Pacific Employers Insurance Co., Plaintiff-appellee, v. Aetna Casualty & Surety Co., Defendant-appellant.pacific Employers Insurance Co., Plaintiff, Cross-appellant, v. Aetna Casualty & Surety Co., Defendant-appellant, 434 F.2d 64 (6th Cir. 1970)

This is a declaratory judgment action involving the liability of two insurance companies under the Michigan Workmen's Compensation law. Both companies were represented by the same agent. In violation of the Michigan statute, this agent wrote policies with both companies providing workmen compensation insurance for Jim Robbins Company as insured. One policy provided for aviation coverage and the other did not list aviation activities. Both policies were issued the same day and for the same period of time.

While both policies were in effect two employees were killed in the crash of an airplane owned by Jim Robbins Company and piloted by Mr. Robbins. The widows of both of the victims claimed workmen's compensation benefits. Each company denied liability and contends that the other is liable. However, Pacific Employees Insurance Company began paying compensation to the two widows promptly after the death of their husbands, under an agreement of reimbursement after ultimate determination of liability.

District Judge Talbot Smith held that each company is liable for fifty per cent of the liability ultimately established by the cognizant administrative officials of the State of Michigan. Both companies appeal.

We conclude that the District Judge arrived at as satisfactory a solution as possible under the facts in this case.

The judgment of the District Court is affirmed. Each party will pay its own costs on appeal.