Boise Motor Car Company, a Corp. v. St. Paul Mercury Indemnity Company, a Corp.
| Citation | 62 Idaho 438,112 P.2d 1011 |
| Decision Date | 30 April 1941 |
| Docket Number | 6854 |
| Parties | BOISE MOTOR CAR COMPANY, a corporation, Appellant, v. ST. PAUL MERCURY INDEMNITY COMPANY, a corporation, Respondent |
| Court | United States State Supreme Court of Idaho |
INSURANCE-LIABILITY POLICY-DEFENSE OF ACTION-WAIVER-ESTOPPEL-TRIAL-NONSUIT-PRIMA FACIE CASE-APPEAL-JUDGMENT ON APPEAL.
1. A motion for nonsuit admits the truth of all facts which the evidence tends to prove and every reasonable inference that can be drawn therefrom.
2. A garage liability insurance policy obligating insurer to defend suits for damages required definite and unequivocal defense though insurer when first notified of accident had right to investigate and defer determining its acceptance of liability, but after investigation insurer had duty to give definite assurance that it would or would not defend.
3. Where insured communicates to insurer a denial of latter's right to defend action against insured with reservation of right to withdraw, and thereafter insurer continues to represent insured in defense of the action, the insurer "waives" right to withdraw and is "estopped" to later assert such right when sued by insured for failure to properly defend.
4. Where insurer elected to go forward with defense of action against insured after receiving notice that insured would not consent to reservation of insurer's right to withdraw the insurer's continued assertion of such right of withdrawal thereafter was a breach of provision in garage liability insurance policy requiring insurer to defend suits for damages, and created a hazard which justified insured in employing its own attorneys to protect itself, and the fee paid the attorneys was properly chargeable against insurer.
5. Where plaintiff made a prima facie case, granting nonsuit was error.
6. Where judgment of nonsuit was reversed, cause would be remanded with direction to set aside the nonsuit and put defendant to its defense if it so desired, and otherwise to enter judgment for plaintiff.
APPEAL from the District Court of the Third Judicial District, for Ada County. Hon. Charles F. Koelsch, Judge.
Action to recover attorney's fees which plaintiff-appellant was allegedly obligated to pay by reason of the contended failure of respondent to properly defend an automobile accident suit against appellant in violation of respondent's contract of insurance with appellant. From a judgment of nonsuit entered at the close of plaintiff's case, plaintiff appeals. Reversed and remanded.
Reversed and remanded and set aside, judgment entered for appellant. Costs awarded to appellant.
James H. Hawley and R. W. Beckwith, for Appellant.
On motion for nonsuit party admits all facts which evidence tends to prove, and evidence must be interpreted most strongly against defendant and most favorably toward plaintiff. (Buhl State Bank v. Glauder, 56 Idaho 543, 56 P.2d 757; Sweetland v. Oakley State Bank, 40 Idaho 726, 236 P. 538; Schleiff v. McDonald, 37 Idaho 423, 216 P. 1044; Bank of Commerce v. Baldwin, 12 Idaho 202, 85 P. 497.)
Where automobile liability insurance contract requires insurance company, at its own expense, to investigate and defend all suits for damage brought against insured, insurance company's reservation of the right to cease investigation and defense, at any time, constitutes breach of contract. ( Sheher-Ford Wagon & Harness Co. v. Continental Casualty Co., (Ala.) 170 So. 249; Sears v. Interurban Transportation Co., Inc., 125 So. 748; American Liability Co. v. Remke, (Ohio) 171 N.E. 372; Buquo v Title Guaranty & Trust Co., 100 S.W.2d 997.)
J. F. Martin and J. L. Eberle, for Respondent.
A motion for a nonsuit is properly granted where the truth of plaintiff's testimony and all inferences justifiably drawn therefrom are admitted, still does not entitle plaintiff to recover. (Maryland Casualty Co. v. Boise Street Car Co., 52 Idaho 133; First National Bank v. Stringfield, 40 Idaho 587; Coulson v. Aberdeen Springfield Canal Co., 39 Idaho 320.)
GIVENS, P. J. Morgan and Holden, JJ., concur. Budge, C. J., and Ailshie, J., did not sit at the hearing and took no part in this opinion.
--Appellant, Boise Motor Car Company, operating a garage and automobile sales agency, purchased, November 5, 1935, from respondent St. Paul Mercury Indemnity Company, a garage liability insurance policy containing these pertinent provisions:
"(b) Caused by any automobile operated by any persons under the age limit fixed by law or under the age of sixteen years in any event"; (Emphasis ours.)
July 6, 1936, while this insurance contract was still in full force and effect, one John McAbee came to appellant's place of business and stated he desired to purchase an automobile. Upon inquiry as to his age he told appellant's officers and agents he was eighteen and would be nineteen in a few days; that he was smoking and appeared to have been shaven. In the evening of July 6, one of the salesmen for appellant permitted John McAbee to take the car out alone and while so driving it McAbee collided with one John Heard, a pedestrian. Later investigation revealed McAbee at that time was only fourteen years of age.
September 30, 1936, Heard filed suit against McAbee and appellant herein, alleging negligence of McAbee and that appellant had permitted McAbee to drive the automobile knowing him to be under sixteen years of age. Summons therein was issued the same day and served on appellant November 2, 1936.
No notice of the accident was given respondent until about October 3, 1936. On that day respondent's local attorney wrote appellant (Plaintiff's Exhibit 2) as follows:
Plaintiff's Exhibit 3, a letter written by the attorney for respondent to appellant May 11, 1937, concerning the Heard suit, states:
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