to recovery by an employee, but in return for his ability to recover regardless of fault the amount which could be recovered was limited, depending upon the type and extent of injury. In return for his liability to compensate employees regardless of fault the employer was granted immunity from an additional common law tort or statutory action. If in any particular case the policy of the law is achieved, that is if the employee is in fact paid workmen’s compensation in accordance with the laws and regulations applicable to his case, then it should not matter whether the immunity arising from this payment inures to the benefit of his immediate employer or to the benefit of a more remote “statutory employer” who has paid the workmen’s compensation claim.

A liberal interpretation has often been pronounced for both the Workmen’s Compensation Act (e.g., Vaught v. Industrial Commission, 52 Ill.2d 158, 287 N.E.2d 701) and the Structural Work Act (e.g., Crafton v. Lester B. Knight & Associates, Inc., 46 Ill.2d 533, 263 N.E.2d 817). Nevertheless, we cannot say that under the circumstances here present it was the legislative intent that a plaintiff was to be given the benefit of both Acts or a choice between them, particularly after the employee has accepted benefits of the Workmen’s Compensation Act from one he now alleges is responsible under the Structural Work Act. In our opinion the latter enactment of section 5(a) of the Workmen’s Compensation Act indicates a legislative intent to the contrary. We think this interpretation is buttressed by the following language of our supreme court in Gannon v. Chicago, Milwaukee, St. Paul & Pacific Ry. Co., 22 Ill.2d 305, 318, 322, 175 N.E.2d 785:

“From this statutory history it is evident that the Scaffold Act, originally enacted to give some protection to structural workers engaged in extrahazardous work at a time when there was no workmen’s compensation act is now relied upon as an additional remedy against third persons.

# # #

* * # under our view, the Scaffold Act may not always afford an injured party a remedy in addition to workmen’s compensation. Since the Scaffold Act was enacted prior to tire Workmen’s Compensation Act, it is obviously not designed to provide any such additional remedy, and any lessening of the effectiveness of the Scaffold Act is due, not to our construction of it, but to the provision in the Workmen’s Compensation Act making it the exclusive remedy against the employer. It is not the province of this court to distort the Scaffold Act in order to insure double remedy, and authorize by indirection what the Workmen’s Compensation Act prohibits by a direct action.”

Judgment affirmed.

EBERSPACHER, J., concurs.