Carthage Stone Co. v. Travelers Insurance Company

• Decision Date: 17 May 1918
• Citation: 203 S.W. 822,274 Mo. 537
• Parties: CARTHAGE STONE COMPANY v. TRAVELERS INSURANCE COMPANY, Appellant
• Court: Missouri Supreme Court

203 S.W. 822

274 Mo. 537

CARTHAGE STONE COMPANY v. TRAVELERS INSURANCE COMPANY, Appellant

Supreme Court of Missouri

May 17, 1918

Appeal from Jasper Circuit Court. -- Hon. David E. Blair, Judge.

Affirmed.

O. C Mossman and McReynolds & Halliburton for appellant.

Bailey & Bailey and Howard Gray for respondent.

BROWN C. Railey, C., concurs. Bond, J., dissents, concurring in the majority opinion of the Springfield Court of Appeals.

OPINION

In Banc.

BROWN C.

This case is certified to us by the Springfield Court of Appeals upon a division of opinion in that court stating the constitutional grounds therefor.

The plaintiff is a corporation engaged in quarrying stone in this State. The defendant is a Connecticut corporation doing the business in this State of selling indemnity insurance against liability of employers for accidents sustained by employees in the course of their employment. In June, 1908, it sold and issued to plaintiff its policy whereby it agreed with plaintiff "as respects bodily injuries accidentally sustained, including death at any time resulting therefrom," as follows: (1) "To indemnify the assured against loss by reason of the liability imposed upon him by law for damages on account of such injuries." (2) "To serve the assured upon notice of such injuries by such investigation thereof, or by such negotiation or settlement of any resulting claims as may be deemed expedient by the company." (3) "To defend in the name and on behalf of the assured any suits which may at any time be brought against him on account of such injuries, including suits alleging such injuries and demanding damages therefor although such suits, allegations or demands are wholly groundless, false or fraudulent." (4) "To pay all costs taxed against the assured in any legal proceeding defended by the company, all interest accruing after entry of judgment upon such part thereof as shall not be in excess of the limits of the company's liability as hereinafter expressed, all expenses incurred by the company for investigation, negotiation or defense, and the expense incurred by the assured for such immediate surgical relief as shall be imperative at the time any such injury is sustained."

By the terms of the agreement contained in it, the policy was made subject to the following condition: (1) "No action shall lie against the company to recover for any loss under paragraph 1, foregoing unless it shall be brought by the assured for loss actually sustained and paid by him in money in satisfaction of a judgment after trial of the issue." (2) "No condition or provision of this policy shall be waived or altered except by endorsement attached hereto signed by the president, a vice-president, secretary, or assistant secretary of the company."

All the questions before us in this appeal relate to the effect of these provisions of the policy considered in connection with the action of the parties with respect to the matters to which they relate.

In April, 1909, and while this policy was in force one David O. Perry, an employee of the plaintiff in a capacity which brought him within the terms of the policy, was injured in the course of his employment. The question arose and was tried in this case as to whether notice was given by the plaintiff to the defendant immediately upon the occurrence of the injury in accordance with a requirement of the policy. There was evidence tending to prove that it was, and also that it was not given. The jury, upon a proper submission of this point, resolved it in favor of the plaintiff, and, upon an examination of the evidence and instructions upon which it was submitted, we see no reason to disturb the verdict in that respect, so that it is eliminated, except in so far as the existence of the controversy may be an element in other questions. The fact will be assumed.

November 4, 1911, Perry instituted suit in the Jasper Circuit Court against this plaintiff to recover $ 4000 on account of his injury, and caused service to be had upon this plaintiff, who immediately transmitted to defendant the process so served, including a certified copy of the petition. In answer it received from McReynolds & Halliburton, acting as attorneys for defendant, under date of November 17, 1911, the following:

"In the matter of the case of David O. Perry v. Carthage Stone Company, returnable to the November Term, 1911, Circuit Court for Jasper County, Missouri, we as local attorneys for the Travelers Insurance Company are instructed to notify you that the company has been waiting to hear from you as to whether or not this case was ever reported to the Travelers Insurance Company; that they have no record of it and to date have not received any information from Mr. Logan as to whether the case was reported at the time.

"Pending the receipt of this information, they instruct us to advise your company and Mr. Logan on behalf of the Travelers Insurance Company that the Travelers Insurance Company will file through us the necessary pleadings in the case to protect against a default but that our action in so doing shall not be a recognition of liability on the part of the Insurance Company for the case, and shall be without prejudice to the rights of either party.

"We write you this letter under instructions of Mr. O....