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JOHN R. ERTZ AND WORKMEN'S COMPENSATION APPEAL BOARD v. GLEN NAN (03/25/77)

COMMONWEALTH COURT OF PENNSYLVANIA


decided: March 25, 1977.

JOHN R. ERTZ AND WORKMEN'S COMPENSATION APPEAL BOARD
v.
GLEN NAN, INC. AND COMMONWEALTH OF PENNSYLVANIA. GLEN NAN, INC., APPELLANT

Appeal from the Order of the Workmen's Compensation Appeal Board in case of John R. Ertz v. Glen Nan, Inc. and Commonwealth of Pennsylvania, No. A-70895.

COUNSEL

Joseph A. Murphy, with him Lenahan, Dempsey & Murphy, for appellant.

Eugene Duffy, with him John E. O'Connor and James N. Diefenderfer, for appellees.

Judges Kramer, Wilkinson, Jr. and Rogers, sitting as a panel of three. Opinion by Judge Kramer.

Author: Kramer

[ 29 Pa. Commw. Page 410]

This is an appeal by Glen Nan, Inc. and its former insurance carrier, Rockwood Insurance Company (Rockwood), from an order of the Workmen's Compensation Appeal Board (Board), which ordered Rockwood to pay 25% of the disability benefits awarded to John R. Ertz.

There is no dispute in this appeal as to Ertz's entitlement to compensation benefits for total disability due to anthracosilicosis under Section 108(q) of The Pennsylvania Workmen's Compensation Act*fn1 (Act). The sole question for resolution is whether and to what extent Rockwood or The State Workmen's Insurance Fund (The Fund) is liable for payment of those benefits.

Ertz was employed as an anthracite coal miner for Glen Nan, Inc. and worked in and around the mines on the 11 P.M. to 7 A.M. shift. The last shift worked by Ertz commenced at 11 P.M. on February 21, 1974 and ended at 7 A.M. on February 22, 1974. During that shift, the insurance coverage provided to Glen Nan by Rockwood expired at 12:01 A.M. on February 22, while coverage provided by The Fund commenced at precisely the same moment.

After determining that Ertz was totally disabled, as of October 25, 1974, by anthracosilicosis, the referee

[ 29 Pa. Commw. Page 411]

    apportioned the payment of benefits, pursuant to Section 305.1 of the Act,*fn2 at 50% to be paid by the Commonwealth and 50% to be paid by Glen Nan or its insurance carrier. The referee, however, further apportioned the employer's duty to pay by directing Rockwood and The Fund to each pay 25% of the benefits awarded.*fn3 Objecting to this latter apportionment, Rockwell appealed to the Board, which affirmed the referee's decision.

It has been held that the compensation authorities "have jurisdiction to determine the general question of the liability of an insurer under the policy and whether the policy is in force or has been cancelled." Eldridge v. Blue Ridge Textile Co., 160 Pa. Superior Ct. 578, 584, 52 A.2d 339, 342 (1947). See Workmen's Compensation Appeal Board v. Cicioni, 29 Pa. Commonwealth Ct. 381, 370 A.2d 1256 (1977). Shiery v. Lauffer Tire Service, Inc., 197 Pa. Superior Ct. 209, 177 A.2d 455 (1962); Kracoski v. Bernice White Ash Coal Co., 183 Pa. Superior Ct. 155, 130 A.2d 190 (1957); Gronski v. Jeddo-Highland Coal Co., 168 Pa. Superior Ct. 605, 81 A.2d 590 (1951); Karoly v. Jeddo-Highland Coal Co., 166 Pa. Superior Ct. 571, 73 A.2d 214 (1950); Gaydosh v. Richmond Radiator Co., 164 Pa. Superior Ct. 154, 63 A.2d 502 (1949). Such a determination is of course, subject to review by this Court. In a case, such as this, where the party with the burden of proof has prevailed below, the scope of that review is limited to determining whether constitutional rights were violated, an error of law was committed or any necessary finding of fact was unsupported

[ 29 Pa. Commw. Page 412]

    by substantial evidence. Garden Coal Co. v. Workmen's Compensation Appeal Board, 27 Pa. Commonwealth Ct. 568, 367 A.2d 360 (1976).

