Ohio Farmers Indem. Co. v. Chames

• Decision Date: 30 December 1959
• Docket Number: No. 36000,36000
• Citation: 163 N.E.2d 367,10 O.O.2d 164,170 Ohio St. 209
• Parties: , 10 O.O.2d 164 OHIO FARMERS INDEMNITY CO., Appellant, v. CHAMES et al., Appellees, et al.
• Court: Ohio Supreme Court

Page 209

170 Ohio St. 209

163 N.E.2d 367, 10 O.O.2d 164

OHIO FARMERS INDEMNITY CO., Appellant, v. CHAMES et al., Appellees, et al.

No. 36000.

Supreme Court of Ohio.

Dec. 30, 1959.

Syllabus by the Court

Under a liberal construction of the Ohio Declaratory Judgments Act (Section 2721.01 et seq., Revised Code), which provides for a declaration of rights, status and other legal relations, an automobile liability insurer, against whom claims have been asserted on account of death and injury inflicted by the driver of an insured automobile, may maintain an action for a declaratory judgment as to liability or nonliability under the insurance policy, notwithstanding that factual determinations are necessary to make a declaration on that controlling issue. Ohio Farmers Ins. Co. v. Heisel, 143 Ohio St. 519, 56 N.E.2d 151, limited, and Travelers Indemnity Co. v. Cochrane, Jr., 155 Ohio St. 305, 98 N.E.2d 840, approved.

This action arose in the Court of Common Pleas of Hamilton County, and the question for decision is whether the plaintiff, Ohio Farmers Indemnity Company, an Ohio corporation, appellant herein, by the allegations of its amended petition asking for a declaratory judgment states a cause properly cognizable under the Ohio Declaratory Judgments Act (Section 2721.01 et seq., Revised Code). All persons affected were made parties defendant.

Such amended petition alleges in substance that on July 22, 1956, plaintiff issued a policy of insurance to Jay's Auto Sales, Inc., effective for one year, in which policy it was agreed that plaintiff would pay on behalf of the insured sums which the insured might become legally obligated to pay on account of bodily injury, including death, caused by the ownership, maintenance or use of any motor vehicles by officers or employees of the insured in connection with its business operations, by the occasional use of such motor vehicles by officers and employees for other business purposes, and by the use of such motor vehicles by others for nonbusiness purposes, providing such use was with the permission of the insured.

The amended petition avers further that on May 29, 1957, the insured delivered to one Mary Davis a described automobile; that on May 30, 1957, while such automobile was being operated by one George McCurdy it collided with two pedestrians, Mary and John Chames, whereby Mary was killed and John injured; that at the time of the collision such automobile was not being used in connection with the business operations of the insured or in any other manner covered by the terms of the insurance policy; that, by reason of the death of Mary Chames and the personal injuries to John Chames, claims have been asserted against the plaintiff; and that, in the absence of a declaratory judgment as prayed for, plaintiff will be obligated at its peril to defend lawsuits which may be brought and to pay or refuse to pay judgments which may be rendered.

Continuing, the amended petition alleges that on June 6, 1957, Margaret McCurdy, daughter of Mary Davis and wife of George McCurdy, gave plaintiff a statement to the effect that when the collision occurred George McCurdy was operating the automobile involved without permission and against her protests, whereas on October 15, 1957, in the Court of Common Pleas of Hamilton County in the case of State v. George McCurdy, Margaret McCurdy gave testimony indicating that at the time of the collision George McCurdy was operating the automobile with her acquiescence.

'Wherefore, plaintiff prays that the court adjudge and declare, by reason of the facts hereinbefore set out:

'A. That there was no coverage in the policy by plaintiff to Jay's Auto Sales, Inc., for said George McCurdy and said Mary Davis and Margaret McCurdy, and there is no obligation upon this plaintiff to defend any action brought against George McCurdy, Margaret McCurdy or Mary Davis arising out of the collsion of the automobile and the person of John and Mary Chames on May 30, 1957.

