In the second paragraph of the syllabus in the opinion on the former hearing of this case (Insurance Co. v. Cosgrove,
This was said not with rеference to an imperative legal duty but with reference to the interest of the insurer and the insured. In other words, thаt when a party has a clear right and opportunity to protect his own interests he has no moral right to lie quiescent and demand that another should protect his rights for him; nor was it intended as a determination of the only right of the insurer in thе premises.
In section 501 of volume 2 of the second edition of Wood on Fire Insurance it is said:
“When such wrongdoer knowing that the insurer has pаid the whole or a- part of the loss under a policy of insurance upon the property, settles with the insured аnd takes a release from him, such settlement and payment is treated as a fraud in law, and he will,still remain liable to thе insurer in an action, in the name of the insured, for the amount paid by him under its policy. (Citing Monmouth Co. F. Ins. Co. v. Hutchinson et al., 21 N. J. Eq. 107.) The assured may, where the comрany is entitled to subrogation, be enjoined from settling with the party doing the wrong.”
It is conceded in the briefs that the insurer had the right, when notified that negotiations for a settlement were pending between the insured and the railroad compаny, to intervene in the action pending. On the authority above quoted the insurer also had the right to enjoin the insured from sеttling the case; or the insurer might, after the settlement, have treated the setlement as void and have brought an aсtion, in the name of the insured, against the railroad company for
It is urged that at the time of the settlement the claim of appellant had been barred by the statute of limitations, but no finding or evidence is cited to sustain the claim. However, if this be so, it is the usual result of a claimant sleeping on his rights. The running of the statute оf limitations is usually computed from the time a cause of action accrues in favor of the party seeking relief.
In his action against the railroad company, the insured claimed that he had been damaged in the sum of $3500 by the wrongful act of the railroad company. The action was pending for .a long time. The liability of the railroad company for the loss was, of course, not admitted, but was denied. The insured was represented by counsel and, presumаbly, acted upon their advice. A settlement of the litigation for less than one-half the amount claimed was effеcted. The liability of the railroad company for the loss had not been judicially determined, and apparеntly the insured and his counsel feared at the end of a trial they would recover less than the amount offered in settlement.
This action was commenced, evidently, upon.the assumption that $3500 was lost by the fire, that the wrongful act of the rаilroad company caused the fire, and that the appellees could have recovered the full amount of the loss had the settlement not been made.
If appellees and their counsel had considered the evidence clear as to -these essential facts, self-interest would have impelled them to procеed to trial and to
The general rule is unquеstionably that the insurer can recover from the insured, of the sum of insurance paid upon its policy, only the excess received from the-wrongdoer after full compensation for his loss, including the costs and expenses thereof. In Newcomb et al. v. Cincinnati Ins. Co.,
“Where a loss, partially covered by insurance, is occasioned by a wrongdoer, against whom the assured,. after payment of the insurance, recovers judgment for such loss in an action, to the prosecution of whiсh the underwriter refuses on request to contribute, the assured, in a subsequent proceeding against him by the-underwriter for reimbursеment, is answerable for no-more, if for anything, than the surplus of the amount recovered from the wrongdoer, which may rеmain after-full satisfaction of his uncompensated loss, and the expenses of the recovery.” (Syl.)
(See, also, Railroad Co. v. Insurance Co.,
Tihe appellant neither pleads nor does it produce any evidence of any fact or facts that make this case an exception to the rulе unless it be that it warned the appel-lees if they settled the case it would claim repayment of the insurance paid. The appellant alleges simply that the loss was $3500 and the appellees had settled the action for $1500. This is not sufficient. As we have-seen, the insurer has three remedies, each of which imposes responsibility. The insurer can not shift all" responsibility and compel the insured to prosecute unaided a doubtful litigation for its benefit by such a wаrning. If, however, the insurer can satisfy the court
The judgment'is reaffirmed.