112 N.J.L. 136 | N.J. | 1934
The opinion of the court was delivered by
Plaintiff herein suffered physical injuries and property damage by reason of the negligent operation of a motor vehicle owned by one Martin, and recovered judgments for the damages sustained. His efforts to obtain from Martin satisfaction of the judgments were unavailing, and he instituted this action to recover the judgment debts from Martin’s insurers. Recoveries were sought from appellant, New Jersey Manufacturers Association Fire Insurance Company, on a policy covering property damage, and from appellant, New Jersey Manufacturers Casualty Insurance Company, on a policy covering loss or damage resulting from bodily injury or death suffered by others, and occasioned by the use of the automobile covered by the policies. The answer alleged that Martin had, subsequent to the occurrence
The answer specified the conditions breached as those “which required him to render co-operation and assistance in defending against claims and in adjusting and minimizing loss or damage, and which provided that the assured shall not commit or attempt any fraud or false swearing touching any matter relating to the insurance provided by said policies, or the subject thereof, either before or after loss.”
This is, in substance, the single defense interposed by the answer. If Martin did not breach the contract in the particulars specified, appellants are concededly severally liable to respondent upon the policies issued by them, respectively. Respondent moved to strike out the answer upon the ground “that it is sham or frivolous.” Assuming that the answer, in respect of each policy, properly and effectively pleaded a breach of the conditions that would deprive Martin of a right of action thereunder, the proofs submitted by appellants on this motion disclosed that it is patently sham, and upon that ground was properly struck.
The case presented by appellants follows: The happening, in which respondent suffered injury, occurred on January 9th, 1932. Three days later Martin, by letter, advised appellants of the occurrence. Therein he gave a detailed explanation of the event, which tended to exculpate him from negligent conduct. The statement contained the following question and answer: “Assured’s speed 30 m. p. h.” Appellants insist that, relying upon the truth of these statements, they concluded “that no claim could arise against” Martin, and therefore they “made no investigation and took no other steps for the protection of themselves or the said Martin.” On January 28th, 1932, respondent instituted suit against Martin in the Second District Court of Paterson, to recover
It is a firmly established rule of construction that policies of insurance will be liberally construed to uphold the contract, and conditions contained in them which create forfeitures will be construed most strongly against the insurer and will
The duty imposed upon the insured, by the policy provisions alleged in the answer to have been breached, was to render to the insurer co-operation and assistance in defending “against claims of liability, and in adjusting and minimizing loss or damage” thereunder, and not to “commit or attempt any fraud or false swearing touching any matter relating to this insurance, or the subject thereof, whether before or after the loss.” Concededly, the insured did not “commit or attempt false swearing.” Nor was there any proof of a failure to comply with the provisions of the policies requiring the insured to co-operate and assist in defending against the claims presented, and in adjusting and minimizing the loss or damage, and to abstain from fraud. The undisputed evidence is that there was compliance with these provisions of the policies, fairly and reasonably interpreted. The insured is not accused of collusion with respondent in an effort to impose a fraudulent claim upon the insurer. It-is not claimed that his second statement is tainted with falsity. On the contrary, appellants contend that they suffered detriment and injury by reason of the untruthful version of the occurrence given in the first statement. There was clearly a substantial compliance with the provisions in question. The insured did not refuse to lend co-operation and assistance to the insurer in meeting the claims of liability. His version of the occurrence contained in the first statement tended to exculpate him from negligence. It cannot be said that this denotes a failure to co-operate and assist the insurer in making a defense, or a purpose to perpetrate a fraud. Rather the reverse is the case. The insured thereby evinced a willingness and purpose to
And it cannot be said that, in rendering a statement false in the particulars mentioned, the insured, under the circumstances here existing, withheld the co-operation and assistance in adjusting and minimizing the loss or damage sustained required by the terms of the policy. Construing this clause most strongly against the insurer, it merely requires such aid and assistance as the assured may be able to render in effecting an adjustment of the claim covered by the policy, and in minimizing the loss sustained by the insured thereunder. The criticised conduct of the insured in the instant case is not within the intendment of that clause. Admittedly, it was not his duty, of his own volition, to negotiate for an adjustment of the loss. Nor was it his privilege to do so, if he chose. lie was bound to refrain from efforts to effect a settlement unless requested to do so by the insurers, and such a request was not made. This is the scope and effect of this particular clause.
But if the withholding of the facts from the insurers, and the lulling of them into a sense of security in respect of liability, be held to be within the intendment of this clause, there was in the instant case a substantial compliance with its terms. When the first action was instituted, the insurers were given a correct statement of the facts. Admittedly, they had ample time to investigate and prepare for trial, or adjust the claims if that were deemed the preferable course. They suffered no detriment or injury by reason of this alleged breach of the provisions of the contracts. The affidavit of the general attorney merely states that it is his “belief” that they were
It is also suggested that the insured did not comply with another provision of the policies that required him, upon the occurrence of an injurjq “to forward immediately written notice thereof with the fullest information obtainable at the time” to the insurers. But assuming, without deciding, that the insured, in the furnishing of the first statement, violated this provision of the policy, appellants cannot take advantage of the breach. A breach of this provision of the policy was not pleaded in the answer. If the provision in question is a condition at all, it is a condition subsequent, and is a matter of defense, which, together with its breach, must be pleaded
The answer is therefore sham, and was properly struck out. Milberg v. Keuthe, 98 N. J. L. 779.
Judgments affirmed, with costs.
For affirmance — The Chancellor, Chief Justice, Trenciiard, Parker, Lloyd, Case, Bodine, Donges, Heher, Perskie, Van Buskirk, Kays, Hetfield, Dear, Wells, Dill, JJ. 16.
For reversal — None.