Goerss v. Indemnity Co. of America

• Decision Date: 06 March 1928
• Citation: 3 S.W.2d 272,223 Mo.App. 316
• Parties: GEORGE GOERSS, RESPONDENT, v. THE INDEMNITY COMPANY OF AMERICA, A CORPORATION, GARNISHEE OF RALPH T. ZAUSCH, APPELLANT. [*]
• Court: Missouri Court of Appeals

3 S.W.2d 272

223 Mo.App. 316

GEORGE GOERSS, RESPONDENT, v. THE INDEMNITY COMPANY OF AMERICA, A CORPORATION, GARNISHEE OF RALPH T. ZAUSCH, APPELLANT. ^[*]

Court of Appeals of Missouri, St. Louis

March 6, 1928

Appeal from the Circuit Court of the City of St. Louis.--Hon. Robert W. Hall, Judge.

AFFIRMED.

Judgment affirmed.

W. E Moser and Hensley, Allen & Marsalek for appellant.

(1) "It is settled law in this State that 'in order that an indebtedness may be liable to garnishment it must be shown to be absolutely due as a money demand, unaffected by liens or prior incumbrances or conditions of contract,' and that except in cases of fraud, 'the creditor can claim no higher rights against the garnishee than the debtor could claim against him.'" Weil v. Tyler, 38 Mo 545; Johnson v. Publishing Co., 122 Mo. 104; Holker v. Hennessy, 143 Mo. 87; Bank v Hoppe, 132 Mo.App. 458; Marz v. Big Horn Glass Co., 269 S.W. 700; Scales v. Southern Hotel Co., 37 Mo. 520; McPherson v. Railroad, 66 Mo. 103; Fenton v. Block, 10 Mo.App. 536. (2) The appellant agreed to indemnify Zausch against loss, not against liability, and the contract further provided that no action to recover for any loss covered by the policy should be sustainable unless brought by the assured for loss actually sustained and paid in money by him. The record and the evidence show, without controversy, that Zausch has not sustained or paid any such loss. It follows that appellant was not indebted to him in any sum, and that the court's finding and judgment are totally without support. State ex rel. v. Trimble (en banc), 297 Mo. 659; Skaggs v. Gotham M. & M. Co., 208 Mo.App. 596; Conqueror Zinc & Lead Co. v. Ins. Co., 152 Mo.App. 332; Stag Mining Co. v. Mo. F. & C. Co., 209 S.W. 321; Realty Co. v. Ins. Co., 179 Mo.App. 123; Most v. Ins. Co., 196 S.W. 1064; Allen v. Ins. Co., 145 F. 881; Connolly v. Bolster, 187 Mass. 266; Finley v. Cas. Co., 113 Tenn. 592; "Liability Insurance," 36 C. J. 1097-8; 1 Joyce, Insurance, sec. 27b, p. 136; 4 Joyce, Insurance, sec. 2800g, p. 4822. (3) "Unequivocal language is to be given its plain meaning, though found in an insurance contract." State ex rel. v. Trimble, 306 Mo. 309; State ex rel. v. Ellison, 269 Mo. 420; State ex rel. v. Trimble, 297 Mo. 659. A garnishment proceeding is an action. Wilson v. Railroad, 108 Mo. 588; Doe Run Lead Co. v. Maynard, 283 Mo. 646; Words & Phrases, 1st Series, p. 128; Chap. 13, R. S. 1919, "Civil Procedure, Particular Actions," Art. V, "Garnishment;" Stevenson v. Add. Mach. Co., 150 Mo.App. 555. (5) "All motions for new trials and in arrest of judgment shall be made within four days after the trial, if the term shall so long continue; and if not, then before the end of the term." Sec. 1456, R. S. 1919. The record shows that the cause was tried and submitted to the court on April 11, 1927; that on June 6, 1927, the court, sitting as a jury, entered his finding as to the facts, and an order requiring defendant to pay the sum in controversy into court. Said finding constituted the end of the trial, and garnishee's motions for new trial and in arrest of judgment were properly and timely filed within four days thereafter. Secs. 1397 and 1402, R. S. 1919; Rhorer v. Brockhage, 15 Mo.App. 16; Crowley v. Sutton, 209 S.W. 903; Scullin v. Wabash R. R. Co., 192 Mo. 1. (6) Where the facts are undisputed and their legal effect only is in question, the court, on appeal, will review the decision of the lower court, even though no instructions were given or refused. In the present case, the questions raised by appellant were sufficiently presented below by the request for peremptory instructions. Henry v. Bell, 75 Mo. 194; Rausch v. Michel, 192 Mo. 293; Harms v. Long, 213 S.W. 507.

Frederick A. Wendt, Roy H. Bergmann and James J. O'Donohoe for respondent.

