Bain v. Atkins

• Decision Date: 03 April 1902
• Citation: 181 Mass. 240,63 N.E. 414
• Parties: BAIN v. ATKINS et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

181 Mass. 240

63 N.E. 414

BAIN v. ATKINS et al.

Supreme Judicial Court of Massachusetts, Suffolk.

April 3, 1902

COUNSEL

Walter B. Grant and Thos. H. Buttimer, for plaintiff.

Robt. W. Nason, Thos. W. Proctor, and Nathl. L. Foster, for defendants.

OPINION

BARKER J.

It is now settled by the findings and the agreed facts that when the plaintiff began this attempt to reach, in liquidation of his claim against Atkins, a supposed obligation to Atkins on the part of the Union Casualty & Surety Company, that obligation was no longer in existence. The bill was filed on January 19, 1898. Nine days before that date the supposed obligation, disputed by the company, had been ended by an actual payment of money then made by the company to Atkins on a settlement made in good faith on the part of both, and without notice to either of any claim on the part of the plaintiff in the obligation, or founded upon it. The settlement was not made for the purpose of enabling Atkins to avoid his liability to the plaintiff, nor of enabling the company to avoid any liability to the plaintiff. When it was made the company had no knowledge of Atkins' financial condition. The settlement is found to have been made as in the ordinary course between two parties, one of whom denied all liability, and wanted to settle for as little as it could without injuring its reputation for fair dealing with those who insured with it, and the other of whom wanted to get all he could, up to the full amount of his claim. Atkins put into his business the $3,000 which he received in the settlement and, had it not been for the judgment of $7,000 afterwards recovered against him by the plaintiff in the action of tort for personal injuries then pending, Atkins could have gone on with his business. He went into bankruptcy in consequence of that judgment, and has paid nothing upon the judgment, and the plaintiff has been unable to collect the judgment, in whole or in part.

We do not consider whether, if, when the bill was brought, the company had been under an existing obligation to indemnify Atkins against the plaintiff's demand, the latter could have compelled, in equity, the application of that obligation to the satisfaction of his claim against Atkins. The fact that when the plaintiff sought the aid of an equity court there was no such obligation is conclusive against the contention that there was an equity springing from such an obligation. Therefore the plaintiff is compelled to contend that the obligation of the company upon the happening of the accident constituted a fund for the benefit of the plaintiff, impressed with a trust for him; that such a trust fund could be paid to Atkins, if at all, only to reimburse him after he had satisfied his own liability to the plaintiff; and that the company's settlement with Atkins without the consent of the plaintiff was in the company's own wrong, and void as to the plaintiff. The essence of this contention, without which no part of it can stand, is that the insurance constituted a trust fund for the benefit of the plaintiff, and for this there is no ground. The only parties to the contract of insurance were Atkins and the company. The consideration for the company's promise came from Atkins alone, and the promise was only to him and his legal representatives. Not only was the plaintiff not a party to either the consideration or the contract, but the terms of the contract do not purport to promise an indemnity for the benefit of any person other than Atkins. The policy only purports to insure Atkins and his legal representatives against legal liability for damages respecting injuries from accidents to any person or persons at certain places, and within the time and under the circumstances defined. It contains no agreement that the insurance shall inure to the benefit of the person accidentally injured, and no language from which such an understanding or intention can be implied. Atkins was under no obligation to procure insurance for the benefit of the plaintiff, nor did any relation exist between the plaintiff and Atkins which could give the latter the right to procure insurance for the benefit of the plaintiff. The only correct statement of the situation is simply that the...