Ohio Casualty Ins. Co. v. Beckwith
Decision Date | 11 January 1935 |
Docket Number | No. 7403.,7403. |
Citation | 74 F.2d 75 |
Parties | OHIO CASUALTY INS. CO. v. BECKWITH. |
Court | U.S. Court of Appeals — Fifth Circuit |
John F. Battaile, of Houston, Tex., for appellant.
M. S. McCorquodale, of Houston, Tex., and Douglas W. McGregor, of Houston, Tex., for appellee.
Before BRYAN, SIBLEY, and WALKER, Circuit Judges.
Appellee, having been injured in an automobile accident, in which William Merrill, Jr., the owner and driver of the automobile was killed, and having recovered judgment for $7,500 against Merrill's widow as executrix of his estate, in an action based upon Merrill's negligence in operating his automobile Merrill v. Beckwith (C. C. A.) 61 F.(2d) 912, but not having realized anything on that judgment, brought this action to recover the amount thereof against appellant upon a policy of automobile liability insurance, which it had issued to Merrill and which was in force at the time of the accident. The policy, in the event of damage "by" the automobile covered by it, insures "against direct loss or expense by reason of the liability imposed upon the assured by law," within the limits of $10,000 for bodily injury or death accidentally suffered by a single person, and of $20,000 if several persons should be injured or killed in any one accident. Upon condition that the assured upon the occurrence of any such accident should give the insurer immediate notice in writing, it binds the insurer to investigate all such accidents and to defend in the name and on behalf of the assured any suit brought against the assured to enforce a claim for damages on account of bodily injury or death; "to pay all costs taxed against the Assured in any such defended suit and all expenses incurred by the Company, also all interest accruing after entry of judgment, upon such part thereof as shall not be in excess of said limits of liability, until the Company has paid, tendered or deposited in Court, such part of such judgment as does not exceed the limit of the Company's liability," etc. It provides that no action shall lie against the insurer "to recover for any loss and/or expense covered by this policy arising or resulting from claims upon the Assured for damages or be sustainable unless brought after the amount of such claim * * * shall have been fixed and rendered certain, either by final judgment against the Assured after trial of the issue or by agreement between the parties with the written consent of the Company." A so-called "co-operation" clause reads as follows:
At the time of the death of William Merrill, Jr., the assured, he, and his wife were residents of Houston in the Southern District of Texas. After his death, his will was probated at Houston, where Mrs. Merrill qualified as executrix and was continuing to reside when appellee, a citizen of Alabama, brought his suit against her as such executrix in the District Court for the Southern District of Texas. She gave the insurer immediate written notice of the automobile accident, and, upon being sued, promptly notified it of the suit and forwarded to it all papers served on or received by her in connection therewith. In that suit she waived service of process and voluntarily entered her appearance; but, with notice that she had done so, the insurer took full charge of and conducted the defense both in the trial court and on appeal.
Appellant defended this suit against it on the grounds: (1) That its policy is one, not of insurance against liability incurred by the assured, but of indemnity against loss actually sustained by him; and, since the executrix had paid no part of appellee's judgment against her, that the estate of the assured had not suffered any loss; (2) that in appellee's suit against her the executrix, by waiving service of process and voluntarily entering her appearance, violated the "cooperation" clause of the policy, and thereby relieved appellant of all liability under it; and (3) that in any event the policy was issued solely for the benefit of the assured, and therefore a third party, though injured by the negligent operation of the assured's automobile, has no right to maintain an action against the insurer upon it.
The case was upon written stipulation tried before the District Judge without a jury, and resulted in a judgment for appellee for the amount for which he sued, which was less than the limit of liability assumed by the policy for injury to a single person. Appellant assigns error upon the denial of a motion for judgment in its favor, and renews here the contentions it made in the district court.
There is a type of policy which insures against liability of the assured, and which becomes enforceable as soon as his liability is established. There is another type which indemnifies the assured against loss and which may not be enforced until after the assured has sustained actual loss. The distinction between...
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