London & Lancashire Indemnity Co. v. Cosgriff

• Decision Date: 31 January 1924
• Citation: 125 A. 529,144 Md. 660
• Parties: LONDON & LANCASHIRE INDEMNITY CO. v. COSGRIFF.
• Court: Maryland Court of Appeals

125 A. 529

144 Md. 660

LONDON & LANCASHIRE INDEMNITY CO. v. COSGRIFF.

Court of Appeals of Maryland

January 31, 1924

Appeal from Circuit Court, Montgomery County; Urner, Peter, and Worthington, Judges.

Action by David W. Cosgriff against Angelia R. Carman, in which the London & Lancashire Indemnity Company was garnishee. From a judgment of condemnation, garnishee appeals. Reversed.

Argued before BOYD, C.J., and THOMAS, PATTISON, STOCKBRIDGE, ADKINS and OFFUTT, JJ.

Jas. J Carmody, of Baltimore (John A. Garrett, of Rockville, on the brief), for appellant.

Thomas L. Dawson, of Rockville (Dawson & Dawson and Albert M. Bouic all of Rockville, on the brief), for appellee.

BOYD C.J.

This is an appeal by the London & Lancashire Indemnity Company of America, of New York, garnishee of Angelia R. Carman, from a judgment of condemnation rendered against that company in favor of David W. Cosgriff. Mrs. Carman, who was the owner of an automobile, had an accident on the 2d day of September, 1919, by which the appellee was injured. He sued her and recovered judgment in the circuit court for Montgomery county of $7,500, with interest from the 3d day of January, 1922, and costs. Mrs. Carman had an automobile policy which was issued by the appellant, and an attachment was issued on the judgment, and, as shown by the return, it was laid in the hands of the appellant on the 4th day of February, 1922. The company, by its attorneys, James J. Carmody and John A. Garrett, appeared and filed a plea of nulla bona on the 13th of March, 1922, and the same day the plaintiff filed interrogatories to be answered by the garnishee. It answered the interrogatories, denying any liability to the defendant, Mrs. Carman, or that it had paid her any money, or that it had delivered to her any goods or property, or to any other person for her, but stated that it had issued "a policy of indemnity" to her, a copy of which was filed. On the 16th day of November, 1922, the garnishee filed a motion to quash the attachment on the grounds: First, because there was not a sufficient affidavit filed; second, because the voucher attached to the affidavit was not a sufficient cause of action; third, because the warrant on which the attachment was issued was fatally defective on its face, inasmuch as it does not appear to have been properly issued; fourth, because the copy of the indemnity bond filed in this case by the garnishee clearly and fully sets out the undertaking of the garnishee to the defendant, which is to indemnify the said defendant upon contingency, which contingency has not occurred, and there is therefore no liability to the defendant and no money or credits to which the defendant is entitled from the garnishee.

The court overruled the motion to quash the attachment, the garnishee excepted, and the court's action is presented by the first bill of exceptions. As this was an attachment on a judgment, there was no affidavit, voucher, or warrant necessary, and therefore the reasons for filing the first, second, and third grounds for the motion to quash are not apparent. Nor would the fourth be good cause for quashing the attachment. The writ of attachment is not in the record, and, although a garnishee under our practice can make a motion to quasn such a writ, if there is any ground for it, there is nothing before us to show any irregularity in this writ. The fourth reason assigned would not be cause for quashing the attachment, but the question intended to be presented by it can be considered under the plea of nulla bona, as apparently was done. A petition to quash and set aside the attachment was filed on the 17th day of November, 1922, and was, according to the appellant's brief, on the theory that section 20 of article 9 of the Code was applicable, but, without deeming it necessary to discuss that, it is clear, from what we said with reference to the fourth reason assigned for the motion to quash referred to above, that in our opinion is not raised by such a petition, although the construction of the policy was before the court under the issues made by the plea of nulla bona filed by the garnishee, and subsequent pleadings. That petition was therefore properly refused. That disposes of the questions presented by the first and second bills of exceptions, and as the important questions involved in the case are presented by the rulings on the prayers, we need not make further reference to the motion of the plaintiff for a judgment of condemnation, which does not appear to have been specifically acted on by the court. Inasmuch as there was no evidence included in the bills of exceptions in reference to the policy, we do not see the necessity of bills of exceptions, as for aught that appears in them the assured may have paid the judgment against her, or some part of it, and the mere fact that this policy was issued would not be ground for a motion to quash, but it would not be necessary to refer further to the subject, without pointing out when bills of exception are necessary.

