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Gaydos v. Packanack Woods Development Co.

Decided: November 29, 1960.

GEORGE GAYDOS, PETITIONER-APPELLANT,
v.
PACKANACK WOODS DEVELOPMENT CO. (GENERAL CONTRACTOR) P. & B. EXCAVATING CO. (SUBCONTRACTOR), AND MAYNOR EQUIPMENT CORP. (SUBCONTRACTOR) RESPONDENTS-RESPONDENTS



Workmen's compensation appeal.

Nadell, J.c.c.

Nadell

This is an appeal from a determination of facts, award and rule for judgment entered in the New Jersey Department of Labor and Industry, Workmen's Compensation Division.

P. & B. Excavating Co. (hereinafter called P. & B.), a subcontractor of Packanack Woods Development Co. (hereinafter called Packanack Woods), general contractor, leased a truck and driver from Maynor Equipment Corp. (hereinafter called Maynor) at the rate of $4.50 an hour to do excavating work for P. & B. On November 14, 1957, George Gaydos, an employee of Maynor and driver of the truck leased by P. & B., had an accident arising out of and in the course of his employment. On the day of the accident Gaydos had reported with the truck to the site of the excavation being dug by P. & B. at Packanack Woods. There an employee of P. & B. instructed him to load the truck with dirt and told him where to dump it. He worked all morning loading and unloading the truck under the direction

of a P. & B. employee. There was no place to eat on the job, and petitioner therefore drove the truck about five blocks to a place where he had a bottle of milk, and on the way back to the job site, the truck jackknifed, struck a boulder, and Gaydos was injured (Record 7, 11, 12). The deputy director granted compensation to Gaydos against Maynor but dismissed the claim as to Packanack Woods and P. & B.

Maynor carried no workmen's compensation insurance and is not appealing from the award of compensation.

This appeal is by the petitioner, who appeals from the denial of compensation against P. & B. The ground of appeal is N.J.S.A. 34:15-79, providing that a contractor placing work with a subcontractor who fails to carry workmen's compensation insurance is himself liable for compensation due to an employee of the subcontractor.

The sole question argued on this appeal was whether a contractor (P. & B.) which rents a truck and driver from a subcontractor (Maynor) is liable under the statute to a driver of Maynor who is injured while operating a truck at the direction of the contractor (P. & B.).

This court will review only those issues specifically raised and submitted by the parties: Schmidt v. Revolvator Co. , 46 N.J. Super. 232, 235 (Cty. Ct. 1957). The only question raised here is as to the interpretation of N.J.S.A. 34:15-79. This section provides:

"* * * Any contractor placing work with a subcontractor shall, in the event of the subcontractor's failing to carry workmen's compensation insurance as required by this article, become liable for any compensation which may be due an employee or the dependents of a deceased employee of a subcontractor * * *."

The purpose of this provision is to provide compensation for employees of subcontractors who are financially irresponsible and who have failed to obtain workmen's compensation insurance, by transferring the liability to the contractor. This seems fair for two reasons: (1) the contractor

has the opportunity to select subcontractors who have obtained proper insurance coverage and (2) the contractor receives the benefit of the work precisely as though he had it done directly by his own employees.

In Jordan v. Lindeman & Co., Inc. , 23 N.J. Misc. 194 (C.P. 1945) the court said, at pp. 196-197:

"* * * (the purpose) is to protect an employee, whose direct employer violates the New Jersey policy by failing to take out compensation insurance, by permitting such employee to recover from the general contractor, who gets the direct benefit of, and is ultimately paid for, the work of such employee. This is no hardship on the general contractor, who gets the benefit of the work, and who could, and should, see that the work is sublet to responsible subcontractors who will comply with the policy of the state * * *."

See also Corbett v. Starrett Bros., Inc. , 105 N.J.L. 228 (E. & A. 1928); Bertucci v. Metropolitan Construction Co. , 21 ...


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