Miller v. Commercial Standard Ins. Co.

• Decision Date: 02 February 1942
• Docket Number: 36465.
• Citation: 6 So.2d 646,199 La. 515
• Court: Louisiana Supreme Court
• Parties: MILLER v. COMMERCIAL STANDARD INS. CO. (two cases). HILL v. SAME.

6 So.2d 646

199 La. 515

MILLER v. COMMERCIAL STANDARD INS. CO. (two cases).

HILL v. SAME.

No. 36465.

Supreme Court of Louisiana

February 2, 1942

Lewis & Lewis, of Opelousas, and Taylor, Porter Brooks & Fuller, of Baton Rouge, for relator.

Durrett & Hardin, of Baton Rouge, for respondents.

Fred G. Benton, of Baton Rouge, as Amicus Curiae.

ODOM Justice.

According to plaintiffs' allegations, the automobile in which they were riding collided with a truck operated, with the consent and permission of the owner, by J. Avery Richard, Jr., and as a result of the collision they received personal injuries. The collision took place in the Parish of Iberia. Plaintiffs are residents of the State of Minnesota, and the owner of the truck has his domicile in the Parish of Vermilion, this state. The Commercial Standard Insurance Company, a Texas corporation authorized to do business in this state, had insured the owner of the truck against liability imposed upon him by law for damages sustained by any person or persons caused by accident arising out of the ownership and use of the truck. The Secretary of State, whose residence and domicile is in Baton Rouge, East Baton Rouge Parish, is the agent of the insurance company in this state, on whom service of process may be made. The insurance company has 'acquired a qualified residence within the state for the purpose of its business, and became domesticated, at least, for all purposes of jurisdiction and legal procedure'. Pittman Bros. Const. Co. v. American Indemnity Co., 194 La. 437, 193 So. 699, 700.

Plaintiffs brought their suits against the insurance company alone to recover damages caused by the collision, which collision they alleged was due solely to the fault and negligence of the driver of the truck. They brought their suits in the Parish of East Baton Rouge.

The insurance company filed an exception to the jurisdiction of the court 'ratione personae and ratione materiae' in each of the cases. The exceptions were overruled by the trial court and the insurance company applied to this court for writs which were granted.

In the policy of insurance issued by the defendant in this case, it is stipulated that action shall not lie against the company unless, as a condition precedent thereto, the insured shall have complied with all the conditions thereof, 'nor until the amount of the insured's obligation to pay shall have been finally determined either by judgment against the insured after actual trial or by written agreement of the insured, the claimant, and the company.'

Under this express provision of the policy, plaintiffs have no right of action against the insurance company to recover the amount of damages which they claim, because the insured's obligation to pay them has not been finally determined either by judgment or by agreement. But plaintiffs are not bound by that stipulation in the policy because they have a statutory right to proceed directly against the insurance company, and against it alone. The provisions of the statute prevail, of course, over the stipulations in the policy. The statute which gives them the right to proceed against the company directly is Act No. 253 of 1918, as amended and reenacted by Act No. 55 of 1930, the act as amended reading in part as follows:

'Provided further that the injured person or his or her heirs, at their option, shall have a right of direct action against the insurer company within the terms, and limits of the policy, in the parish where the accident or injury occurred, or in the parish where the assured has his domicile, and said action may be brought either against the insurer company alone or against both the assured and the insurer company, jointly and in solido.' (Emphasis ours.)

The plaintiffs in bringing their suits took advantage of the provisions of this statute and brought them against the insurance company, and against it alone, and, having done so, they are bound by its provisions relating to the place where such suits are to be brought. They brought their suits in East Baton Rouge Parish, the domicile in this state of the insurance company. Their counsel argue, and the judge held, that, since the company alone was sued, plaintiffs selected the proper forum, because Article 162 of the Code of Practice provides that:

'It is a general rule in civil matters that one must be sued before his own judge, that is to say, before the judge having jurisdiction over the place where he has his domicile or residence, and shall not be permitted to elect any other domicile or residence for the purpose of being sued, but this rule is subject to those exceptions expressly provided by law.'