It appears from the docket entries that on March 25, 1923, the case was submitted to a full bench. Testimony was taken, and two prayers, numbered 1 and 2, were offered by the plaintiff and were granted by the court. The ruling on them constitutes the third bill of exceptions. Special exceptions to those prayers were filed, but were overruled, and the action of the court presented by the fourth and fifth bills of exceptions. A judgment of condemnation in favor of the plaintiff for $5,393.32, with interest from the 10th of May, 1923, and costs, was entered. From that judgment this appeal was taken.

The proper construction of the policy of indemnity is the important question before us. The garnishee claims that it is not liable because the insured has not paid the judgment against her or any part of it.

Before discussing that question it will be convenient to refer to Hodge and McLane on Attachments, § 148, and cases cited in the notes, to show that--

"The general rule is that the right of the attaching creditor to recover against the garnishee depends upon the subsisting rights between the garnishee and the debtor in the attachment, and the test of the garnishee's liability is that he has funds, property, or credits in his hands belonging to the debtor, for which the latter would have the right to sue. The plaintiff is subrogated, as against the garnishee, to the rights of the debtor, and can recover only by the same right, and to the same extent, as the debtor might recover, if he were suing the garnishee. But the above general rule is subject, of course, to some exceptions."

A number of exceptions are mentioned by the authors in that section, amongst others, that in some cases an attachment may be laid in the hands of a garnishee before the debt owing by the latter to the debtor in the attachment has matured; that equitable interests, which can ordinarily be enforced only in a court of equity, may be attached, and that the plaintiff's right to a judgment of condemnation does not depend upon there being funds or credits in the hands of the garnishee at the time of the service of the writ but upon whether funds have since come into his hands, or are in his hands at the time of trial.

Although it is contended in the brief of the company that notice was not given to it as required by the policy, there does not seem to be any substantial foundation for that. The provisions relied on are:

"Upon the occurrence of an accident, or notice of any claim, the assured shall give immediate written notice thereof to the company or its duly authorized agent. If suit is brought, the summons or other process shall be immediately forwarded to the company."

No special reliance was placed on an alleged failure to give notice in any of the papers filed by the appellant, and it is shown that the company took charge of the trial of the suit between the injured party and the assured, and the company's regular attorney and another attorney employed by it to defend, and, as far as appears from the record. no objection whatever was made by it to any omission on the part of the assured to notify it of the accident. There is no provision in our statute, or requirement under our practice, to leave the summons or other process with the defendant when a suit at law is brought against an individual. But the evidence shows that the accident which formed the basis of the suit against Mrs. Carman was in the state of Connecticut; that she did not know that any one was injured, although she admits that Mr. Cosgriff was the one that figured in the accident; "that she notified the company of the accident through Mr. Malcolm McConihe about two or three days after the accident, and after the accident she got a communication to appear in court. After that, Mr. Carmody called; that she had not known Mr. Carmody prior to that; that she told him the particulars of the case, but did not know whether they were reduced to writing."

Mr. McConihe testified as follows:

"That he resided in Washington, and that he knew Mrs. Carman, and he received a notice from the defendant about an accident. He testified that Mrs. Carman came down to the bank in a day or two after the accident, and that she and he notified M. M. Parker & Co., agents of the company, of the accident, but did not recall whether the notice was in writing or not; that this policy was issued by M. M. Parker & Co. through his instructions, and that he and Mrs. Carman notified them of the accident. He testified further that Mrs. Carman bought a machine under a chattel mortgage, and the Merchants' Bank loaned the money, and that whenever the bank loans money on machines they have them insured for their own protection; that Mrs. Carman had paid for the machine long

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