156 N.E.2d 44
Mass.
1959
Spalding, J.

Having recovered a judgment against the defendant Pica (hereinafter called the insured), the plaintiff brought this bill in equity to reach and apply the obligation of the defendant insurance company (hereinafter called the company) under the noncompulsory provisions of a motor vehicle policy issued by it to the insured. See G. L. c. 175, § 113; c. 214, § 3 (10). The judge made findings of material facts and ordered the bill dismissed. 1 From a decree entered in accordance with this order, the plaintiff appealed. The сase comes here on an agreed record. Rule 4 of the Rules for the Regulation of Practice before the Full Court (1952), 328 Mass. 695.

Findings of the judge .include the following: On July 2, 1951, the plaintiff brought an action of tort against the insured, alleging that on the night of August 5, 1950, he was struck and injured by an аutomobile owned and operated by the insured. On July 25, 1951, an appearance for the insured was entered in the case by a firm of attorneys representing the company. On April 24, 1952, the plaintiff’s attorney sent to the attorneys for the company a notice of a demand to admit facts (under G. L. c. 231, § 69) in the tort action against the insured. This notice was received by the company’s attorneys on the same day, On that day (April 24) an attorney of the firm representing the company dictated and signed a letter to thе insured which stated that his office, under the insured’s policy, was representing him in the tort case; that notice of a demand from the plaintiff to admit facts had been received that day; that the demand required the insured to admit or deny certain facts; and that it was necessary for the insured “to come to this office” so that “the facts can be reviewed” and the answers prepared for his signature. The letter concluded with the following: “Accordingly will you contact me by telephone, and in the event that I am nоt in the office, contact my secretary who will be glad to arrange an appointment at a time which suits your convenience. The matter must be attended to within ten days -of this date so that your prompt cooperation is required.”

This letter was never mailed to the insured. Six days later, on April 30, 1952, an employee of the company delivered the letter in person to the insured at his residence in East Weymouth. Before delivery he read the letter to the insured, who replied that he would get “in touch right away.” Thе insured did not go to the office of the company’s attorney ‍​​‌‌​‌​‌​‌‌‌​‌‌‌​‌‌‌‌​‌‌‌‌‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌​​​‌‍or get in touch with anyone there before or after ten days from the date of the letter. No reply to the demand to admit facts was ever filed, the facts set forth in the demand were “deеmed admitted” under G. L. c. 231, § 69, and the case was tried on that footing. On May 27, 1952, the company’s attorneys withdrew their appearance in the case.

It is agreed that the company’s attorneys did not communicate with the insured between April 30 (the date of delivеry of the letter) and May 27 when they withdrew from the case; nor did they prepare any answers to the demand to admit facts and neither sought nor obtained any extension of time for answering it.

The only relevant provision of the policy here involved is the following: “The insured shall cooperate with the company and upon the company’s request, shall attend hearings and trials and shall assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of suits.”

During the trial, the рlaintiff offered certain interrogatories propounded to the company and the answers thereto, which were excluded. In substance the answers to these interrogatories state that the insured submitted a written report of his accident dated August 7, 1950, whiсh was received by the company on August 8, 1950; that he also gave a signed statement of the accident to the company on August 16, 1950; and that he notified the company when the writ was served on him. The insured’s signed statement and his written report of the accident wеre also offered and excluded. The plaintiff’s attorney called the insured as a witness and asked him in turn as to each of the facts set forth in the demand to admit facts whether such fact was true. This procedure was repeated when the plaintiff was called as a witness. The judge excluded each such question. The plaintiff duly saved exceptions to these rulings, and made appropriate offers of proof. These offers were to the effect that the excluded evidence would show substantiаl compliance by the insured with the cooperation clause and that the facts actually existing touching the accident would be the same as those set forth in the demand.

The judge found that the insured, by failing to get in touch with the company’s attorneys “aftеr timely notice in hand,” did not cooperate “in a vital and immediate matter” pertaining to the defence of the tort case.

