Glens Falls Indem. Co. v. Keliher

• Decision Date: 06 October 1936
• Citation: 187 A. 473
• Parties: GLENS FALLS INDEMNITY CO. v. KELIHER et al.
• Court: New Hampshire Supreme Court

187 A. 473

GLENS FALLS INDEMNITY CO.

v. KELIHER et al.

Supreme Court of New Hampshire. Strafford.

Oct. 6, 1936.

Transferred from Superior Court, Strafford County; Sawyer, Judge.

Petition for declaratory judgment by the Glens Falls Indemnity Company against Thomas R. Keliher and others. The case was transferred from the Superior Court.

Judgment for plaintiff.

Petition for a declaratory judgment to determine whether the plaintiff is legally bound to satisfy either or both of two judgments recovered severally by the defendants Ethel W. Adams and Joseph V. Adams against the defendant Keliher. Trial by the court (Scammon, J.) with findings in favor of the defendant Ethel W. Adams and against the defendant Joseph V. Adams, to which all the parties excepted. Transferred, after the retirement of Judge Scammon, by Sawyer, C. J.

The record discloses the following facts: Upon January 1, 1933, the plaintiff company issued to the defendant Keliher at Lynn, Mass., a motor vehicle liability policy in accordance with the Massachusetts Compulsory Insurance Act (Massachusetts Laws 1925, c. 346) containing a so-called "extra territorial" clause, by, which the plaintiff agreed "to indemnify the named assured * * * against loss by reason of his legal liability to pay damages to others for bodily injuries, including death at any time resulting therefrom, accidently sustained during the term of this policy by any person or persons not hereinafter excluded, arising out of the ownership, operation, maintenance, control or use, including loading and unloading, of the motor vehicle or trailer described in the policy, within the limits of the Continental United States of America and the Dominion of Canada, elsewhere than upon the ways of the Commonwealth of Massachusetts."

The policy also contained a clause requiring the co-operation of the assured, in the following language: "The foregoing agreements are subject to the following conditions: C. Cooperation. The assured, when requested by the company, shall aid in effecting settlement, in securing evidence and the attendance of witnesses, in defending suits, and in prosecuting appeals, and shall at all times render to the company all cooperation and assistance in the assured's power."

Upon July 26, 1933, while said policy was in force, a collision occurred between the insured car driven by the defendant Keliher, and a car owned and operated by the defendant Ethel W. Adams, within the state of New Hampshire.

Upon the following day, July 27, 1933, the defendant Keliher was arraigned in the municipal court of the city of Rochester upon a complaint charging him with a violation of Public Laws, c. 90, § 1, providing that "If a person traveling on a highway with a vehicle meets another person so traveling in the opposite direction, he shall seasonably turn to the right of the center of the traveled part of the road, so that each may pass the other without interference." To this complaint he pleaded guilty and was sentenced to pay a fine of $5 and costs, which he paid.

Upon August 4, 1933, Ethel W. Adams brought suit in the superior court for the county of Strafford against the defendant Keliher, to recover for personal injuries sustained by her as a result of the above mentioned accident, declaring as the basis of her claim upon his violation of Public Laws, c. 90, § 1. Upon the same day an attachment was made of Keliher's automobile. The writ in the abovementioned action was sent by Mrs. Adams' attorney to James H. Dignan, a claims attorney of the plaintiff company and the manager of its Boston branch, who accepted service on behalf of the defendant Keliher, and returned the writ to plaintiff's counsel, together with a letter which reads as follows:

"August 8th, 1933. Conrad E. Snow, Esq., Rochester Trust Co. Bldg., Rochester, New Hampshire. Re: Ethel W. Adams vs. Thomas R. Keliher.

"Dear Sir: I return herewith writ in the case of Ethel W. Adams vs. Thomas R. Keliher on which service has been accepted by me on behalf of Mr. Keliher.

"Under date of January 1, 1933, this company issued a policy of Liability Insurance to Mr. Keliher covering a Chevrolet Sedan against liability and property damage claims arising in Massachusetts and elsewhere in the United States. At the time of the accident which occurred on July 26th, 1933, at Barrington, New Hampshire, this policy of insurance was in force and effect and the company will pay any judgments entered against Mr. Keliher up to and including the limits of the policy which are as follows:

"$5,000. Any one person for bodily injury.

10,000. Any one accident for bodily injury.

5,000. For property damage.

