The Greyhound Corporation v. Excess Insurance Company of America

CORPORATION, The GREYHOUND Appellant, OF

EXCESS INSURANCE COMPANY AMERICA,Appellee.

No. 15748. Appeals

United States Court of

Fifth Circuit.

May 15, 1956.

Rehearing Denied June Judge.

JONES, Circuit litigation phase is another Here Fidelity from which arose American & Casualty Inc., Greyhound Corpo- ration, Cir., prelim- 232 F.2d 89. Our inary statement, change, with minor is taken from the in that case. appellee here, Excess Insurance originated Company, proceedings bringing against Greyhound, an action alleging it had entered a con- into Greyhound of insurance tract suring against Greyhound loss from lia- bility in excess of certain stated amounts; Greyhound had contend- damages ed that Excess was for liable arising personal injury out of action against reported Greyhound, in Florida Greyhound Jones, Fla., Lines v. 60 So.2d 396; and that there is no its the loss thus suffered Greyhound because failed give timely notice to Excess of the liability, Joneses’ claims of as is re- quired by policy. complaint sought declaratory relief that Excess any was not liable to upon judgments amount based case, injunctive against Jones relief Greyhound’s instituting any action to recover such sums. Greyhound answered, denying guilty duty breach of

had been alleging premises, and that all condi- against entitling it to recover Ex- tions alleged performed. been also had cess manner been Greyhound’s prejudiced by or harmed addition, it failures to act. acts brought third-party action Service, Inc. and American Fidel- Markel Casualty Company, ity Inc. Its third-party complaint in the action al- being that, proc- leged served with gave proper Jones ess Miami, Flick, Blackwell, T. J. H. Willis suit to Markel and American tice Fidelity Miami, Gray, Blackwell, Fla., Walker & Casualty, car- appellant. Fla., for riers; the defense action Fla., Gotthar.dt, Miami, More- E. F. thereupon passed into the hands of the Miami, Forrest, Orr, head, & Gotthardt defendants; although third-party appellee. Fla., for ad damnum clauses Jones increasing (thereby TUTTLE, were raised CAMERON case Before Judges. recovery possibility JONES, of a in excess Circuit primary policy), formation obtainable at the time amount covered third-party Street, failed to no- at 99 John New defendants tify York, or Excess of this New York. The assured shall either give although particulars amendment, ex- of it knew of the like notice with any coverage claim on of under con- made of such istence excess the account any brought tract of entered into between accident. If suit against parties; to these two last-named the assured enforce such claim, Greyhound guilty of of shall was no breach assured immediate- ly duty that, company copies premises; and Ex- forward if to liability discharged every by process of cess’ its not summons or other was receiving may notice of the be served the assured. amendment case, company up- damnum ad clauses the Jones shall not called be charge third-party on to then the defendants breached assume of the settle- duty any a owed ment or of to to settle defense claim made although brought proceeding or Jones was suit or because there insti- against it, third-party assured, no defense to defend- tuted but settle, company proceeded right ants refused to but to shall have the and trial, incurring liability Greyhound’s given opportunity on shall be to damages part to the for Joneses which associate with assured in the de- any recovered in excess of fense and of the limits of control claim or primary policy, proceeding suit or which Excess refuses to an ac- relative pay. involves, Later cident amended its which claim or suit third-party may .complaint allege, involve, contract, or inter this alia, third-party .the which case defendants the assured and the com- guilty .negligence pany things cooperate of faith bad and shall in all conducting negotiations the settlement defense of such claim or or suit proceeding. any in the Jones case. Should there be company conflict between the and Subsequently granted the trial court respecting carrier a judgment summary by for motions made contract, claim covered under this Markel, and and from the first agrees the assured to follow the judgments Greyhound these ap- has company written instructions of the pealed. For our determination is the. regarding