James v. Young

• Decision Date: 29 July 1950
• Docket Number: No. 7201,7201
• Citation: 43 N.W.2d 692,77 N.D. 451,20 A.L.R.2d 1086
• Parties: , 20 A.L.R.2d 1086 JAMES v. YOUNG et al.
• Court: North Dakota Supreme Court

Page 692

43 N.W.2d 692

77 N.D. 451, 20 A.L.R.2d 1086

JAMES v.YOUNG et al.

No. 7201.

Supreme Court of North Dakota.

July 29, 1950.

Rehearing Denied Aug. 17, 1950.

Syllabus by the Court.

1.Municipalities are agencies of the state and have only such powers as are expressly granted to them or as may be necessarily implied from the powers granted.

2. Sec. 40-0501, Subsec.27, N.D.R.C.1943, authorizes a city to regulate the operation of taxicabs.

3.An ordinance requiring the proprietors of taxicab lines to file policies of insurance indemnifying those using such taxicab lines and the public in general against loss for which the taxicab proprietor is legally liable is a valid exercise of the power granted by Sec. 40-0501, Sub. Sec. 27, N.D.R.C.1943 and is not in contravention of any law or public policy in this state.

4.When a person, while riding as a pay passenger in a taxicab, covered by a liability insurance policy issued in compliance with a city ordinance, which indemnifies the user of the cab against loss or damage, suffers damage for which the owner of the taxicab is liable, he has a right of action for damages directly against the insurer as well as against the insured owner.

5.A cause of action in tort may be united in the same complaint with a cause of action on contract when both arise out of the same transaction or transactions connected with the same subject of action.Sec. 28-0703, N.D.R.C.1943.

6.A cause of action for damages on account of the negligence of the driver of a taxicab may be joined in the same complaint with a cause of action on a contract of insurance indemnifying the user of such taxicab against loss or damage while riding therein, as both arise out of the same transaction or transactions connected with the same subject of action, towit: the negligent driving resulting in the collision and damage.

Burnett, Bergesen, Haakenstad & Conmy, Fargo, attorneys for plaintiff and appellant.

Nilles, Oehlert & Nilles, Fargo, attorneys for defendants and respondents.

GRIMSON, Judge.

The plaintiff brings this action for damages resulting from an automobile collision in the City of Fargo.In her complaint she alleges that she was, on March 11, 1948, a pay passenger in the taxicab driven by the defendant, Dallas Iverson, and owned by the defendant, Stewart Doyle, Inc. a corporation, engaged in the general cab business; that the defendant, Hartford Accident and Indemnity Company is a foreign corporation, engaged in the business of automobile liability insurance duly licensed in the State of North Dakota, and the insurer of the defendant, Stewart Doyle, Inc. indemnifying the public against damages from injury to person and property in the use of its automobiles, as required by Article 22, Sec. 306 of the Revised Ordinances of the City of Fargo, North Dakota, 1939, as amended by OrdinanceNo. 700 adopted December 29, 1943; that defendants, Robert W. Young and Mary A. Young, were husband and wife, owners of a Ford automobile used as a family purpose car; that at said time there was a collision between the cab driven by defendant Iverson, owned by defendant, Stewart Doyle Inc., insured by the defendant, Hartford Accident & Indemnity Co., and the family car driven by the defendant, Mary A. Young, caused by the negligent and careless manner in which the defendant, Iverson, drove his cab and defendant, Mrs. Young, drove her automobile at a certain intersection in the City of Fargo.Plaintiff claims that by reason thereof she was seriously injured and claims $26,000.00 damages.

To this complaint the defendants, Stewart Doyle Inc., Iverson and the Hartford Accident & Indemnity Co., interposed a separate demurrer on the grounds, first, that several causes of action were improperly united, and second, that plaintiff's complaint did not state facts sufficient to constitute a cause of action against such defendants.The district court made an order sustaining the demurrer and for the dismissal of the action.Plaintiff appeals from that order assigning as error the sustaining of the damurrer and the dismissal of the action.

The Fargo City Ordinance involved is set forth in the complaint and reads as follows:

'Insurance and Surety Bond Required

'The proprietors of licensed taxicab lines operating within the City of Fargo are hereby required to file with the City Auditor policies of insurance written by a company licensed to do business in the State of North Dakota or, in lieu thereof, a satisfactory surety bond indemnifying those using such taxicab line and the public in general against loss to person or property as follows:

'(1) Indemnity against property damage for which the taxicab proprietor is legally liable in the sum of not less than One Thousand Dollars ($1,000.00);

'(2) Indemnity against death or personal injury for which the taxicab proprietor is legally liable, in the sum of not less than Ten Thousand Dollars ($10,000.00) if to any one person and/or Twenty Thousand Dollars ($20,000.00) if to more than one person invoved in any one accident.