"It is my understanding that upon receipt of this letter plus the writ on which service has been accepted, Mr. Keliher's car will be released. Very truly yours, (Signed) J. H. Dignan, Claims Attorney."

Upon receipt of this letter, the attachment on Mr. Keliher's car was released.

In its findings the court construed the above letter as follows: "This is an unconditional agreement, it was in no way dependent upon anything that Mr. Keliher might or might not do, it was made more than one and one-half years prior to the trial, and was an independent agreement with Mrs. Adams and both should be bound by it. It was made for a consideration and was relied upon by counsel for the plaintiff, and the company ought not to be permitted to repudiate its agreement because someone else has failed to perform their agreement with it. To permit a person or corporation to obtain property from another upon a promise to pay, to escape liability because of the conduct of a third party with whom it has contractual relations, opens the door for fraud that should forever remain closed." To the foregoing ruling the plaintiff duly excepted.

Upon July 30, 1934, suit was brought by the defendant Joseph V. Adams against the defendant Keliher to recover for expenses, loss of consortium and loss of his wife's services, alleged to have resulted from the injuries sustained by her in the abovementioned accident.

In accordance with the terms of its policy, the plaintiff company, by its attorneys, assumed the defense of the suit brought by Ethel W. Adams, but disclaimed liability in the suit of Joseph V. Adams. By express authority from the defendant Keliher, however, the attorneys for the plaintiff appeared for him personally and defended the action of Joseph V. Adams.

The above actions came on for trial together upon February 25, 1936, and Mr. Keliher was requested by the plaintiff to assist in their preparation and trial. Upon that date he came to Dover with an agent of the plaintiff and was present in court when the jury was drawn. He was also present at the view thereafter taken by the jury. With reference to his subsequent conduct, the court made the following findings:

"On the following day (February 26th), Keliher failed to appear at Court and was found in a local hotel under the influence of liquor and unable to attend Court. He agreed to wait until five o'clock that day but left earlier and counsel with the Sheriff of the County tried to locate him so as to have him in Court on Wednesday, February 27th, but were unable to. On Wednesday when he did not appear, his counsel moved for a mistrial. This was denied but a continuance was ordered until the following Monday morning, March 4th, 1935, to give the defendant an opportunity to appear. During this recess, the defendant was located in Lynn and promised to appear on Monday but avoided an agent of the company sent to bring him to Court on March 4th and he did not appear.

"On March 4th a motion for a mistrial was denied and the defendant excepted, and counsel for the defendant disclaimed coverage and in proceeding with the trial under the orders of the Court did not waive any of its rights.

"The jury found a verdict for both plaintiffs, $6500 for Ethel W. Adams and $1500 for Joseph V. Adams for expenses, loss of consortium, etc. The plaintiff had previously offered to settle both cases for $5,000."

The court further found that "the company made every effort within reason to have him (Keliher) attend and he refused and violated his :greement to cooperate and assist the company in defending the action." To this finding the defendants Ethel W. Adams and Joseph V. Adams duly excepted.

The facts having been found as above, the court made the following rulings of law:

"The Court finds that the policy in question did not cover the damage sustained by Joseph V. Adams:

"1st. Because the extra-territorial coverage did not embrace the damage he sustained;

"2nd. Because of the failure of Mr. Keliher to cooperate."

To these findings the defendants Ethel W. and Joseph V. Adams severally excepted.

"The Court finds that the policy in question covers the damage sustained by Ethel W. Adams to the amount of Five Thousand Dollars and that the judgment by Mrs. Adams against Keliher should be satisfied by the Glens Falls Indemnity Company to that extent and in that amount."

To this finding the plaintiff excepted.

Other facts are stated in the opinion.

Both parties made numerous requests for findings of fact and rulings of law, which, so far as they appear to be material, are stated in the opinion.

Hughes & Burns and S. M. Burns, all of Dover, for plaintiff.

Conrad E. Snow, of Rochester, for defendants.

BRANCH, Justice.

Although the questions presented by the plaintiff's petition might have been raised as matters of defense to a bill in equity brought by the defendants Ethel W. Adams and Joseph V. Adams against the plaintiff company to secure the payment of their judgments against the defendant Keliher in accordance with the procedure approved by this court in Sanders v. Insurance Company, 72 N.H. 485, 57 A. 655, 101 Am.St.Rep. 688, a petition for a declaratory judgment like that now before...