Donahue v. Associated Indem. Corp.
Decision Date | 15 March 1967 |
Docket Number | 36,Nos. 35,s. 35 |
Parties | Annette DONAHUE v. ASSOCIATED INDEMNITY CORPORATION. Laurence J. DONAHUE, Jr. v. ASSOCIATED INDEMNITY CORPORATION. Appeal |
Court | Rhode Island Supreme Court |
These actions which have been consolidated for hearing are before us on the appeal of the respective plaintiffs from a decision of the superior court granting the defendant's motion for summary judgment in each case.
The plaintiffs Laurence J. Donahue, Jr., and his wife brought suit on the uninsured motorist clause of his insurance policy to recover for injuries suffered by Mrs. Donahue in an automobile collision with an uninsured motorist, Richard A. Gabriel. The defendant's motions were based upon certain provisions of the policy which prohibit any action thereon by plaintiffs until they submit both the question of liability and damages to arbitration.
The 'uninsured motorist clause' is a comparatively new type of insurance coverage having been developed since 1954 to serve a need for protection of the policyholder against damages suffered in a collision with a motorist who has no insurance. It is now available in most of the fity states. Several of the states have enacted uninsured motorists legislation making this type of coverage mandatory. 1 In Rhode Island under the provision of § 27-7-2.1, as amended, such protection is offered but it may be rejected by the insured.
One provision of this policy under the heading 'Insuring Agreements' is:
'To pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured automobile because of bodily injury, sickness or disease, including death resulting therefrom, thereinafter called 'bodily injury,' sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured automobile; provided, for the purposes of this endorsement, determination as to whether the insured or such representative is legally entitled to recover such damages, and if so the amount thereof, shall be made by agreement between the insured or such representative and the Company or, if they fail to agree, by arbitration.' (Italics ours.)
Included among the numerous paragraphs of the policy is a provision for arbitration under the heading 'Conditions' which reads:
(Italics ours.)
While plaintiffs have alleged several grounds upon which they allege error by the superior court in granting defendants' motions for summary judgment, we need consider just one. This is their contention that defendant insurer in preparing this policy has failed to comply with the provisions of G.L.1956, § 10-3-2, and therefore they are not required to proceed to arbitration. We believe plaintiffs' position in this regard is well taken. This section reads as follows:
'Agreements to arbitrate subject to chapter.-When clearly written and expressed and contained in a separate paragraph placed immediately before the testimonium clause or the signatures of the parties, a provision in a written contract to settle by arbitration a controversy thereafter arising out of such contract, or out of the refusal to perform the whole or any part thereof, or an agreement in writing between two or more persons to submit to arbitration any controversy existing between them at the time of the agreement to submit, shall be valid, irrevocable and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract; provided, however, that the provisions of this chapter shall not apply to collective contracts between employers and employees, or between employers and associations of employees, in respect to terms or conditions of employment.' (Italics ours.)
Chapter 3 of title 10 is known as The Rhode Island Arbitraction Act. It was first enacted into law on April 25, 1929 and was then known and cited as P.L.1929, chap. 1408. This act has remained unchanged throughout the years. The only change of record is shown in sec. 2, chap. 659, of P.L.1939 which restored certain words inadvertently omitted from the Arbitration Act as a result of the compilation of the General Laws in 1938.
Prior to this time, this court in 1901 in Pepin v. Societe St. Jean Baptiste, 23 R.I. 81, 49 A. 387, enunciated what was and is the common-law rule relative to the recognition of a clause calling for binding arbitration of future disputes which deprive a person of his remedy or recourse at law. We stated that such a provision is against public policy, has no binding force and will not be recognized. We, in effect, held that the courthouse doors would not be barred so as to prevent a person from litigating a future controversy of which he had no knowledge at the time of the original agreement.
The insuring agreement before us provides for the disposition of claims with respect to the issues of liability and damages by arbitration. It is clear from the language of the policy that this provision constitutes an agreement to submit to arbitration disputes which may arise in the future on these two issues and is, in our opinion, within the common law prohibition.
The provision in the instant policy differs considerably from one calling for an appraisal in the case of a disagreement as to the amount of loss which is usually found in a fire insurance policy. Compliance with such terms is a condition precedent before a suit to recover on such a policy can be commenced. We have in the past recognized such a stipulation. 2 Here, however, the arbitration provision is a final and conclusive adjudication between the parties both as to liability and damages and falls four square within the rule of Pepin, supra. See also Childs v. Allstate Ins. Co., 237 S.C. 455, 111 S.E.2d 867.
As part of our study of these causes we have examined the...
To continue reading
Request your trial-
Indiana Ins. Co. v. Noble, 569A84
...Neb. 602, 169 N.W.2d 606 (1969); Ellison v. Safeguard Mut. Ins. Co., 209 Pa.Super. 492, 229 A.2d 482 (1967); Donahue v. Associated Indem. Corp., 101 R.I. 741, 227 A.2d 187 (1967); and Macaluso v. Watson, La.App., 171 So.2d 755 (1965). There is a basic inter-relationship and inter-dependence......
-
Siravo v. Great American Ins. Co.
... ... 3 Id. at 160, 282 A.2d at 593; Donahue v. [122 R.I. 541] Hartford Fire Insurance Co., 110 R.I. 603, 604, 295 A.2d ... Associated Indemnity Corp., 101 R.I. 741, 748, 227 A.2d 187, 191 (1967), quoting ... ...
-
Pacheco v. Nationwide Mut. Ins. Co.
...292 A.2d 865 (1972); Calore Rigging Corp. v. Sterling Eng'r & Constr. Co., 106 R.I. 290, 259 A.2d 123 (1969); Donahue v. Associated Indem. Corp., 101 R.I. 741, 227 A.2d 187 (1967). It thus appears that unless there is some reason defendant may not assert the right created by § 10-3-2, plain......
-
Little v. Conflict of Interest Commission
... ... In Donahue v. Associated Indemnity Corp., 101 R.I. 741, 748, 227 A.2d 187, 190 ... ...