Jaloff v. United Auto Indemnity Exchange

• Decision Date: 08 March 1927
• Citation: 253 P. 883,121 Or. 187
• Parties: JALOFF v. UNITED AUTO INDEMNITY EXCHANGE ET AL.
• Court: Oregon Supreme Court

253 P. 883

121 Or. 187

JALOFF v. UNITED AUTO INDEMNITY EXCHANGE ET AL.

Supreme Court of Oregon

March 8, 1927

Department 2.

Appeal from Circuit Court, Multnomah County; George Rossman, Judge.

Action by A. Jaloff, doing business under the firm name and style of the Columbia Stages, against the United Auto Indemnity Exchange and others. Judgment for plaintiff, and defendants appeal. Affirmed.

See also, 250 P. 717.

This is an appeal from a judgment in the sum of $6,812 in favor of plaintiff and against the defendants. During the times hereinafter mentioned, A. Jaloff, plaintiff herein, was engaged in the transportation of passengers for hire by means of motor vehicles, over the Columbia Highway, under the firm name and style of Columbia Stages. Defendant United Auto Indemnity Exchange was an organization composed of individuals, partnerships, and corporations authorized to exchange reciprocal or inter-insurance contracts, and defendant United Underwriters, Inc., was the duly appointed attorney in fact for its codefendant.

On May 10, 1924, the defendants issued to the plaintiff their liability insurance policy, whereby they insured "all cars owned or operated by assured" in his stage business as provided in the policy. Clause A of the policy indemnifies the assured as follows:

"Against loss resulting directly from the ownership, manipulation or use of any automobile described herein, by reason of the liability imposed by law upon the subscriber for damages on account of bodily injuries (including death resulting therefrom), accidentally inflicted upon any person or persons * * * during the contract period. * * *"

Clause B relates to damage to property of others. As to any suit for damages brought against the assured, the policy provides:

"United Auto Indemnity Exchange * * * do hereby agree to defend, in the name and on behalf of the subscriber, any suit brought against the subscriber to enforce a claim covered by clause A of this policy, whether groundless or not, for damages on account of bodily injury or death suffered, or alleged to have been suffered, by any person or persons under the circumstances described in Clause A of this policy, and resulting from an accident occurring during the period this policy is in force. * * *"

And:

"United Auto Indemnity Exchange do hereby agree to pay, in addition to the limits of liability mentioned in clauses A and B of this policy, all expenses incurred by the exchange for investigation, negotiation, or defense; all costs and expenses incurred by the exchange in defending any suit including any costs taxed against the subscriber and the interest accruing on that part of the verdict or judgment not in excess of the policy limits; all expenses incurred by the subscriber for such immediate surgical relief as shall be imperative at the time of the accident. * * *"

Under the policy, the duty of assured upon the occurrence of an accident is as follows:

" Notice. Upon the occurrence of an accident covered by this policy, the subscriber shall give immediate written notice thereof to the exchange, and shall forward to the exchange forthwith after receipt thereof, every written communication, or information as to any oral communication and every process, pleading, and paper of any kind relating to any and all claims and proceedings.

"The exchange reserves the right to settle any claim or suit and the subscriber shall not voluntarily assume any liability or interfere in any negotiation or legal proceedings conducted by the exchange on account of any claim; or, except at his own cost, settle any claim; or incur any expense.

"Action against the exchange. No action shall lie against the exchange to recover for any loss and/or expense under this policy, unless it shall be brought by the subscriber for loss and/or expense actually sustained and paid in money by him after actual trial of the issue. * * *"

On August 17, 1924, this plaintiff, owner and operator of stage No. 48, was transporting passengers by means thereof, over the Columbia Highway, from The Dalles to Portland. On the same date, C. A. Wells, accompanied by Dorothy Wells, his wife, their three infant children, and one Burnice Case, was driving his Essex touring car from Portland to Hood river. About 4:15 p. m., Wells, while proceeding eastward along the Columbia Highway through the town of Cascade Locks to the intersection of the highway by the Stevenson Ferry road about a quarter of a mile east of Cascade Locks, saw a sedan approach the highway from the north and turn toward the west. About the time the sedan reached the highway, Wells, seeing the stage approaching from the east at a rapid rate of speed, immediately drove his car off the pavement and onto the gravel on the right of the pavement, leaving the pavement in the clear. The driver of the stage, in an attempt to pass the sedan, pulled so far to his left that the stage collided head on with the Wells car, with the result that Wells, his wife, one of their children, and Miss Burnice Case, all occupants of the Wells car, and Mary Knight, one of the stage passengers, sustained personal injuries of more or less consequence.

