New Jersey Fidelity & Plate Glass Ins. Co. v. Love
| Decision Date | 19 September 1930 |
| Docket Number | No. 3010.,3010. |
| Citation | 43 F.2d 82 |
| Parties | NEW JERSEY FIDELITY & PLATE GLASS INS. CO. v. LOVE. |
| Court | U.S. Court of Appeals — Fourth Circuit |
Walter L. Brown, of Huntington, W. Va. (Douglas W. Brown and Fitzpatrick, Brown & Davis, all of Huntington, W. Va., on the brief), for appellant.
Connor Hall, of Huntington, W. Va. (O. J. Deegan, of Huntington, W. Va., on the brief), for appellee.
Before PARKER, Circuit Judge, and GRONER and ERNEST F. COCHRAN, District Judges.
In October, 1927, the appellant (who will for convenience hereinafter be styled the insurance company) issued to Mrs. Susie K. Watt, a resident of Huntington, W. Va. (hereinafter styled the assured) an insurance policy to indemnify her against liability for bodily injuries including death, suffered by any person by reason of the ownership, maintenance, or use of an automobile described in the policy. The insurance company also agreed to defend in the name of and on behalf of the assured any suits brought against her to recover damages.
The policy contains the following provisions:
Appellee's decedent, Mrs. Georgia Lowe, died as the result of injuries sustained in an accident occurring while she was the guest of Mrs. Watt in the insured car, and appellee (hereinafter styled the plaintiff) recovered a default judgment against Mrs. Watt in the state court. Execution on the judgment being returned unsatisfied, this suit was instituted under the provision of the policy quoted above. The insurance company defended the present suit, alleging that the assured, Mrs. Watt, had not complied with certain terms of the policy, and in particular the provision which required that the assured should immediately forward to the company the summons or other process served upon her. The district court held, although process in the case brought in the state court against Mrs. Watt by the plaintiff was not forwarded to the insurance company until more than seven months after she had received it, nevertheless that the insurance company had an opportunity to appear and defend the action in the state court and that its failure to do so made it liable under the terms of the policy to the plaintiff. The facts are substantially as follows:
The accident occurred on May 22, 1928, was promptly reported to the insurance company's local agent, and within a day or so he obtained statements from Mrs. Watt, the assured, and Mrs. S. J. Bord, another occupant of the car. He wrote the insurance company on May 24, 1928, reporting his investigation and advising that the matter would not be turned over to counsel unless action should be instituted by the relations of Mrs. Lowe. On behalf of the insurance company, he paid for the repairs to Mrs. Watt's car, under the collision clause of the policy. The local agent later learned that a claim was being made by plaintiff as administrator of the estate of Mrs. Lowe, and that the matter was in the hands of Mr. Deegan as attorney. On several occasions, the local agent and Mr. Deegan discussed the claim, and on one occasion Mr. Deegan told him that unless settlement was made, he was instructed to institute action.
On July 31, 1928, plaintiff instituted action against Mrs. Watt in the state court. Process was served by posting at her residence during her absence. She returned on August 23, 1928, and found the process, but did not forward it to the insurance company or notify either the company or its agent of the institution of the action. The declaration was duly filed, and on January 24, 1929, April 10, 1929, and April 11, 1929, Mrs. Watt was served with notices of the taking of depositions on behalf of the plaintiff. But none of these notices was forwarded to the insurance company or its agent, nor was the insurance company informed in any manner of their receipt. Pursuant to these notices served on Mrs. Watt, plaintiff took the depositions of a number of witnesses (three of them being occupants of the car at the time of the accident). On April 17, 1929, the local agent learned of the pending action from a casual conversation with the plaintiff, and immediately called Mrs. Watt to ascertain if she had been served with process. On that date, the local agent obtained the original process and notices of the depositions. While the plaintiff testified concerning some conversations with the local agent in an effort to show that the local agent had some knowledge of the pending suit prior to April 17, 1929, yet his testimony was entirely indefinite, and we think that the record shows clearly that this was the first time that either the insurance company or the local agent had any notice or knowledge of the institution of the suit.
The insurance company, on being advised of the situation, obtained copies of the depositions which had been taken up to that time, and submitted them to its counsel, and on May 8, 1929, counsel advised the company that its rights had been clearly prejudiced by being deprived of the opportunity to cross-examine the witnesses whose depositions had been taken; and on May 13, 1929, pursuant to instructions from the company, counsel for the company informed Mrs. Watt that the company disclaimed all liability under the policy.
The action of Love, administrator (who is the appellee here), against Mrs. Watt, was tried in the state court ...
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