dispute, claim so in question whether such issue fact was agrees company and the to indem- presented by disposition as would make nify any the assured for loss or ex- summary judgment improper. pense may by the assured sustain Fidelity Casualty American Com- having reason of the assured’s fol- Greyhound against pany had insured lia- lowed such instructions. Such in- $40,000 bility any extent demnity, however, shall not increase injured opera- person killed or one liability the maximum otherwise as- by Greyhound, motor vehicles tion by sumed $100,000 personal under extent of this any injuries received in one accident. contract. Against liability over and above any agent, “No notice or knowl- specified pri- so American’s amounts edge by agent possessed any by or coverage provided mary policy, was a any person other shall be held to ef- Greyhound by policy issued to Excess. change any part or fect waiver among policy contained, other latter estop contract nor following: terms, asserting Company any right “Upon the occurrence of ac- contract; the terms of this involve cident nor shall the terms of this contract part company, as- changed, except by waived or en- immediate shall written sured thereof the fullest dorsement issued form with damages alleging declaration was filed officer hereof, duly executed amount of on behalf Mrs. Jones in the Company”. $175,000 husband in the and for her oc- August 11, the accident On $250,000. $75,000, amount a total of suit arose the of which out curred Of this amended declaration Jones, hus- R. her T. Jones Anna given American Greyhound. driver’s band, rep- attorneys employedby to Greyhound, employer, said report to his Greyhound. resent No advice injuries. bodily .nothing respect to to Excess. year Nearly half later suit Greyhound was The case of Jones v. husband by and her Mrs. Jones filed during of Novem- for the week set trial 11, against Greyhound. On December 15, 1951, 5, in re- 1951. On October ber .1948, issued. summons was a sponse inquiry, claim to an American’s Greyhound two on process was served agency Greyhound letter wrote a 13, fol- later, (cid:127)days 1948. December following: appeared the which lowing Greyhound day summons sent the to its forwarded it which you requested to American attorneys “I understand that all “protect interest of the you if was this officeto advise there ac- was not The summons concerned.” companied possibility this claim would by any other declaration or wheth- cannot volve excess. We tell damages in pleading. showed that go into excess be- er or it will $75,000 An of were claimed. the amount appearance foretell the future. cause we cannot on be- was filed the cause say judg- I is that our All ment, can attorneys by Greyhound se- the half of excess we do not believe that attorneys by To these lected American. will be involved. copy the of for delivered a counsel Jones suing “However, Jones is Mrs. damage showing was declaration is, course, $75,000 of which by of amount claimed Anna Jones $65,000 your with of limits excess bodily injuries, deriva- with Casualty Fidelity and American damage by hus- tive claimed taking therefore, are, Company. We $10,- band, Jones, of R. in the amount T. you opportunity or this to invite was bOO. this declaration no notice Of your to associate excess carrier by Greyhound by American in the trial this counsel represent by attorneys employed it to attorneys.” trial our given Ex- 'Greyhound. No advice was forego- copy Greyhound of the sent cess. acknowledged Excess, letter to 1949, American’s December On receipt on of it on October Grey- department wrote a letter to claim Grey- Excess wrote October among things, where, it was other hound denying liability because of the hound .said: case of Jones notice. The unknown “For some reason tried. On November was resting pleadings on demurrer are 13, 1951, for Mrs. Jones in the a verdict plaintiff’s declaration with $50,000 and for Mr. Jones in amount taken since demurrer no action $17,500was returned. On amount of Rules in on the March entered, was filed judgment verdict appeal judgment was affirmed. general plaintiff 60 So.2d and her “In indicated their ac- have husband contends it could deliberately at- are tions that anticipated at the time of the acci- up tempting their claim”. to build when suit was filed that the nor dent coverage primary become inade- counsel noted new

