Breeden v. Frankfort Marine, Accident & Plate G. Ins. Co.

• Decision Date: 22 May 1909
• Court: Missouri Supreme Court
• Parties: BREEDEN v. FRANKFORT MARINE, ACCIDENT & PLATE GLASS INS. CO.

119 S.W. 576

220 Mo. 327

BREEDEN v. FRANKFORT MARINE, ACCIDENT & PLATE GLASS INS. CO.

Supreme Court of Missouri.

May 22, 1909.

1. CHAMPERTY AND MAINTENANCE (§ 1) — COMMON LAW.

The law of maintenance is in force in Missouri.

2. CHAMPERTY AND MAINTENANCE (§ 4) — INTEREST IN SUBJECT-MATTER.

Any interest asserted in good faith, whether contingent, vested, near, or remote, in pending litigation, relieves a party from the charge of maintenance.

3. CHAMPERTY AND MAINTENANCE (§ 4) — NATURE OF MAINTENANCE.

The insurer in a policy indemnifying an employer against loss for injuries to employés has such an interest in a suit against the employer for injuries to an employé as justifies it aiding in the defense, and so doing does not make it liable for maintenance.

4. INSURANCE (§ 139) — EMPLOYER'S LIABILITY INSURANCE — CONTRACTS — VALIDITY.

A policy indemnifying in part an employer against loss for injuries to employés is not void as contrary to public policy, but is valid because it does not lessen the employer's liability but increases his means of meeting it.

5. INSURANCE (§ 139) — EMPLOYER'S LIABILITY INSURANCE — CONTRACTS — VALIDITY.

A clause in a policy indemnifying an employer against loss for injuries to employés, which permits insurer to take charge of an action against the employer for injuries to an employé and forbids settlement at the initiative of the employer, relates only to the liability of the insurer to the employer, and does not forbid a settlement with the injured employé, provided the employer takes such course independently of his contract.

6. ACCORD AND SATISFACTION (§ 24) — OPERATION — RIGHTS AND LIABILITIES OF THIRD PERSONS.

An employé recovered judgment against his employer for personal injuries, and the same was settled by an agreement of parties by which the employer paid the employé a specified sum in full satisfaction. The insurer in a policy indemnifying the employer against loss for injuries to employés participated in defending the action, and knew of the settlement, and with plaintiff's knowledge furnished the money with which the judgment was satisfied. The employer at the time was insolvent. Held, that the settlement was a bar to an action by the employé against the insurer for maintenance.

Valliant, C. J., and Lamm, J., dissenting in part.

In Banc. Appeal from Circuit Court, Jasper County; Hugh Dabbs, Judge.

Action by J. C. Breeden against the Frankfort Marine, Accident & Plate Glass Insurance Company. From a judgment for defendant, plaintiff appeals. Affirmed.

The plaintiff instituted this suit against the defendant in the circuit court of Jasper county to recover the sum of $4,650, damages alleged to have been sustained by him through the unlawful and wrongful maintenance of a certain suit instituted by him against the Big Circle Mining Company, a corporation of the same county, which had for its object the recovery of $5,000 damages for personal injuries alleged to have been sustained by him through the negligence of said mining company. There was a trial had in the circuit court, which resulted in a judgment in favor of the defendant, and from which the plaintiff duly appealed. The defendant is what is commonly known as an employer's liability insurance company, and was, at and prior to the issuance of the policy referred to hereafter, duly licensed to do business in this state.

On and prior to October, 1901, said mining company was engaged in operating a mining plant in said county, and, as such, applied to and procured from defendant the policy of insurance mentioned in the evidence, the material parts of which are as follows:

"Does hereby agree to indemnify Big Circle Mining Co., of Oronogo, county of Jasper, state of Missouri, (hereinafter called `The Assured,') for the term of six months beginning on the 8th day of October, 1901, at noon, and ending on the 8th day of March, 1902, at noon, standard time.

"Against loss arising from legal liability for damages on account of bodily injury or death suffered by any employé or employés of the assured resulting from any and every accident of whatsoever nature or cause happening in, upon or about the premises of the assured as described herein and in the application herefor; but the liability of the company in respect to any one employé suffering injury or death shall in no case exceed the sum of twenty-five hundred dollars ($2,500.00), nor shall the total liability of the company in respect to any one accident resulting in injury to, or the death of several employés in any event exceed the sum of ten thousand dollars ($10,000.00).

