Neilson v. Am. Mut. Liab. Ins. Co. of Boston

Decision Date27 September 1933
Docket NumberNo. 11.,11.
Citation168 A. 436
CourtNew Jersey Supreme Court

Syllabus by the Court.

1. The insured, at the time of the accident, was transporting passengers for hire, which was in violation of the insurance contract, which provided, in clear and unmistakable language, against liability in such event.

2. Insurance contracts, as a rule, contain both affirmative and promissory warranties. The first class relates to matters existing at or before the issuance of the policy, and has the effect of a condition precedent; while a promissory warranty is one where the insured stipulates that something shall be done or omitted after the policy takes effect, and during its continuance, and has the effect of a condition subsequent.

3. The provisions of the policies under consideration in the present case must be construed as promissory warranties on the part of the insured, and in the nature of conditions subsequent, a compliance with which is essential to the right of recovery under the contract.

4. It is well settled that the injured party, in cases against the insurer, has no greater rights under the policy than the insured, he being bound by the terms of the contract, and cannot recover unless the insured could have done so, had he paid the judgment.

Appeal from Supreme Court.

Actions by Carl W. Neilson and by Antonio Perriera and another against the American Mutual Liability Insurance Company of Boston and another. From adverse judgments, plaintiffs appeal.


Coult, Satz & Tomlinson, and Elias G. Willman, all of Newark, for appellants.

Edward R. McGlynn, of Newark, and Edwards, Smith & Dawson, of Jersey City, for respondents.


This appeal involves two cases tried together in the Supreme Court, Essex circuit, resulting in judgments against the three plaintiff-appellants, on directed verdicts. The plaintiffs, on May 10, 1929, were injured" by a certain autotruck owned and operated by one James C. Stiles. They instituted suit, and each obtained a judgment against Stiles; Neilson in the sum of $5,000, Perriera for $2,000, and Tires $1,500. Executions were issued on these judgments, and returned unsatisfied. The present respondent insurance companies had each issued to Stiles an automobile liability insurance policy, and suit was brought against them, under the terms of the policies, which conformed to chapter 153, of the Laws of 1924 (Comp. St. Supp. § 99—90e). The undisputed proof in the trial showed that! the vehicle involved in the accident was a Graham Bros, dump truck, and that the infilled, Stiles, entered into an agreement with the Elizabeth Paving Company, whereby he was to be paid $1.90 per hour for the service of himself and truck, which consisted, in part, of transporting laborers engaged by the paving company in certain, construction work, it being his duty to meet the workmen at 6:30 a. m. at the Newark-Elizabeth line and take them to the work which wast in Union township. He was also to carry them back from the job to the Newark line, in the evening, his duties not being completed until this was done. At the time of the accident, Stiles was transporting the laborers from the work to the city line, and had eight men in the truck with him, one of whom sat in the cab, and the others being seated upon boards placed across the body of the truck. Before the truck arrived at its destination, it collided with an automobile operated by one Gustav Anderson, in which Neilson was a passenger; the other appellants, Perriera and Pires, being passengers in the truck. The policy issued by the Constitution Indemnity Company of Philadelphia provided that the company would not be liable if the vehicle was used for any purpose other than that specified in the declarations contained in the policy; and declarations 8 and 9 provided, in substance, that the truck would be used for pleasure, business, and commercial transportation of materials and merchandise, incidental to the insured's business or occupation, and that the truck described as used for commercial purposes would not be rented to others or used...

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27 cases
  • Merchants Indem. Corp. v. Eggleston
    • United States
    • New Jersey Supreme Court
    • 19 Marzo 1962
    ...The classic mode of reservation is a nonwaiver agreement between the insured and the insurer. Neilson v. American Mutual Liability Ins. Co. of Boston, 111 N.J.L. 345, 168 A. 436 (E. & A. 1933); Caiola v. Aetna Life Ins. Co., 13 N.J.Misc. 845, 181 A. 524 (Sup.Ct.1935), affirmed, 116 N.J.L. 3......
  • Myers v. Ocean Accident & Guarantee Corporation
    • United States
    • U.S. Court of Appeals — Fourth Circuit
    • 19 Octubre 1938
    ...Co. v. Wilcox, D. C., 16 F.Supp. 799, 801; Sleeper v. Mass. Bonding & Ins. Co., 283 Mass. 511, 186 N.E. 778; Neilson v. American Mut. Liab. Ins. Co., 111 N.J.L. 345, 168 A. 436; Gross v. Kubel, 315 Pa. 396, 172 A. 649, 95 A.L.R. 146; Dziadosc v. American Cas. Co., 171 A. 137, 12 N.J.Misc. 2......
  • Hocken v. Allstate Ins. Co.
    • United States
    • Missouri Court of Appeals
    • 4 Febrero 1941
    ... ... Casualty Ins. Co., 251 N.Y. 302, 167 N.E. 450; ... Neilson v. American Mut. Liab. Ins. Co., 111 N.J. L ... 345, 168 A. 436; Hutt ... ...
  • Atlantic Cas. Ins. Co. v. Interstate Ins. Co.
    • United States
    • New Jersey Superior Court — Appellate Division
    • 28 Octubre 1953
    ...(E. & A.1940); Whittle v. Associated Indemnity Corp., 130 N.J.L. 576, 581, 33 A.2d 866 (E. & A.1943); Neilson v. American Mutual, etc., Boston, 111 N.J.L. 345, 168 A. 436 (E. & A.1933). '* * * However, it appears to be well established that such a provision is not unreasonable or against pu......
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