Kingan & Company, Ltd. v. Maryland Casualty Company

• Decision Date: 07 March 1917
• Docket Number: 9,607
• Citation: 115 N.E. 348,65 Ind.App. 301
• Parties: KINGAN AND COMPANY, LIMITED, v. MARYLAND CASUALTY COMPANY
• Court: Indiana Appellate Court

115 N.E. 348

65 Ind.App. 301

KINGAN AND COMPANY, LIMITED, v. MARYLAND CASUALTY COMPANY

No. 9,607

Court of Appeals of Indiana

March 7, 1917

Rehearing denied June 20, 1917. Petition for leave to file petition to transfer denied October 4, 1917.

From Marion Superior Court (91,960); Joseph Collier, Judge.

Action by Kingan and Company against the Maryland Casualty Company. From a judgment for defendant, the plaintiff appeals.

Reversed.

W. H H. Miller, C. C. Shirley, Samuel D. Miller and William H Thompson, for appellant.

Alvah J. Rucker, James E. Rocap and J. F. Damman, for appellee.

OPINION

CALDWELL, J.

Appellant brought this action against appellee to recover on an indemnity insurance policy. A trial resulted in a decision and judgment for costs in appellee's favor. The principal questions presented arise on exceptions reserved to conclusions of law stated on a special finding. The portions of the policy material to the inquiry here are as follows:

"In consideration of the terms, conditions and agreements herein contained, and subject thereto * * * The Maryland Casualty Company * * * hereinafter called 'the company,' does hereby insure Kingan and Company, * * * hereinafter called 'the assured,' * * * against all immediate loss or damage caused by explosion * * * of the steam boilers or either of them, designated and described in the schedule on this policy, as follows: * * *

C. For loss from liability of the assured resulting from the loss of life or personal injury of any person or persons; but the liability of the company for loss of life or injury of any one person shall not exceed the sum of Five Thousand Dollars. * * *

D. * * * In no event shall the liability of the company exceed the sum insured by this policy. * * *

Conditions and Agreements: * * *

4. It (the insurer) shall have charge of all negotiations and suits on account of claims for damages to persons. * * * But the assured shall at all time render to the company all co-operation and assistance in its power. If any suit is brought against the assured to enforce a claim for damages on account of an accident covered by this policy, the assured shall immediately forward to the company's home office every summons or other process as soon as the same shall have been served on him, and the company will at its own cost defend such suit in the name and on behalf of the assured, unless the company shall elect to settle the same or pay the assured the indemnity provided for by the provisions of this policy. The assured shall not incur any expense on account of personal injuries without the consent of the company previously given in writing, except that claims for bodily injuries may be settled by the assured on the basis of loss of wages of the injured person for the time of total disability and reasonable expenses for nursing and medical attendance, for which the company will reimburse the assured on receipt of a suitable release without prejudice to the rights of the assured under this policy. * * *

9. * * * No claim shall become payable until proofs and affidavits stating * * * the amount of the loss or damage, and a detailed statement of all other insurance if any covering loss of life or injury to person * * * shall have been furnished to the company."

