Globe Nav. Co. v. Maryland Cas. Co.

• Decision Date: 24 July 1905
• Citation: 81 P. 826,39 Wash. 299
• Parties: GLOBE NAVIGATION CO., Limited, v. MARYLAND CASUALTY CO.
• Court: Washington Supreme Court

81 P. 826

39 Wash. 299

GLOBE NAVIGATION CO., Limited, v. MARYLAND CASUALTY CO.

Supreme Court of Washington

July 24, 1905

Appeal from Superior Court, King County; R. B. Albertson, Judge.

Action by the Globe Navigation Company against the Maryland Casualty Company. Judgment for plaintiff, and defendant appeals. Affirmed.

Graves Palmer, Brown & Murphy, for appellant.

H. R. Clise, for respondent.

HADLEY J.

This is a suit upon an indemnity bond. The plaintiff is the owner of vessels plying the waters of the Pacific Ocean. Among vessels so owned and operated is a certain schooner called the 'Willis A. Holden.' The defendant, for a valuable consideration, executed and delivered to plaintiff its certain policy of indemnity, whereby it agreed to indemnify the plaintiff against loss for damages on account of bodily injuries accidentally suffered by any employé of plaintiff while on duty on or about its vessels, caused by the negligence of the assured and resulting from the operation of its vessels. The schooner above mentioned was engaged in a voyage from Newcastle, in New South Wales, to the Pacific Coast of the United States, by one or more ports in the territory of Hawaii; and on board of said vessel was a certain seaman named Donovan, who was by the captain of said schooner regularly employed as second mate during said voyage. While in the performance of his duties, on or about September 24, 1903, he met with an accident on board the schooner, whereby he suffered certain injuries. On account of said injuries said Donovan, on or about October 23, 1903, in the District Court of the United States for the District of Hawaii, caused a certain libel and citation to issue out of said court against said schooner claiming damages in the sum of $10,000. The schooner was, by the marshal of said district, seized and detained until such time as it was released by reason of the fact that the master, in behalf of this plaintiff, gave bond in the sum of $10,000 with the United States Fidelity & Guaranty Company as surety. The complaint avers that upon the seizure of the schooner the plaintiff advised the defendant thereof, and that at the request of defendant plaintiff procured said bond for release, for which defendant agreed to pay; that plaintiff sent to defendant copies of the libel and proceedings in said action, and at its request employed attorneys to defend the libel, and caused an answer to be filed, denying the liability of this plaintiff for any damages whatsoever in the premises; that plaintiff took such other steps as were requested and advised by the defendant the latter at all times agreeing to bear the expense of said defense, and to pay all charges incurred therein; that thereafter such proceedings were had in said action that said Donovan obtained a judgment against this plaintiff in the sum of $800; that upon the entry of said judgment the plaintiff at once advised the defendant thereof, and the latter instructed that an appeal should be taken to the proper court, whereupon the plaintiff took the necessary steps and incurred the necessary expense to perfect said appeal; that thereafter the defendant instructed the plaintiff to abandon the appeal, and then agreed with plaintiff to pay the said judgment; that the plaintiff, relying upon said instruction and promise, instructed the attorneys in charge of the defense in the action to abandon the appeal, and that the same was accordingly done; that thereafter the defendant, without cause, and unwarrantedly, refused to pay the judgment, and still so refuses; that plaintiff was compelled to pay the judgment, amounting, with costs, to $881.45, and that plaintiff also necessarily incurred other expense in the defense of the action, including witness fees, attorney's fees, costs of appeal, and other costs in the sum of $675.54. Judgment is demanded for the total sum of $1,556.99.

The defendant answered that the said United States District Court rendered a decision in said cause, wherein it found that the owner of the schooner, the plaintiff herein, and its agents in control thereof, were not guilty of any negligence in the operation of the vessel rendering the owner liable to said Donovan; but that the court further found that the owner failed to provide suitable medical assistance for said seaman after his injury, and that for this reason only it caused the said judgment to be rendered against the schooner and her tackle; that the obligation upon which the judgment was based was one growing out of the implied maritime contract of employment, and was not on account of any damages occasioned by the negligent operation of the vessel, which subject was alone covered by the policy of indemnity. The answer further avers that all of the directions and requests made by the defendant to the plaintiff with regard to the bond for releasing the schooner and as to prosecuting a defense were made solely upon the representations made by plaintiff to defendant that the former was being sued on account of damages alleged to have been occasioned by the negligent acts of those in charge of the schooner and connected with its operation; that all directions given with regard to taking an appeal and making a settlement after judgment were given solely by reason of information from the plaintiff to the foregoing effect; that as soon as the defendant ascertained that the judgment was given solely on account of the violation by plaintiff of its maritime contract to furnish Donovan with suitable medical attendance, it informed plaintiff that it would neither pay the judgment nor be in any way responsible by reason thereof; that, if the plaintiff had informed defendant at the time of the rendition of the judgment of the true nature thereof, it would have disclaimed any liability, and would neither have said nor done anything regarding an appeal, a settlement, or other disposition of the case. The plaintiff replied that, because of the matters alleged in the complaint, the defendant is estopped from setting up or offering in evidence any of the matters set up in the affirmative defense. It was stipulated that the cause should be tried before the court without a jury, and upon an agreed statement of facts. It was so tried, and the court made findings of facts and conclusions of law and entered judgment in favor of the plaintiff for the full sum demanded. The defendant has appealed.

There are no exceptions to the findings of facts, and the errors assigned relate wholly to the court's conclusion from the facts that appellant is estopped to deny its liability. The court found that the libel filed in said district court was based upon an alleged claim for damages growing out of the negligent operation of the vessel, and also from failure to supply the libelant with proper surgical treatment; that both appellant and respondent has in their possession copies of the libel, and both knew that the libelant claimed damages for negligence of operation, and also for breach of the maritime contract; that under the libel, being in part for personal injuries accidentally suffered through alleged negligence, the appellant was obligated by its policy of indemnity to defend the action. The facts with regard to the seizure of the vessel and the employment of counsel at appellant's request to defend against the libel are found substantially as alleged in the complaint and as above set forth. The nature of the decision and judgment rendered by the admiralty court are found to have been as alleged in the answer and set out above. The facts concerning appellant's instructions to the respondent to appeal from the judgment, to thereafter withdraw the appeal, accompanied with the promise by appellant to pay the judgment, the subsequent refusal to pay, and the expense incident to the defense and appeal, are all found as alleged in the complaint and as above stated. It is found that the attorneys for the defense in the libel suit, while nominally representing this respondent, were in truth and in fact defending said libel as the attorneys and agents for this appellant. It is further found that the respondent has at all times acted in good faith in giving to appellant all information in its possession pertaining to said action in Hawaii, and that neither party to this action, save by the knowledge possessed by the attorneys in Hawaii, knew upon what ground alleged in the libel the said District Court had given judgment; but that, notwithstanding this, the appellant instructed the respondent to abandon the appeal, and stated without qualification or condition that it would pay the judgment.

Appellant admits that it was under the obligation to defend against the libel as far as the same had to do with negligence in the navigation of the schooner, and that it was liable for any damages that might be recovered as the consequence of...