'(3) The policy or bond shall contain a provision that the insurance company shall give the City Auditor fifteen (15) days notice of cancellation by registered mail.

'(4) The form of, and sufficiency of, such policy or bond, and the surety thereon, shall be subject to the approval of the Board of City Commissioners.'

As a ground for their claim that this complaint does not state a cause of action against them, respondents assert the invalidity of this ordinance.They argue that the city has no authority to pass an ordinance of this kind and that even if it had, it could not change a rule of public policy which they claim exists in North Dakota to the effect that the insurer cannot be joined with the insured as a defendant in the same damage action, nor the matter of insurance brought to the attention of the jury.

It is conceded that cities are merely agencies of the state and have only such powers as are expressly granted to them or such as may be necessarily implied from the powers granted.City of Fargo v. Sathre, N.D., 36 N.W.2d 39;Village of North Fargo v. Fargo, 49 N.D. 597, 192 N.W. 977;State ex rel. Dreyer v. Brekke, 75 N.D. 468, 472, 28 N.W.2d 598.The governing principles are well stated in Lang v. City of Cavalier, 59 N.D. 75, 228 N.W. 819: 'A municipal corporation takes its powers from the statutes which give it life, and has none which are not either expressly or impliedly conferred thereby or essential to effectuate the purposes of its creation.In defining the corporation's powers, the rule of strict construction applies, and any doubt as to their existence or extent must be resolved against the corporation; but, the existence and extent of such powers having been determined and measured, the rule of strict construction no longer applies, and the manner and means of exercising the same, where not prescribed by the Legislature, are left to the discretion of the municipal authorities.'

It is common knowledge that the driving and operation of a taxicab within a city limits is a difficult and dangerous operation.It involves traveling through congested traffic, sometimes on urgent missions requiring speed, traveling over all kinds and conditions of streets and across intersections used by pedestrians.The very nature of the operation of taxicabs emphasizes the need of throwing precautions about it.For the welfare of the people in such situations a resort to the police power is proper.Under that power statutory authority is granted to the city for that purpose in Sec. 40-0501, N.D.R.C.1943, which provides that: 'The governing body of a municipality shall have the power: (Sub.Sec. 27) To license, tax, regulate, and prescribe the rates charged by draymen, parcel delivery men, bus drivers, taxi drivers, porters, expressmen, watermen, and others pursuing like occupations, and the operation of taxicabs.'

The City of Fargo has attempted by the Ordinance here involved to protect the public.It has attempted to provide security for all who have occasion to use the taxicab.It has made it a condition to the obtaining of a license and the operation of a taxicab, that the owner furnish an insurance policy 'indemnifying those using such taxicab line and the public in general against loss to persons or property.'Such policy is for the benefit of anyone injured in such taxicab.That is well within the authority granted by Sub. Sec. 27 of Sec. 40-0501, supra.

'A municipality is limited to the exercise of such powers as are expressly conferred by statute, or as may be implied as necessarily incident thereto, still, in the exercise of such implied powers, it has the right to adopt all ordinary or usual means which may be necessary to their full execution.The regulation and control of Jitney bus traffic coming clearly within the powers of the municipality, the ordinance requiring the operators of such busses to furnish to the city a bond for the protection of persons who might be injured in the conduct of such business was the exercise of an ordinary and necessary means of regulating such traffic.'Transylvania Casualty Insurance Company v. City of Atlanta, 35 Ca.App. 681, 134 S.E. 632.

'A municipality, under its police powers to regulate the operation of public service motor vehicles within the city limits, may require such a bond, policy of liability insurance, or other security, as a condition to the operation of such motor vehicles for hire upon the streets of the municipality.'60 C.J.S., Motor Vehicles, Sec. 111, page 397.

Many cities have an ordinance like the one here in question and the courts have uniformly held such ordinances valid.Kruger v. California Highway Indemnity Exchange, 201 Cal. 672, 258 P. 602;Grier v. Ferrant, 62 Cal.App.2d 306, 144 P.2d 631;Sprout v. City of South Bend, 198 Ind. 563, 153 N.E. 504, 154 N.E. 369, 49 A.L.R. 1198;People's Taxicab Co. v. City of Wichita, 140 Kan. 129, 34 P.2d 545, 95...