Hoven v. Employers' Liability Assurance Corp.
67 N.W. 46
Wis.
1896
Check Treatment
Maeshall, J.

Did thе court err in construing the policy of insurance to be a contract of indemnity against liability, instead of one of indemnity against damages, and in holding that payment of the personal injury claim is not a condition precedent to the right to recover thereon?

The policy recites that it is issued on an application for i/ndemnit/y against claims for compensation for personal injuries. It acknowledges the payment of $1,044 as the premium for such indemnity for a period of twelve months. This is followed by the agreement to pay ‘ to the employer . . . all sums for which it shall become liable to its employees.’ Certain conditions are indorsed on the policy and made a part of it, which are consistent with the apparent meaning оf the language contained in the body of the contract. By such conditions the assured is prohibited from settling the claims, except by consent of the assurer. They exprеssly provide that an action may be brought against the assurer before the payment of the claim, by the use of the following language: “ The company shall not be sued uрon this policy in any court after six years from the time that the injury occurred, upon or by reason of which ‍‌​​​‌‌‌‌‌‌‌‌‌‌​​​​​‌‌​‌​​​‌‌‌​‌‌‌‌‌‌‌‌‌‌​​​​​‌​​‍the cause of action accrued, unless at the expirаtion of said time some suit brought by the injured employee be then pending against the employer, in which case an action may be brought within six months after the termination of such suit, аnd not later.” This language plainly indicates that payment of the claim is not a condition precedent to a right of action against the insurer on the policy. Again, by оne of the conditions, the insurance company assumes entire charge and responsibility for the settlement of the loss and of any legal proceedings, and for thе payment of the costs thereof. There is no way provided by which it can be re*208lieved of its liability except by actual payment to the employer of the full amоunt for which it could, in any event, become liable.

It will be seen that both the provisions in the body of the policy and the conditions indorsed thereon and made a part •оf it are inconsistent with any reasonable theory other than that the contract of insurance is one of indemnity against liability, and that actual damages are not a сondition precedent to the maintenance of an action thereon. It not only •clearly contemplates that such an action may be brought before actual payment of the claim for damages by the assured, but by plain and unmistakable language it contracts to indemnify the assured against liability, not against damages. The case is not one requiring a resort to rules for judicial construction in order to determine what the parties intended by the language of the contract. Substantially the same kind of policy was under consideration in the recent case of Anoka L. Co. v. Fidelity & C. Co. (Minn.), 65 N. W. Rep. 353, cited in the brief of counsel for respondent, where the court held ‍‌​​​‌‌‌‌‌‌‌‌‌‌​​​​​‌‌​‌​​​‌‌‌​‌‌‌‌‌‌‌‌‌‌​​​​​‌​​‍it to be a contract of indemnity against liability, and said: “ The intention of the parties appears to be so plainly expressed that any other construction than the ■one here given to the contract would do violence to the language they saw fit to use.”

It is further claimed on the part of the appellant that the .accident whereby plaintiff was injured was not within thе terms of the contract of insurance; that by the schedule referred to in the body of the policy, and attached to it, liability was restricted to injuries to employeеs while engaged in operations connected with the business of iron and steel works,— that is, in the operating department of the business, as distinguished from business like that of constructing necessary buildings. To be sure, plaintiff was injured while at work in the operating department, by the fall of a girder which was being raised to its position by an inde*209pendent crew engagеd in building an addition to tbe works. Therefore, if the labor of constructing such addition, under a proper interpretation of the policy, is not an operation ■connected with the business of iron and steel works, appellant is not liable.

