American Cas. Co. v. Purcella

• Decision Date: 17 January 1933
• Docket Number: 42.
• Citation: 163 A. 870,163 Md. 434
• Parties: AMERICAN CASUALTY CO. v. PURCELLA ET AL.
• Court: Maryland Court of Appeals

163 A. 870

163 Md. 434

AMERICAN CASUALTY CO. v. PURCELLA ET AL.

No. 42.

Court of Appeals of Maryland

January 17, 1933

Appeal from Circuit Court, Allegany County; Albert A. Doub, Judge.

Actions by Joseph Purcella and another against Mike Martirano and the American Casualty Company, respectively. Judgments for plaintiffs, and defendant Casualty Company appeals.

Affirmed.

Argued before BOND, C.J., and URNER, ADKINS, OFFUTT, DIGGES, and SLOAN, JJ.

Walter C. Capper, of Cumberland, for appellant.

Taylor Morrison, of Cumberland (Edward J. Ryan, of Cumberland, on the brief), for appellees.

SLOAN J.

Joseph Purcella and Frank Sicola each brought a suit against Mike Martirano, and each recovered a judgment for injuries respectively sustained by them while riding as guests in Martirano's automobile. Writs of fi. fa. were issued on both judgments and returned "nulla bona." Martirano had a liability insurance policy with the American Casualty Company, appellant, and after the return of the writs of fi fa., the appellees brought suits against the insurance company and recovered judgments against it for the amounts which they had obtained against Martirano. By agreement the cases were tried together, before the court sitting as a jury, and from judgments in favor of the plaintiffs, the defendant appellant appeals. There is one exception, and that is to the refusal of the appellant's two prayers for directed verdicts, the first on the ground of no legally sufficient evidence, the second "that the insured (Martirano) failed to give immediate notice to the defendant (insurer) of the accident in question." The provision of the policy requiring notice to be given is: "XI. Reporting accidents and claims. The assured, upon the occurrence of any accident covered hereby, shall give immediate notice thereof, together with the fullest information respecting it then obtainable. He shall give like notice, with full particulars, of any claim growing out of such accident, and the assured shall forward to the company every summons or other process as soon as it shall have been served upon him."

The policy of insurance sued on was sold and issued to Mike Martirano by Metzger & Holben, insurance agents, by whom the same was "countersigned at Frostburg, Md., on the 25th day of February, 1929," to be effective to February 25 1930, "against loss from the liability imposed by law upon the assured, for damages" to persons or property to the extent provided "by reason of the ownership maintenance or use for the purpose named in the warranties" of the automobile described in the policy. On November 10, 1929, the assured, Mike Martirano, who resided at Eckhart Mines in Allegany county, had two of his friends, Joseph Purcella and Frank Sicola, out driving. At Morantown, about two miles from Eckhart Mines, the car ran off the road into a telephone pole, slightly injuring Martirano, and more seriously injuring his guests. Martirano said he went to Frostburg a couple of days later and notified C. A. Holben, of the firm of Metzger & Holben, of the accident. The appellant denies that any such notice was given or, conceding that it was, it did not, according to the testimony of Martirano, impart "the fullest information respecting the accident then obtainable," and contends that the first notice of any kind received by the company or its agents was when Martirano, on December 13, 1929, went to the office of Metzger & Holben at Frostburg, and delivered to Mr. Holben a letter of Edward J. Ryan, attorney for Purcella and Sicola, dated December 11, 1929, and copies of the summons and declarations in both cases against Martirano, all of which had been left with him by the sheriff of Allegany county. These papers were forwarded by Messrs. Metzger & Holben to the office of the appellant at Reading, Pa., and on December 28th, the company, by C. A. Glase, its adjuster, wrote Martirano that, because of his failure to comply with the requirements of section XI of the policy, it would not defend any action brought against him or pay any judgment, and returned the papers. The cases were uncontested and proceeded to judgments.

