Utah Supreme Court
Can corporations exclude officers from workers' compensation with partial notice? Olsen v. Samuel McIntyre Investment Co. Explained
Summary
Gregory Olsen, president of Samuel McIntyre Investment Company, was killed in an automobile accident in 1994. The corporation had provided written notice only to its insurance carrier, not to the Industrial Commission, when electing to exclude Olsen from workers’ compensation coverage. The Industrial Commission denied death benefits to Olsen’s widow and children, but the court of appeals reversed.
Practice Areas & Topics
Analysis
In Olsen v. Samuel McIntyre Investment Co., the Utah Supreme Court addressed whether a corporation could exclude a corporate officer from workers’ compensation coverage by providing written notice only to its insurance carrier, rather than to both the carrier and the Industrial Commission as required by statute.
Background and Facts
Gregory Olsen served as president of Samuel McIntyre Investment Company. In 1993, the corporation provided written notice to the Utah Workers’ Compensation Fund of its intent to exclude Olsen from coverage under section 35-1-43(3)(b). However, the corporation failed to provide separate written notice to the Industrial Commission. The Fund sent the Commission a magnetic computer tape containing information about the exclusion. When Olsen was killed in an automobile accident in 1994, his widow and children applied for death benefits, which the Fund denied based on the exclusion.
Key Legal Issues
The primary issue was whether the corporation’s notice to only the insurance carrier satisfied the statutory requirement for dual notice. Secondary issues included whether information on a magnetic tape constituted “written notice” and whether the 1995 statutory amendment eliminating the dual notice requirement should apply retroactively.
Court’s Analysis and Holding
The Supreme Court applied correctness review to the statutory interpretation question. The court found section 35-1-43(3)(b) unambiguous in requiring written notice to both the insurance carrier “and” the Industrial Commission. The court rejected arguments that the magnetic tape constituted written notice, noting that information on magnetic tape is not visible to the eye and does not qualify as printing, handwriting, or typewriting under traditional definitions. The court also refused to apply the 1995 amendment retroactively, finding it substantive rather than procedural because it altered the parties’ rights and duties regarding workers’ compensation coverage.
Practice Implications
This decision emphasizes the importance of strict statutory compliance in workers’ compensation exclusions. Practitioners should ensure corporate clients provide all required notices in the exact manner specified by statute. The court’s liberal construction of workers’ compensation statutes in favor of coverage means that technical deficiencies in exclusion procedures will likely result in continued coverage and potential liability for benefits.
Case Details
Case Name
Olsen v. Samuel McIntyre Investment Co.
Citation
1998 UT
Court
Utah Supreme Court
Case Number
No. 970127
Date Decided
April 3, 1998
Outcome
Affirmed
Holding
A corporation must provide written notice to both its insurance carrier and the Industrial Commission to exclude a director or officer from workers’ compensation coverage under section 35-1-43(3)(b).
Standard of Review
Correctness for statutory interpretation
Practice Tip
When advising corporate clients on workers’ compensation exclusions, ensure written notice is provided to all entities specifically required by statute, as constructive notice or partial compliance will not suffice.
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