Brune v. McDonald

• Decision Date: 18 January 1938
• Citation: 75 P.2d 10,158 Or. 364
• Parties: BRUNE v. McDONALD (PACIFIC INDEMNITY CO., Intervener). [*]
• Court: Oregon Supreme Court

75 P.2d 10

158 Or. 364

BRUNE v. McDONALD (PACIFIC INDEMNITY CO., Intervener). ^[*]

Supreme Court of Oregon

January 18, 1938

Department 1.

Appeal from Circuit Court, Hood River County; Fred W. Wilson, Judge.

Action by Evelyn Brune against Ted McDonald to recover damages for personal injuries sustained while riding as a guest in defendant's automobile, in which the Pacific Indemnity Company, a corporation which had issued a policy of automobile insurance to defendant, by leave of court filed a complaint in intervention. From an order sustaining plaintiff's demurrer to the complaint in intervention intervener appeals.

Affirmed.

John F. Reilly, of Portland (Wilson & Reilly and Thomas S. Wilson, all of Portland, on the brief), for appellant.

Glen R Jack, of Oregon City (Butler & Jack and George L. Hibbard all of Oregon City, on the brief), for respondent.

KELLY Justice.

On November 6, 1936, plaintiff, Evelyn Brune, instituted this action against defendant, Ted. McDonald.

It appears from the original complaint of plaintiff that on the 16th day of August defendant was driving his automobile, with plaintiff as his guest therein, in a northerly direction traveling from the Clackamas county side of Mount Hood on the Mount Hood Loop Road, toward Hood river, and that, when in the vicinity of Van Horn, defendant drove his automobile off the highway, along the edge thereof, across a culvert, through a fence and into a tree, causing injuries to plaintiff.

To support the charge of gross negligence on defendant's part, plaintiff specifically alleged in her original complaint that defendant operated his automobile at an excessive rate of speed, failed to keep his automobile under control, failed to maintain a proper lookout, and failed and neglected to heed plaintiff's remonstrance against defendant's maintenance of such excessive speed. In said original complaint plaintiff also alleged that prior to said accident defendant had imbibed alcoholic liquor, and, in the face of plaintiff's positive opposition thereto, drank excessively of alcohol.

On the 19th day of December, 1936, an amended complaint was filed from which reference to defendant's use of alcohol was omitted.

On the 9th day of January, 1937, said Pacific Indemnity Company procured an order granting said company leave to file a complaint in intervention herein.

On the 15th day of January, 1937, said Pacific Indemnity Company filed its complaint in intervention, in which said company alleged its corporate capacity, and than it had executed and delivered to defendant herein a policy of insurance, in force and effect on the 16th day of August, 1936, and for more than one day thereafter, wherein and whereby it insured defendant against loss by reason of the liability imposed by law upon him for damages on account of bodily injuries suffered or alleged to have been suffered by any person other than his employees as a result of the ownership, maintenance, or use for pleasure purposes of the automobile referred to in the amended complaint herein, subject to a limitation to the sum of $5,000 for bodily injuries sustained by any one person.

That in and by said policy of insurance it was provided in part as follows:

"The Assured, whenever requested by the Company, and at the Company's expense, shall aid in securing information and evidence and the attendance of witnesses, and shall, upon notice from the Company, personally, attend the trial of any issue arising out of any such legal proceeding and shall cooperate with the Company (except in a pecuniary way) in all other matters which the Company deems necessary in the defense of any suit, or in the prosecution of any appeal. The Assured may, at the Assured's own cost, have the Assured's attorneys participate in the defense of any suit or in the prosecution of any appeal."

"This entire policy shall be void if the Assured has concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof; or in case of any fraud, attempted fraud, false statements, or false swearing by the Assured touching any matter relating to this insurance or the subject thereof, whether before or after a loss."

The intervener, in its complaint in intervention, alleges:

"IV. That on the 16th day of August, 1936, while plaintiff and defendant were riding in the automobile described in said policy, in the County of Hood River, State of Oregon, said automobile left the road and was wrecked and plaintiff sustained certain injuries therein, the exact nature and extent of which are unknown to this intervenor.

