Pawlowski v. Eskofski

• Decision Date: 11 October 1932
• Citation: 209 Wis. 189,244 N.W. 611
• Parties: PAWLOWSKI v. ESKOFSKI ET AL.
• Court: Wisconsin Supreme Court

209 Wis. 189

244 N.W. 611

PAWLOWSKI

v.ESKOFSKI ET AL.

Supreme Court of Wisconsin.

Oct. 11, 1932.

Appeal from a judgment of the Circuit Court for Winnebago County; Fred Beglinger, Circuit Judge.

Action by Mary Pawlowski against Anton Eskofski and another. Judgment for the plaintiff, and the defendants appeal.--[By Editorial Staff.]

Judgment reversed, with directions to dismiss the complaint.

Action for personal injuries commenced December 8, 1930; judgment for plaintiff entered December 2, 1931. Defendants appeal.

The plaintiff, a guest in an automobile, sued her host and his insurance carrier to recover damages sustained in the overturning of the automobile caused by the blowing out of a tire. The blowout is alleged to have been caused by the negligence of the defendant in driving the car at a dangerous rate of speed when to his knowledge the tire was defective and too highly inflated.

There was a plea in abatement by the insurer on the ground that the action was prematurely brought against it. The court overruled the plea and the trial proceeded before the jury.

The jury by special verdict found: (1) That the automobile was overturned by the blowing out of a tire; (2) that the condition of the tire was such that it was dangerous to inflate as it was inflated shortly before it burst; (3) that the blowout was caused by the unsafe condition of the tire, in view of the speed at which the car was driven after the inflation; (4) that the defendant knew of the unsafe condition before driving it after the inflation; (5) that defendant failed to exercise ordinary care as to speed after the inflation, in view of the unsafe condition of the tire and the danger of its use in that condition; (7) that driving at the speed the defendant drove after the inflation was subjecting the plaintiff to a new danger to which the plaintiff was unreasonably exposed without warning; and (8) that the defendant failed to exercise ordinary care to avoid this new danger to plaintiff and to warn her thereof. Judgment was entered for the plaintiff for the amount of damages assessed by the jury, a total of $3,530.50.Sanders & McCormick, of Milwaukee, and Bouck, Hilton, Kluwin & Dempsey, of Oshkosh, for appellants.

Rubin & Zabel, William A. Zabel, and Roy R. Stauff, all of Milwaukee, for respondent.

FOWLER, J.

In the view we take of the case, only two assignments of error need be considered. These are that the court erred (1) in overruling the plea in abatement and (2) in not dismissing the case on the merits for want of evidence to support the verdict.

[1][2][3][4][5] 1. The plea in abatement was based on a provision of the insurance policy that no action should be brought upon it until after the liability of the insured had been determined by judgment after trial, or by agreement with the written consent of the insurer. There was no such agreement. The policy was issued and the accident involved occurred prior to the enactment in 1931 of section 260.11, Stats., which makes an insurer indemnifying a motor vehicle owner against liability for injuries caused by his negligence a proper party defendant in any action brought against the insured to recover for injuries so caused. It is contended by the appellants that this statute, as applied to policies issued before its enactment, is unconstitutional under article 1, § 10, of the United States Constitution, prohibiting states to pass laws impairing the obligation of contracts.

The no action clause of the policy here involved is identical with that involved in Morgan v. Hunt, 196 Wis. 298, 220 N. W. 224, wherein it was held that an action could not be maintained against an insurer until the liability against the insured had become fixed as by the clause provided. The rule of that case obtained at the time this policy was issued. Bergstein v. Popkin, 202 Wis. 625, 233 N. W. 572. In the Popkin Case, a plea in abatement had been interposed, overruled, and judgment entered against both insured and insurer. The case was reversed, with directions to dismiss as to the insurer and for a new trial as to the insured. A like ruling must be made here, if the appellants' position under the contract clause of the Constitution of the United States is upheld. The respondent contends that the statute cited is remedial only, and therefore retroactive and applies to the instant case.

It is true as a general rule that statutes that are remedial only are retroactive, and it is also true that prior enactments similar to the one in suit have been stated in opinions of this court to be remedial. But statutes are not to be given retroactive effect if so doing will deprive the parties to the contract of a valuable right. The decisions of the United States Supreme Court upon questions arising under the contract clause of the United States Constitution are of course conclusive upon this court. That court long ago held that any statute, whether remedial or not, that operated to deprive a party to a contract antedating the enactment of the statute of any valuable right secured to him by that contract, is void as to that contract. Edwards v. Kearzey, 96 U. S. 595, 24 L. Ed. 793. If a statute substantially lessens the value of a pre-existing contract, the constitutional provision bars application of it to the contract. Many decisions of the Supreme Court of the United States have so held. This was held as far back as Planter's Bank v. Sharp, 6 How. page 327, 12 L. Ed. 447, where it is said, “One of the tests that a contract has been impaired is, that its value has by legislation been diminished. It is not, by the Constitution, to be impaired at all. This is not a question of degree or manner or cause, but of encroaching in any respect on its obligation, dispensing with any part of its force.”

It has been recognized in later cases that the impairment or diminution of value must be to some substantial degree. But the fact that the court of a state has declared that the statute involved “impaired the obligation of the pre-existing contract very slightly and remotely” has not saved the judgment of the court from reversal for applying it to the contract. Bank of Minden v. Clement, 256 U. S. 126, 41 S. Ct. 408, 65 L. Ed. 857, where the above quotation from Planter's Bank Case is quoted with approval.

The decisions of our own state fully recognize this principle. Second Ward Savings Bank v. Schranck, 97 Wis. 250, 263, 73 N. W. 31, 35, 39 L. R. A. 569, contains the following quotation from Brine v. Insurance Co., 96 U. S. 627, 637, 24 L. Ed. 858, and Edwards v. Kearzey, supra: “There is no doubt that a distinction has been drawn, or attempted to be drawn, between such laws as regulate the rights of the parties, and such as apply only to the remedy.” “[But] at all events, the decisions of this court are numerous that the laws which prescribe the mode of enforcing a contract, which are in existence when it is made, are so far a part of the contract that no changes in these laws which seriously interferes with that enforcement are valid, because they impair its obligation.”

The opinion further quotes from Bronson v. Kinzie, 1 How. 311, 316, 11 L. Ed. 143, as follows: “Whatever belongs merely to the remedy may be altered according to the will of the state, provided the alteration does not impair the obligation of contracts;...