'B. That plaintiff is under no obligation to pay any judgment that might be obtained against George McCurdy, Margaret McCurdy or May [Mary] Davis as a result of said collision.

'C. That plaintiff be afforded such other and further relief as is just and equitable in the premises, including the cost of this action.'

In its material parts, the answer to the amended petition is as follows:

'Now comes the defendant, John Louis Chames, individually and as administrator of the estate of Mary Chames, deceased, and for his answer to the amended petition of the plaintiff admits that he is the duly appointed administrator of the estate of Mary Chames, deceased, that plaintiff is a corporation organized and existing under the laws of the state of Ohio and qualified to do insurance business in the state of Ohio, that defendant Jay's Auto Sales, Inc., is a corporation, that plaintiff issued a policy of insurance to the defendant Jay's Auto Sales, Inc., wherein it agreed to pay on behalf of its insured sums which the insured might become legally obligated to pay for bodily injury, including death, but for want of knowledge this defendant denies all other allegations as to such insurance made by plaintiff in its petition; defendant further admits that on May 30, 1957, a certain automobile belonging to Jay's Auto Sales, Inc., was being operated by one George McCurdy, and that there was a collision with two pedestrians, namely Mary Chames and John Chames in which collision said Mary Chames was fatally injured, and in which John Chames received personal injuries; this defendant further admits that by reason of the death of Mary Chames and personal injuries sustained by John Chames, claims for damages have been asserted by John Chames individually and by John Chames as administrator of the estate of Mary Chames, deceased, against the plaintiff.

* * *

* * *

'Further answering this defendant denies every other allegation contained in plaintiff's amended petition not herein specifically admitted to be true.'

Later, defendants John Louis Chames and John Louis Chames, administrator, by leave of court, filed a motion in the nature of a motion for judgment on the pleadings, wherein they ask for a dismissal of the amended petition, 'on the grounds that the questions raised by said amended petition are not such questions as may properly be decided in a declaratory judgment action.'

Such motion was sustained and the amended petition dismissed for the stated reason that 'from the allegations of the said amended petition * * * the question is one of fact as to whether the driver had permission, rather than a question of construction of contract.'

On an appeal on questions of law to the Court of Appeals, that court affirmed the judgment of dismissal, without written opinion, and the cause is now in this court for determination on its merits, pursuant to the allowance of a motion to require the Court of Appeals to certify the record.

Edward J. Utz, Cincinnati, for appellant.

Harry Gehler, Cincinnati, for appellees, John Louis Chames and John Louis Chames, administrator.

ZIMMERMAN, Judge.

Section 2721.13, Revised Code, a part of the Ohio Declaratory Judgments Act, provides:

'Sections 2721.01 to 2721.15, inclusive, of the Revised Code are remedial, and shall be liberally construed and administered.'

This court has spoken to the same effect in a number of cases. See Walker v. Walker, 132 Ohio St. 137, 5 N.E.2d 405; Radaszewski v. Keating, 141 Ohio St. 489, 49 N.E.2d 167; Ohio Farmers Ins. Co. v. Heisel, 143 Ohio St. 519, 56 N.E.2d 151; Coshocton Real Estate Co. v. Smith, 147 Ohio St. 45, 67 N.E.2d 904; and Sessions v. Skelton, 163 Ohio St. 409, 127 N.E.2d 378.

Section 2721.02, Revised Code, authorizes courts of record to 'declare rights, status, and other legal relations.' Such a declaration may be either affirmative or negative in form and effect and constitutes a final judgment or decree.

As it relates to the pending action, Section 2721.03, Revised Code, recites:

'Any person interested under a * * * contract, or other writing constituting a contract, or whose rights, status, or other legal relations are affected by a * * * contract, * * * may have determined any question of construction or validity arising under such * * * contract * * * and obtain a declaration of rights, status, or other legal relations thereunder.'

That the Declaratory Judgments Act contemplates cases with factual issues which may be tried to a jury is evidenced by Section 2721.10, Revised Code, which reads:

'When a proceeding under sections 2721.01 to 2721.15, inclusive,...