Immediately after the accident, this plaintiff, in accordance with the terms of the policy of insurance hereinabove referred to, made to the defendants a report of all the facts and circumstances relating to the accident, and, when claims for compensation were made, immediately communicated such facts to defendants, who entered upon a full investigation. Thereafter, following the institution of action by Dorothy Wells and Merwin Wells, the defendants herein prepared and filed answers in such actions on behalf of plaintiff and appeared and defended the action of Dorothy Wells against him, but, upon the return of a verdict of $4,000 in favor of Dorothy Wells, the plaintiff in that case, the defendants immediately repudiated their contract and refused to defend the case prosecuted against plaintiff by Merwin Wells, on the ground that car No. 48 was not covered by his policy of insurance. Merwin Wells recovered judgment for $2,500. Thereafter, this plaintiff paid the above judgments and sued these defendants upon their contract embraced in the insurance policy which had been issued and delivered to him, for the recovery of the sums so paid. The defendants answering, denied that car No. 48 was covered by the policy sued upon. That issue terminated in favor of this plaintiff, who recovered judgment for the sums paid by him on account of the prior judgments recovered against him by Dorothy Wells and Merwin Wells. On appeal to this court, that case was affirmed. See opinion in Jaloff v. United Auto Indemnity Exchange, filed December 28, 1926, 250 P. 717.

Following the recovery of judgments by Dorothy Wells and Merwin Wells against this plaintiff, C. A. Wells, Burnice Case, and Mary Knight brought actions against him for personal injuries arising out of the accident. Plaintiff promptly transmitted to the insurer all papers and process served upon him in these actions, with the request that it appear and defend the same. Upon its refusal to appear and defend, plaintiff settled the claims and brought action to recover the amounts paid to the respective parties in the three personal injury cases set forth above and in a fourth cause of action based upon the payment by him of $750 attorney's fees and filing fees in the sum of $62. The trial terminated in a judgment for this plaintiff. The defendants, appealing therefrom, assign the errors hereinafter discussed.

McBride J., dissenting in part.

Barnett H. Goldstein and Thomas Mannix, both of Portland, for appellants.

Alfred E. Clark and S. B. Weinstein, both of Portland (Clark, Skulason & Clark and S. B. Weinstein, all of Portland, on the brief), for respondent.

BROWN, J. (after stating the facts as above).

The defendants contend that the trial court erred in admitting as evidence the judgment roll in a former case between the parties hereto. The court record was relevant to a material issue. It proved that the coverage of plaintiff's motor vehicle, known in the record as car No. 48 by insurance policy No. 428, issued and delivered to him by the defendants, and forming the basis of this action, formed one of the material and relevant issues in a prior action between the identical parties hereto, and involved the same wrongful act, which action resulted in a final judgment upon the merits of the case and determined that car No. 48 was within the protection of the insurance policy.

"Regardless of any difference in the causes of action or subject-matter, the conclusiveness of a former adjudication extends to every question in issue and determined by the court." 2 Freeman on Judgments (5th Ed.) § 688, and authorities cited in note 6.

See, also, Runnells v. Leffel et al., 105 Or. 346, 207 P. 867.

The defendants' contention that motor car No. 48 is not covered by insurance policy No. 428 is barred by the former adjudication, unless, as they assert, the appeal of the former case removed the bar.

"It has been held in some jurisdictions that the pendency of an appeal from a judgment deprives the judgment of that character of finality which is necessary to constitute it an estoppel, and for that reason it cannot be set up as a bar to a new suit. In other jurisdictions, however, it is held that, although the pendency of an appeal stays the enforcement of the judgment, it does not affect its conclusive effect as evidence, and therefore does not prevent the judgment from being pleaded in bar of a second action for the same cause." 34 C.J. pp. 771, 772.

In this jurisdiction, it has been uniformly held that an appeal does not affect the conclusive character of a judgment as evidence. Day v....