94 Minn. 478 | Minn. | 1905
Lead Opinion
Demurrer to a complaint upon the ground that it does not state facts sufficient to constitute a cause of action.
Appellant company entered into a contract of insurance with respondent whereby it agreed to compensate respondent for any loss from the common-law or statutory liability for damages on account of bodily injuries accidentally suffered by his employees. The contract, which is made a part of the complaint, among other things provided that the corporation would pay the assured, subject to certain conditions : (a) The full amount of such sum for which a settlement might be effected by the corporation’s representative; (b) eighty per cent, of such sum for which the assured shall, in his discretion, effect a compromise with the injured person, when, in the judgment of the assured, he is legally liable for the injury, subject to certain conditions unnecessary to set out; (c) eighty per cent, of all medical, surgical, and all other expenses for which the assured should render himself liable; (d) the full amount of such sum as the assured shall pay upon a judgment recovered against him after final determination of the litigation; the total liability being limited to $5,000. The contract further provides that the assured shall, upon the occurrence of an accident, give immediate notice thereof, with all the information obtainable, to defendant,
The policy contained the following clause: “This policy does not cover any loss from liability for injuries to, or caused wholly or in part by, any child employed by the assured contrary to law.”
The complaint then states that, while the contract was in force, respondent employed a minor fourteen years old, James Elmer Perry, who during such employment was injured by having his foot caught in the machinery, which resulted in an’amputation of the leg; that he had been employed contrary to the provisions of chapter 171, p. 386, Eaws 1895, which require respondent to procure and keep on file a certificate from the school superintendent and school board permitting such employment.
It is alleged that immediately after respondent gave notice of the accident to appellant, with all the information obtainable, as required by the contract, appellant inquired into and ascertained the facts and circumstances of the employment and the accident, and the nature and character of the claim, and thereupon advised respondent that he was not liable therefor, and informed him that it would take up and conduct negotiations in the matter of the claim with Perry’s attorney, and give it such further attention as it might require, and requested respondent to furnish appellant with an itemized statement of the time and wages of the boy and his father, as the same appeared upon the payroll, all of which was duly furnished by respondent. It is then al
The complaint further states that the summons and complaint in the action were duly served upon respondent, who thereupon gave notice thereof to appellant, as required by the contract, and immediately forwarded to its head office the summons and complaint, and surrendered full control of the defense to appellant, all in accordance with the terms of the policy; that defendant accepted the control and defense of the action in the full belief on the part of both respondent and appellant that the claim so made against respondent was a loss within the terms of the policy; that, with full knowledge of the nature and character of the claim, appellant assumed the defense of the action, and employed an attorney, who conducted the defense in the name of plaintiff, as provided by the contract; that the cause came on for trial, and resulted in a verdict for the boy of $7,750. One of the issues presented by the pleadings and submitted at the trial was whether the boy had been employed by respondent contrary to law, and the trial court instructed the jury that such employment was illegal.
Appellant moved for a new trial of that action, which being denied, appeal was taken to this court, for which purpose respondent executed a certain indemnity security bond for the benefit of appellant upon such appeal. The action was duly prosecuted upon appeal, and the order of the trial court was affirmed denying the motion for a new trial, and judgment was thereupon entered in the district court for $8,269.12, of which amount appellant’s attorney agreed to pay $5,000, provided respondent should pay the judgment in full; that thereafter the judgment was paid by respondent, and fully satisfied, and demand was made upon appellant company for $5,000, with interest, which is refused upon the ground that no liability attached under the provisions of the contract on account of such accident.
The complaint also alleges that, prior to the commencement of the action for damages, Perry, through his attorney, informed appellant, through one of its adjusters, who had in charge the adjustment of the
The trial court sustained the complaint, and respondent justifies the decision upon the following grounds -. First, that the clause with reference to employment of children contrary to law should be construed as though it read, “This policy does not cover any loss from liability for injuries to any child employed by the assured contrary to law, which is the proximate result of his employment contrary to law;” second, that the clause referred to is ambiguous, and the parties to the policy adopted a practical construction thereof to the effect that the employment was not necessarily illegal, and consequently that appellant was liable under the policy; third, that appellant, by its conduct, waived the right to claim the policy did not extend to the loss sustained by respondent in the suit brought by Perry, and that appellant is estopped by its conduct from denying its liability under the policy.
These propositions are vigorously assailed by appellant, and we consider the first and second positions of respondent untenable. We are not inclined to the view that the condition proposed by respondent should be read into the clause in question. The clear intent of the language is that, where a child was employed by the assured contrary to law, there should be no liability on the part of appellant, and whether such child should be employed contrary to law did not depend upon whether or not the injuries sustained were the proximate result of such illegal employment. We do not regard the language of the clause in the policy referred to as ambiguous, and hence the subsequent conduct of the parties is not to be accounted for upon the theory of practical construction.
But the third position taken by respondent is sound. The complaint sufficiently sets forth facts which create an estoppel in pais. In other words, appellant, by its conduct with reference to the litigation, is es-topped from denying its liability under the terms of the policy. It is alleged that both parties assumed appellant was liable in indemnity; but the question of estoppel is not necessarily determined by the fact
While it may be that the acts of appellant were not such as to constitute a waiver, strictly speaking, yet there was at least an election of positions ; and, having pursued a course of action consistent with its liability, such conduct ripened into an equitable estoppel. No doubt appellant acted in good faith; but bad faith is not always necessary to estoppel, and it does not always follow that no estoppel will arise when the party to whom the representation is made has knowledge as to the truth of all the facts. Appellant comes within the rule that a person is precluded from taking, merely because his interests may change,
We think the position of appellant in this case is analogous to that of a party who has taken advantage of an unconstitutional law to stay execution against him by putting up a bond. In such case it has been held that he would not be permitted to question its validity thereafter, notwithstanding that the law under which he was proceeding was after-wards declared unconstitutional. Davis v. Wakelee, 156 U. S. 680, 15 Sup. Ct. 555. In that case the following general statement was made: “It may be laid down as a general proposition that where a party assumes a certain position in a legal proceeding, and succeeds in maintaining that position, he may not thereafter, simply because his interests have changed, assume a contrary position, especially if it be to the prejudice of the party who has acquiesced in the position formerly taken by him.” So, in this case, simply because it may be for its interest, appellant will not be permitted to change its position to the prejudice of the party who acquiesced in its line of conduct. By its own election appellant put the question of indemnity at rest.
Order affirmed.-
Dissenting Opinion
(dissenting).
The court in the opinion correctly states the elements essential to give rise to an estoppel, but, as it seems to me, wholly fails to recognize the elementary rule that no person can invoke the doctrine, unless to deny him the right to do so would result in his substantial injury or damage. The doctrine of estoppel is purely equitable, and is resorted to and applied by courts of justice for the purpose of awarding redress and preventing injury, and for no other purpose. Unless injury or damage result from a reliance upon the acts or conduct of another, no estoppel arises.
In the case at bar, while the elements of an estoppel, in so far as the acts and conduct of defendant are concerned, exist, the complaint fails to show that plaintiff has been injured or damaged by a reliance thereon, except to the extent the recovery against him exceeded the settlement he could have made, had the offer for that purpose been communicated to him. It clearly appears that plaintiff was liable in the action which defendant undertook to and did defend for him under the mistaken im