O'Leary v. Lumbermen's Mut. Cas. Co.

• Decision Date: 19 June 1979
• Court: Connecticut Supreme Court
• Parties: John F. O'LEARY v. LUMBERMEN'S MUTUAL CASUALTY CO.

Page 888

420 A.2d 888

178 Conn. 32

John F. O'LEARY v. LUMBERMEN'S MUTUAL CASUALTY CO.

Supreme Court of Connecticut.

Argued Feb. 8, 1979.

Decided June 19, 1979.

Irwin E. Friedman, Bridgeport, with whom, on the brief, were Christopher C. Burdett and Bracken C. O'Neill, Bridgeport, for appellant (defendant).

Richard F. Oburchay, Stratford, with whom was George L. Holmes, Jr., Bridgeport, for appellee (plaintiff).

Before COTTER, C. J., and LOISELLE, BOGDANSKI, LONGO and PETERS, JJ.

LOISELLE, Associate Justice.

The plaintiff brought this action against the defendant insurance company pursuant to General Statutes § 38-175 because of the defendant's refusal to satisfy a judgment previously rendered against the defendant's insured. The trial court found the issues for the plaintiff and, from the judgment rendered, the defendant has appealed.

The finding as corrected is, in part, as follows: ¹ The plaintiff John F. O'Leary was a passenger in an automobile involved in an accident with another automobile owned and operated by Bruce E. Dewey on November 7, 1969. As a result of the collision, the plaintiff suffered injuries and brought suit against Dewey and the driver and owner of the vehicle in which the plaintiff was a passenger. The defendant insurance company had issued an automobile insurance policy to Dewey for property damage and bodily injury which was in effect on November 7, 1969, and covered the automobile operated by Dewey on that day. Condition No. 21 of the policy provided, in part, that "the insured shall cooperate with the company and, upon the company's request, assist ... in the conduct of suits ... and the insured shall attend hearings and trials and assist in securing and giving evidence."

Sometime in 1970, Dewey was contacted by the defendant and was told of the law suit and that he should keep the defendant informed of his whereabouts. In May and again on October 5, 1975, counsel retained by the defendant to defend Dewey notified the defendant's claims supervisor that the O'Leary case had been put on the assignment list for trial in Bridgeport. On October 20, 1975, Dewey was subpoenaed by the plaintiff's counsel to appear at the Superior Court in Bridgeport on October 22, 1975; but an instruction on the subpoena advised Dewey to call prior to coming to court. When Dewey did call, he was advised not to come. In December, 1975, Dewey received a second subpoena from the plaintiff's counsel to come to Bridgeport and he complied, only to wait for the entire day without talking to anyone or being called to testify.

On December 19, 1975, a letter was sent to Dewey by the defendant advising him that the case would be reached soon and asking him to contact his counsel in Bridgeport. On January 12 or 13, 1976, a claims adjuster for the defendant spoke to Dewey on the telephone and advised him that the case would be reached for trial that week and that his testimony was necessary. On January 14, 1976, the claims adjuster again spoke to Dewey and directed him to be at his counsel's office in Bridgeport at 1:30 p. m., Thursday, January 15, 1976. On the same day, his counsel attempted to reach Dewey by telephone. He was unsuccessful but did leave word for Dewey to call. Dewey did not appear at his counsel's office at 1:30 p. m., January 15, 1976, but did call at about 4:40 p. m. Dewey agreed to come to his counsel's office at 9:30 a. m. the next morning to talk to his counsel and he was given instructions on how to get there from Hartford and where to park.

Dewey did not appear at his counsel's office on January 16, 1976. When he failed to appear, his counsel advised the defendant's claims supervisor of Dewey's absence and told him to make an effort to locate Dewey. On that day the claims supervisor wrote a letter to Dewey advising him that if he failed to appear and testify at the trial, the defendant would disclaim coverage and refuse to pay any judgment. At the trial on the morning of January 16, 1976, after the plaintiff and codefendant had rested, Dewey's counsel requested a brief recess to make further efforts to locate Dewey. The court at that time commented to the effect that this was the second time the trial was held up in order to locate Dewey. In response Dewey's counsel told the court that he had spoken with Dewey and his son the previous evening. The court then stated: "I do want to proceed with the case .... I'll take a five minute recess."

