Curtis & Gartside Co. v. Aetna Life Ins. Co.
| Decision Date | 10 October 1916 |
| Docket Number | 5982. |
| Citation | 160 P. 465,58 Okla. 470,1916 OK 872 |
| Parties | CURTIS & GARTSIDE CO. v. ÆTNA LIFE INS. CO. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
A clause in a policy undertaking to indemnify assured against loss by reason of liability on account of injuries to employés, by which the insurer undertakes to defend proceedings against the assured, unless it should elect to settle the same or pay the assured the indemnity provided for, does not make the contract one guaranteeing payment of an obligation of the assured, rather than one of indemnity where another clause of the policy provides that no action shall be brought against the insurer unless by the assured himself to reimburse him for loss actually sustained and paid; the former clause being merely an additional privilege for the protection of the insurer.
Contracts to pay legal liabilities differ from contracts of indemnity in this, that, upon the latter, action cannot be maintained and recovery had until the liability is discharged, while upon the former the right of action is complete when the liability attaches.
Under a policy indemnifying an employer against loss, not exceeding $5,000, by reason of liability incurred from injuries to employés, the insurer is not liable for interest on a judgment for $5,000 pending an appeal taken by the insurer who, by the terms of the policy, conducts the litigation.
The extent of the company's liability under such policy is governed by the terms of the contract, and is thereby limited to $5,000, and the expense of defending the action against the assured, if the company elects to defend, and the interest accruing on the judgment recovered in such action pending an appeal therefrom, is not a part of such expense.
Additional Syllabus by Editorial Staff.
"Expense of litigation," as commonly understood, does not include interest, though interest may accumulate as the result of the litigation. An agreement to pay the "expense or cost of making a defense" to an action at law, in the common and well-understood acceptance of the term, fairly and reasonably contemplates the attorney fees, the court costs, stenographer fees, and other expenditures necessary and directly required to present the defense, and does not include the collateral and indirect results of doing so.
Error from District Court, Oklahoma County; George W. Clark, Judge.
Action by the Curtis & Gartside Company against the Ætna Life Insurance Company. Judgment for defendant, and plaintiff brings error. Affirmed.
Ames, Chambers, Lowe & Richardson, of Oklahoma City, for plaintiff in error.
Everest & Campbell, of Oklahoma City, for defendant in error.
September 6, 1908, the Ætna Life Insurance Company executed an accident policy to the Curtis & Gartside Company, by which it insured the latter against loss or expense arising or resulting from claims upon the assured for damages, on account of bodily injuries suffered by its employés on account of the operation of its business as a manufacturer of sashes and doors at Oklahoma City, Okl. On the 19th day of October following, one James Pribyl, an employé of the assured, received injuries to his person, on account of which suit was afterwards brought against his employer, the manufacturing company. March 19, 1910, in a trial had in the superior court of Oklahoma county, judgment was awarded in favor of Pribyl and against the manufacturing company in the sum of $5,000. On appeal to this court, the judgment of the trial court was affirmed on July 22, 1913. Curtis & Gartside Co. v. Pribyl, 38 Okl. 511, 134 P. 71, 49 L. R. A. (N. S.) 471. The insurer "does hereby insure * * * against loss or expense arising or resulting from claims upon the insured for damages on account of bodily injuries or death accidentally suffered by reason of the operation of the trade or business described herein."
And it also contains certain conditions, including the following:
Other provisions, lettered C, D, and E, of the policy, provided that upon the occurrence of an accident the assured should give immediate written notice thereof, with fullest information obtainable, to the home office of the company, or its duly authorized agent, and that if a claim was made on account of such action the assured should give like notice thereof with full particulars; and, further, that the assured should at all times render the company all co-operation and assistance in its power; that if thereafter any suit was brought against the insured to enforce a claim for damages on account of an accident covered by the policy, the assured should immediately forward to the company's home office every summons or other process, immediately after service thereof; and that the company would, at its own cost, defend such suit in the name and behalf of the assured, unless it should elect to settle the same or pay the assured the indemnity provided for in the policy; that the assured whenever requested by the company, should aid in effecting settlement, securing information and evidence, or attendance of...
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