In October quate, it was appearance her when informed for Mrs. Jones and and that their insufficiency possible its Soon thereafter an amended husband. coverage steps it notified Excess. then take sees fit genuine by way investigation, contends issues there were of additional presented etc., protect of material fact and hence own interests. entry summary judgment provision Under the notice 56(c) Civ.Proc., wording error. Rule Fed.Rules excess exercise some urges judgment U.S.C.A. It- two factual on the of the assured ^ evaluating posed; first, issues were whether the is contem- case given by Greyhound plated. however, is, tice to Excess was adequate; second, precedent whether Excess condition estopped breached, waived or if to assert held to be absence notice which would be exonerated required liability, though been of insurance even there was showing Greyhound. which it had issued to it was in fact timely diced the failure to receive In its discussion of the first these notice.” 21 Ins. Counsel J. 131. questions, is, adequacy notice, appellant points required out that Notice is the Ex provisions policy upon same any cess as to notice are neither the occurrence of required “may” liability needed nor in excess insurance accident which involve generally policy pri- policy. as are “may”, found in of under the The word mary coverage. April, 1954, auxiliary verb, In when issue used as an sus is Journal, ceptible meanings. of compre Insurance Herbert Counsel of several It question. C. Brook possibility, From hends discusses mere but includes also quote: thought probability, his we of article and in its scope expectancy is the idea of an readily apparent is “It certainty. meaning reasonable The in a party liability of third insur- field particular contractual is to be responsibility ances, division of by determined a reference to the con inherent in the use of deductibles Reynolds text. St. Louis v. Transit apt and excess insurances is more Am.St.Rep. 189 Mo. 88 S.W. 109 give controversy. to For in- rise 360; English Ruback, State ex rel. giving stance, the matter of no- policy Neb. 281 N.W. 607. The accident, situation is not tice of provisions gave company the insurance straightforward as in the case as rights imposing certain as well ob primary primary insurances. In lia- ligations. right It had the to associate bility insurer uni- insurances with the assured in the defense of the investigate formly undertakes to suit, any and in the event of conflict be by any pol- claim defend covered tween it and the insurance car reg- Consequently icy. policies right require rier it had the as give ularly require that the assured sured to follow its instructions. A rule company to the immediate applicable construction which is here involving or claim has been thus stated: However, excess insurance. lia- bility (as as in insurances well most “It is true conditions are in- policies by insurances written over a serted in insurance deductible) protection the excess in- for its substantial insurer and should construed, surer does not to defend where undertake be such construc- against Consequently, permissible, the assured. the ex- tion is cess insurer interested in surer. Hoffman v. Illinois Nation- every accident, Casualty Co., Cir., but in those that al enough may equally true, however, be serious to involve it. therefore, usually policies, policy that the is the con- parties require assured notice of tract between and that appear likely provisions contract, claims ‘that to involve unambiguous The the excess.'1 excess carrier can which are clear and guiding illegal ject rule, under the and which are neither being par- impact particular facts on nor of their statute reason They public policy, en- ticular cases. do not in terms should be require or notice courts immediate notice forced courts. days. particular parties in- within a number of for the rewrite They They may not be so construed. surance which are clear contracts Hawkeye-Se- provide unambiguous.” do not ‘as even for notice and curity terms, they possible.’ Myers, soon as quire Ins. Co.v. practicable’ notice ‘as soon as must construed as re- be “may” think as was We the word quiring the notice within a reason- policy by Excess, used issued able es, time all the circumstanc- types intended of ac- to refer to those objects pur- to effectuate the regularly frequently cidents which poses Thus, the notice clause. are or cover- become claims within the applying clause, think that we age word in which the appear is made if it the no- happening used. If was such given reasonably quickly tice was anticipated the assured should have accident, after the occurrence might develop of an amount a claim open it will not involving liability, policy provi- then the prove, that more immediate imposed duty sion notice. effective, more tice have been policy, contract, evidenced defense, preparing their for the acci- there was an when stipulated that provisions time would the clause the as- involve dent literally complied have been effect give written “immediate” should sured hand, ap- other with. On the if it pro- generally held that notice. pears that the of the notice es- immediate notice is vision for delayed longer has been than was and a failure of the contract sence reasonably required physically to will defeat comply give notice, then material issued, policy covery as where question would whether be that de- specified subject conditions in- here, Young lay prejudice.” has caused cluding requirement immediate Co., Cir., 1941, v. Travelers Ins. 5 829, Insurance Am.Jur. § 29 notice. 