Opinion
December 31, 1914.
Alvin C. Cass, for the plaintiff.
John C. Coleman, for the defendant.
On January 29, 1910, the plaintiff issued to the defendant, as receiver of the Ferguson Contracting Company, its policy of liability insurance, whereby it agreed to indemnify the defendant against loss from liability imposed by law upon him for damages on account of bodily injuries accidentally suffered or alleged so to have been while that policy was in force, including death, by any employee of the defendant while working at any place as described in the policy. The premium was based on the entire compensation paid to defendant's employees as the same should be ascertained in the manner provided for in the contract. This policy ran for one year from its date. On August 31, 1910, by a rider attached to the policy and in consideration of an additional premium, the risks covered by the policy were extended from and after the date last mentioned to the end of the insured period, so as to cover the liability of the assured under chapter 674 of the Laws of 1910, known as the "Workmen's Compensation Law." The total amount of the premium for the additional risk covered by the rider for the unexpired time covered by the policy amounted to $704, no part of which has been paid. In the case of Ives v. South Buffalo R. Co. ( 201 N.Y. 271) the Court of Appeals, on March 24, 1911, declared the Workmen's Compensation Law to be unconstitutional. This decision reversed the decision in the same case theretofore made by the Appellate Division of this court in the Fourth Department ( 140 App. Div. 921), which latter decision until its reversal was the accepted law of the State. It will be noticed, however, that the period covered by the policy had expired some time before the decision of the Court of Appeals was rendered. The question submitted for our determination is whether the plaintiff is entitled to recover the amount of its said premium together with interest, amounting in the aggregate to $851.23, or whether defendant is under no liability to pay said premium or any part thereof because, as he contends, the act being unconstitutional, there was in fact no liability to insure against and the contract of insurance was without consideration.
I think the defendant has misapprehended the meaning of the term "risk" upon which the question at issue depends. If property insured against fire turns out to have been destroyed before or to have had no existence at the time the policy was written, clearly no risk ever attached, and the insurer could not claim to have given any consideration for the premium reserved. But here the risk insured against attached at the time the policy was issued and continued until the policy expired, because during all of that period the defendant rested under the possibility of being cast in damages in the event that accidents such as those insured against had happened. The fact that thereafter the act was held to be void did not destroy the risk — qua risk — which existed while the act was in force. It would seem, however, as if all doubt was removed by the agreement of the parties themselves, for the rider provided "The actual wages and earned premium shall be determined in the manner set forth in the Policy to which this indorsement is attached, and it is agreed that such earned premium shall be retained by the Company regardless of the construction which may be given by the courts to the law referred to herein," being the act in question.
There should be judgment for the plaintiff for $851.23, with costs.
INGRAHAM, P.J., McLAUGHLIN, LAUGHLIN and DOWLING, JJ., concurred.
Judgment for plaintiff, with costs, as stated in opinion. Order to be settled on notice.