"V. That prior to the trip during which said accident occurred plaintiff and defendant were and had been for a long time intimate friends and associates, frequently in the company of each other, and on frequent parties together, at which intoxicating liquors were consumed, and in the consumption of which both participated, and that plaintiff was well aware of the habits of defendant with respect to the use of intoxicating liquor.

"VI. That on the afternoon of Sunday, August 16, 1936, plaintiff and defendant embarked upon a pleasure trip around the Mount Hood Loop Highway, taking with them a bottle of intoxicating liquor for consumption during the trip, and they did from time to time during said trip jointly participate in drinking said intoxicating liquor and at Government Camp on said highway jointly engaged in drinking other intoxicating liquor with other persons.

"VII. That after said accident defendant gave to this intervenor several conflicting stories about the occurrences leading up to said accident, at first alleging that, while he was operating his automobile carefully and at a moderate speed it was forced from the highway by another automobile, and then later that both plaintiff and defendant had consumed a considerable quantity of intoxicating liquor on the trip and that the accident occurred because of a momentary lapse of attention on his part while the automobile was being operated at a moderate speed; later plaintiff and defendant learned that there could be no recovery under said policy on such allegations and then connived and conspired with each other to mulct this intervenor of damages under said insurance policy and to that end jointly agreed that plaintiff should file an action against defendant for damages on account of her personal injuries and should allege that at the time of the accident defendant was grossly intoxicated and operating his automobile at a grossly high rate of speed and that defendant should represent to this intervenor that such charges were true and should deny to this intervenor that plaintiff participated in any of the drinking done on the trip, or knew that defendant was or was becoming intoxicated, thereby presenting an appearance of liability on the part of the defendant to plaintiff where none in truth and in fact existed, and with the intent of defrauding this intervenor of a substantial part of the face of said insurance policy.

"VIII. That in pursuance of said conspiracy plaintiff caused a complaint to be filed in this cause wherein she made the charges heretofore referred to against defendant and defendant thereupon represented to intervenor that said charges were all true, and further represented that the plaintiff did not participate in the drinking of any liquor on said trip, that plaintiff was not aware that he was or was becoming intoxicated and was not aware of his habits respecting intoxicating liquor because of his peculiar ability and capacity to imbibe large quantities of intoxicating liquor without other persons being aware of the fact, all of which representations made by the defendant were false and known by him and by plaintiff to be false and were made in accordance with their joint agreement to deceive and defraud this intervenor.

"IX. That by reason of the matters aforesaid said policy of insurance is void as to the accident in which plaintiff was injured and neither plaintiff nor defendant should be permitted to look to said policy in equity and in good conscience for any reimbursement or damages growing out of said accident; that plaintiff and defendant are planning to procure the entry of a judgment in favor of plaintiff and against defendant for a sum equal to the face of said policy but have agreed that plaintiff will look solely to this intervenor for the payment of said judgment and will make no attempt to collect any part of said judgment from defendant; that plaintiff will, unless restrained by this Court, procure a judgment to be entered against defendant and will then delay action on said policy of insurance until just prior to the expiration of the period of limitation applicable thereto, by which time the witnesses to establish the facts concerning said accident and said conspiracy of plaintiff and defendant, and the fraud perpetrated on defendant, will have scattered and be unavailable.

"X. That this intervenor has no plain, speedy or adequate remedy at law.

"Wherefore this intervenor prays that plaintiff and defendant be enjoined from the prosecution of this action, that this action be transferred to the equity side of this court and a determination had of the respective rights of the parties with relation to the policy of insurance hereinbefore referred to; that on such determination it be decreed that said policy is void as respects the accident in which plaintiff was injured because of the fraud of plaintiff and defendant as hereinbefore alleged and that plaintiff and defendant be perpetually enjoined from prosecuting any action against this intervenor on said policy growing out of said accident and that this intervenor have and recover of and from plaintiff and defendant its costs and...