877, 119 F.2d 880. requirement of “immedi- But the 1105. usually that held to mean excuses its failure to notice is ate” given rea- within a earlier notice rea must be because it notice seq. injuries 827, suppose 29 Am.Jur. son et were time. sonable 1104; Accident Standard more than trivial and as soon as it § Insurance 1939, Alexander, Cir., 103 5 otherwise the to Excess learned Co. v. Ins. Sage given. rule, 500; v. Utilities Ins. was The as stated Le 1942, Court, Cir., F.2d 536. It has been 131 is: 5 “immediate”, provisions said that duty of was the insured “It here policies casualty for notice of report as soon as given accident, mean- is to be same an ing practicable. This does not mean practicable.” soon as clause “as as the every trivial accident that oc- Casualty Co., 2 Zanderer Continental reported. An curred should be ac- discussing 211. Cir., 140 F.2d prudent ordinarily an cident that phrase has said: this court latter acting reasonably dividual would clause, consider, words in the ‘as under all the “The time circumstanc- es, practicable’ inconsequential, are not words as and which soon import. They precise not afford definite would the basis of They claim, roomy provide for insured was words. not bound to áre Maryland Casualty They report.” play. are less free Co. v. more or Sammons, ambulatory 99 F.2d sub- nature in their notice”, by certiorari denied 306 U.S. struction application “immediate S.Ct. L.Ed. of a rule of “reasonable time”, the insured follow must a course The decision fol- last above cited was diligence. . of reasonable This language quoted lowed and the was above say failed to do. It cannot be heard to approved origin having in a case it did not inquire. know when it did not Indemnity Florida. Phoenix An- Co. v. attorneys The who conducted the defense- Groves, Cir., 1949, derson’s agents of the claim were its con- duct of knowledge the suit and their will' question as whether imputed Greyhound. so. is- given proper time notwithstanding the fact that the attor- question whether Excess was as to neys employed paid pri- generally prejudiced are mary insurer. However, questions of fact. where We hold that the reasonable man of by the assured as asserted are facts prudence have, along somewhere established, that, re could be no if there line, filing and not later than the undisputed covery; facts or where the declaration, the amended perhaps much preclude as such that would are sooner, notice to Excess. question recovery, then the be sured’s has, This Court in a case where there for determination of comes one law analogous situation, applied factual proper dis and a the court matter rule, saying: summary judgment. Such, position by personal “That injuries, too, actu think, is the situation here. we ally were sustained is evidenced summons, Greyhound, show served judgments against the nity which indem claimed, $75,000 was should sought. Notice communieat suggested perhaps one of the years ed more than two after this asserting joint plaintiffs injuries flagrantly accident was so viola exceeding policy pri limits of the provisions tive of the mary coverage. The declaration dis the court was warranted in closed that this was true. The advice holding, law, as a matter of that plaintiffs attempting that were to build the contract was breached the in up their claim should have indicated that Sage sured.” Le v. Utilities Ins. plaintiffs planning attempt were to Co., supra [131 537]. recovery for a and substantial serious injury rather than a trivial one. The It has been said that where there had! filing of an amended declaration increas been a of six weeks in notice ing. $75,000 the ad damnum from to policy stipulating of an accident under a $250,000should have served confirma as for notice “as practicable”, soon as tion, required, if required that there insured was not to show genuine claim made for a substan liability dice in order to- defeat because a. primary policy non-compliance sum in tial excess of the of with the impressed by limits. We are not gument Greyhound the ar for notice. Preferred Acc. Ins. Co. v. Castellano, of control of 148 F.2d 761. litigation was in the primary the hands of the We are committed to a rule different Greyhound Young insurer and that it under Co., v. Travelers Ins. su- knowledge pra. self had no of period the facts which of three between weeks supplied would have information to given as the time notice to Excess was and! seriousness of the claim. wholly The as the time of the trial was inade- diligence use quate permit sured must due investigate and follow and] to Excess to procedures exercise, as would inform rights it as to elected, if it so the accident and the nature and policy. amount served to it under the Such be- of the claim asserted reason prejudiced by thereof. Excess delay. 