De Hart v. Illinois Casualty Co., No. 7399.

• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)
• Writing for the Court: EVANS and SPARKS, Circuit , and LINDLEY
• Citation: 116 F.2d 685
• Parties: DE HART v. ILLINOIS CASUALTY CO.
• Docket Number: No. 7399.
• Decision Date: 16 January 1941

116 F.2d 685 (1940)

DE HART
v.
ILLINOIS CASUALTY CO.

No. 7399.

Circuit Court of Appeals, Seventh Circuit.

December 10, 1940.

Rehearing Denied January 16, 1941.

Geo. B. Gillespie, Edmund Burke, and Louis F. Gillespie, all of Springfield, Ill., for appellant.

Walter C. Williams, of Michigan City, Ind., for appellee.

Before EVANS and SPARKS, Circuit Judges, and LINDLEY, District Judge.

This action against the defendant arises out of an insurance policy issued to B. Reuben, an automobile owner, whose car was negligently driven by B. Roin, with resulting injury to plaintiff.

Plaintiff first sued Roin and obtained a money judgment against him. He then sued defendant on its policy to Reuben covering this automobile. A jury was waived in the second action, and the court made findings favorable to plaintiff, for whom a judgment was entered for $6500. Defendant appeals.

EVANS, Circuit Judge.

Defendant disputes liability solely on the ground that the assured, Roin, failed to cooperate with it in "securing information, furnishing evidence and attendance of witnesses" in the trial of the original action.

Among other clauses, the insurance policy provided:

"No action shall lie against the Company unless, as a condition precedent thereto, the assured shall have fully complied with all the conditions hereof. * * *."

"Assured shall render to the Company full cooperation and assistance in securing information, furnishing evidence and the attendance of witnesses."

"The neglect or failure of assured to comply with the foregoing requirements or the refusal to comply with a request of the Company or its attorney or representative for the cooperation and assistance stated above, shall relieve the Company of all liability under this policy."

The Facts. Ben Roin, with the consent of Ben Reuben, upon whose car the automobile insurance was written, drove the automobile into the State of Indiana, where a collision occurred in which plaintiff was injured and his car damaged. Roin also claimed damages to himself and the car he was driving. Plaintiff sued for damages, and the defendant Roin counterclaimed.

In the course of the trial one Henry Jacobsen testified for the defendant Roin, and falsely stated that he was present at the accident. His story revealed negligent driving by plaintiff and careful action on the part of Roin. Before the trial was completed, however, plaintiff recalled Jacobsen for further cross-examination and caused him to take the witness stand, where he stated that his previous testimony was false; that he was not present at the time of the accident and knew nothing about it; that one David H. Greenberg, attorney for Roin had persuaded him to take the witness stand for the defendant and to testify falsely to facts related to him by Greenberg. He said his previous testimony was false and fictitious.

Thereupon the court excused the jury and conducted an investigation into the

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facts and circumstances surrounding the perjury and subornation of perjury. It appeared on this investigation that counsel for defendant herein were not involved in the subornation of perjury, and were ignorant of the falsity of Jacobsen's testimony when it was first given. Defendant herein, then moved to withdraw a juror and declare a mistrial, which was denied

After the verdict, defendant Roin, who denied knowledge of the falsity of Jacobsen's story (although court and jury found otherwise) moved for a new trial which was denied. Roin took no appeal from the judgment against him, and it remains unsatisfied.

Defendant herein, after the disclosure of the perjury, participated in the trial, presented other witnesses, argued the case to the jury, submitted proposed instructions, asked for stay of entry of judgment, and not until the judgment was about to be entered did it withdraw from further participation in the case, asserting for the first time, lack of cooperation and assistance on the part of Roin.

Rejection of defendant's attack on the judgment is urged because of,

(1) The action of the defendant in electing to proceed with the trial and take a chance on the verdict.

(2) The failure of the evidence to show a breach of the contract. Appellant unduly stretches the provision of its contract which required assured's cooperation.

(3) The fact that the court found that cooperation and assistance were given. We quote from one of its special findings:

"* * that, pursuant to the provisions of such policy, * * Ben Roin * * cooperated at all times with the defendant in this action in the preparation of said cause for trial, and in the presentation of the evidence to the jury; that this defendant did not know that the witness Jacobsen would commit, or had committed, perjury, prior to his admission thereto upon the witness stand, but, after he had admitted in open court that he had committed perjury in his former testimony, and after the examination of said witness and his attorney, Greenberg, in the absence of the jury, the attorneys for the defendant in this action who were representing the said Ben Roin in cause No. 601, did not withdraw from that case and refuse to participate further in the trial of the same, but continued to conduct the defense; that the defendant Roin thereafter took the witness stand in that case, was examined by attorneys for the defendant in this case and testified in his own behalf; that attorney Greenberg was also called to the witness stand by the attorneys conducting the defense and testified as a witness for the defendant."

While the court found that Roin cooperated at all times with the defendant in the preparation of said cause for trial and in the presentation of the evidence to the jury, it also found that the defendant herein did not know that the witness Jacobsen would commit or had committed perjury prior to his admission on the witness stand.

Defendant argues that this last stated fact impeaches and negatives the finding of cooperation.

In considering the effect of this asserted lack of knowledge by defendant, we can not ignore another special finding that said witness Jacobsen also testified that he had not been employed for a period of months prior to the trial and was not employed at the time of trial, when it was known to the defendant herein, the insurance company, that he was at the time of the trial and prior thereto, employed by a taxicab company in the City of Chicago as an investigator.

In other words, it is not a complete or correct statement to say that defendant was unaware of the falsity of Jacobsen's testimony. Its representative examined Jacobsen before trial, and it knew the moment Jacobsen testified that his testimony was false so far as occupation and employment were concerned.

Whether the finding that there was, excluding this knowledge of falsity of part of this witness' testimony, cooperation depends, in part, upon the terms of the insurance contract and particularly the terms of the provision which called for "full cooperation and assistance."

The query naturally arises — In what subjects was there to be cooperation? It was to be in three matters. The provision above-quoted is clear.

(a) First, in the attendance of witnesses. Obviously there was no default here.

(b) Second, assistance in securing information. Again, there was no breach. Roin gave to the defendant the names of possible witnesses who were examined by

116 F.2d 687

the defendant. The defendant was free to examine them and did examine them before trial

(c) The third activity in which the assured was to give...