DE CONCINI, Justice.
The parties were originally here on an appeal by certiorari from the Industrial Commission, 72 Ariz. 299, 233 P.2d 1082, hereinafter referred to as the first Pressley case. A rehearing was granted, 73 Ariz. 22, 236 P.2d 1011, hereinafter called the second Pressley case.
Pressley, while in the employ of Pioneer Constructors, was injured by a gas explosion in a manhole where he was working. He accepted accident benefits from the Commission but returned its check for compensation. For full details of what occurred see the second Pressley case.
After the decision on rehearing in the Pressley case, Pressley brought suit in the Superior Court of Pima County against the Tucson Gas and Light Co., defendant, as the third party tort-feasor whom he alleged was responsible for his injuries. The defendant answered, denying liability. The Industrial Commission filed a complaint in intervention on the ground that Pressley had no right to sue a third party, (1) because he had made an election to take compensation,
The commission then filed a petition for a writ of certiorari, or in the alternative a writ of prohibition, and then amended it to read "for a writ of mandamus". This court, under the authority of Brown v. De Concini, J., 60 Ariz. 476, 140 P.2d 224, granted the alternative writ.
The commission's petition seeks to relitigate the issues in the second Pressley case and in addition claims: (1) that Pressley should have sought review by the superior court of the commission's order that Pressley had made an election, and (2) that it was entitled to intervene and be subrogated to all of Pressley's rights against the defendant third party as set out in its complaint in intervention.
Respondent Pressley denies the commission has the right to intervene on the grounds, (1) its complaint fails to state a cause of action; (2) the commission is neither a proper or necessary party and its presence would be detrimental to Pressley because it would introduce compensation insurance into the case.
The matter was fully briefed on all issues in the second Pressley case and is now ready for determination.
Before treating the new matters raised in this action we deem it advisable to first mention that we affirm our decision in the second Pressley case in all respects. To reiterate in part:
The questions to be decided in this case are those of Election, Subrogation, and Intervention. We will treat them in that order.
Is the trial court the proper tribunal to determine whether Pressley has made an election? The answer is Yes. Next, is it the duty of the trial judge or the jury to decide that question? The answer: the trial judge should decide that question as a matter of law.
The question then arises whether section 56-950, supra, affords the employee the "reasonable election" of remedies required by our holdings in Alabam's Freight Co. v. Hunt, 29 Ariz. 419, 242 P. 658, and Moseley v. Lily Ice Cream Co., 38 Ariz. 417, 300 P. 958; for unless it does, the section is clearly unconstitutional. In cases like this an election is a waiver of one right and the acceptance of another in lieu thereof, and we hold that to be binding the election must be with knowledge (1) of the alternative remedies, and (2) that the acceptance of one waives the right to the other. See Graybill v. Corlett, 60 Colo. 551, 154 P. 730; Craig v. Meriwether, 84 Ark. 298, 105 S.W. 585; 28 C.J.S., Election of Remedies, § 24. With this construction, section 56-950, supra, is constitutional. If the applicant does not have this knowledge, whether his ignorance be one of law or fact, he has in fact made no binding election. Gardner v. Gauthier, 101 Vt. 147, 141 A. 682. The question of an election must of course be raised by the pleadings as stated in Moseley v. Lily Ice Cream Co., supra, and the petitioner must sustain his claim of lack of knowledge by reasonable evidence. See Taylor v. Hubbell, 9 Cir., 188 F.2d 106, which construed Article 18, section 6 of the Arizona Constitution to give an injured employee the right to sue a third party. We consider such employee to have that right by virtue of sections 56-949 and 56-950, supra, under Article 18, section 8; however, Taylor v. Hubbell, supra, is authority for what constitutes a binding and valid election. Subrogation, under Workmen's Compensation Acts, 1948, by William B. Wright, also defines what constitutes an election (page 27):
In reporting the two former Pressley cases the NACCA Law Journal, Vol. 8, page 101, made the following comment:
In Taylor v. Hubbell, supra [188 F.2d at page 109], the court held that the question of election was one of law for the trial judge to decide, and said this:
Wright on Subrogation, supra, page 79, section 36, says:
In the event the trial judge decides that Pressley has elected to take compensation does the commission have the right of subrogation of Pressley's right against the third party tort-feasor? Yes. Does it include the right of subrogation for accident benefits regardless of an election? Yes.
Section 56-949, A.C.A. 1939, refers to the commission's right to sue a third party as "assigned to the state" rather than subrogation. There appears to be three titles: "Statutory assignments", "Legislative grants", and "Subrogation". We will use the latter because most courts and writers use that term. See Wright's work on Subrogation, supra, and also Horovitz on Workmen's Compensation.
Before determining what rights the commission has to Pressley's claim against the third party defendant it would be well to make some general observations as to the nature of the Workmen's Compensation Act, A.C.A. 1939, § 56-901 et seq.; the public policy of the state and the manner in which the Act should be construed.
The Act was enacted primarily for the benefit of the injured employee and his dependents, Red Rover Copper Co. v. Industrial Commission, 58 Ariz. 203, 118 P.2d 1102, 137 A.L.R. 740, and secondarily for the benefit of the employer. The Act deals solely with the employer-employee relationship. No mention is made of third party tort-feasors, except in sections 56-949 (hereinafter set out) and 56-950, supra, which provide the employee's right to sue a third party but confers no rights on such third parties. The public policy has been, first, to protect the employee whose injury arose in and out of the course of his employment; and second, to protect the Compensation fund administered by the commission, which indirectly benefits the employer. Goodyear Aircraft Corp. v. Industrial Comm., 62 Ariz. 398, 158 P.2d 511.