Section 301(c)(2) of the Act, 77 P.S. ยง 411(2) provides in pertinent part:

The employer liable for compensation provided by section 305.1 or section 108, subsections (k), (l), (m), (o), (p) or (q), shall be the employer in whose employment the employe was last exposed for a period of not less than one year to the hazard of the occupational disease claimed. . . .

Under a similar provision in Section 301(g) of The Pennsylvania Occupational Disease Act,*fn4 the employe's last exposure to the occupational hazard has been held to fix the liability of both the employer and his insurance carrier. Gronski v. Jeddo-Highland Coal Co., supra; Karoly v. Jeddo-Highland Coal Co., supra; Gaydosh v. Richmond Radiator Co., supra. We conclude that this is likewise the case under Section 301(c)(2) of The Workmen's Compensation Act.*fn5

[ 29 Pa. Commw. Page 413]

The conclusion that "last exposure" fixes the liability of the employer and carrier does not, however, resolve the present case. The referee ordered Rockwood and The Fund to assume equal shares of the employer's obligation on the ground that both carriers provided coverage on the date of last exposure. Rockwood maintains that liability of a carrier attaches at the moment of last exposure. Our research discloses this to be a matter of first impression.

We note initially that Section 301(c)(2) of the Act imposes liability upon the employer on the basis of a last exposure "for a period of not less than one year." The reason for this durational requirement is not difficult to understand. While the Legislature clearly intended in the Act that liability for a single occupational illness not be apportioned among the various employers in the industry for whom an employe has worked over the years, it likewise manifested in Section 301(c)(2) its intention that an employer not be liable for an occupational illness to which it made, what the Legislature considered to be, a comparatively insignificant contribution.*fn6 Such considerations are inapplicable to the situation of the insurance carrier. The Act imposes liability upon the employer for the role his business has played in causing an occupational illness, whereas the insurer's liability arises merely from its contractual undertaking to protect the employer from liability arising out of the employer's activities. By reducing the risk to the employer, the requirement of a one-year exposure inures to the benefit of the insurer by likewise reducing its risk. In view of its rejection of apportionment of liability in the case of employer's, we do not believe that the

[ 29 Pa. Commw. Page 414]

Legislature intended a further benefit and protection for insurers in the form of apportionment among insurers of the employer's liability arising from an employe's "last exposure."*fn7

Given that we observe the intent of the Legislature to run counter to the apportionment among insurers of the liability arising out of the "last exposure," we find no reason in law or logic to achieve precisely that result in this case by denominating the last calendar day of an employe's exposure as the crucial period of "last exposure" for the fixing of an insurance carrier's liability. We conclude that, absent fraud, the liability of the carrier attaches at the last moment of an employe's exposure. Thus, under the facts in this case, The Fund must fully assume the employer's obligation to pay benefits.

Order

And Now, this 25th day of March, 1977, the decision of the Workmen's Compensation Appeal Board, at Docket No. A-70895, filed October 8, 1975, is reversed insofar as it orders the Rockwood Insurance Company to assume any portion of the liability of Glen Nan, Inc., to pay benefits to John R. Ertz. The remainder of the Board's decision is hereby affirmed as hereinafter modified. Compensation is awarded to

[ 29 Pa. Commw. Page 415]

    the claimant herein at the rate of $106.00 per week from October 25, 1974, and continuing within the limitations of the Act. Fifty per cent or $53.00 shall be paid by Glen Nan, Inc., and its insurance carrier, The State Workmen's Insurance Fund, and fifty per cent or $53.00 shall be paid by the Commonwealth of Pennsylvania. All compensation awarded herein shall be paid to the claimant, John R. Ertz, by The State Workmen's Insurance Fund pursuant to Rule 121.21(b) of the Bureau of Occupational Injury & Disease Compensation. Interest is assessed at the rate of ten per cent per annum on all deferred payments of compensation owing by the insurance carrier.

Disposition

Reversed in part and affirmed in part as modified.


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