North River Ins. Co. of New York v. Gourdine
| Decision Date | 09 March 1964 |
| Docket Number | No. 5695,5695 |
| Citation | 135 S.E.2d 120,205 Va. 57 |
| Parties | THE NORTH RIVER INSURANCE COMPANY OF NEW YORK v. MAURY G. GOURDINE, ET AL. Record |
| Court | Virginia Supreme Court |
H. Lee Addison, III and N. W. Coward (Pender, Coward, McDuffie & Addison, on brief), for the plaintiff in error.
Berryman Green, IV and Francis E. Clark (Breeden, Howard & MacMillan; Parker & Clark, on brief), for the defendants in error.
On March 26, 1962, Maury G. Gourdine, while operating his automobile in the city of Norfolk, Virginia, was involved in an accident with another automobile owned by Irving L. Goninan and operated by Mary L. Goninan, in which Mary N. Mason was a passenger, and a truck operated by James E. Wilson and owned by R. H. Jenkins Transfer, Inc. Mary L. Goninan and Mary N. Mason suffered personal injuries as a result of the accident. Irving L. Goninan and R. H. Jenkins Transfer, Inc. sustained damages to their respective vehicles; and the driver of the Jenkins' truck, James E. Wilson, suffered personal injuries.
There was an automobile liability insurance policy covering Gourdine, issued by The North River Insurance Company of New York, in effect at the time of the accident. The policy had the usual provision for giving notice of an accident, containing particulars sufficient to identify the insured, information as to time, place and circumstances of the accident, the names and addresses of the injured and of available witnesses, and the further provision that:
'If claim is made or suit is brought against the insured, he shall immediately forward to the company every demand, notice, summons or other process received by him or his representative.'
A further provision of the policy provided that no action should lie against the company 'unless, as a condition precedent thereto, the insured shall have fully complied with all the terms of this policy.'
The North River Insurance Company of New York, sometimes hereinafter referred to as insurer or plaintiff, filed a motion for a declaratory judgment, seeking a declaration of its rights, duties and obligations to the insured, Gourdine, and the above-named persons who were involved in the accident of March 26, 1962, under its policy of insurance, issued to Gourdine. The insurer contended that the failure of its insured, Gourdine, to deliver to it in proper time certain suit papers in a motion for judgment against Gourdine for property damage arising out of the accident, returnable on July 12, 1962, to the civil justice court of the city of Norfolk, breached the conditions of its policy, and worked a forfeiture of all coverage thereunder, both as to the property damage and personal injuries arising from the accident.
Gourdine filed an answer denying that any conduct on his part had terminated the obligations of the insurer to him or the other persons injured or damaged in the said accident.
The parties waived trial by jury and all matters of law and fact were submitted to the court for determination.
After a consideration of the evidence and argument, the court held there had not been 'a substantial and material failure (by Gourdine) to comply with the conditions of the insurance policy;' that no prejudice resulted to the plaintiff therefrom; and that the policy 'was not otherwise vitiated or forfeited. ' It thereupon entered judgment declaring the policy to be in full force and effect as to all parties to the cause.
The facts are not in material conflict, the evidence being largely in the form of stipulations by counsel.
After the accident on March 26, 1962, Gourdine promptly reported its occurrence to Hubert E. Baldwin, an adjuster for the plaintiff. On April 4th, the adjuster went to the insured's residence in Franklin, Virginia, to interview him. At Baldwin's request, Gourdine brought, on April 6th, the four passengers who were in his vehicle at the time of the accident, to the adjuster's office in Suffolk, Virginia, to be interviewed. Baldwin told Gourdine that he should notify him or the insurance company of any suit papers being served upon him, or of other papers he received relating to claims arising out of the accident. On at least two or three occasions thereafter, Gourdine went to the adjuster's office to assist the latter in his investigation of the accident.
On or about June 10th, and on July 8th, Gourdine received a letter from Royal-Globe Insurance Company demanding restitution for moneys paid to R. H. Jenkins Transfer, Inc., on its collision policy. Gourdine advised plaintiff of the receipt of the letters on July 26th.
On June 23, 1962, Gourdine also received, by substituted service, notice of a motion for judgment for property damage, instituted against him by Irving L. Goninan, returnable to the civil justice court of the city of Norfolk on July 12, 1962. On the return date, the action was continued until July 23rd, at which time judgment was entered by default against Gourdine in the sum of $1,415.00.
On the following day, July 24th, Jack K. Moulton, the attorney who represented Irving L Goninan, advised the insurer, North River Insurance Company, of the suit and judgment. On July 26th, Baldwin went to Gourdine's residence to inquire why the insurer had not been notified of the action.
On July 30th, Baldwin orally notified Gourdine that having failed to give notice to the insurer of the suit brought against him, the insurer considered the policy null and void.
Baldwin further told the insured that the insurer would not pay the default judgment, would not note an appeal to a court of record, and that the insured could take whatever steps he thought necessary to protect his interest. Later, the same day the notification was confirmed in writing to the insured by counsel for the plaintiff, by certified mail, addressed to his usual place of abode. The letter was returned to the sender marked, 'Unclaimed and Box Down,' dated August 8, 1962.
On August 23rd, the insurer was notified by Moulton that the judgment entered in favor of Irving L. Goninan on July 23rd in the civil justice court had been vacated, and the case was set for trial September 18th. The vacation order was entered several days before the time in which to take an appeal as a matter of right from the civil justice court would have expired.
On September 10th, the insurer wrote to Francis E. Clark, attorney for Gourdine, advising him that it would not defend the suit in the civil justice court.
On September 14th, plaintiff again wrote Gourdine that it would not defend that action; but would defend any subsequent claims for personal injuries arising out of the accident, and requested that Gourdine promptly forward any suit papers received. Insurer further stated that it was reserving its rights to ultimately deny liability. Three days later, suit papers in the action were forwarded to the insurance company by Gourdine's attorney.
On September 18, 1962, default judgment was entered in favor of Goninan against Gourdine in the civil justice court for $1,415.00.
As a result of the accident of March 26th, three other suits were filed against Gourdine in the Court of Law and Chancery of the city of Norfolk. One of these was by Mary L. Goninan for personal injuries; another by Mary N. Mason, an infant, for personal injuries; and the third by Mary L. Goninan for medical expenses and loss of services of Mary N. Mason, an infant. The claim of James E. Wilson for personal injuries was settled without suit by the plaintiff in this case.
All of the summonses and process in these cases were forwarded to the insurer in proper time, and Gourdine has fully and completely cooperated in every respect with the insurer in the defense thereof.
Gourdine was 29 years old and employed at the Naval Supply Center in Norfolk. It is evident from his testimony that he was an uneducated man. He did not know the difference between 'plaintiff' and 'defendant.' He said he read the first summons, found by him posted at the front door of his home, but that he 'couldn't very well understand it.' In explanation of his failure to notify the plaintiff of the summons, he said: ' He further said his wife had been sick; that he didn't know the full name of Baldwin; and that he could not afford to lose 'too many days from work because I have a family to support.'
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