Cleaveland v. Chesapeake & Potomac Tel. Co. of Md.
| Decision Date | 05 April 1961 |
| Docket Number | No. 198,198 |
| Parties | Robert L. CLEAVELAND v. CHESAPEAKE AND POTOMAC TELEPHONE COMPANY OF MARYLAND. |
| Court | Maryland Court of Appeals |
Arthur V. King, Silver Spring (George H. Eggers and Joseph E. Byrne, Silver Spring, on the brief), for appellant.
Jerrold V. Powers, Upper Marlboro (Sasscer, Clagett & Powers, Upper Marlboro, on the brief), for appellee.
Before BRUNE, C. J., and HENDERSON, HAMMOND, PRESCOTT and HORNEY, JJ.
A collision occurred between automobiles driven and owned by Frederick H. Thompson and Robert L. Cleaveland, respectively, at a place where it was claimed that a truck owned by the C. & P. Telephone Company partially blocked the highway. Thompson and his wife were seriously injured, and his car was damaged. Thompson's insurer, Interstate Insurance Company, paid his repair bill of $906.50, less the sum of $50, deductible under his collision policy.
Thompson and Interstate, as subrogee and use plaintiff, then sued Cleaveland. Cleaveland filed general issue pleas and filed a third party declaration against the Telephone Company, with leave of court, alleging that its negligence was the sole cause of the accident or that it was a joint tortfeasor. The Telephone Company filed a general issue plea and moved for summary judgment on the ground that Thompson and his wife had, prior to the institution of suit, received payment of $8,750.00 and had executed a release, attached to the motion, of Cleaveland and the Telephone Company from all claims for personal injuries and property damage arising out of the accident.
The judgment was entered but reopened to permit the introduction of an affidavit on behalf of Cleaveland and his insurer, Federal Mutual Insurance Company, under a liability policy, alleging that the Telephone Company, the third party defendant, had notice of the claim for personal injuries and the subrogation claim for property damage and participated in discussions and negotiations for settlement, although it denied liability and refused to contribute thereto; that Federal paid the sum of $8,750 in settlement of the personal injuries claims; that the third party defendant knew of the settlement and knew it was the intention of the parties to settle only the personal injuries claims; and that there was no settlement of the use plaintiff's property damage subrogation claim. Attached to the affidavit was a copy of the claim draft in payment of the release which recited that it was in full and final settlement of all claims arising out of the accident.
The trial court refused to strike the summary judgment, and this appeal was taken by the defendant and third party plaintiff. The original plaintiffs did not appeal. For present purposes it is conceded that the third party plaintiff has standing to appeal by reason of his potential right to contribution. Cf. Northwestern Nat. Ins. Co. v. Samuel R. Rosoff, Ltd., 195 Md. 421, 73 A.2d 461; O'Keefe v. Baltimore Transit Co., 201 Md. 345, 94 A.2d 26, and Keitz v. National Paving and Contracting Co., 214 Md. 479, 134 A.2d 296, 136 A.2d 229. See also Maryland Rule 315.
The appellant contends that the release of all claims to the plaintiff did not bar the right of plaintiff's subrogee to proceed against a third party defendant or the right of a third party plaintiff to assert that right in order to obtain contribution, where the third party defendant, as well the parties to the release, had notice of the subrogee's interest prior to the execution of the release. The appellee does not deny that it knew of the pending settlement and release, although it maintains that the release and claim draft speak for themselves and must be taken to release all claims, regardless of the alleged contrary intention of the parties. It also admits that it knew Interstate had paid the property damage claim, less $50, at the time of the negotiations and release and that it had then become a subrogee pro tanta.
The cases and text writers generally take the position that where third parties, who may be liable to an insured for a loss, effect a settlement with the letter and obtain a release from and liability with knowledge of the fact that an insurer has already paid the amount of its liability to an insured, the settlement and release will not bar the assertion of the insurer's right of subrogation. The reasoning seems to be that such release is a fraud on the insurer and constitutes no defense against it in an action to enforce its right of subrogation. See 8 Couch, Insurance § 2001; Vance, Insurance (3d ed.) §...
To continue reading
Request your trial
-
Ankney v. Franch
...any benefits paid after the date of the settlement were destroyed by Ankney's unauthorized settlement. See Cleaveland v. C & P Telephone Co., 225 Md. 47, 51-52, 169 A.2d 446 (1961). 4 The merits of Ankney's legal malpractice claim turn, in part, on whether the Commission properly terminated......
-
Travelers Indem. Co. v. Chumbley
...357 Mo. 1099, 212 S.W.2d 396.5 Nationwide Mutual Ins. Co. v. Spivey, 259 N.C. 732, 131 S.E.2d 338; Cleaveland v. Chesapeake & Potomac Tel. Co., 225 Md. 47, 169 A.2d 446, 448(1); Calvert Fire Ins. Co. v. James, 236 S.C. 431, 114 S.E.2d 832, 835-836, 92 A.L.R.2d 97; Dubose v. Lowe, Ohio Mun.C......
-
Home Ins. Co. v. Hertz Corp.
...(Ky.App.1953), 258 S.W.2d 713; Pennsylvania Fire Insurance Co. v. Harrison (La.App.1957), 94 So.2d 92; Cleaveland v. Chesapeake & Potomac Telephone Co. (1960), 225 Md. 47, 169 A.2d 446; Wolverine Insurance Co. v. Klomparens (1935), 273 Mich. 493, 263 N.W. 724; Travelers Indemnity Co. v. Vac......
-
Leader Nat. Ins. Co. v. Torres
...v. Bannon, 258 S.W.2d 713 (Ky.1953); Pennsylvania Fire Ins. Co. v. Harrison, 94 So.2d 92 (La.Ct.App.1957); Cleaveland v. Chesapeake & Potomac Tel. Co. 225 Md. 47, 169 A.2d 446 (1961); Wolverine Ins. Co. v. Klomparens, 273 Mich. 493, 263 N.W. 724 (1935); General Exch. Ins. Corp. v. Young, 20......