29 Am.Jur. Insurance 1112. To be § See Dunn v. Travelers Ind. Cir., 1941, relieved of a literal con- harshness 123 F.2d 710. It was As Life sur. denying Fire & rights General Accident its within Cir, 1945, Corp, 396. There estopped to waived or unless it an within three to pursu- oral notice right require notice to assert days of first believed seven an at policy provisions. ant objection trivial, made and no to Greyhound, in appellant, was evidence- form of notice. There allegation of of a custom sists custom, upon relied of a known and upon Excess, relied to and known accepting assured, oral notices. of accepting when Greyhound, If we have a different situation. it Here opinion that became Excess; conceded or established that be presented might involved, be Excess estopped except require when- is Greyhound estoppel which should issue waiver became jury. Support ato have been submitted ing might (which Excess be involved position shows need not does not admit and which we ac reports of other Excess were made prevail' hold), such doctrine could not days ranging from ten times cidents at opinion, There have been here. could year accident. after the more than reasonably reached, perhaps prior at or upon relied the doctrine The nature of of the demand of the in to the increase Supreme by the asserted has thus been jured claimants, that Excess United Court of the States: have been involved. That waiver, as- doctrine of as “The transpiring not know what was does did companies serted excuse it it should have known. when to avoid the strict enforcement supposed Excess in It cannot be poli- in their conditions contained should denied be notice- tended only cies, another name for originally claim, $15,000 over of a only estoppel. can be doctrine of coverage subsequently where conduct of invoked excess, years $210,000 for four after companies has been such to induce accident, after the in ten months it, upon action in reliance and where demand, crease three operate fraud as a doctrine weeks before trial. The if al- assured were afterwards estoppel prevail. waiver cannot lowed disavow their conduct failed have not to consider the We just enforce the conditions. To a primary casualty in- differences between application of this doctrine es- it is coverage. and excess We are- surance sought sential that requires mindful the rule law that estopped denying the waiver policy construe a of insurance most- us to apprised claimed should be of all favorable the assured. facts; of those which create the for- Finding, do, judgment, as we that the feiture, and of nec- those will correct, appealed is it is essarily judgment influence its Affirmed. consenting to it.” Insurance waive Wolff, L.Ed. Co. U.S. Judge (dissent- CAMERON, Circuit ing). “Strictly speaking, in opinion, my judgment,, majority The ability party of a to an action assert law in this settled Cir- repudiates the right given holding as a a defense contract this record re- cuit any genuine thereof, spring as issue material does from a not waiver flects thought genuine my resulting is is- estoppel It but from from waiv fact. Grey- developed as whether were er”. Alexander v. sues Standard Accident gave Excess within a rea- Cir, 997. hound Ins. time, Excess was bring whether sonable itself The effort delay, and whether Excess estoppel doctrine diced within waiver and notice. of earlier primarily v. waived Dickinson based average prudent is such notice unbroken of decisions as Under an line summary granting Court, man would circumstanc- of a of this holding judgment only proper when the facts es. There is no doubt about the point: conflict or rea this Court themselves are without on that in men not draw different sonable duty insured “It was the fur ferences from such facts.1 We have report here to accident as soon summary judgment is ther declared that practicable. as This does mean not quite justified clear “when it every trivial accident that oc solely is”;2 and, based what the truth upon reported. curred should An ac general atmosphere of a ease ordinarily prudent cident that an involving laches, estoppel, limitations acting reasonably would individual defenses,3 sent a case and other like we consider, under all the circumstanc fact-finder, back for consideration es, inconsequential, as and which citing many justifying ac cases as any would not afford the basis of summary judgment tion. And we held improper claim, the insured was not bound to subjec intent, motive, “where * * * every report. ‘It is not feelings reactions, conscious tive mishap trivial or occurrence that searched, ness and conscience were to be policy of the assured under such lia and cross-examination examination regard bility insurance must necessary in obtain instruments of which should be ing the truth.”4 Under these established given immediately to the insurance principles judgment be of the Court though company, may prove even it ought low the case to be reversed and in serious afterwards to result should be heard on its facts. * * * jury.’ That the accident parties The basic contract between the appeared in the case at bar to be was that insured Excess prepon trivial was borne out * * * exceeding $40,000—100,- derance the evidence. Grey- premium limits return for a question whether paid .hound had Excess. The rest the accident notice of policy largely machinery dealt insurance accordance carrying agree- out fundamental provisions policy, with the *” * * provisions One of the of that ment. jury. was one machinery was that should [Emphasis added.]5 any notify accident of such injury In that logically seriousness as would lead to Sammons, roommate of and he did involving Excess. re- claim quired injury report the accident notice; but, like so “immediate” by Crandall until more than fifteen ceived many provisions prolix mishmash happened. months after should be average policy, which is the in mind that borne the Sammons case to decide courts have had all the others which will be men- dictionary and not mean what the does word involved notice to the tioned (cid:127)says means, notice is suf- reasonable,—that carrier, every is, whose extended to it is if it ficient if 1953, Dennis, Cir., 1948, Inc., Cir., 257, F.2d 5 5 203 Co. v. and Sla- Hawkinson 1. Telephone States, 61; gle Cir., 1956, 5 Park v. United F.2d Winter 228 166 Telephone Bell & Tele F.2d 673. v. Southern Co. Co., Cir., graph 181 F.2d 5 341 Hyman Regenstein, Cir., 1955, 5 v. 222 3. ; Dunnington National v. Atlantic First 545. F.2d Daytona Beach, Cir., 1952, 5 Bank of R. Co. v. 4. Alabama G. S. & Louisville N. F.2d 1017. 195 Cir., 1955, Co., 224 5 F.2d R. 5. Cir., 1950, Chappelle Goltsman, 5 v. 2. Maryland Casualty Sammons, Co. v. 215, 218, 5 5. see also F.2d Whitaker 186 Cir., 1938, 99 F.2d Coleman, 5 115 v. F.2d 307; Freight, v. T.S.C. Motor Williamson prop- way preparing It injury; was to Excess while notice defense. only you respect injuries which is found that take only ‘when er with delay, expected it logically exceed the circumstances would be might probably some mentioned. cause limits dice,’ depriving here, majority As stated opportunity injured to talk to the requirement of immediate the really party employed before he had an at- practica- means notice “as soon torney. speculative hypo- or Surety Callaway & v. ble”. In Central prejudice thetical is kind of not the Corp., Cir., 1939, F.2d Insurance prejudice at which law looks in 761, 762, phrase meant we held that this construing a clause kind. of this that within a reasonable time and obligation An of the nature that gave “ample full for a notice which investigation time assumed insurer under suf- would be case” policy, wiped cannot be and de- out ficient. stroyed speculative grounds. on such gave question full con- whole We merely here viewed Young Ins. Travelers sideration standpoint the time was more than Cir., 1941, reasonably necessary was it was but gross. There, insured and a mo- automobile in no sense excessive or resulting collision, torcycle into came its nature it was which the one to being injured rider and taken to the hospital, prejudice doctrine peculiar application. has vel non he two months. where remained no There was insured, Young, not that did conceive prejudice. The notice clause gave held liable he he could be so [Emphasis breached.” added.] let- his insurer he received a tice to until point It be noted at this that lawyer from a three and one-half ter attempt Excess not did show or fail- months later. The trial Court held prejudiced, to show that it had been but fatal, ure to notice until then to be appeared Grey- from its answers to reversed, holding and we that * ** Requests hound’s for Ex- Admission quirement “as written abso- recognize peremptorily cess refused to rigid in form and terms lute [that] any liability. These showed answers construction, miti- have been court not, prior Excess did such re- gated by importing them, into considera- * * investigate fusal, extent of the prudence reasonable tions of juries plaintiffs in the Jones decision, we said in What concerning inquire ad- names and page 880, concerning necessity of at witnesses, po- dresses of the examine the showing prejudice of the in- report, lice accident