MFA Mut. Ins. Co. v. Sailors, 36071
| Decision Date | 22 April 1966 |
| Docket Number | No. 36071,36071 |
| Citation | 141 N.W.2d 846,180 Neb. 201 |
| Parties | MFA MUTUAL INSURANCE COMPANY, a Corporation, Appellant, v. Duane SAILORS et al., Appellees. |
| Court | Nebraska Supreme Court |
Syllabus by the Court
An insurer cannot assert a breach of the cooperation clause as a policy defense in the absence of a showing of prejudice or detriment to the insurer.
Baylor, Evnen, Baylor & Urbom, Lincoln, Dwight Griffiths, Auburn, Robert T. Grimit, Lincoln, for appellant.
Boland, Mullin, Walsh & Cooney, Omaha, Harold L. Gurske, Falls City, for appellees.
Heard before WHITE, C.J., and CARTER, SPENCER, BOSLAUGH, BROWER, SMITH, and McCOWN, JJ.
This is an action for a declaratory judgment brought by MFA Mutual Insurance Company to determine its rights and liabilities under an automobile liability insurance policy issued by the plaintiff to Jerry J. Janko. The policy insured a 1955 Ford automobile.
On September 10, 1960, Duane Sailors was operating the insured automobile when it was involved in a collision with an automobile owned by Ervin Pupkes and operated by Mildred Pupkes. Donald Pupkes and Deborah Pupkes are minor children who were passengers in the Pupkes automobile at the time of the accident. The defendants in this action are Sailors, the Pupkes, and their children.
The policy issued by the plaintiff contained a provision extending the coverage of the policy to any person using the automobile with the permission of the named insured. The policy also contained provisions requiring the insured to give written notice of accident or loss to the plaintiff as soon as practicable, and to forward immediately every demand, notice, or summons received by the insured. The policy further provided that 'the insured shall cooperate with MFA Mutual, disclosing all pertinent facts known or available to him, and upon MFA Mutual's request, shall attend hearings and trials and assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of any legal proceedings in connection with the subject matter of this insurance.'
The record shows that Sailors had been drinking at the time of the accident on September 10, 1960. After the accident Sailors and Janko agreed that they would represent that Janko had been operating the insured automobile at the time of the accident. This was done, and the plaintiff did not ascertain the true facts concerning the identity of the driver of the insured automobile from Janko and Sailors until January 31, 1961.
On June 19, 1962, Mildred Pupkes commenced an action against Sailors to recover damages arising out of the accident of September 10, 1960. Sailors did not notify the plaintiff that this action had been commenced and did not forward any summons to the plaintiff. The plaintiff received notice of the suit in November 1962 by a letter from the attorney for Mrs. Pupkes.
On January 8, 1963, the plaintiff wrote to Sailors stating that he had failed to cooperate, that the plaintiff wanted to investigate the accident, and that it reserved its rights under the policy. On January 22, 1963, Dwight Griffiths, an attorney employed by the plaintiff, wrote to Sailors requesting that he contact Griffiths immediately. On January 30, 1963, Griffiths again wrote to Sailors. On January 31, 1963, Sailors called Griffiths and said that he would come to Griffith's office on the following Monday. Sailors did not keep the appointment and has not contacted Griffiths since that time.
This action was then commenced and further proceedings in the Pupkes v. Sailors action stayed until the determination in this case.
The trial court found that Sailors was an additional insured under the insurance policy issued by the plaintiff to Janko; that Sailors had failed to notify the plaintiff that Mildred Pupkes had commenced an action against him and that he had failed to cooperate with the plaintiff as required by the policy; that Sailors had materially and substantially breached the terms of the policy but that there was no showing of prejudice or detriment to the plaintiff; that there was no evidence of any...
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