There is no question of construction of the policies here involved which has not been decided by this court. In this court, ever since the decision in Washington Fire Ins. Co. v. Kelly, 32 Md. 421, 3 Am. Rep. 149, in the construction of contracts of insurance, the same rule of construction has obtained as on other contracts, namely, that the intention of the parties, as gathered from the whole instrument, must prevail. Westchester Fire Ins. Co. v. Weaver, 70 Md. 536, 17 A. 401, 18 A. 1034, 5 L. R. A. 478; Agricultural Ins. Co. v. Hamilton, 82 Md. 88, 33 A. 429, 30 L. R. A. 633, 51 Am. St. Rep. 457; Frontier Mortgage Corporation v. Heft, 146 Md. 1, 125 A. 772; Brownstein v. N.Y. Life Ins. Co., 158 Md. 51, 148 A. 273. The appellant has referred us to the opinions of other courts wherein the clause here relied on has been construed and applied, amongst which are Woodmen Accident Ass'n v. Pratt, 62 Neb. 673, 87 N.W. 546, 55 L. R. A. 291, 89 Am. St. Rep. 777, Chapin v. Ocean Accident & Guarantee Corp., 96 Neb. 213, 147 N.W. 465, 52 L. R. A. (N. S.) 227, McCarthy v. Rendle, 230 Mass. 35, 119 N.E. 188, L. R. A. 1918E, 111, and the dissenting opinion of Judge Cothran in Ott v. American Fidelity & Casualty Co., 161 S.C. 314, 159 S.E. 635, 637, 76 A. L. R. 4, in which the decisions in this country are pretty generally reviewed. It cites also the case of New Jersey Fidelity & Plate Glass Ins. Co. v. Love (C. C. A.) 43 F. (2d) 82, 86, in which the first notice had been promptly given, but notice of suit had not. There the rule was stated generally that: "A compliance with the conditions of the contract within a reasonable time is indispensable to fix liability. The condition is a material and important part of the contract and should not be deliberately set aside as of no moment." 33 C.J. 10; 36 C.J. 1100.

It is not necessary here to review these cases, as they nearly all are predicated on the rules of construction prevailing in this court, as will appear from those to which we shall refer in this opinion.

In construing contracts of insurance, and particularly of those conditions which must be observed by the respective parties to the contract, the courts make no distinction between fire, life, accident, and liability policies. In all of them the courts require evidence of substantial compliance on the part of the insured, or the one seeking indemnity, if the insured has failed to do what the policy provides.

In the case of Rokes v. Amazon Insurance Co., 51 Md. 512, 519, 34 Am. Rep. 323, it was said of the provision for immediate notice of a fire loss: "The policy requires that proofs of loss shall be furnished in writing immediately after the fire. Immediately as here used means within a reasonable time; and what is a reasonable time must of course depend upon the facts and circumstances of each particular case. Cashau v. Ins. Co. [Fed. Cas. No. 2499], 5 Biss. 476; Edwards v. Ins. Co., 75 Pa. 378."

But we are not restricted in this case to experience in fire insurance cases as precedent or authority. Automobiles, with their resultant casualties, have brought to this court for construction a new kind of insurance policy which not only gives protection to the policy holders, but to the victims of his carelessness, negligence, or lack of skill. Recently we had one between two insurance companies, one of which had paid for the damage done to its policyholder's automobile. It, in turn, sued the wrongdoer, obtained a judgment, and, on his failure to pay, sued his insurer. The wrongdoer's insurer resisted the claim on the ground that the insurer had, without its consent, admitted liability contrary to a provision of his policy. In that case ( American Automobile Ins. Co. v. Fidelity & Casualty Co., 159 Md. 631, 637, 152 A. 523, 525) the provision of the policy under review was not the one requiring notice, but another material clause forbidding a voluntary admission of liability without the written consent of the company, and it was there said: "There can be no doubt that the violation of that condition contained in the policy is a breach of the contract," and among the cases cited was Coleman v. New Amsterdam Casualty Co., 247 N.Y. 271, 160 N.E. 367, 369, 72 A. L. R. 1443, on the co-operation clause of such a contract, in which the court said: "Co-operation with the insurer is one of the conditions of the policy. When the condition was broken, the policy was at an end,...