The issues on this appeal are two: (1) Whether the insured’s conduct amounted to a material breach of the cоoperation ‍​​‌‌​‌​‌​‌‌‌​‌‌‌​‌‌‌‌​‌‌‌‌‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌​​​‌‍clause. (2) Whether there was prejudicial error in the exclusion of any of the proffered testimony.

1. Where the obligation which a plaintiff seeks to reach arises -out of noncompulsory insurance — and that is the case here 1 — any defencе available to the insurer against the insured is also available against the plaintiff, for the plaintiff stands in the shoes of the insured. Blair v. Travelers Ins. Co. 291 Mass. 432, 436, and cases cited. Salonen v. Paanenen, 320 Mass. 568, 575. That an insurer may terminate its liability under a policy if the insured commits a material breach of the cooperation clause contained in it is well settled. Goldberg v. Preferred Acc. Ins. Co. 279 Mass. 393. Goldstein v. Bernstein, 315 Mass. 329. Williams v. Travelers Ins. Co. 330 Mass. 476. Polito v. Galluzzo, 337 Mass. 360. And the insurer need not show that it was prejudiced by the breach. Polito v. Galluzzo, supra.

But the “problem of non-cooperation has a dual aspect: not only what the assured failed to do, but what the insurer on ‍​​‌‌​‌​‌​‌‌‌​‌‌‌​‌‌‌‌​‌‌‌‌‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌​​​‌‍its part did to secure co-operаtion from an apathetic, inattentive, or vanished policy holder, must be considered.” Pennsylvania Threshermen & Farmer’s Mut. Cas. Ins. Co. v. Owens, 238 F. 2d 549, 550 (4th Cir.). Although we have frequently dealt with cooperation clauses, we have not heretofore considered the subject with respect to the insurer’s duties under them. This quеstion, however, has received the attention of courts elsewhere. It has been held, in accordance with the language quoted above, that an insurer cannot be relieved of liability because of an alleged breach of a coоperation clause by the insured in a situation where it has not itself exercised diligence and good faith. Royal Indem. Co. v. Rexford, 197 F. 2d 83 (5th Cir.). Commercial Cas. Ins. Co. v. Strode, 202 F. 2d 599 (6th Cir.). Duffy v. Fort Dearborn Cas. Underwriters, 270 Ill. App. 143, 149. Indemnity Ins. Co. v. Smith, 197 Md. 160, 165. Finkle v. Western Auto. Ins. Co. 224 Mo. App. 285, 297. Heimbecher v. Johnson, 258 Wis. 200, 205. Modl v. National Farmers Union Property & Cas. Co. 272 Wis. 650, 657. See annotation, 60 A. L. R. 2d 1146, 1154. Elementary principles of justice and fair dealing require such a rule. The obligations under a cooperation clausе are reciprocal. The insured must cooperate; but the insurer is under a duty to exercise diligence and good faith in bringing that about. The demand for cooperation by the insurer must not be unreasonable. There is the additional circumstance in cаses of this sort that an attorney undertaking the defence of the case covered by the policy is an attorney for both the insurer and the insured and owes to each a duty of good faith and due diligence in the discharge of his duties. The rights of one cannоt be subordinated to those of the other.

Applying the foregoing principles to the case at hand it becomes necessary to determine whether the company exercised reasonable diligence in seeking cooperation from the insured in the matter of the answers to the demand to admit facts. We draw no inference of bad faith on the part of the company or its attorneys. See Dragone v. Dell'Isola, 332 Mass. 11, 13. The letter of notification to the insured was prepared and signed by the company’s attorneys on the same day that notice of the demand to admit facts was received by them. But the letter was not transmitted to the insured until six days later. No explanation for this delay appears. By the time it was delivered to the insured only five days of the reply pеriod remained. The day of delivery was April 30, 1952, and we take judicial notice of the fact ‍​​‌‌​‌​‌​‌‌‌​‌‌‌​‌‌‌‌​‌‌‌‌‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌​​​‌‍that this was a Wednesday, so that two of the statutory ten days were Saturday and Sunday. However, since the last day of the reply period fell on a Sunday, a reply to thе demand could have been filed on the following Monday. G. L. c. 4, § 9. Thus the insured had an additional day in which to act. It must also be borne in mind that some part of the ten day period would have been consumed by transmittal even if the letter had been promptly mailed.