discuss the case applies here: sured handling counsel who were deter- it to physi- speaking “Here, in terms of adequately pre- mine whether it had been time, the could reason- cal pared trial, explore or determine ably been sooner than it possibilities. settlement The truth And, if it had been made to was. through- that the had been case handled prejudice appear that resulted from by attorneys out for the carrier delay plaintiff’s case aught trial, appears and in the Upon out. made the vital been question witness, every contrary, possible here, whether it has been every produced and reasonable effort prejudiced, we think record fails recovery. to defeat made or diminish It support its claim and the district keep important in mind finding judge’s was. ignores entirely majority the nor is found it shown that not holding prejudice question that of the failure to earlier reason in this was a evidence case as a notice there loss exists matter oí dice prejudice any difficulty up raised in the or that need not be law shown. holding policy quoting words, of the from our decision effect In other repudiated rightfully case, supra, all the Sammons we held: is that Excess regardless obligation contract under its reasonably or not “Whether existing without of the facts then regarded prudent might person have consideration of them. question of such accident Indemnity giv- require Co. case of Phoenix nature as to trivial ing Cir., 1949, Inc., Groves, question not Anderson of no notice is 246, 248, particularly but one which interest- law over is of fact ing that it arose minds reasonable men view of the fact dif- [Emphasis Florida insurance Florida and added.] involved fer.” brought a declara- contract. Phoenix tory judgment impossible I find it our to reconcile .its to determine action holding majority what is there with liability in with an accident connection doing primary A here. notice to the reported fifteen until which was not likely delayed carrier fifteen months is trial occurred. The months after prejudicial than to be more its effect that and found Court heard evidence delayed notice sev to the excess carrier accident, subsequently resulted which events, period. eral times that At all leg, amputation “appeared of in the of a the record shows that first intimation defendant, trivial a that so using nature danger possible of re could care reasonable covery in excess of the cover that claimant would have seen the said age of Nov. American’s letter ** leg amputated The Court his Greyhound promptly 1951 which trans did occurrence “said found that says: further majority mitted to Excess. investigation by plain- prejudice pru We hold that the reasonable man of nor it be along will have, of the tiff said dence would somewhere filing cause line, of said defense in the than the of the embarrassed and not later plaintiff declaration, perhaps state- has written much soon in that amended er, of said occurrence facts [Em ments notice Excess.” eye emphasized that witnesses phasis two from the Do not the added.] happen- recognized present at the time words show employee ing, namely, might honestly defend- differ as reasonable men claimant.” ant constitutes “reasonable what Finding the involved circumstances” all of notice was a rea- compliance with the terms of 6 sonable Grey- chronology 1951—American wrote of what trans- Oct. Here respect pired hound case set for trial Jones case. Superficially seem the de- Nov. it would years 1951—Greyhound lay Ex- four notified than between Oct. of more by enclosing letter to Excess cess accident and consider that But near- from American inordinate. say years elapsed bring- ly between the I can stated: “All three setting it for we not believe suit and trial. do delay the Jones was not on the that Excess will be involv- any great con- to demonstrate ed.” calculated part. fidence Aug. 11, their 1951—Excess to as- Oct. declined any liability occurred. sume 1947—Accident brought Greyhound. and sum- 1948—Suit Dec. issued mons Jones Was it reasonable tify probable danger case. of its , light meager counsel took 1950—New over had? Oct. information it display for Jones little later Did the Jones case ever neg- declaration new creasing merit ligent to convict filed failing amounts de- or unreasonable beyond manded. it as evaluate the limits of 31st) Williamson, (Oct. two 15th after Indemnity but weeks to v.Co. In Home being 572, 576, “fully Cir., 1950, this Court informed the occurrent announcing judgment declaratory facts” ac- before its decision had before a involving liability dealing renounce its under its contract situation with a tion delay give de- because of notice. Under Wil rested its in notice. It failure to liamson, supra, question against on the of waiver both cision the insurer upon ground prejudice and was one minds reasonable of failure to show right rely might considering differ, the time ele waived the

