McNamara v. Allstate Ins. Co., Chicago, Ill.
| Decision Date | 13 March 1957 |
| Citation | 3 A.D.2d 295,160 N.Y.S.2d 51 |
| Parties | Daniel McNAMARA, Great Valley, N. Y., Plaintiff-Respondent, v. ALLSTATE INSURANCE COMPANY, CHICAGO, ILLINOIS, Defendant-Appellant. |
| Court | New York Supreme Court — Appellate Division |
David M. Franz, Salamanca, Shane & McCarthy, Olean, for plaintiff-respondent.
Daniel A. Isaacson, Phillips & Isaacson, Jamestown, for defendant-appellant.
Before McCURN, P. J., and VAUGHAN, KIMBALL, WILLIAMS and BASTOW, JJ.
This appeal presents the question of the necessity of compliance with certain requirements of the Insurance Law, § 167, subd. 1, par. (b) before an injured person, who has obtained a judgment against a tortfeasor, may bring a direct action against the insurer of the latter.
In June, 1954 the present plaintiff obtained a judgment for damages for personal injuries in the sum of $20,000 against one Woodring as the result of a collision between automobiles of the respective parties. Woodring was insured by the defendant in this action. The policy contained a monetary limit of liability, in so far as we are here concerned, of $10,000. A copy of the judgment was served upon the defendant and subsequent to the passing of thirty days this action was commenced. Upon the trial the plaintiff proved the foregoing facts. The defendant offered no proof and the court at the close of the evidence directed the jury to return a verdict in favor of the plaintiff in the sum of $10,000--the limit of defendant's liability under the policy. The focal point of this appeal is the failure of the plaintiff to allege and prove that notice of entry of judgment was served upon Woodring, the insured or his attorney.
Subdivision 1 of section 167 of the Insurance Law provides that no liability policy shall be issued in this state unless it contains in substance certain provisions thereafter set forth 'which are equally or more favorable * * * to judgment creditors so far as such provisions relate to judgment creditors * * * .' Paragraph (b) of the same subdivision and section requires a policy provision 'that in case judgment against the insured * * * shall remain unsatisfied at the expiration of thirty days from the serving of notice of entry of judgment upon the attorney for the insured, or upon the insured, and upon the insurer, then an action may, except during a stay or limited stay of execution against the insured on such judgment, be maintained against the insurer under the terms of the policy * * *' for the amount of the judgment not exceeding the amount of the applicable limit of coverage.
We turn to the policy to find if it contains a provision that is equally or more favorable to this judgment creditor. The sixth condition of the policy provides that . Research discloses that the substance of this language is used in the majority of policies issued in this and other states. In modified form it has been approved by the two casualty insurance rating organizations .
It seems plain that this policy provision is less favorable to a judgment creditor than the statutory provision. The former sets up as a condition precedent to the institution of the action 'full compliance with all the terms' of the policy. There is no such condition in the statute. The present action is not brought upon the contract of insurance. It 'owes its parentage to the statute, rather than to the contract of insurance.' Jackson v. Citizens Casualty Co., 277 N.Y. 385, 392, 14 N.E.2d 446, 448. Of course, in such an action the claimant must abide by the conditions of the contract as the insured would have been required to do, Coleman v. New Amsterdam Casualty Co., 247 N.Y. 271, 275, 160 N.E. 367, 72 A.L.R. 1443, and 'The insurer may assert any defenses against such injured person * * * which it could have employed against the insured' (1 Richards on Insurance [5th Ed.] p. 629).
It follows that this policy provision will be deemed to be in violation of the statutory provision and the policy provision pursuant to section 143, subd. 1 of the Insurance Law will be enforced as if it conformed with the requirements of the statute. Moreover, condition 3 of the policy states that 'Such terms as are in conflict with statutes of the state in which this policy is issued are hereby amended to conform.'
We thus return to the contention of the defendant that there is a jurisdictional defect and that this judgment may not stand because of the absence of allegation in the pleading and proof upon the trial that notice of entry of the judgment was served upon either the insured or his attorney. There is no hint in either record or brief that there was any impossibility of performance by the plaintiff of this requirement. The language of the statute is plain. There are at least four conditions to be met before the insurer may be sued. First, judgment against the insured, which (2) shall remain unsatisfied at the end of thirty days from (3) the serving of notice of entry of judgment upon (a) the attorney for the insured, or upon the insured and (b) upon the insurer and (4) the absence of any stay or limited stay of execution against the insured.
The statute is remedial. Prior to the enactment of section 109 (present section 167) of...
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