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Godley v. County of Pitt and / or Town of Winterville

Filed: October 20, 1981.

WILLIE GODLEY, EMPLOYEE-PLAINTIFF
v.
COUNTY OF PITT AND/OR TOWN OF WINTERVILLE, EMPLOYER, U.S. FIRE INSURANCE AND/OR GREAT AMERICAN INSURANCE, CARRIER, DEFENDANTS



Appeal by defendants Pitt County and U.S. Fire Insurance Company from the North Carolina Industrial Commission. Opinion and award filed 14 November 1980. Heard in the Court of Appeals 15 September 1981.

Arnold, Judge. Judges Vaughn and Webb concur.

Arnold

Two assignments of error are brought forth on appeal.

I.

Defendant County first contends that the Industrial Commission erred in concluding that the County and its insurance carrier

are estopped from asserting that no employment relationship existed between the plaintiff and the County. We agree. Application of the principles of equitable estoppel was improper on the facts of this case.

We recognize that it is well established law in North Carolina that principles of estoppel are applicable to workers' compensation cases. Aldridge v. Motor Co., 262 N.C. 248, 251, 136 S.E.2d 591 (1964). Furthermore, as the defendant Town correctly points out, acceptance of premium payments by a compensation insurer has been held sufficient to subject the insurer to liability on equitable grounds even where the claimant was not properly includable under the terms of the policy. Aldridge v. Motor Co., supra; Britt v. Colony Construction Co., 35 N.C. App. 23, 240 S.E.2d 479 (1978). However, in each case cited by the Town, an element essential to equitable estoppel, that of detrimental reliance by the party seeking estoppel, has been met. See 5 Strong's N.C. Index 3d, Estoppel ยง 4.6 (1977). These cases are, in this respect, distinguishable from the case at bar. While it is true that the County's insurer accepted premiums on behalf of the plaintiff, there is no evidence in the record to indicate that the Town or its insurer appreciably altered its position in reliance upon this fact. The only reliance asserted by the Town is its own failure to pay insurance premiums specifically on behalf of the plaintiff. We are not persuaded that this omission constitutes detrimental reliance. The Town's insurer has conceded liability in the event that plaintiff is found to have been an employee of the Town and has made no claim that the policy would have been altered or cancelled had it been known that plaintiff was a covered individual. Although failure to collect premiums for covered individuals does not relieve an insurer of liability, the insurer can, of course, recover unpaid premiums upon discovery of the error. Williams v. Ornamental Stone Co., 232 N.C. 88, 59 S.E.2d 193 (1950).

We find no evidence in the record of an act or omission detrimental to either of the parties seeking estoppel which justifies imposition of this equitable remedy. See Bourne v. Lay and Co., 264 N.C. 33, 140 S.E.2d 769 (1965).

II.

Defendant's second argument is that the Commission erred in concluding that plaintiff was an employee of Pitt County. It is

clear that in workers' compensation cases, as the North Carolina Supreme Court has succinctly held, "the test is this: For whom was the plaintiff working as an employee at the time of the accident?" Suggs v. ...


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