Robertson v. Metropolitan Casualty Ins. Co., 4024.

• Decision Date: 08 June 1936
• Docket Number: No. 4024.,4024.
• Citation: 84 F.2d 465
• Parties: ROBERTSON v. METROPOLITAN CASUALTY INS. CO. OF NEW YORK.
• Court: U.S. Court of Appeals — Fourth Circuit

84 F.2d 465 (1936)

ROBERTSON v. METROPOLITAN CASUALTY INS. CO. OF NEW YORK.

No. 4024.

Circuit Court of Appeals, Fourth Circuit.

June 8, 1936.

Samuel L. Prince and T. Frank Watkins, both of Anderson, S. C. (Watkins & Prince, of Anderson, S. C., on the brief), for appellant.

Thomas Allen, of Anderson, S. C. (Allen & Doyle, of Anderson, S. C., on the brief), for appellee.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

NORTHCOTT, Circuit Judge.

This is an action brought in October, 1933, by the appellant, a citizen of South Carolina, herein referred to as the plaintiff, against the appellee, a New York corporation herein referred to as the defendant, and Sam B. King, as insurance commissioner of the state of South Carolina, J. G. Edwards, Jr., Martha Lane Edwards, as administratrix of the estate of the late J. G. Edwards, Sr., deceased, and Mrs. Mary H. Watson, defendants, in the court of common pleas for Anderson county, S. C. The cause was removed to the District Court of the United States for the Western District of South Carolina on petition of the defendant insurance company. No answer or other pleading was ever filed by, or on behalf of, any of the defendants, other than the appellee.

By stipulation the cause was submitted to the judge of the District Court upon an agreed statement of facts, and, after argument of counsel, both for the plaintiff and the defendant, the court below on the 11th day of January, 1936, entered its opinion and order holding that the complaint should be dismissed and judgment rendered in favor of the defendant insurance company. From which action this appeal was brought.

On February 8, 1936, after the judgment of the court, an order of severance was entered permitting the plaintiff to prosecute this appeal against the defendant insurance company, alone, without joining the other defendants.

This action was brought seeking to obtain judgment against the defendant as surety upon a $10,000 qualifying bond executed by Public Indemnity Company for the purpose of enabling said company to obtain a license to do business, as an accident insurance company, in the state of South Carolina during the insurance statutory license year of April 1, 1931. For the prior insurance year the Constitution Indemnity Company of Philadelphia had been surety upon a similar bond for Public Indemnity Company, and on May 19, 1932, said Public Indemnity Company filed a new bond with Independence Indemnity Company as surety, which new bond was accepted by the insurance commissioner of the state of South Carolina, and Public Indemnity Company was again licensed for the annual period of one year ending in 1933. These several bonds were in the same sum ($10,000), and were uniform in their provisions. The condition of the bond executed by the defendant is as follows:

"Now therefore, the condition of the above bond is such that it shall continue in full force and effect so long as said principal shall do business in this State, or have outstanding contracts herein, or until another bond is lawfully accepted by the Insurance Commissioner, and that if the above bound principal or surety shall well and truly pay or cause to be paid to the said Sam B. King, Insurance Commissioner of South Carolina, and his successors in office, on demand, the full and just sum of any and all judgments entered up against the said principal in any Court of competent jurisdiction in this State (any such judgment hereby being declared to be a lien upon this bond), during the time the said principal does business in this State, or has outstanding contracts herein, then this bond to be void and of no effect, otherwise to remain of full force and effect."

On July 3, 1931, Public Indemnity Company issued to the plaintiff, John Will Robertson, a policy of insurance in the sum of $15,000, and on July 25, 1931, the plaintiff sustained an injury and suffered a loss within the terms of his policy contract. On January 14, 1932, the plaintiff, Robertson, brought an action in the court of common pleas for Anderson county, S. C., against said Public Indemnity Company for the loss sustained by him under the policy contract. This action was transferred to the District Court of the United States for the Western District of South Carolina, and resulted in a judgment in favor of said Robertson against the said Public Indemnity Company, which was duly entered on February 6, 1933, in the sum of $17,379.50. No part of this judgment has been paid by the Public Indemnity Company, and the record shows that the Independence Indemnity Company, surety on the bond of the Public Indemnity Company for the annual period beginning April 1, 1932, the year in which the judgment against the Public Indemnity Company was obtained, is insolvent.

The sole question presented is whether the defendant's liability, under the bond on which it was surety, is limited to judgments obtained within the license year for which the bond was given, or is to be held to cover liabilities for causes of action arising during that year, upon which judgment is not obtained until after the expiration of the year.

The pertinent statutes of South Carolina, setting forth the conditions and limitations applicable to the business conducted by Public Indemnity...