Ford Hospital v. Fidelity & Casualty Company of New York

• Decision Date: 23 June 1921
• Docket Number: 21259
• Citation: 183 N.W. 656,106 Neb. 311
• Parties: FORD HOSPITAL, APPELLEE AND CROSS-APPELLANT, v. FIDELITY & CASUALTY COMPANY OF NEW YORK, APPELLANT: MARYLAND CASUALTY COMPANY, APPELLEE AND CROSS-APPELLEE
• Court: Nebraska Supreme Court

183 N.W. 656

106 Neb. 311

FORD HOSPITAL, APPELLEE AND CROSS-APPELLANT, v. FIDELITY & CASUALTY COMPANY OF NEW YORK, APPELLANT: MARYLAND CASUALTY COMPANY, APPELLEE AND CROSS-APPELLEE

No. 21259

Supreme Court of Nebraska

June 23, 1921

APPEAL from the district court for Douglas county: ARTHUR C WAKELEY, JUDGE. Affirmed.

AFFIRMED.

Morsman Maxwell & Crossman, for appellant.

John J Sullivan, James E. Rait, George B. Thummel, George W. Pratt and Smith, Schall & Howell, contra.

Heard before MORRISSEY, C.J., DAY, DEAN, FLANSBURG, LETTON and ROSE, JJ. FLANSBURG, J., dissenting.

OPINION

ROSE, J.

This is an action on two insurance policies, each for $ 5,000, to recover the amount alleged to be due from the insurers for a loss reduced to a judgment for $ 5,500, which Mary Jane Hannah, an infant, recovered against the Ford Hospital Company, the insured, in a former action for personal injuries. One of the policies was issued by the Fidelity & Casualty Company and the other by the Maryland Casualty Company. Both are defendants, and insured is plaintiff herein. Each insurer, referring to its own policy, pleaded, among other defenses, that liability for the negligence resulting in the personal injuries to the child was not covered by its insurance, and that it was not bound by the judgment for damages. After the evidence had been adduced in this action on the liability insurance policies, each party requested a directed verdict in its favor. As a result the trial court excused the jury and entered judgment in favor of the Ford Hospital Company against the Fidelity & Casualty Company for the face of its policy, or $ 5,000, for interest amounting to $ 120.83, and for an attorney's fee of $ 400. The action was dismissed as to the Maryland Casualty Company. The Fidelity & Casualty Company has appealed.

The principal argument is directed to the merits of the defense that the Fidelity & Casualty Company, insurer, did not assume liability for the Ford Hospital Company's negligence in injuring the child, and that the insurer is not bound by the judgment for damages for personal injuries. This requires consideration of the issues, evidence and findings in the former action for damages and of the terms of the liability insurance.

The child was born in the Ford Hospital August 16, 1917, while its mother was an inmate and a patient there for the purposes of accouchement. Within two or three weeks the mother went to her own home, taking her child with her, but returned to the hospital alone from time to time for the temporary treatment of ailments resulting from conditions attending childbirth. For this purpose she returned to the hospital November 7, 1917, but was detained until the next day on account of having to undergo an operation. In the meantime the child was brought to the mother for nourishment and was left in the exclusive care of the hospital. While a hospital nurse, in the performance of her duties, pursuant to a rule of the hospital, was giving the child a bath November 8, 1917, its left hand, through the negligence or the mistake of the nurse, came in contact with a hot appliance and was severely burned. It was for the injuries thus inflicted that the child recovered in the former suit for damages the judgment against the Ford Hospital Company for $ 5,500 It was alleged in the petition in the former case mentioned, among other things, that--

"Before and after the birth of said child at said hospital, its mother and said child were inmates of said hospital for some months under treatment; that said child remained at said hospital with its mother during said period of treatment; that during all of the time that the child's mother was at said hospital she paid for the services rendered by said hospital in their care and treatment."

The acts constituting the negligence on which the damages for personal injuries are based were pleaded in the petition of the child and denied in the answer of the Ford Hospital Company.