The policy is set out in full in the finding, which is further to the following effect: On February 29, 1908, while the policy was in force, a steam boiler covered by the policy and located in appellant's plant exploded, and as a proximate result thereof certain physical injuries were sustained by William E. King, appellant's employe. Appellant duly notified appellee of the occurrence. On October 9, 1908, King brought suit against appellant in the Marion Circuit Court to recover damages on account of his injuries, charging appellant with negligence in maintaining the boiler. Appellant notified appellee of the institution of the action as required by the policy, whereupon appellee directed counsel to appear thereto for appellant, and thereafter contested said action in appellant's name. A trial resulted in a verdict against appellant for $ 7,500, returned March 3, 1910, on which judgment was rendered July 2, 1910. Appellee thereafter, under the terms of the policy, and in appellant's name, appealed from the judgment to the Supreme Court of the state. On February 20, 1913, the judgment of the trial court was affirmed. On May 1, 1913, appellant paid the judgment, which consisted of the following items: Principal, $ 7,500, interest, $ 1,422, costs, $ 131.25, total, $ 9,053.75, and immediately thereafter made demand on appellee for reimbursement, pursuant to the terms of the policy as follows: Appellant demanded the sum of $ 6,079.58, consisting of principal, $ 5,000, interest from March 3, 1910, to the date of payment, $ 948.33, costs, $ 131.25. Thereupon appellee presented to appellant a draft for $ 5,139.80, being $ 5,000 principal, $ 131.25 costs, and $ 8.55 interest from date of payment of the judgment by appellant to the date of presenting the draft. Appellee refused to accept the draft, assigning the following reasons: First, that it was not a legal tender; second, it was less than the amount due; third, a reason expressed in the following language: "Since the letter written to you on May 1, 1913, in which $ 6,079.58 was demanded on behalf of Messrs. Kingan & Company, Ltd., it has been discovered that prior to the commencement of this suit, your company had the opportunity to settle and compromise the same by the payment of an amount less than the face of the policy, and that you refused to settle the same on that basis. Under these circumstances, on behalf of Messrs. Kingan & Company, Ltd., we now demand payment by you of the sum of $ 9,053.75, being the full amount of the judgment, interest and costs, paid in this case by Messrs. Kingan and Company, Ltd., together with interest thereon from the date of its payment, namely, May 1, 1913." On May 16, 1914, Mr. Dammann, an authorized representative of appellee, had the following conversation with Mr. Miller, an authorized representative of appellant:

"Mr. Dammann: 'Now Mr. Miller, in view of your letter of the 12th to the Company, concerning the claim of Kingan & Company, Ltd., against the Maryland Casualty Company, on account of the accident to William King in his suit for judgment and satisfaction, I want to make a tender to you as a representative of the Kingan & Company of that amount of money which the Company considers the extent of its liability under the policy of insurance which covered the King case, that is the boiler policy. It is my understanding from the correspondence, that you satisfied a judgment for Kingan & Company, by the payment of $ 9,053.75, and that you claim that amount of money from the Maryland Casualty Company. The Maryland Casualty Company denies owing that amount of money to Kingan & Company, and offers in payment of its liability under the boiler policy referred to $ 5,149.25, which represents Five Thousand Dollars, which is the principal of the sum named in the policy, Fifteen Dollars, interest, up to and including the 19th of May, 1913, and $ 131.25, and I have here the cash,--and I understand you do not raise a point about that--and if you would rather have it in any other form we are perfectly willing to put it in some other form.' And to which statement the said Miller replied as follows:

"Mr. Miller: 'Understanding that this tender is made on the theory that the amount tendered covers the entire liability of the Maryland Casualty Company under the policy of insurance referred to on account of the case of King v. Kingan & Company, Ltd., the tender is refused, but no question is made to the form in which the actual money is tendered.'"

The court further finds "that at said time defendant tendered and offered to pay plaintiff the said sum of $ 5,149.25, as recited in said conversation." Appellee thereafter retained said sum in its possession up to December 16, 1913, (being the day it filed its answer to the complaint), when it paid said sum to the clerk of the court for the use and benefit of appellant, which sum remained in charge of the clerk of the court until about July 3, 1914, when appellee in open court waived any right it had to said fund.

Before King commenced his suit against appellant, he made to appellee a proposition to settle his claim for $ 4,000. After the suit was commenced, he made to appellee, through its attorneys, a subsequent proposition to settle for $ 6,000. Appellee rejected each proposition, and made no counter-proposition. Before King commenced his action, and also while it was pending, appellant requested appellee to compromise it with King, but appellee refused to do so. Appellant's attorneys at its request appeared in the King action to protect its interests, and aided in the defense of the cause, but appellee, through its attorneys, had full and complete charge of the litigation, and conducted the defense thereof, both in the trial court and on appeal in the Supreme Court. On the special finding of facts the court stated general conclusions of law in appellee's favor, to the effect that appellant is not entitled to recover, and that appellee is entitled to recover costs.

In support of its assignment that the court erred in the conclusions of law, appellant states alternatively three propositions, in substance, as follows: (1) That, under the facts found, appellant is entitled to recover the full amount paid by it in discharge of the King judgment, consisting of principal $ 7,500, interest $ 1,422, and costs $ 131.25 aggregating $ 9,053.25; (2) that, if appellant is in error in its first proposition, it is entitled to recover the full amount of appellee's liability as...