The plaintiff, having recovered a judgment against the defendant Paanenen (hereinafter called the assured), brought this bill in equity to reach and apply the obligation of the defendant insurance company (hereinafter called the company) under a motor vehicle liability policy issued by it to the assured. See G. L. (Ter. Ed.) c. 175, § 113; c. 214, § 3 (10). The judge made voluntary findings of fact and ordered the bill dismissed. From a final decree entered pursuant to this order the plaintiff appealed. The evidence is reported.
The facts may be summarized as follows: The judgment which the plaintiff is seeking to satisfy stems from an action of tort brought by her against her sister, the assured, to recover compensation for personal injuries which she sustained on July 6, 1940, while riding as a guest in an automobile owned and operated by the assured. At the time of the accident the assured was the holder of a motor vehicle liability policy issued by the company. The policy contained a cooperation clause,
On July 18, 1940, twelve days after the accident, one Meehan, a representative of the company, called upon the assured and obtained from her a statement of what she - knew about the accident. Meehan, who had written down what the assured had told him, then read the statement to her, and she stated that it was true and correct but refused to sign it until it had been approved by her husband. The
When the case came on for trial before an auditor, the assured repudiated material portions of the statement and corroborated a substantially different version of the accident given by the plaintiff, which in substance was that the assured was travelling at forty to forty-five miles per hour and her automobile swerved from one side of the road to the other several times; that the plaintiff objected to the manner in which the assured was driving; and that the assured without slackening her speed looked around to comment about some milk that the plaintiff had spilled and while she was doing this the automobile went off the road. The assured also testified that she did not see the “old Ford” referred to in the statement. She admitted that she desired to see her sister compensated for her injuries. After the auditor’s hearing and before his finding, the company wrote the assured on March 3, 1943, advising her that it -would not satisfy any judgment that might be rendered against her and that it “reserve[d] all rights and defences which it . . . [had] under the . . . policy,” assigning as its reasons that the assured had failed to cooperate and that the furnishing of inaccurate information with respect to the happening of the accident had impeded its investigation and preparation of the case for trial. The letter also stated that the assured was at liberty at her own expense to engage counsel to protect her interest and to have him associated with its counsel, and that the company would continue the defence of the case under its reservation of rights.
• The judge found that the assured had violated the cooperation clause and that the disclaimer by the company was justified. He also found that notice of the disclaimer was given to the assured as soon as possible after the grounds for it were discovered by the company; that no unfair advantage was taken of the assured; and that the company was not estopped to deny liability under the policy.
We think that the finding of the judge that the assured violated the “cooperation” clause cannot be said to be plainly wrong. We reach this conclusion without reliance on the finding of the judge, which is not supported by the evidence, that at the jury trial, because of her repudiation of her statement, the assured was not called as a witness by the company’s counsel who defended her at that trial.
The plaintiff argues that the defence of failure to cooperate is not open to the company because, by continuing to defend the case after learning of the alleged breach of the policy, it was estopped from denying liability. It is well settled in this Commonwealth that an insurer, after having acquired information sufficient to warrant a disclaimer of liability, cannot continue in defence of an action and, upon the rendition of an unfavorable decision, then be heard to say it is not liable. Daly v. Employers Liability Assurance Corp. Ltd.
But we have held that the defence of an action against an insured under a so called “nonwaiver” agreement will not estop the insurer from subsequently disclaiming liability. Liddell v. Standard Accident Ins. Co.
We are of opinion that the conclusion of the judge that the company was not estopped was warranted. The company found itself on the horns of a dilemma through no fault of its own. If it continued to defend the case, it ran the risk of losing its right to disclaim later. If it severed its con
We are not to be understood as holding that an insurer may reserve its rights to disclaim liability in a case and at the same time insist on retaining control of its defence. But here the assured never, after learning of the company’s position, offered or attempted to assume defence of the action but, for aught that appears, acquiesced in the conduct of the case by the company. See Meyers v. Continental Casualty Co. 12 Fed. (2d) 52, 57 (C. C. A. 8); Ancateau v. Commercial Casualty Ins. Co.
The plaintiff’s rights do not rise higher than those of the assured. Sweeney v. Frew,
A question of evidence remains. Counsel for the company called to the stand one Hayden, a police officer who had investigated the accident, and, after directing his attention to prior inconsistent statements made by bim in a writing that he had signed, introduced it in evidence subject to the plaintiff’s exception. The document was clearly admissible as a prior inconsistent statement (G. L. [Ter. Ed.] c. 233, § 23) and no contention is made to the contrary. The plaintiff argues only that the judge erred in not limiting the use to be made of it. Evidence of this sort, of course, has no affirmative probative force, and can only affect credibility. Mroczek v. Craig,
Decree affirmed with costs.
Notes
The material portions of this are as follows: “Assistance and Co-operation of the Insured. The insured shall co-operate 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.”
Salonen v. Paanenen,
The evidence shows that the assured testified at the jury trial, and there is no evidence to the contrary.
Meyers v. Continental Casualty Co. 12 Fed. (2d) 52, 56 (C. C. A. 8). Atlantic Lighterage Corp. v. Continental Ins. Co. 75 Fed. (2d) 288 (C. C. A. 2). Western Casualty & Surely Co. v. Beverforden, 93 Fed. (2d) 166 (C. C. A. 8). Hill v. Standard Mutual Casualty Co. 110 Fed. (2d) 1001 (C. C. A. 7). Basta v. United States Fidelity & Guaranty Co.
The findings of the judge that the company gave the assured notice of its disclaimer of liability as soon as possible after it learned of the ground therefor, and that it took no unfair advantage of her are warranted by the evidence. The evidence discloses that at the hearing before the auditor the attorney for the company, upon learning that the assured was going to repudiate the statement, said to her, “lam going to continue in the defence of this case to protect the company’s rights only. ... I want you to understand that in the event that your sister recovers a judgment, that I am going to recommend that the company not pay the judgment for your failure to co-operate. And you can go back and tell your sister and her counsel that.”