Metropolitan Casualty Ins. Co. v. Albritton

• Decision Date: 05 February 1926
• Citation: 214 Ky. 16
• Parties: Metropolitan Casualty Insurance Company of New York v. Mary Albritton. Same v. W.D. Albritton.
• Court: United States State Supreme Court — District of Kentucky

Page 16

214 Ky. 16

Metropolitan Casualty Insurance Company of New York v. Mary Albritton.

Same v. W.D. Albritton.

Court of Appeals of Kentucky.

Decided February 5, 1926.

1. Insurance — Person Injured by Automobile of Assured Held to have Right to Sue Insurance Company, Regardless of Acts of Assured. — Provision in insurance policy taken out by automobile owner, that person injured could bring action against insurance company, if execution was returned unsatisfied, held to give injured person independent right to sue, regardless of acts of assured; such right not being based on subrogation to rights of assured.

2. Judgment — One Participating in Litigation Held Concluded by Judgment. — One who participates in litigation, and openly and actively assumes and manages its prosecution or defense, though a stranger to it, is concluded by judgment rendered therein.

3. Insurance — Insurance Company Held Bound by Judgment in Action which it Defended. — Where insurance company, in compliance with policy, defended action against assured, it could not, in subsequent action by the injured person against it, relitigate matter of contributory negligence, since a res judicata estoppel operates against one responsible to litigant, who has notice of litigation and opportunity to appear and defend, or has expressly stipulated to abide by its result.

Appeals from McCracken Circuit Court.

C.C. GRASSHAM and L.B. ALEXANDER for appellant.

EATON & BOYD for appellees.

OPINION OF THE COURT BY JUDGE THOMAS.

Affirming the judgment in each case.

On June 25, 1924, the appellant and defendant below, Metropolitan Casualty Insurance Company of New York, issued its indemnity policy to one Ira Mimms in Paducah, Kentucky, whereby in consideration of the premium paid by him it agreed to indemnify him against all damages in consequence of accidents to persons or property produced by the operation of a Cadillac automobile that he owned, under prescribed conditions, and the policy contained certain limitations as to the persons or property injured or damaged, but none of which apply to the character of accident involved in these cases and no further notice will be taken of them. The amount of indemnity for injury or death to any one person was limited to $5,000.00, and the amount of damages to property of a single person growing out of one accident was limited to the sum of $1,000.00. The defendant also agreed in its policy to defend in the name and on behalf of the assured any suit brought against him to enforce a claim covered by the policy, "whether groundless or not, on account of damages suffered or alleged to be suffered under the circumstances hereinbefore described," and to pay the expenses incurred in defending any suit against the assured to collect damages for any claim covered by the policy. It was also stipulated as a part of the policy that "(5) The insolvency or bankruptcy of the assured hereunder shall not release the company from the payment of damages for injuries sustained or loss occasioned during the life of this policy, and in case execution against the assured is returned unsatisfied because of such insolvency or bankruptcy in an action brought by the injured or his or her personal representative in case death results from the accident, then an action may be maintained by the injured person or his or her personal representative against the company under the terms of the policy for the amount of the judgment in the said action not exceeding the amount of the policy."

On August 8, 1924, and while the policy was in force and effect, assured's automobile that was covered by the policy collided on one of the streets of Paducah with an automobile owned by appellee and plaintiff below, W.D. Albritton, and which was being driven at the time by his wife, the appellee and plaintiff below, Mary Albritton, resulting in personal injuries to her and damages to her husband's automobile that she was driving. Each plaintiff brought separate suits against Mimms, the husband, to recover damages to his automobile, and the wife to recover damages for her personal injuries, upon the ground that the accident was produced by the negligence of the assured in operating his indemnified automobile. Assured, according to the terms of the policy, immediately notified defendant of the bringing of those actions and it took charge of their defense, as it had agreed to do in its policy. It not only employed defending counsel, but he filed the defense and conducted the trials throughout, which resulted in a judgment in favor of the husband for the sum of $513.00 and costs, and one in favor of the wife for the sum of $2,000.00 and costs. Execution was issued upon each judgment and a return made thereon by the sheriff of "no property found," whereupon plaintiffs filed these two actions against defendant under inserted clause (5) above of the policy to recover the amount of each judgment, with interest.

The petitions alleged the facts, the substance of which we have stated, and the court overruled demurrers filed thereto. The answers denied the negligence of Mimms in producing the accident, and perhaps some other matters, and in a second paragraph defendant alleged and relied on section 5 of paragraph B of the policy saying: "Whenever requested by the company, the assured shall aid in securing information, evidence and the attendance of witnesses in effecting settlements and in defending suits hereinbefore referred to. The assured shall at all times render to the company all reasonable co-operation and assistance." It was then averred that after the service of summons on Mimms and his notification of the company he disappeared and declined and refused to...