Karcher v. Burbank

• Decision Date: 03 June 1939
• Citation: 303 Mass. 303,21 N.E.2d 542
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: CARL A. KARCHER v. HAROLD BURBANK & another.

303 Mass. 303

21 N.E.2d 542

CARL A. KARCHER v. HAROLD BURBANK & another.

Supreme Judicial Court of Massachusetts, Norfolk.

June 3, 1939

April 5, 1939.

Present: FIELD, C.

J., DONAHUE, DOLAN COX, & RONAN, JJ.

Covenant, Not to sue. Agency, Liability of agent to principal. Surety. Equity Jurisdiction, Specific performance, To enjoin prosecution of proceeding in Federal court.

An agent, whose negligence in the scope of his employment had caused an injury to one who for a consideration had given him a covenant that he would "forever refrain from instituting, pressing or in any way aiding any claim action or causes of action . . . in any way growing out of" the injury, was entitled to a decree in equity enjoining the injured person from prosecuting an action in a Federal court against the agent's principal for damages growing out of the same injury.

BILL IN EQUITY filed in the Superior Court on June 8, 1938. The final decree was entered by order of Williams, J.

In this court the case was submitted on briefs.

W. A. Torphy &amp J.

P. McGuire, Jr., for the defendants.

K. C. Parker, for the plaintiff.

COX, J. The only question in this case is whether the final decree, from which the defendants appealed, should have been entered enjoining, as it did, the defendants from further prosecution of actions brought by them against The American Sugar Refining Company, hereinafter referred to as the company, and from instituting or pressing any action or claim against that company on account of injuries received by the defendants by reason of an automobile accident involving a motor vehicle in which they were riding and a motor vehicle owned and operated by the plaintiff. The case was heard by a judge of the Superior Court on the bill and answer. Rule 31 of the Superior Court (1932). For the purposes of such a hearing all facts well pleaded in the answer, and all facts well pleaded in the bill and not denied in the answer, are treated as true, and the question is whether the plaintiff is entitled to relief upon the pleadings. Polish Political Club v. Cloper, 260 Mass. 559 . Joslin v. Boston & Maine Railroad, 274 Mass. 551 , and cases cited. Boston v. Curley, 276 Mass. 549 . Borggaard v. Department of Public Works, 298 Mass. 417 , 419. The allegations of the bill here admitted and not denied in the answer are that on or about November 21, 1935, there was a collision between the automobile operated by the plaintiff and the automobile in which the defendants were riding, and, as a result, the defendants were injured; that on or about July 22, 1936, the defendants, in consideration of the sum of $7,200 paid to them by the plaintiff, covenanted and agreed as follows: "We, Harold Burbank and Mary Burbank, Individually and as husband and wife, of East Bridgewater in the County of Plymouth and Commonwealth of Massachusetts for my heirs, executors and administrators, in consideration of Seventy-two Hundred and 00/100 Dollars . . . to us paid by Carl A. Karcher the receipt of which is hereby acknowledged, do by this instrument covenant with said Carl A. Karcher to forever refrain from instituting, pressing or in any way aiding any claim, demand action or causes of action for damages, cost, loss of service, expenses or compensation for, on account of, or in any way growing out of any injury received by us on or about the 21st day of November, 1935 at or near Elm Street, Raynham, Massachusetts by reason of Automobile accident involving motor vehicle in which we were riding and motor vehicle owned and operated by the said Carl A. Karcher." This instrument was signed and sealed by both of the defendants. The bill further alleges that the defendants have brought actions, now pending in the District Court of the United States, against the company to recover compensation and damages for their said injuries; that in these actions recovery is sought on the ground that the plaintiff in the case at bar was negligent and that at the time of the accident he was an agent or servant of the company. The defendants in their answer aver that, at the time of their injuries, the plaintiff was operating the automobile as an agent for the company. It was admitted that the plaintiff had received a notice from the company to defend these actions and that he had been notified that it would hold him liable for the payment of any judgments which the defendants might obtain in their actions.

