279 Mass. 393 | Mass. | 1932
On May 24, 1925, the plaintiffs were injured in an accident in which an automobile owned and driven by one Costa was in fault. Costa was at that time insured against liability for loss or damages on account of bodily injury as the result of the ownership, maintenance or use of the automobile. The policy was issued by the defendant. The date of issue does not appear from the record. Actions against Costa were brought by the plaintiffs who obtained judgments against him. Costa did not satisfy the judgments within thirty days after their entry; and, thereupon, the plaintiffs brought these bills in equity against the defendant to reach and apply in satisfaction of their judgment debts the obligation of the insurer, the defendant, basing their rights upon G. L. c. 175, §§ 112, 113, and G. L. c. 214, § 3 (10), as amended by St. 1923, c. 149.
The defendant answered admitting that such a policy issued by it was outstanding and in effect on May 24, 1925; but setting out, further, that it was a condition of the policy that Costa should cooperate with and furnish all needful and possible assistance to the insurer in connection with any claim which should be made or any action which should be brought arising out of his use or maintenance of the automobile, and that Costa had utterly failed in performance of the conditions, and, in consequence, that the defendant was relieved of liability thereunder. The answer ignored the other allegations of the bill, and left the plaintiffs to their proof.
Lorando v. Gethro, 228 Mass. 181, and later cases following it, see McMahon v. Pearlman, 242 Mass. 367, 370, Lunt v. Aetna Life Ins. Co. of Hartford, 253 Mass. 610, Kana v. Fishman, 276 Mass. 206, 210-211, (compare Coleman v. New Amsterdam Casualty Co. 247 N. Y. 271, Weatherwax v. Royal Indemnity Co. 250 N. Y. 281, Gerka v. Fidelity & Casualty Co. of New York, 251 N. Y. 51, Seltzer v. Indemnity Ins. Co. of North America, 252 N. Y. 330,) have settled that under G. L. c. 175, §§ 112,113, and G. L. c. 214, § 3 (10), the rights of the plaintiffs against the defendant do not rise higher than those of the assured. If Costa broke the condition of his policy which required that he “Whenever re
The trial judge found that Costa seasonably informed the defendant of the accident, made proper report thereof, turned over such papers as were served upon him, and, at least until the cases were put upon the trial list, cooperated in all needful ways. Lawyers engaged by the defendant filed appearances for Costa, made answers in the actions and filed and attended to interrogatories in them. In so doing they learned that Costa was engaged in violating the Federal prohibitory liquor laws and was trying to make himself inconspicuous to the authorities. They had difficulty in securing his presence for information and signature in the matter of interrogatories. Their experience, the judge found, “was enough to show . . . [the defendant] that it had insured a slippery customer.” “I cannot find even that any request was made of him to keep the defendant informed of his whereabouts or that some address be given or other means of reaching him should be devised which would not be likely to be a source of danger to him in his illegal pursuits.” The attorneys believed Costa had a defence. See S. & E. Motor Hire Corp. v. New York Indemnity Co. 255 N. Y. 69.
When the cases were nearing trial the defendant engaged Mr. Sleeper to try them. He began preparation and desired to discuss them with Costa, but, although he sent letters to such addresses as he thought might reach him and employed an investigator to search for him and conduct him to the office, he was unable to secure an interview. The letters
On May 31 counsel for plaintiffs secured, continuances of the cases after the withdrawals. No motion under Common Law Rule 24 of the Superior Court (1923) for continuance owing to absence of a witness with affidavit of the testimony expected was made. The cases were again marked for trial, and, on June 2, 1930, Costa was defaulted. On June 6, 1930, damages were assessed in each case. Nothing was done
We have considered the evidence, duly reported by the stenographer, and are unable to say that the findings of fact of the trial judge are plainly wrong. His findings must stand. We think, however, that his ruling of law is erroneous. In our opinion the defendant was bound to do only what a reasonably prudent person would do to keep in contact with the insured; and that, in following his ruling, the judge did not consider and decide the proper question of fact. We think it could be found that the defendant did all that it was bound to do and that it had a right to disclaim liability. There was basis for inference that in some way, although all but one of the letters were not accepted and not delivered, Costa, or some one for him, knew of their existence, and should have inferred that he was wanted by the attorneys in charge of the cases.
The attorney who was to try the case was justified in feeling that an interview with Costa was indispensable to proper preparation for trial, and that his presence and assistance in court at the trial were essential to the defence. A refusal on Costa’s part, due to personal reasons not material to the defence of these cases, would constitute lack of cooperation. Coleman v. New Amsterdam Casualty Co. 247 N. Y. 271.
It has been decided that an insurance company which
Here, however, the attorneys of the insurance company withdrew from the cases when the failure to cooperate, as they viewed it, was complete, and the company immediately disclaimed. Daly v. Employers Liability Assurance Corp. 269 Mass. 1, is not controlling. There the insurer did not withdraw until after a verdict had been rendered. It took chances which this defendant did not. See also Lunt v. Aetna Life Ins. Co. of Hartford, 261 Mass. 469.
Even if it be believed that the defendant desired and sought for opportunity to disclaim, that would not defeat disclaimer if the assured failed to cooperate without collusion on the insurer’s part. There is no finding of collusion here.
In view of the decisions holding the insurer to liability although a breach of the condition has occurred, the insurer is placed in a position in which it must separate itself from the defence decisively and completely if it desires to insist upon its right to disclaim upon breach of the condition. A motion for continuance might prejudice its position, if made after actual breach when the right to disclaim liability was openly asserted. Any action on the part of the insurer in behalf of the assured taken after the withdrawal and disclaimer in open court would expose it to a claim of waiver. There is nothing here to justify finding that Costa sought to purge his default but was denied unreasonably. See Weatherwax v. Royal Indemnity Co. 250 N. Y. 281.
We are unable to find that the action of the defendant or its attorneys was collusive or taken in bad faith. The decrees for the plaintiffs are based upon an incorrect ruling of law, and, in substance, require actual knowledge by the assured
Ordered accordingly.