Power Fabricating, Inc. v. State Compensation Insurance Fund

State Compensation Insurance Fund (State Fund) obtained summary judgment in an action filed by plaintiff Power Fabricating, Inc. (Power), which sought declaratory relief and damages arising from State Fund’s failure to defend it in a separate action against Power brought by the widow of a worker who died in an industrial accident. Power contends it presented a triable issue of fact on whether the decedent was employed by Power, an entity related to Power, or a joint venture between the two entities. Power asserts that if the trier of fact determines the decedent had been employed by either Power or the joint venturer, the widow’s claims could be covered under the employer liability insurance (ELI) provisions under State Fund’s policy, triggering a duty to defend. State Fund, contends, however, that the situation falls within the worker compensation provisions of the policy, not the ELI provisions, and its full payment of death benefits to the widow discharged any responsibility to defend.

We agree with State Fund. ELI coverage accrues only if (a) the worker was acting in the course and scope of employment with the insured; and (b) workers’ compensation law either does…