The principal and his agent are liable in separate actions to a third person for the agent's negligent acts committed within the scope of his authority, both of which actions may be pursued until one satisfaction is obtained. Pion v. Caron, 237 Mass. 107 , 111, and cases cited. Popkin v. Goldman, 266 Mass. 531 , 536, and cases cited. See Bruce v. Johnson, 277 Mass. 273, 275. Gordon v. Cross & Roberts, Inc. 287 Mass. 362 . In the case at bar, if the company is chargeable with the negligence of the plaintiff, it is only because his negligence is imputed to it by a rule of law; and if, because of his negligence, the defendants were injured and the company is compelled to pay damages, the plaintiff will be bound to reimburse it. White v. Phillipston, 10 Met. 108, 111. Pittsley v. Allen, 297 Mass. 83 . See Alderman v. Noble, 296 Mass. 30 . Apart from cases arising under some statute, it is the rule that the law will not permit a party to receive anything more than one compensation for an injury, and where the injury is caused by the joint, combined or concurrent negligence of two or more persons, there can be but one full and complete indemnity. Stone v. Dickinson, 5 Allen, 29. Cormier v. Worcester Consolidated Street Railway, 234 Mass. 193 .

Compare Porter v. Sorell, 280 Mass. 457 . It is assumed that a cause of action of the principal against the agent for the latter's tort, committed in the course of his employment, does not arise until the principal has been required to pay the damages. It is settled that where a plaintiff has received money on account of his injuries from one tortfeasor, but not in such circumstances that the transaction amounts to a release, the amount so received is admissible in evidence in reduction of damages in an action against a joint or concurrent tortfeasor. O'Neil v. National Oil Co. 231 Mass. 20, 28, 29. Solomon v. Dabrowski, 295 Mass. 358 . See Daniels v. Celeste, ante, 148.

In the case of Johnson v. Von Scholley, 218 Mass. 454 , a sealed instrument was in evidence that in all respects corresponds with the instrument in the case at bar except as to names, dates, amounts, and the addition after the words "or in any way growing out of," of the words "or hereafter to grow out of." The court said, at page 457: "But the covenant not to sue put in evidence by the defendants [owners of the truck in collision with a street railway car in which the plaintiff was a passenger, the covenant running to the railway company] did not operate as a discharge of the plaintiff's cause of action; it only barred the remedy against the company for reasons stated in Matheson v. O'Kane, 211 Mass. 91 ." In the case of Matheson v. O'Kane, 211 Mass. 91, the court, for the first time, decided that a covenant not to sue did not operate as a release of other joint tortfeasors, making a distinction between a release and a covenant not to sue. In that case the court said, at page 94: "For a breach of his covenant not to sue he [the plaintiff] becomes liable for the damages suffered by the one to whom the covenant was given. It is true that a covenant not to sue an individual debtor may be pleaded in bar to the original cause of action. But this exception was early established in order to avoid circuity of action, as otherwise the court would be burdened with cross actions for the same damages, one on the original liability and the other on the covenant not to sue." Foster v. Purdy, 5 Met. 442. Green v. Hoffarth, 277 Mass. 508 .

The plaintiff in the case at bar contends that, if the defendants are permitted to pursue their actions against the company and to recover, the covenant not being pleadable in bar in those actions, the company will in turn look to him for reimbursement of any sums paid in satisfaction of any judgment, and that he has no adequate remedy at law. He further contends that the covenant should be interpreted to mean that the plaintiff intended to buy his peace and be forever relieved from any further costs or expense on account of the automobile accident in which he was involved, and that the defendants intended to refrain from action or conduct that would subject him to any further expense beyond the amount that he had paid the defendants. As against this contention it may be said that the plaintiff may defend the actions that the defendants had brought; that unless the payment by the plaintiff to the defendants amounted to full compensation for their injuries, they should not be precluded from the attempt to recover whatever may be due them; that the plaintiff may offer in evidence the amount paid by him for the purpose of reducing the defendants' damages; that no one knows what the outcome will be of the cases in the District Court of the United States or whether the defendants will recover anything at all, and that no distinction should be made in the case of a covenant not to sue an agent, where there is also a right of action against his principal, and a covenant not to sue one joint or concurrent tortfeasor. This precise question did not arise in the case of Johnson v Von Scholley, 218 Mass. 454 , where the defendants and the street railway were concurrent tortfeasors. As was said in that case, at page 458, if, notwithstanding the covenant not to sue, the defendants, on whom rested the burden of proof, had shown that the plaintiff in fact had...