"It is expressly warranted and agreed:

"1. That the company's liability for accidents caused by or happening about any elevator plant or caused by the explosion, rupture or collapse of any steam boiler or boilers is limited to such elevator plant and boilers as are described and enumerated herein and in the application hereto.

"2. That upon the occurrence of an accident, whether any claim be made in respect thereof or not, the assured shall give immediate notice in writing of such accident to the company, addressed to the manager for the United States at the office of the company in New York, N. Y., or to the duly authorized representative of the company for the locality in which this policy is issued. If thereafter the assured shall receive notice of any claim growing out of an accident, duly reported to the company as before provided, or if any legal proceedings to enforce such a claim, he shall give immediate notice thereof to the company in like manner.

"3. That if any legal proceedings are taken to enforce a claim against the assured, covered by this policy, the company shall, at its own cost, undertake the defense of such legal proceedings in the name and on behalf of the assured and shall have the entire control of such defense. But if the company shall offer to pay to the assured the full amount for which the company is liable in respect to the claim sought to be enforced, it shall not be bound to defend any legal proceedings nor be liable for any costs or expenses which the assured may incur in defending the same. The assured shall at all times, under the direction of the company, render all reasonable and necessary assistance to enable the company to effect settlements or to properly conduct a defense or to prosecute an appeal.

"4. That the company may undertake at its own cost the settlement of any claim, duly reported to it as before provided, and the assured shall not, except at his own cost, settle any claim nor incur any expense without the consent of the company thereto previously given in writing; provided however that such immediate medical and surgical relief to the injured may be furnished as may be imperative at the time of the accident and reasonable expenses thus incurred, shall be deemed a part of the liability of the company.

"5. That this policy may be cancelled by the company at any time; it may also be cancelled by the assured provided the premium has been paid. If cancelled by the company it shall retain a pro rata premium for the time the policy has been in force; if cancelled by the assured the company shall, after deducting twenty-five per centum of the whole of the premium for expenses, retain a premium computed according to the customary short rates based upon the amount of pay roll expended up to the date of cancellation.

"6. That the premium is based upon the estimated annual pay roll to be expended by the assured during the term of this policy. If the wages paid in that period exceed the amount on which the premium has been paid there shall be paid to the company a further premium for such excess, and if the pay roll expended is less than that estimated, the company will return to the assured the unearned premium pro rata; provided however that the premium to be retained by the company shall in no event be less than the sum of fifty dollars.

"7. That the company shall have the right at all reasonable times to examine the books of the assured so far as they relate to the wages paid employés; and the assured shall, when so requested, furnish the company with a sworn statement of the total amount of wages paid to his employés during any period within the term of this policy which may be specified by the company.

"8. That the assured shall not, in any case whatsoever, voluntarily assume by contract or otherwise any liability for loss on account of bodily injuries, fatal or non-fatal, to any employé or employés, except by consent of the company, evidence of the indorsement of such consent signed by the manager and attorney for the United States."

"15. That in case of loss under this policy, the company shall be subrogated to all claims or rights of the assured in respect to such loss against any person or persons, and the assured shall execute any and all papers required to secure to the company said rights."

The policy was written for a period of six months, beginning on October 8, 1901, for which a premium of $88.74 was paid by the mining company to respondent.

In January, 1902, appellant claimed to have received an injury in the mining company's mill by reason of breakage of an eye in one of the bumpers. This respondent was immediately notified of the accident by the mining company, and respondent, acting under the provisions of its policy, proceeded to cause an investigation to be made of the accident. Soon thereafter the appellant commenced a suit in the circuit court of Jasper county, Mo., against the mining company, seeking to recover from it $5,000 damages. The respondent, acting in pursuance of the provisions of the policy, employed an attorney and undertook the defense of said suit, which, in the trial thereof at the June term, 1908, resulted in a judgment against the mining company in the sum of $2,500. From this judgment, in due course, an appeal was taken to the Kansas City Court of Appeals, and the judgment of the circuit...