Was the liability of the hospital for the damages described covered by its policy in the Fidelity & Casualty Company, insurer? The hospital was insured "against loss from the liability imposed by law upon the assured for damages on account of bodily injuries or death suffered by any patient or patients at the hospital," says the policy, "in consequence of any malpractice, error, or mistake made, while this policy is in force, within the said hospital, * * * by the assured in the giving of medical, surgical, or hospital treatment, or by any person employed by the assured, in the giving of any such treatment."

It is argued that, within the meaning of this insuring clause, the child was a mere licensee when injured, that it was not a "patient," that it was not receiving "hospital treatment," that the petition in the action for damages alleged the child was an "inmate," but not that it was a "patient," that negligent injury to the child was not within the terms of the insurance contract, and that a loss covered by the policy was not within any material issue in the action brought by the child against the hospital to recover damages for personal injuries. Is the position thus taken tenable?

The Fidelity & Casualty Company insured the Ford Hospital Company. The latter had a department equipped for obstetrics. In that department the mother was both an inmate and a patient. The child was expected. It was born helpless. It had the same right to room and care as the mother, and was not a mere licensee. Both mother and child were under the care of hospital nurses. The liability of the hospital for mistakes or negligence in "hospital treatment" extended to both. These conditions and relations were obvious in a hospital with a department equipped for obstetrics. Accouchement included the right of the mother to return for any hospital treatment required as a result of conditions attending child-birth, and compensation for room and services furnished to her included the care of the child in the meantime while necessarily in the hospital. These conditions and relations existed when the child was injured. After going to her home the mother returned for treatment and was detained for an operation. In the meantime the child was brought to its mother for nourishment. Both were then under the care of hospital nurses. A rule of the hospital required a bath for the child. The mother was not consulted about the rule or its enforcement, and the child was not accountable. The bath was usual, necessary and proper. When given, it was "hospital treatment" within the fair import of that term as used in the policy. For the purpose of hospital care, while the mother was in charge of hospital nurses, the helpless child was both an "inmate" and a "patient" when being bathed by a hospital nurse in compliance with an established rule. Pecuniary gain is not the sole aim of a modern hospital equipped for obstetrics. It has a mission requiring a degree of care prompted by the ordinary dictates of humanity. Of this all are aware. The precaution which resulted in the procuring of liability insurance covering a loss for a negligent injury to the mother would naturally suggest protection from a like injury to her child. This liability, it may be inferred, was within the contemplation of the negotiating parties, and it is fairly covered by the terms of their written contract. The nurse, while bathing the child in compliance with a rule of the hospital, was guilty of negligence. She made a "mistake" within the meaning of the insurance policy when she allowed the hand of the helpless child to come in contact with a hot appliance.

The trial judge in the former case of Mary Jane Hannah, an infant, plaintiff therein, against the Ford Hospital Company, defendant therein, permitted the child to recover damages only upon a finding that it was an "inmate" under the exclusive care and control of the hospital, and he submitted to the jury for a special finding the question, "Was the plaintiff at the time she sustained her injuries a patient in defendant's hospital?" The answer thereto was "Yes." The facts outlined are inferable from the evidence in the case at bar and are established by the findings of the trial court.

The Fidelity & Casualty Company, insurer, is engaged in the business of writing liability insurance for profit. It is not a favorite of the law with the standing of individuals who become sureties or guarantors as mere accommodations. No narrow or technical construction of the pleadings in the former action for damages or of the policy in the case at bar is permissible to defeat the insurance. For the purposes of the liability insurance the word "inmate" as used in the petition to recover damages for personal injuries and the word "patient" as used in the policy of insurance, to repeat what has already been said, fairly include both mother and child. The conclusions, therefore, are that the relation of hospital and patient existed between the Ford Hospital Company and the child at the time of the latter's injury, that the hospital was liable for resulting damages, and that the policy of the insurer covered the loss on account of that liability to the extent of $ 5,000.

Could the insurer have defended the action for damages and at the same time have preserved its right to assert that it did not insure the loss? The insurer by its policy had bound itself to defend any suit against the hospital company to enforce any claim for a liability covered by the insurance, "whether groundless or not." The action against the hospital for damages was a suit to enforce such a claim. The action was well founded, but, even if it had been "groundless," the insurer had agreed to defend it. Though notified of the action for damages and requested to make a...