The trial judge found specifically that the letter was received by the insured on April 30 and at that time he said that he would get “in touch right away.” The insured’s residence was located in East Weymouth, which we know to be about fifteen miles from Boston. In the time remaining to him he mаde no effort to communicate with the company’s attorneys. For that matter, the insured did not communicate with the company’s attorneys between the time he received the letter and May 27, 1952, the date on which the attorneys withdrew their appearance in the case. At the trial the insured not only did not complain about receiving inadequate notice, but made a complete denial of the entire episode of receiving the letter and having it read to him. This the judge found not to be true. In view оf these facts we think that the conclusion of the trial judge, that the insured violated the cooperation clause, cannot be said to be plainly wrong.

2. We turn now to the question whether there was prejudicial error in the exclusion of any of the prоffered testimony. The plaintiff argues that all of the excluded evidence was relevant to one or both of two propositions which would compel findings in his favor. These propositions are (a) that the insured cooperated in every particular, except that of giving answers to the demand to admit facts, by furnishing a written notification of the accident to the company promptly, reasonable notice of the service of the writ, and an exhaustive and accurate written statement tо the company’s adjuster; and (b) that the insured’s failure to cooperate in the giving of answers to the demand to admit facts was not a material breach since each and every fact contained in the demand was true and the insured would have had tо admit them; that the company knew of this from the notice of accident and the written statement furnished by the insured; and that the only consequence of the failure to answer the demand was that the facts contained in it were deemed admitted.

In so far as thе proffered evidence supports the first proposition it is irrelevant and was properly excluded. An insured cannot excuse his failure to furnish ten per cent of the cooperation requested of him by showing that he had cooperated as to ninety per cent. Even if the first proposition were proved it would not aid the plaintiff’s case, since the company denies liability solely on the ground of the insured’s failure to cooperate in answering the demand to admit facts, and whether such а failure was a material breach of the cooperation clause ‍​​‌‌​‌​‌​‌‌‌​‌‌‌​‌‌‌‌​‌‌‌‌‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌​​​‌‍was the only issue in the case.

In so far as the excluded evidence is probative of the second proposition (materiality of the breach) it stands on a somewhаt different footing. The decision in Polito v. Galluzzo, 337 Mass. 360, 364-365, holds that the insurer is not required to show that it was prejudiced by the insured’s failure to cooperate, but that holding does not preclude an inquiry as to whether the breach was not material. Nevertheless, it was not error to exclude this evidence. This is so because even if all the excluded testimony was admitted and given full credit it would not amount to a showing that the breach was not material. Even if the facts contained in the demand were true and the insured would have had to admit them and the company knew of this from the accident report and the statement of the insured, the company was entitled to the insured’s verification of the facts under oath at the time the notice to admit facts was served. That the only consequence of the failure to answer the demand was that the facts were deemed admitted does not render this breach immaterial. The company was entitled to know whether there were any discrepancies between the earlier unsworn statements and the answers under oath, a mаtter of considerable importance in the preparation of a case for trial.

The final decree rightly dismissed the bill as against the company. However, it is silent as to the defendant Pica, against whom the bill was taken pro confessa. The decree should be modified by inserting a provision establishing the liability of Pica, and, as so modified, is affirmed, with costs of appeal to the company.

So ordered.

Notes

1

The bill was taken as confessed as against the insured.

1

The accident, it seems, occurred on a private way.