McDaniel v. State Farm Mut. Auto. Ins. Co.
| Decision Date | 18 January 1965 |
| Citation | 205 Va. 815,139 S.E.2d 806 |
| Court | Virginia Supreme Court |
| Parties | Allen Randolph McDANIEL, an Infant, etc. v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY. |
Douglas K. Frith, Jackson L. Kiser, Martinsville (R. Reid Young, Jr., Young, Kiser & Frith, Martinsville, on brief), for plaintiff in error.
Coleman B. Yeatts, Chatham, for defendant in error.
The question presented on this appeal is whether the appellant, Allen Randolph McDaniel, may collect from the appellee, State Farm Mutual Automobile Insurance Company, under the provisions of the uninsured motorist law, Code § 38.1-381,* the amount of a judgment obtained by McDaniel against Obie Henry Spencer as damages for personal injuries.
On September 28, 1960, McDaniel, hereinafter referred to as plaintiff, while riding as a passenger on a bicycle, was injured in a collision with an automobile operated by Spencer. By his father and next friend he filed a motion for judgment against Spencer on May 5, 1961. At the time of the accident Spencer was a named insured in a liability insurance policy issued by Nationwide Mutual Insurance Company. That company filed an answer and grounds of defense for the defendant and the case was set for trial on Setember 28, 1961. However, on September 26, 1961, Nationwide wrote plaintiff that it would defend under a reservation of rights agreement because of the failure of Spencer to cooperate. Trial of the case was twice continued, lastly to October 26, 1961, to give Nationwide an opportunity to find Spencer.
At the time of the accident plaintiff was insured under a policy issued to his parents by State Farm, by which it agreed to pay plaintiff the amount that he should be entitled to recover as damages from the owner or operator of an uninsured motor vehicle, within stated limits. Code § 38.1-381(b).
On September 28, 1961, plaintiff's counsel wrote to the registered agent of State Farm, enclosing a copy of Nationwide's letter of September 26 and stating that by reason thereof Spencer became an uninsured motorist under § 38.1-381(c)(ii), and that a copy of plaintiff's motion for judgment was being forwarded for service on State Farm. A copy of the motion for judgment was accordingly served on State Farm on October 5, 1961.
On October 12, 1961, counsel for Nationwide wrote plaintiff's counsel that plaintiff's suit against Spencer would be defended by Nationwide 'under a full reservation of rights' and that Nationwide would not pay any judgment rendered in the case because Spencer had failed to cooperate with it under his insurance policy. A copy of this letter was mailed to State Farm's assistant claim superintendent on October 14, 1961.
On October 14, 1961, State Farm filed a demurrer stating that plaintiff's motion for judgment was not sufficient in law because no allegation in it 'alleges any of the requirements as set forth in Section 38.1-381 of the Virginia Code.' This demurrer was treated by the court as a motion to quash process and sustained 'for the reasons that the defendant, Obie Henry Spencer, was not an uninsured motorist as contemplated by Section 38.1-381; that the motion for judgment contained no statement that the plaintiff intended to rely on the Uninsured Motorist Act--no allegation that the defendant was an uninsured motorist--no allegation or information as to why process was being served on State Farm--no information or allegation on which State Farm could prepare an adequate response or defense.' The quotations are from the court's opinion; the motion for judgment, the demurrer and the order dealing with it are not in the record.
The action of McDaniel v. Spencer was tried before a jury on October 26, 1961, defended by Nationwide's counsel, and a verdict and judgment were rendered against Spencer in the sum of $5,000. Execution thereon was returned unsatisfied.
Thereafter, on January 27, 1962, the plaintiff filed the present motion for judgment against Nationwide and State Farm to recover from them the amount of his judgment against Spencer. Both Defendants filed answers denying liability. The answer of State Farm asserted that since its motion to quash was sustained, it was not thereafter before the court or required to defend plaintiff's suit against Spencer, who was not an uninsured motorist. The answer of Nationwide asserted that its insurance policy issued to Spencer contained a provision and condition requiring his full cooperation in connection with any lawsuit for which coverage was claimed under the policy; that after the accident Spencer moved away without notifying Nationwide where he could be found, and that diligent efforts to locate him before the trial had been unavailing; that the failure of Spencer to cooperate in any way violated an essential provision and condition of his policy and rendered void its coverage, and that hence no liability for the judgment against Spencer rested on Nationwide.
No evidence was taken and on April 13, 1962, State Farm filed a motion for summary judgment (Rules of Court, 3:20) on the grounds that plaintiff's motion for judgment contained admissions that the Spencer car was an insured motor vehicle; that it did not allege that Nationwide denied coverage to Spencer as contemplated in § 38.1-381(c)(ii), and that State Farm was never a proper party to the action of McDaniel v. Spencer since its motion to quash process [demurrer] was sustained.
Plaintiff filed a motion to reject State Farm's motion and afterwards filed his own motion for summary judgment against State Farm (but not against Nationwide) on the grounds that Nationwide had denied liability under its policy because Spencer had failed to cooperate; that thereupon plaintiff had caused to be served on State Farm a copy of plaintiff's motion for judgment against Spencer as though State Farm were a party defendant, pursuant to said § 38.1-381 of the Code. Therefore, plaintiff alleged, since neither the amount of the damages nor any other material fact was genuinely in dispute, he was entitled to summary judgment against State Farm for the amount of his judgment against Spencer with interest and costs.
State Farm filed an answer to plaintiff's motion for judgment and thereafter the court entered the order now appealed from in which it stated 'that the parties to this cause are at issue and that from the pleadings, exhibits and admissions, no material fact being genuinely in dispute, the Court after mature consideration and for reasons set forth in a written memorandum of opinion filed in the papers in this cause, doth sustain the motion of State Farm Mutual Automobile Insurance Company for a summary judgment and doth overrule the motion of the Plaintiff for a summary judgment.'
The court accordingly entered final judgment in favor of State Farm with costs against the plaintiff. Plaintiff's assignments of error are to this ruling.
State Farm in its brief states the issues to be: (1) whether the quashing of process against it [service of motion for judgment against Spencer] rendered the service void; and if not, (2) whether Spencer was an uninsured motorist; and if so, (3) whether plaintiff complied with § 38.1-381 'in his treatment of State Farm Mutual Automobile Insurance Company as the uninsured motorist liability insurance carrier.'
The relevant provisions of $ 38.1-381 are paragraphs (b), (c), (e)(1) and (g).
State Farm, by the terms of its insurance policy, as well as by virtue of paragraph (b) of § 38.1-381, agreed to pay the insured [plaintiff] 'all sums which he shall be legally entitled to recover as damages from the owner or operator [Spencer] of an uninsured motor vehicle, within limits * * *.' The quoted language is from paragraph (b).
Paragraph (c) of said § 38.1-381 provides, inter alia, that the term 'uninsured motor vehicle' means a motor vehicle as to which there is no bodily injury and property damage liability insurance in required amounts, or 'there is such insurance but the insurance company writing the same denies coverage thereunder.'
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