Luft v. Factory Mut. Liab. Ins. Co. of Am.

• Court: Rhode Island Supreme Court
• Writing for the Court: STEARNS, Chief Justice
• Citation: Luft v. Factory Mut. Liab. Ins. Co. of Am., 53 R.I. 238, 165 A. 776 (R.I. 1933)
• Decision Date: 21 April 1933
• Docket Number: Nos. 7211, 7212.,s. 7211, 7212.
• Parties: LUFT v. FACTORY MUT. LIABILITY INS. CO. OF AMERICA. SMALL v. SAME.

165 A. 776

LUFT

v. FACTORY MUT. LIABILITY INS. CO. OF AMERICA.

SMALL

v. SAME.

Nos. 7211, 7212.

Supreme Court of Rhode Island.

April 21, 1933.

Fraud of insurer's agent did not avoid operation of statute of limitations as against insurer, in view of fact that cause of action against insured and cause of action against insurer was exactly same cause of action, and cause of action against insurer arose at time injuries complained of were sustained, and the condition that a writ non est inventus must be returned before proceeding against the insurer is condition referable to remedy only.

Exceptions from Superior Court, Providence and Bristol Counties; Edward W. Blodgett, Judge.

Separate actions by Isador A. Luft and by Morris Small against the Factory Mutual Liability Insurance Company of America. Decision in each case in favor of the plaintiff, and the defendant brings exceptions.

Exceptions sustained.

Albert A. Baker, Walter I. Sundlun, and Baker & Spicer, all of Providence, for plaintiffs.

Sherwood, Heltzen & Clifford and Sidney Clifford, all of Providence, for defendant.

STEARNS, Chief Justice.

These are actions to recover for personal injuries sustained by plaintiffs as the result of an accident which occurred in Plainfield, Conn., on November 6, 1926, when an automobile owned and operated by one William P. Barstow of Plainfield collided with the automobile in which plaintiffs were passengers. The cases were previously before this court (see 51 R. I. 452. 155 A. 526) on defendant's exceptions to decisions of the superior court for plaintiffs. We then decided that these actions were barred by the statute of limitations, and plaintiffs were given an opportunity to show cause why judgment should not be entered for the defendant. As it appeared upon the rehearing that the superior court had not decided an Issue raised by the replications to the pleas of the statute of limitations, the cases were remitted to the superior court for a new trial (see 156 A. 927). They were later tried by a justice of the superior court without the intervention of a jury upon the issue raised by the replications; i. e., that defendant had practiced fraud which prevented the running of the statute of limitations. Decision in each case was for the plaintiff, and the cases are in this court on defendant's exceptions to these decisions.

The liability of Mr. Barstow and the amount of damages are admitted. At the trial the only witnesses were Mr. Sundlin, attorney for the plaintiffs, and Mr. Lees, an adjuster and the assistant secretary of the defendant corporation. Mr. Sundlin testified: That on November 9, 1926, he received a letter from Mr. Barstow at the bottom of which was the postscript: "I am insured with the Automobile Mutual Ins. Co. of America. Providence, R. I." That within a week Mr. Sundlin went to the office of the defendant company in Providence and interviewed Mr. Lees. That Mr. Lees saw the letter and said the statement in the postscript was correct.

It appears that Mr. Barstow had two policies of insurance, one for fire and theft in the Automobile Mutual Insurance Company of America, and one for personal liability in the defendant company. These companies, although separate corporations authorized to issue different lines of insurance, occupied the same offices and had the same officers. Mr. Lees was an adjuster and assistant secretary in each company.

After the interview referred to, negotiations for a settlement were ineffective. August 19, 1927, plaintiffs issued writs against Mr. Barstow which were returned non est inventus. On September 28, 1927, plaintiffs issued writs against the Automobile Mutual Insurance Company of America. At the trial in April, 1929, plaintiffs discovered that they had brought the actions against the wrong defendant, and they were nonsuited. On April 26, 1929, more than two years after the accident, the present actions against the defendant were begun. The fraud alleged was that defendant's agent told plaintiffs' attorney that Barstow was insured for personal liability by the Automobile Mutual Insurance Company of America and that he did so for the purpose of concealing the fact that Barstow was insured for this liability by defendant. The trial justice decided that Mr. Lees did make a fraudulent representation of fact to plaintiffs' attorney, and that as a consequence the actions were not barred by the statute of limitations.

The evidence is conflicting, and we cannot say that the trial justice is clearly wrong in his findings of fact. The...