Counsel for plaintiffs argue that the 'general rule' laid down by Article 162 of the Code is applicable here.

Counsel for the insurance company point out that the Code, after stating the general rule, says 'but this rule is subject to those exceptions expressly provided by law', and they say that the general rule laid down by the Code as to the place where 'one must be sued' is not applicable to suits of this character, but that such suits, as relate to the forum, are governed by an exception 'expressly provided by law', the law cited and relied upon being Act No. 55 of 1930, which provides that the injured person or his or her heris, at their option, shall have a right of direct action against the insurer company, within the terms and limits of the policy, 'in the parish where the accident or injury occurred, or in the parish where the assured has his domicile'.

Counsel for the insurance company argue that, under the provisions of this statute, these plaintiffs had a right to bring their suits either in the Parish of Iberia, where the accident occurred, or in the Parish of Vermilion, where the assured has his domicile, but not elsewhere. Their contention, in sum, is that what the act means when it says that the injured person shall have a right of direct action against the insurer company 'in the parish where the accident or injury occurred, or in the parish where the assured has his domicile' is that, as to the place where actions of this character may be brought, jurisdiction is limited or restricted to the parishes referred to. They concede that suits against this insurance company, grounded upon ordinary causes of action, may be brought in the Parish of East Baton Rouge, where the Secretary of State has his domicile. But they argue that the same law, Act No. 55 of 1930, which conferred upon injured persons the right to sue the insurer company alone in cases of this kind, went further and prescribed the territorial limits within which such suits must be brought, not where they may be brought, as contended by counsel for plaintiffs and as held by the trial judge.

Plaintiffs' counsel argue that the language of the act, in so far as it relates to jurisdiction, is not restrictive but merely permissive. In other words, they say that the act confers upon injured persons the right to file their suits in such parishes and, at the same time, leaves to them the privilege of suing the insurer at its domicile.

Act No. 55 of 1930 granted to persons injured or damaged by a motor vehicle covered by insurance against liability a privilege which they did not theretofore have. It gave to them 'a right of direct action against the insurer company' alone, to recover such damages as they may have sustained by the fault of the insured. Under Act No. 253 of 1918, they had no 'right of direct action' against the insurer except in cases where the insured was insolvent or bankrupt. But, under Act No. 55 of 1930, which amended the act of 1918, the injured person or his heirs may in all cases maintain a direct action against the insurer, under the terms and limits of the policy.

Immediately following the provision in the act which grants to injured persons a right of direct action against the insurer company, there is written into the act the following provision: 'in the parish where the accident or injury occurred, or in the parish where the assured has his domicile'.

If, by writing into the act this special provision, the Legislature did not intend that such actions should be brought only in the parish where the accident or injury occrred or in the parish where the insured has his domicile and not elsewhere, then that provision of the act was inserted for no purpose at all. If that special provision had not been written into the act, injured persons could have brought their suits either in the parish where the accident occurred or in the parish where the insured has his domicile, under the provisions of Paragraph 10, Article 165 of the Code of Practice, as amended by Act No. 130 of 1926. That paragraph of the article relates exclusively to suits on policies of insurance. When Act No. 55 of 1930 was adopted, Paragraph 10 of Article 165 of the Code of Practice read as follows:

'10. Insurance. In all suits on a policy of fire, life, marine, or accident insurance or sick benefit insurance, the defendant may be sued at the domicile of the insurance company, or in the place where its principal agency is established, or in the parish where the loss occurred, or in case of life insurance, at the domicile of the deceased or his beneficiary, or in case of accident insurance, at the domicile of the insured, or in the parish where the accident occurred, or in the parish where the accident policy was written, and in case of sick benefits at the place where the claimant resides at the time of his sickness.' (Emphasis ours.)

Article 165 of...