because it had Upon petition “The ment alone. for rehear of the notice: the tardiness ing questions we held that all of under denied all jury ground policy al- the insured’s Williamson case were for on the give leged decision.7 of the ac- failure to notice prac- cident to the insurer as soon as Moreover, the record before us con- giv- delay interposed ticable. very strong showing tains a Excess * * * but it show notice did encouraged Greyhound report not to any prejudice to it prior that had resulted showing claims unless there was a fair give Coop’s from failure to that the involvement of Excess was im- filed time suit was quite minent. The reason for this is ob- him; for- and the contains no my opinion, question vious. give feiture for failure ‘ waiver should been submitted practicable” tice “as soon as ’. along question the fact-finder with the roomy ‘they are Court has said that prejudice question and the fundamental ‘provide words’ which for more or less failing give notice, whether, play’.” free reasonably pru- acted as a We a further indicated liberal at- person dent acted under titude should be followed in favor of de- circumstances. claring require- a waiver of the notice deep-seated ment so is the universal This idea is buttressed the fact feeling against forfeitures: fail- “The right, availed itself of its ure of the insured to notice of an declaratory judgment ac- when sued a be waived the insurer Excess, bring primary tion in its immediately after the Casualty latter has been insurer, Fidelity American and fully facts; informed of party occurrent as third defendant. This and necessary complicated time to constitute a matter all whole involved parties, waiver need take few three of these and this is a case minutes * * * agree peculiar We trial which makes call to a court to Court policy’s questions dispose that the insurer of all one waived the before fact- ” * * * quirement finding to notice. tribunal one trial. As shown Here, opinion, delayed, majority minutes, few now in the Maybe carrier? that he was of the sincere reasonable questions men would answer those not a basis there was for claim. In these point affirmative. The investigation is that made, should no such cases opportunity to do so. held, law, this Court Texas fact was fatal to the extended 7. There are decisions this Court in those eases. which are at war with those cited. Le- Sage question Co., Cir., whole Utilities Insurance of the effect lack showing prejudice and Dunn effect on v. Travel the an- Indemnity Co., question ers of notice is discussed in an 123 F. pp. seq. decisions, 2d both in 18 A.L.R.2d notation et Texas peculiar went off on the that there are law It is shown cases on both of Texas. question, every non-reporting Before a but in sides insured could good claim faith this Court is shown as in stance the fore- reasonable care he obligated holding showing prej- those to make an front of examination of requisite. the facts order that it udice to be be said litigation stands in disadvantage as distinct and at a carrier compared which would

to the situation in the case. were also exist if Excess reason, the reason also For ignores majority opinion that the discussed,

pudiates the above decisions compelled

I dissent. am Rehearing CAMERON, Cir- denied: dissenting. Judge,

cuit Green, Quen GREEN, A. Robert

Oscar L. Green, Alice tin L. Green and Plaintiffs-Appellees, Madge Green, GREEN

Herschel S. Defendants-Appellants.

No. 11568. Appeals Court of States

United Seventh Circuit.

3,May Lenz, Horsley, L. H. G. William Ill., defendants-appel

Springfield, lants. Hutton, Danville, Ill., Au R. Jackson gust Brandt, Pointe, Mich., for F. Grosse n

plaintiffs-appellees.

Case Details

Case Name: The Greyhound Corporation v. Excess Insurance Company of America

Court Name: Court of Appeals for the Fifth Circuit

Date Published: Jun 25, 1956

Citation: 233 F.2d 630

Docket Number: 15748

Court Abbreviation: 5th Cir.