75 Colo. 271 | Colo. | 1924
delivered the opinion of the court.
Sometime prior to September 5, 1908, Dillie S. Aldrich died in Kansas, leaving a will, which was there probated.
This contract provides inter alia: That the National Surety Company agreed to reinsure certain unexpired surety and fidelity bonds “for any default of the principals named in said bonds * * * occurring after four o’clock p. m. of the 22d day of August, 1912.”
This contract contains a further provision that the National Surety Company should take the place of the Empire Company “as to all said unexpired bonds and all said unexpired policies in all respects with regard to all obligations therein and for loss thereunder, on which no written notice of claim was received by any of the officers of The Empire State Surety Company located at the Home Office in the City of New York, or * * * Denver, Colo.”
Also the further provision that “The National Surety Company shall not be liable for any liability of The Empire State Surety Company except as expressly set forth herein.”
The principal contention of defendant is that the bond in the Aldrich estate signed by the executrix and the Empire State Surety Company was not a risk included in the contract between the National Surety Company and the Empire State Surety Company. The defendant insists that if there were any default, claim, or loss, known to the representatives, officers, or general agents or branch office managers of the Empire State Surety Company, at the time of entering into the agreement, there could be no liability upon the part of the National Surety Company, becaüse such default, claim, or loss, were expressly excepted and excluded from the agreement.
It appears from the evidence that Mr. Crank, an attorney, and brother-in-law of the executrix, discussed with Mr. Gemmill, then the local agent of the Empire State Surety Company, in Denver, and who, it appears was the attorney in fact for the company, and signed the bond of the executrix for the company, the particular claim made by the legatees, and informed Gemmill of the claim made against the executrix, and that the claim would be defeated; that later Mr. Crank gave a written statement of the claims made by the legatees as against the executrix in the case which they had brought to set aside the judgment, and as to the reasons why it was not a valid
If the defendant became liable to the plaintiffs it was because of the contract which defendant entered into with the Empire State Surety Company, and it was not, by the terms of the agreement, to become liable upon any bond, even though specified in the schedule, if as to any such bond, there was a known default, claim, or loss, prior to August 22, 1912. This contract has once before been considered by this court. People v. National Surety Co., 68 Colo. 231, 188 Pac. 653.
The uncontradicted evidence shows that the managing officer of the Empire State Surety Company, at Denver, knew of this claim asserted against the executrix, at the time of, and long before, the execution of the contract, and evidently the defendant did not. There was an entire lack of evidence that defendant had notice or knowledge of the existence of the claim at the time the contract was entered into, and it cannot be presumed that the defendant knowingly assumed a risk then in litigation.
The plaintiffs, however, claim that there was no default, claim, or loss, and could not be, until the court declared in favor of the legatees, and set aside the judgment obtained by Marshall, and not until she was ordered to account for the money, an order for distribution made, and disobeyed, and that all these things occurred long after the execution of the contract in question, in fact in May, 1918.
We cannot agree with plaintiffs’ contention. The claim was made against the executrix and existed regardless of the outcome of the litigation. It cannot be questioned, of course, that the defendant had a right to limit its obligations in the contract which it signed. It had the right to provide in the contract that it would not become liable upon any bond, even though specified in the schedule, upon which there was a known default, claim, or loss, prior to
The following cases sustain us: Fireman’s Fund Ins. Co. v. Aachen & Munich Fire Ins. Co. 2 Cal. App. 690, 84 Pac. 253; Southern Surety Co. v. Equitable Surety Co., 84 Okl. 23, 202 Pac. 295, 299; Mutual Reserve Fund Life Ass’n v. Green (Tex. Civ. App.) 109 S. W. 1131, 1133; Hoffman v. North British & Merc. Ins. Co. of Edinburgh & London, 70 N. Y. Supp. 106, 108 (104 N. Y. St. Rep.) ; Sun Mutual Ins. Co. v. Ocean Insurance Co., 107 U. S. 485, 1 Sup. Ct. 582, 27 L. Ed. 337; Spande v. Western Life Indemnity Co., 61 Or. 220, 117 Pac. 973, 122 Pac. 38.
Plaintiffs seem to claim that defendant’s liability in this case was determined in the People v. National Surety Co., supra. The question here discussed was not there considered. In that case the sufficiency of the amended complaint was attacked by general demurrer, and the court stated that there seemed to be but one contention of the defendant that required consideration, and that was, that the contract between the two companies was a strict reinsurance agreement, one for indemnity only with the Empire Company, and the original assured had no right of action against the reinsurer. The court held that the complaint stated a cause of action against the defendant. Obviously the matters here involved could not have been, and were not, passed upon by this court in that ease.
In view of the conclusions we have reached, it is unnecessary to pass upon the other questions presented.
The judgment of the lower court is reversed with directions to dismiss the action.