When the trial resumed, Dewey's counsel put a statement on the record concerning Dewey's absence. He also stated that the defendant had that morning sent a certified letter of disclaimer to Dewey for failure to cooperate. Counsel did not request a continuance to the next court day. The court in the present case in one of its conclusions found that when Dewey failed to appear on the morning of January 16, 1976, Dewey's counsel consulted with the defendant's claims supervisor and was instructed not to ask for a continuance or to make any further effort to locate Dewey. In the underlying negligence action, the jury had returned a verdict in favor of the plaintiff O'Leary in the amount of $30,200 against the defendant Dewey only. The motion to set aside the verdict was denied.

On Monday, January 19, 1976, Dewey called his counsel at his office. Counsel told Dewey that the jury had returned a verdict of $30,200 against him on the previous Friday and that the defendant insurance company had disclaimed coverage because Dewey had failed to appear and cooperate in the defense of the suit. Dewey explained that he had attempted to come to the trial but had encountered car trouble and that he had been unable to get to Bridgeport. Dewey's car had broken down at approximately 8:30 a. m. on Friday, January 16, 1976, while on the way from his home in East Hartford to the trial in Bridgeport. He had the car towed off the highway to a garage. Dewey then went to a bar and did not call anyone to explain his failure to appear at his counsel's office or at the trial. Dewey was never sent a letter of disclaimer.

The court in the present action concluded that Dewey did not breach condition No. 21 of the insurance policy issued to him by the defendant insurance company. This conclusion was based on the finding that Dewey's car broke down while he was on his way to Bridgeport. The court further concluded that when Dewey did not appear on January 16, 1976, his counsel should have requested a continuance until the next trial day. The court also found that counsel was instructed by the defendant not to ask for a continuance or to make any further efforts to locate Dewey. An ultimate conclusion was that the defendant breached its duty to protect the interests of its insured Dewey because it did not request a continuance of the trial after Dewey failed to appear. The defendant attacks the court's conclusions as not supported by the subordinate facts found.

To test the conclusion that when Dewey did not appear at the trial on Friday, January 16, 1976, the defendant decided to disclaim coverage rather than request a continuance, we have examined the defendant's reference to the testimony of Dewey's counsel in the appendix and to the transcript of such testimony. Practice Book, 1978, § 3049; Gordon v. Indusco Management Corporation, 164 Conn. 262, 275, 320 A.2d 811 (1973). The following interchange between Dewey's counsel in the previous case and the court is pertinent on this issue. The court asked the witness whether he had "discussed it with Mr. (Kenneth) Bickford," the defendant's claims supervisor. The court inquired: "You decided that since your client didn't appear you would disclaim coverage and proceed on that basis rather than asking for a continuance of it to the following week?" After the witness replied, "That's right," the court asked: "(I)s there any reason why you did not make a motion for a continuance?" to which the witness replied, "Yes, because I had discussed it with Mr. Bickford." There was an objection and the court stated: "I think he just answered what he just said. He discussed it with Mr. Bickford and they decided that they would disclaim coverage rather than make a motion for further continuance." No effort was made to contradict this statement, and when Dewey's counsel was asked if he ever made application for a continuance of the case, he answered "No."

In the absence of estoppel, waiver or other excuse, cooperation by the insured in accordance with the provisions of the policy is a condition the breach of which puts an end to the insurer's obligation. Arton v. Liberty Mutual Ins. Co., 163 Conn. 127, 133, 302 A.2d 284 (1972); Guerin v. Indemnity Ins. Co., 107 Conn. 649, 654, 142 A. 268 (1928). The lack of cooperation, however, must be substantial or material. Curran v. Connecticut Indemnity Co., 127 Conn. 692, 696, 20 A.2d 87 (1941); Rochon v. Preferred Accident Ins. Co., 118 Conn. 190, 198, 171 A. 429 (1934); annot., 60 A.L.R.2d 1146, 1150. In this state, where an insurer raises the issue of the violation of the cooperation clause of the policy by a special defense, the burden is on the plaintiff to prove cooperation by the insured. Arton v. Liberty Mutual Ins. Co., supra, 163 Conn. 135, 302 A.2d 284; Manthey v. American Automobile Ins. Co., 127 Conn. 516, 519, 18 A.2d 397 (1941). It was for the plaintiff to show that the absence of the insured was excused or justified....