315 Mass. 329 | Mass. | 1943
These are four bills in equity brought under G. L. (Ter. Ed.) c. 175, §§ 112, 113; c. 214, § 3 (10), to reach and apply, in satisfaction of judgments recovered by the first three plaintiffs for personal injuries and by the fourth for consequential damages, which arose when the female plaintiffs were injured while riding as guests of the insured in an automobile she was operating on July 23, 1938, the indemnity furnished by the corporate defendant to the insured by a policy which included guest coverage. The plaintiffs appealed from final decrees ordering the bills dismissed as against the insurance company.
One of the conditions of the policy was that the insured should cooperate with the company and, upon the company’s request, should attend hearings and trials and assist in the conduct of actions. The company’s attorney withdrew from the defence of the four tort actions when they were reached for trial on the ground that the failure of the insured to attend the trial constituted a breach of this condition of the policy and justified it in disclaiming liability. The question here is whether, upon the evidence presented at the hearing of the present suits and the report of the material facts, the judge was plainly wrong in finding that the company had the right on account of the conduct of the insured to disclaim liability under the policy.
At the request of the insured, Mr. Sears, attorney for the company, on February 6, 1941, secured a postponement of the trial of the tort actions until March 1, 1941, in order that she might make a trip to Florida. In answer to her
Upon the happening of the accident, which was a risk covered by the policy, the plaintiffs acquired a beneficial interest in the proceeds of the policy and the right, if judgments were entered in their favor in the tort actions, to enforce in their own names the satisfaction of their judgments out of the indemnity furnished to the insured by the company. Their rights in the indemnity, however, were derivative and if, by breach of the provisions of the policy by the insured, the company was discharged from its obligation to indemnify her, it was likewise relieved of any obligation to pay the plaintiffs. It has been said that the rights of the third persons injured to have recourse to the indemnity promised by the company do not rise any higher than those of the insured. Lorando v. Gethro, 228 Mass. 181. Cogliano v. Ferguson, 245 Mass. 364. Souza v. Car & General Assurance Corp. Ltd. 281 Mass. 117. Sheldon v. Bennett, 282 Mass. 240. Liddell v. Standard Accident Ins. Co. 283 Mass. 340. Wainer v. Weiner, 288 Mass. 250. Blair v. Travelers Ins. Co. 291 Mass. 432. Phillips v. Stone, 297 Mass. 341. Klefbeck v. Dous, 302 Mass. 383.
After a cause of action has accrued to the injured persons against the insured, then the parties to the contract of insurance cannot by any release, agreement or collusion destroy the rights of the injured persons in the indemnity.
The judge found that there was no evidence of connivance, and upon the testimony it is plain that there was not the slightest evidence of anything savoring of fraud between the insured and the company. Goldberg v. Preferred Accident Ins. Co. 279 Mass. 393, 399.
The company had the right to insist upon the performance by the insured of the condition of the policy. The finding that the insured’s conduct constituted a breach of the condition of the policy cannot be said to be plainly wrong. That finding is decisive unless, as the plaintiffs contend, the company is estopped to rely upon a disclaimer.
The company was under no affirmative duty to protect the plaintiffs’ rights. Its paramount duty was to fulfill its contractual obligation to undertake the defence of these actions and to protect the interests of the insured, which in fact were adverse to those of the plaintiffs. The company was not bound, so far as the plaintiffs were concerned, to defend these actions, Rollins v. Bay View Auto Parts Co. 239 Mass. 414, 421; Kana v. Fishman, 276 Mass. 206; Goldberg v. Preferred Accident Ins. Co. 279 Mass. 393, and if the attorneys for the company believed on the afternoon of March 5 that the insured might not appear at the start of-the trial, they were not required to disclose that information to the plaintiffs or their counsel. In Nichols v. Pope, 287 Mass. 244, counsel for the defendant had a case marked “passed,” when it appeared upon the trial list, for the reason that the plaintiff had died since the commencement of the action, and then notified the plaintiff’s counsel of the death of his client. As a matter of fact, the defendant was also deceased at this time, but the plaintiff’s counsel was ignorant of this fact and counsel for the defendant made no mention of it, and later when the plaintiff’s counsel attempted to have
The insurance company was acting in good faith and was justified in disclaiming liability. The judge properly excluded evidence that counsel for one of the plaintiffs would have been willing to grant a continuance when the case was reached for trial if requested to do so by the attorneys for the insured. The record shows that counsel for another plaintiff requested that the judge assess damages following the default of the insured. The company was not required to request or to assent to a continuance when the insured failed to appear. Such conduct might have later subjected it to a claim of waiver or estoppel. See Goldberg v. Preferred Accident Ins. Co. 279 Mass. 393, 399.
Upon the findings of the judge, the company was authorized by the insured’s conduct to disclaim liability and was not estopped to rely upon this breach of the policy by the insured. The result is that the company had been discharged of its obligation to indemnify the insured, and consequently, as there was nothing that the plaintiffs could reach in satisfaction of their judgments, their bills of complaint as far as the company was concerned were properly dismissed. Sontag v. Galer, 279 Mass. 309. Sheldon v. Bennett, 282 Mass. 240. Wainer v. Weiner, 288 Mass. 250. Blair v. Travelers Ins. Co. 291 Mass. 432.
Decrees affirmed.