Merchants Mut. Cas. Co. v. Leone

• Decision Date: 03 July 1937
• Citation: 9 N.E.2d 552,298 Mass. 96
• Parties: MERCHANTS MUT. CASUALTY CO. v. LEONE et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

298 Mass. 96

9 N.E.2d 552

MERCHANTS MUT. CASUALTY CO.

v.LEONE et al.

Supreme Judicial Court of Massachusetts, Suffolk.

July 3, 1937.

Suit for a declaratory judgment by the Merchants Mutual Casualty Company against Polo Leone and others, to determine the rights of the parties under an automobile liability policy issued by plaintiff to named defendant, in whose automobile the other defendants were riding when injured. Actions of tort were brought against named defendant by the other defendants. From a decree sustaining a demurrer to the bill by such other defendants, and from a decree dismissing the bill as to all defendants, plaintiff appeals.

Decree sustaining demurrer reversed, and decree dismissing bill affirmed.Appeal from Superior Court, Suffolk County; Walsh, Judge.

C. F. Schipper, Jr., and S. L. Solomont, both of Boston, for plaintiff.

William P. Di Vitto, of Milford, and E. Burke, of Boston, for defendant Di Benedetto and Cocco.

Fusaro & Fusaro, of Worcester, for other defendants.

LUMMUS, Justice.

The case made by the bill is as follows: The plaintiff issued to the defendant Polo Leone a Massachusetts compulsory motor vehicle liability policy, to which was attached a provision for ‘extraterritorial public liability,’ by which the plaintiff agreed to indemnify Leone against loss by reason of his legal liability to pay damages to others for bodily injuries arising out of the operation of Leone's automobile outside of Massachusetts within the United States or Canada. This extraterritorial provision was not to apply when the automobile was being ‘used for renting or livery use or the carrying of passengers for a consideration.’ It was provided that Leone, upon the occurrence of an accident covered by this policy, should ‘as soon as practicable after learning thereof, given written notice with full particulars to the company or its duly authorized agent.’ The plaintiff agreed to defend or settle any ‘claims, suits or other legal proceedings' to enforce any liability within the policy.

The defendants Di Benedetto and Cocco were sisters of Leone's wife. In September, 1933, they suggested to Leone that if he would take them in his automobile to New York they would pay for the gasoline and oil consumed in the journey. He accepted the proposal, and the journey was made accordingly. On the return trip, on September 18, 1933, while Leone was operating the automobile in Connecticut, an accident happened, and the defendants Di Benedetto and Cocco sustained personal injuries. The plaintiff had no knowledge or notice of the accident until February 1, 1934, when Leone delivered to it the processesserved upon him in actions of tort brought against him by the defendants Di Benedetto and Cocco. Those defendants intend to hold the plaintiff liable, under G.L.(Ter.Ed.) c. 175, §§ 112, 113, for the satisfaction of any judgment which they may obtain against Leone.

This bill is brought under G.L.(Ter.Ed.) c. 213, § 3, Tenth A, and Rule 101 of the Superior Court (1932), to obtain a determination of the rights of the plaintiff, of Leone, and of the two other defendants, under the policy of liability insurance. One question is, whether the failure of Leone to give notice of the accident earlier absolves the plaintiff from obligation to Leone, and from any derivative obligation to the other defendants. The scanty extracts from the policy incorporated into the bill leave some doubt whether the giving of the required notice was a condition of the plaintiff's liability under the policy. Phillips v. Stone (Mass.) 8 N.E.(2d) 890. But for the purposes of this decision we may assume that it was. Another question is whether the automobile at the time of the accident was outside the coverage of the policy because it was being used for ‘the carrying of passengers for a consideration.’ Sleeper v. Massachusetts Bonding & Ins. Co., 283 Mass. 511, 186 N.E. 778, 779;Goff v. Benson, 286 Mass. 119, 190 N.E. 16. A third question, dependent upon the same principles as the other two, but between the plaintiff and the defendant Leone only, is whether the plaintiff is now obligated to defend or settle the actions of tort brought against Leone by the other defendants.

The case comes here upon appeals by the plaintiff from an interlocutory decree sustaining the demurrer of the defendants Di Benedetto and Cocco, and from the final decree dismissing the bill as to all defendants.

Procedure in the Superior Court for the interpretation of written instruments, without consequential relief, is not prescribed by any statute of general application. Compare St. 1935, c. 247. In some respects it is not new. Whiteside v. Merchants' National Bank, 284 Mass. 165, 172, 173, 187 N.E. 706; Guaranty Trust Co. of New York v. Hannay & Co., [1915] 2 K.B. 536, 12 A.L.R. 1. The statute which lies at the foundation of this case merely empowered certain courts to provide by rule a procedure for making binding determinations of right, interpreting written instruments, whether consequential relief is or could be claimed, or not. St.1929, c. 186, § 1, now G.L.(Ter.Ed.) c. 213, § 3, Tenth A. After that statute, there was made and promulgated Rule 101 of the Superior Court (1932).

We think the demurrer should have been overruled. The present case is within the rule. The bill seeks a ‘determination of right, interpreting a written instrument.’ In other words, the plaintiff asks the court to determine its rights, the correlative rights of the defendant Leone, and those of the other two defendants, all dependent upon a proper construction of the words of the policy (Blair v. Travelers Ins. Co. [Mass.] 197 N.E. 60), with reference to certain facts alleged to have happened. The bill cannot be dismissed on the ground that the court does not agree with the construction for which the plaintiff contends, for the bill seeks a determination of the rights of the parties, whatever they may be. Neither is the bill outside the scope of the rule because the terms of the policy cannot ‘be construed in vacuo or as mere abstractions' [Bryne v. Gloucester (Mass.) 8 N.E.(2d) 170], but in order to interpret the policy in its application to the facts alleged to have happened, those facts must be determined as an incident to the solution of the disputed question of interpretation. Nicholls v. Nichools, 81 L.T.R. 811, 812; Lewis v. Green [1905] 2 Ch. 340, 343; Chapman v. Michaelson, [1908] 2 Ch. 612, 618; Taylor v. Yielding, 56 Sol.J. 253; Palace Shipping Co., Ltd., v. Gans Steamship Line, [1916] 1 K.B. 138. The rule does not require that the plaintiff be a party claiming a right as distinguished from one claiming freedom from a supposed or pretended obligation. Pickford L. J. in Guaranty Trust Co. of New York v. Hannay & Co., [1915] 2 K.B. 536, 562, compare Bankes L. J., page 571.

But overruling the demurrer would not have meant that the plaintiff was entitled as of right to the determination sought. What is given to the Superior Court by Rule 101 is authority, not absolute obligation. The rule provides: ‘In its...