American Fire & Cas. Co. v. Collura
| Decision Date | 15 April 1964 |
| Docket Number | No. 3670,3670 |
| Citation | 163 So.2d 784 |
| Parties | AMERICAN FIRE AND CASUALTY COMPANY a corporation, Appellant, v. Frank A. COLLURA, Appellee. |
| Court | Florida District Court of Appeals |
Charles Luckie, Jr., of Dayton, Dayton & Luckie, Dade City, for appellant.
William B. Goodson, of Larkin, Larkin & Goodson, Dade City, for appellee.
The appellant, American Fire & Casualty Company, appeals from a final judgment entered against it in garnishment proceedings initiated by the appellee, Frank Collura. The garnishment proceedings were based upon a judgment which Collura had obtained against A. L. Stephens, who was insured under an automobile liability policy issued by the appellant. The judgment against Stephens was the result of a negligence action arising out of an automobile accident in which Collura suffered personal injuries. In the garnishment proceedings, the insurance company unsuccessfully contended that it was not liable to appellee under the policy because Stephens, the insured had breached two clauses of the insurance contract, and the compliance with these clauses was a condition precedent to the company's liability.
By the terms of the insurance policy, the company agreed to pay on behalf of Stephens all sums which Stephens should become legally obligated to pay as damages because of bodily injury sustained by any person (Coverage A), or because of injury to or destruction of property (Coverage B), caused by accident and arising out of the ownership, maintenance or use of the automobile owned by Stephens. The policy contained the following pertinent clauses:
'* * *
'2. Notice of Claim or Suit--Coverages A and B. If claim is made or suit is brought against the insured, the insured shall immediately forward to the company every demand, notice, summons or other process received by him or his representative.
'* * *
'7. Action Against Company--Coverages A and B. No action shall lie against the company unless, as a condition precedent thereto, the insured shall have fully complied with all the terms of this policy * * *.
'* * *
'18. Assistance and Cooperation of the Insured--Coverages A, B, D, E, F, G, H, I and J. The insured shall cooperate with the company and, upon the company's request, shall attend hearings and trials and shall assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of suits * * *.'
In 1956, at a time when the insurance policy was in effect, an automobile owned and operated by Stephens was involved in a collision with an automobile operated by Collura. Notice of the accident was given by Stephens to the insurance company's agent who had sold the policy to Stephens; hence, there is no question here of actual knowledge of the accident. Collura retained counsel who sought settlement of Collura's claim through direct negotiations with the insurance company. About one year after the accident, Stephens moved from Pasco County, florida, to Graceville, Alabama. Subsequently, the settlement negotiations coming to naught, Collura's negligence action was filed against Stephens. Collura's attorney forwarded to the insurance company a copy of the complaint, together with a written request that the company authorize its attorneys to defend the action. Receiving no response, Collura's attorney then contacted Stephens in Alabama and obtained from him a signed answer. This answer, constituting a general denial, was filed in the negligence action, and a copy thereof was forwarded to the insurance company by Collura's attorney. Thereupon The insurance company advised Collura that it was not liable under the policy it had issued to Stephens because Stephens had violated the terms of the policy by failing to make demand upon the company to defend the case and by failing to furnish the company with suit papers served upon him.