(1) Garnishee failed to file a motion for a new trial to the final judgment. Therefore, if anything is reviewable it is restricted to the record proper. Secs. 1853, 1865, R. S. 1919; Rucking v. McMahon, 75 Mo.App. 372; Panagos v. General Cigar Co., 268 S.W. 652. The same rule obtains in all other cases. "The motion for new trial must be filed 'within four days after the rendition of a final judgment.'" St. Louis v. Boyce, 130 Mo. 572. (2) Plaintiff made out a prima-facie case by proving that he was injured by the automobile insured under the policy in question; that he recovered judgment for said injuries; that same was not paid and garnishee had not paid assured. Plaintiff having thus made out his prima-facie case, the burden was then cast on garnishee to plead and prove an affirmative defense. Rausch v. Bankers Life Co., 201 S.W. 919; Mensenworth v. Metropolitan Life Ins. Co., 249 S.W. 113; Landrigan v. Missouri State Life Ins. Co., 234 S.W. 1042; Peterson v. Railroad, 265 Mo. 480; Banke v. Supreme Council, 179 Mo.App. 21; Winn v. Modern Woodmen, 157 Mo.App. 1. This is especially true where, as here, the statute says that "the issue or issues made upon the denial and reply shall be the sole issue or issues tried." Sec. 1864, R. S. 1919. It is elemental that if there is any defect in the denial the same is cured by judgment; and defenses, including the "no action" one, must be set up; otherwise they will be deemed waived. (3) The policy under the caption, "Part V, Liability," indemnifies against loss resulting from claims upon the assured for damages on account of bodily injuries accidentally suffered or alleged to have been suffered by any person or persons by reason of the ownership, maintenance and use of such automobile, as distinguished from reimbursement for loss by reason of payment of judgment. State ex rel. v. Trimble, 297 Mo. 659; Century Realty Co. v. Ins. Co., 179 Mo.App. 123; McManus v. Tralles, 253 S.W. 406; Swanson v. Georgia Casualty Co., 315 Mo. 1007; Mathews v. Modern Woodmen, 236 Mo. 243, 244; Strong v. Ins. Co., 62 Mo. 289; Murgic v. Fort Dearborn Casualty Underwriters, 243 Ill.App. 650. (4) Under the caption, "limitation," in paragraph 24, it is provided that: "No action to recover for any loss and/or expense covered by this policy, arising or resulting from claims upon the assured for damages, shall be sustainable unless brought by the assured for loss and/or expense actually sustained and paid in money by him after actual trial of the issue." This "no action" clause is by its own words restricted to an action and cannot be enlarged by construction to prohibit ancillary proceedings to work a virtual forfeiture. In Missouri garnishment is not an action, but is characterized as an incidental remedy to the judgment; a mere sequence or dependency or proceeding supplemental to the main action; a mere mode of execution or relief, inseparably connected with the original judgment; an appendage, etc. Tinsley v. Savage, 50 Mo. 141; Ritter v. Ins. Co., 28 Mo. 140; Spengler v. Kaufman & Wilkinson, 43 Mo.App. 5; Goodman v. Gordan, 61 Mo.App. 685; Chapman v. Yancey, 173 Mo.App. 132; Owens v. McCleary, 273 S.W. 145. Garnishment not being an action and being auxiliary of the judgment only, even a change of venue is not allowable. State ex rel. v. Hughes, 135 Mo.App. 131. And for the same reason is not removable from the State to the Federal court. Bank v. Turnbull Co., 16 Wall. (83 U.S.) 190; Brucker v. Georgia Cas. Co., 14 F.2d 688. (5) Failure to defend the damage suit brought against Zausch, the assured, and disclaiming liability constituted a breach of contract upon garnishee's part and put an end to the no-action clause. Gen'l Acc. F. & L. Assur. Corp. v. Butler's Ice Cream Factory, 291 S.W. 674; Matter of Empire State Sec. Co., 214 N.Y. 553; Juskiewicz v. N.J. Fid. & P. G. Ins. Co., 206 N.Y.S. 566; Kinnan v. Hurst Co., 317 Ill. 251. (6) Regardless of the no-action clause, where an action is brought by a third party against assured under an indemnity policy, a judgment in the action becomes as between plaintiff, defendant and the insurance company a debt owing unconditionally by the company to the defendant (assured), which may be reached by garnishment. And the no-action clause is void. Rood on Attachments and Garnishments (1901), 147; 14 R. C. L., p. 132; 15 Cyc, p. 1036. Fullers Acc. Emp. Liability Insurance, pp. 452-455. (7) The no-action clause is void for the further reasons: (1) Want of insurable interest; (2) Encouraging strife and promoting litigation; (3) Violating the doctrine of alienation. (8) The words "to defend," as used in the policy, mean to pay the judgment. Sanders v. Ins. Co., 72 N.H. 485. (9) The insuring clause of the policy in question precedes and overrides the "no-action" clause because in conflict. It is well settled that where two clauses of a contract are in conflict, the first governs rather than the last; and further, where there is a conflict, the clause promising indemnity controls rather than the one forfeiting indemnity. Drucker v. Western Indemnity Co., 204 Mo.App. 516; Howell v. Ins. Co., 215 Mo.App. 385, certiorari quashed, 305 Mo. 607.

SUTTON, C. Daues, P. J., and Becker and Nipper, JJ., concur.

OPINION

SUTTON, C.

This is a garnishment proceeding. On March 23, 1925, plaintiff obtained a judgment against defendant Ralph T. Zausch for $ 3000 in the circuit court of the city of St. Louis, in an action brought to recover damages for personal injuries accidentally suffered by plaintiff as a result of being struck by an automobile operated and driven by defendant on a public street in said city. Execution was issued upon the said judgment, and the Indemnity Company of America was summoned as garnishee. The trial of the garnishment proceeding, which was had before the court without a jury resulted in a judgment in favor of the plaintiff against the garnishee for the sum of $ 3421.15, being the amount of the judgment in said action for...