We are referred to People's Ice Co. v. Employers' L. Ass. Corp. 161 Mass. 122, as a case directly in point to sustain appellant’s contention. The policy in that case insured the employer against claims for damages on the part of its employees in “ all operations connected with the business of ice dealers.” The court held that this language covered only •employees in the operating department, and that a person injured while engaged in constructing an ice-house was not ■оne of the employees mentioned. But this conclusion was reached by reason of representations contained in the application ‍‌​​​‌‌‌‌‌‌‌‌‌‌​​​​​‌‌​‌​​​‌‌‌​‌‌‌‌‌‌‌‌‌‌​​​​​‌​​‍upon which it was issuеd. The latter contained, •among other representations, the following: “Employer’s works are situated . . . where cutting ice.” “The trade ■or business is ice dealers.” “ The oрerations carried on by the work-people are cutting and handling ice.” “ The machinery in use is such as is necessary in cutting ice.” We are not prepared to say but that there was reasonable ground to hold that the policy, taken in connection with the application, and the language of the schedule, “ All operatiоns ■connected with the business of ice dealers," covered only persons engaged in the actual operations of cutting, handling, storing, and delivering ice, and - not thosе engaged in the •construction of storehouses; nevertheless we should hesitate to adopt such construction if the precise question were before us. The languаge was inserted for the benefit of the appellant. It is its language. Therefore, if open to judicial •construction at all, that interpretation should be given most favоrable to the assured. Insurance Co. of N. A. v. Garland, 108 Ill. 220; Niagara F. Ins. Co. v. Seammon, 100 Ill. 644; Symonds v. N. W. Mut. L. Ins. Co. 23 Minn. 491; Foot *210v. Ætna L. Ins. Co. 61 N. Y. 511; Stout v. Comm. U. Ass. Co. 11 Biss. 309; Teutonia F. Ins. Co. v. Mund, 102 Pa. St. 89. -This rule is applied rigidly in the construction of conditions inserted in policies restricting the general scope of the contract of insuranсe. Burkhard v. Travellers' Ins. Co. 102 Pa. St. 262.

Here there is no application containing representations descriptive of the particular departments of the business covered ‍‌​​​‌‌‌‌‌‌‌‌‌‌​​​​​‌‌​‌​​​‌‌‌​‌‌‌‌‌‌‌‌‌‌​​​​​‌​​‍by the contrаct as in the Massachusetts case, or of damages caused by particular instrumentalities as in the case of Phillipsburg H. C. Co. v. Fidelity & G. Co. 160 Pa. St. 350. The general language of the contract, “All operations connected with the business of iron аnd steel worlcs,” is not restricted by anything in the conditions indorsed on the-policy or any paper referred to or made a part of it. If the intention was to restrict such lаnguage to operations in any particular department, or to any particular branch of the business, or to any particular instrumentalities used in such, business, it was easy tо have said so in unmistakable language. The court should give the general language the-assurer saw fit to use, under the circumstances, a broad and’ liberal construction in fаvor of the objects for which the policy was taken out, and by so doing the conclusion is easily reached that it covers the operation of constructing a building for the use of the assured in its business,-as one of the-operations connected with such business.

It is further claimed that the indebtedness of the garnishee to the iron and steel company did not become due-absolutely till judgment was entered in respondent’s action against such company, hence not subject to garnishment when this action was commenced. We hardly understand the force of this assignment of error. Judgment was entered against the iron and steel company before the garnishee action was commenced. ‍‌​​​‌‌‌‌‌‌‌‌‌‌​​​​​‌‌​‌​​​‌‌‌​‌‌‌‌‌‌‌‌‌‌​​​​​‌​​‍Entry of such judgment ■made the indebtedness of the iron and steel company abso*211lute. Sec. 2769, R. S., provides that “no judgment shall be rendered upon a liability of the garnishee ... by reason of any money owing from him to the defendant, unless before judgment against the defendant it shall have become due absolutely.” This action was not commencеd till January 26,1894. Judgment was entered in the action against the iron and steel company on the 22d day of December, 1893. Due notice was served upon the insurer of the claim for damages and of the commencement of the action therefor, and it refused to recognize the claim upon the ground that such claim was not covered by the policy. On the rendition of such judgment, under the circumstances, the liability of the garnishee became absolute for the amount thereof, $1,451.95, and that being before the commencement of this action satisfies the provisions of sec. 2769, R. S. St. Joseph Mfg. Co. v. Miller, 69 Wis. 389; Jones v. St. Onge, 67 Wis. 520.

There is no other question in the case requiring consideration.

By the Court.— The judgment of the superior court is affirmed.