Upon motion by Collura, the suit then pending was dismissed without prejudice. Shortly thereafter another suit was filed involving the same parties and the same issues. Service of process was effected in the manner prescribed by § 47.30, Florida Statutes, F.S.A. Collura's attorney forwarded to Stephens, by registered mail, copies of the complaint, process and notice of service. Enclosed with the foregoing items were a stamped envelope addressed to the insurance company and a written request that Stephens mail the suit papers to the company. At the same time, Collura's attorney mailed to the insurance company copies of the suit papers, together with a copy of the letter to Stephens requesting him to forward the suit papers to the company. Subsequently, the insurance company was advised by Collura's attorney that a default would be entered against Stephens unless the company defended the suit. Stephens failed to forward the suit papers to the company. Default was subsequently entered, after which there was a trial culminating in the entry of the judgment in favor of Collura and against Stephens, which judgment was in an amount three times the insurance coverage. There was no contact or communication between Stephens and the insurance company from the time he advised the company's agent of the accident until after the entry of the final judgment against him. Stephens' conduct is better understood in the light of the court's finding that he was illiterate. 1
With regard to the clause requiring the insured to give to the insurance company 'notice of claim or suit', the appellant contends that the forwarding by Collura's attorney of the suit papers to the company does not constitute compliance with that condition precedent; and that compliance could only have been effected by the forwarding of the said documents by Stephens, its insured. In so contending, the company frankly admits that the weight of authority is to the effect that the forwarding of the suit papers to the insurer by the plaintiff's attorney meets the requirements of such a condition, citing as an example Spears v. Ritchey, 1958, 108 Ohio App. 358, 161 N.E.2d 516. The company, however, endeavors to draw a distinction between this admitted weight of authority and the law in Florida by pointing out that the decisions in most of the other jurisdictions are based upon the premise that the injured party has such an interest in the insurance policy of the party who injured him that he may fulfill the insured's obligations; whereas, the Florida Supreme Court has held that an injured party does not have any interest in the insurance policy of the party who injured him, citing Brooks v. Owens, Fla.1957, 97 So.2d 693. In the cited decision, the statement was indeed made that automobile liability insurance is ordinarily considered to be for the protection of the insured and is in the nature of a reimbursement for a loss. The Court acknowledged, however, that 'in the foreseeable future,' there may be developed the doctrine that an automobile liability insurance policy inures to the benefit of any and all who suffer injuries occasioned by the insured's automobile.
We are of the view that the timely receipt by the insurance company of the suit papers, from whatever source, meets the intent and purpose of that condition which requires the insured to forward suit papers to the insurer; and that the insurance company should not be heard to complain where it has received the suit papers from the injured party as promptly as it could have received them from the insured. Such a holding is particularly appropriate in view of the fact that Florida's Financial Responsibility Law has, under the police power of the state, required financial security of owners and operators of motor vehicles on the public highways whose responsibility it is to recompense others for injury they might cause to persons or property by the operation of their motor vehicles, by providing that any owner or operator involved in an accident shall first respond for damages caused thereby and then, as a requisite to the future exercise of the privilege of owning and/or operating motor vehicles on the public highways, show proof of financial ability to respond for damages in future accidents. § 324.011, Florida Statutes, F.S.A. While this is not to say that an injured party has an interest in the policy of insurance to the extent sought and rejected in Brooks v. Owens, supra, we do feel that the public policy declared in the foregoing statute should not be thwarted by the strained, technical interpretation urged here by the insurance company. This holding places Florida with the great weight of authorities who share the view that it matters not who gives the notice or who furnishes copies of the suit papers, so long as the notice is given and the copies furnished--so that the insurance company may have an opportunity to investigate the claim and defend the suit. 5A Am.Jur.2d, Automobile Insurance, § 225; 8 Appleman, Insurance Law and Practice, § 4740, p. 65; Annotation, 18 A.L.R.2d 458, § 9. This result is similar to that reached in Norwich Union Indemnity Co. v. Willis, 1936, 124 Fla. 137, 168 So. 418, wherein the Supreme Court held that notice to an agent of the insurance company was sufficient, even though the policy required such notice to be given to the home office.
The insurance company next contends that the record here shows that Stephens, the insured, violated the 'assistance and cooperation clause' of the insurance policy. Our consideration of this point will encompass all of the facts and circumstances disclosed by the record, specifically including Stephens' failure to forward the suit papers to the insurance company. Even though we have previously rejected the contention that this fact alone constituted such a breach of the contract as to relieve the company of liability, it is an element to be considered with reference to the cooperation clause.
In considering the question of breach of a cooperation clause in an...
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