In analyzing the above section we find it is divisible in three parts. The first sentence provides that the employee shall elect either to take compensation under the Act or sue a third party under section 56-950, supra. Thus, section 56-950 protects an employee's constitutional rights as heretofore set out under "Election" in this opinion.
In construing the first sentence of 56-949 in the second Pressley case, we held that an injured employee was entitled to "accident benefits" without having made an election to take compensation.
The second sentence of 56-949, supra, deals with the assignment of the employee's rights against the third party or "subrogation" as we are pleased to term it. It is this portion of the statute with which we are concerned. The third sentence provides for approval of settlement and compromise of claim against the third party.
Pressley contends that there is no subrogation of "accident benefits" because
There are several principles underlying the Workmen's Compensation Acts that negative Pressley's contention. First, there shall be no double recovery, one by way of compensation and one by way of damages. Aetna Life Ins. Co. v. Moses, 287 U.S. 530, 53 S.Ct. 231, 77 L.Ed. 477; Smith v. Southern Ry. Co., 237 Ala. 372, 187 So. 195; Jacobsen v. State Industrial Accident Comm., 212 Cal. 440, 299 P. 66. Second, the subrogation provisions of Workmen's Compensation Acts should be liberally construed to make them effective. Standard Accident Insurance Co. v. Pennsylvania Car Co., 5 Cir., 49 F.2d 73; Johnson v. Turner, 319 Ill.App. 265, 49 N.E.2d 297; Henry Steers, Inc., v. Turner Const. Co., 104 N.J.L. 189, 139 A. 42. Thirdly, liability of third party tort-feasors is not intended to be disturbed by the Act. Riss & Co. v. Anderson, 108 Colo. 78, 114 P.2d 278; Wilson v. Smith, 110 Colo. 68, 130 P.2d 1053; Hartquist v. Tamiami Trails Tours, 139 Fla. 328, 190 So. 533; Pittsburgh, etc., Ry. Co. v. Keith, 89 Ind.App. 233, 146 N.E. 872.
We hold that the commission does have the right of subrogation against the third party as held in Moseley v. Lily Ice Cream Co., supra [38 Ariz. 417, 300 P. 960].
We realize, by affirming the second Pressley case, we have held that the word "compensation" in the first sentence of 56-949 did not include "accident benefits", thereby giving the statute a liberal construction in favor of the injured employee; and now in this case we hold that the word "compensation" in the second sentence does include "accident benefits", thereby giving it a liberal construction in favor of the commission as against the third party in order to effectuate the subrogation provision. We believe such a construction is entirely in harmony with the letter and spirit of the Act and will promote justice between all parties. We have held innumerable times that the provisions
In the case of Atlantic Cleaners & Dyers v. United States, 286 U.S. 427, 52 S.Ct. 607, 608, 76 L.Ed. 1204, the Supreme Court said:
In United States v. Hartwell, 6 Wall. 385, 18 L.Ed. 830, in construing a criminal statute, it was said:
Section 21-527, A.C.A. 1939, as amended, Rule 24(a), as amended, provides for intervention under subsection (3). Even before the advent of this rule of court we held, in United States Fidelity & Guaranty Co. v. Alfalfa Seed & Lumber Co., 38 Ariz. 70, 297 P. 868, 870:
In view of our construction of 56-949, supra, the commission has the right to intervene. See also Wright's Subrogation, Section 33, p. 72:
To recapitulate, we affirm the second Pressley case in all respects. We further order, the alternative writ of mandamus heretofore issued be made peremptory and the commission be allowed to intervene; that the commission be allowed subrogation to any and all of Pressley's rights against the third party for payments made for "accident benefits" received by Pressley; and that the trial judge hear and decide the question of election as a matter of law before proceeding with the trial of the case on its merits.
Each party to pay his own costs.
STANFORD, PHELPS and LA PRADE, JJ., concur.
UDALL, Chief Justice (dissenting in part).
While I concurred in the decision rendered in the second Pressley case and find myself in accord with many of the holdings in the instant case, particularly as to the matters covered under "Election", yet, I am impelled to dissent to the majority holding that the statutorily defined word "compensation", when separately used in Section 56-949, supra, has two diametrically opposed meanings.
In determining the legislative intent regarding third party suits brought under Section 56-949, supra, I think the court is
In the case of Sakrison v. Pierce, 66 Ariz. 162, 185 P.2d 528, 534, 173 A.L.R. 480, we stated:
In the most recent revision of Sutherland's work on statutory construction, the following rule is stated:
Irrespective of the right of the Commission to recover the accident benefits theretofore paid by it to Pressley, it would, in my opinion, still have the right to intervene in the present suit pending in the Pima County Superior Court to protect its rights in this third party suit; first, on the question as to whether Pressley had made an election; and second, if so, to be in a position as assignee to take over the law suit and prosecute it to conclusion. I therefore agree that the alternative writ of mandamus should be made peremptory.
My primary purpose in writing this partial dissent is to highlight the deficiencies in the workmen's compensation Act as regards the liability of third persons to injured employees, Section 56-949, in the hope that the legislature may "spell out" with more particularity the substantive rights of all parties, this being a legislative rather than a judicial function.