Insurance: Temporary Worker – Employee – ‘Furnish’

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Where plaintiff sought insurance coverage for the death of her husband, and the policy included an exclusion from liability coverage for employees of the insured, summary judgment for the insurer is reversed and remanded because the man was a “temporary worker,” subject to coverage, since he was “furnished” to his employer by a third party when the employer decided to hire the man based solely on the recommendation of the third party, even though the third party was not an employment agency and there was no agency relationship between the man and the third party.

Drastic consequence

Dissenting opinion by Stith, J.: “I respectfully dissent. The dispositive issue in this case is whether a third party can ‘furnish’ an employee to an employer by merely recommending or referring him to the employer. In Gavan v. Bituminous Cas. Corp., 242 S.W.3d 718 (Mo. banc 2008), this Court addressed the meaning of ‘furnish’ in the same ‘temporary worker’ exception at issue in this case and held that “‘furnished to,’ in context and in its plain and ordinary meaning, is not ambiguous and necessarily implies that a third party has been involved in providing or supplying the worker to the insured….

“Further, although the majority’s construction of the word ‘furnish’ will permit recovery here, it could have the unintended and potentially drastic consequence of denying workers’ compensation coverage to scores of other workers who otherwise would have been covered as employees under the workers’ compensation act. Under the majority’s approach, any part-time or seasonal workers who are recommended or referred to their employer are temporary workers, not employees, and, therefore, are not covered by their employers’ workers’ compensation insurance. If their employer has no private insurance, as often will be the case, then they will have no source of recovery.”

Judgment is reversed.

Mendenhall v. Property and Casualty Insurance Company of Hartford (MLW No. 63968/Case No. SC92202 –17 pages) (Missouri Supreme Court, Teitelman, C.J.; Russell and Breckenridge, JJ., and Mobley, Sp.J., concur; Stith, J., dissents in separate opinion filed; Fischer and Price, JJ., concur  in opinion of Stith, J. Draper, J., not participating) Appealed from circuit court, St. Louis County, McShane, J. (Amy Lynn Fehr and Mark E. Goodman, St. Louis for appellant) (John L. Hayob and Diane Hastings Lewis, Kansas City, Missouri, for respondent).

Read the full text of this opinion. (PDF)