Pennsylvania, etc. Ins. Co. v. Horner

• Decision Date: 10 June 1955
• Citation: 281 S.W.2d 44,198 Tenn. 445,2 McCanless 445
• Parties: , 198 Tenn. 445 PENNSYLVANIA, etc., INSURANCE CO. v. James T. HORNER et al.
• Court: Tennessee Supreme Court

Page 44

281 S.W.2d 44

2 McCanless 445, 198 Tenn. 445

PENNSYLVANIA, etc., INSURANCE CO. v. James T. HORNER et al.

Supreme Court of Tennessee.

June 10, 1955.

Rehearing Denied Aug. 2, 1955.

Wallace F. Burroughs and Keith M. Henry, Knoxville, for appellant.

Jennings, O'Neil & Jarvis, Knoxville, for appellee.

PREWITT, Justice.

The Chancellor found in favor of the Insurance Company, but the Court of Appeals reversed.

This lawsuit grows out of an automobile collision in Knoxville, on January 31, 1953, on East 5th Avenue. Horner is the holder of the insurance policy with complainant Company. After the accident the insurance company filed its bill in the Chancery Court seeking to ascertain its rights under the Horner policy, and whether it was liable for the damages growing out of the collision.

The policy in question provides in part as follows:

'When an accident occurs written notice shall be given by or on behalf of the insured to the company or any of its authorized agents as soon as practicable. Such notice shall contain particulars sufficient to identify insured and also reasonably obtainable information respecting the time, place and circumstances of the accident, the names and addresses of the injured and of available witnesses.'

'The insured shall cooperate with the company and, upon the company's request, shall attend hearings and trials and shall assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of suits. The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for such immediate medical and surgical relief to others as shall be imperative at the time of accident.'

The defendant Kerr, plaintiff in the action at law, filed an answer denying the material allegations of the bill. The answer also denied that any delay in giving notice or any assumption of liability by the insured for another claim as charged in the bill resulted in any prejudice to complainant, or violated the terms of the policy in reference to this defendant's claim for personal injuries. The insured filed no answer and a judgment pro confesso was entered as to him.

The Chancellor found the facts in favor of the insurance company as to a breach of the above policy provisions and permanently enjoined both defendants from prosecuting any action on the policy. The defendant Kerr appealed.

The facts are that Horner was driving his insured automobile eastwardly; Kerr, a postal employee, had parked a government owned mail truck along the curb on the south side of the street, and was engaged in assorting mail within the enclosed bed of the truck. No one was in the cab.

Horner's car struck the parked truck a glancing blow, knocking off two hub caps of the car and damaging the truck to the amount of about $25. The cost of repairing the car was approximately $80.

The collision only slowed the car, and after looking back and seeing no one in the cab of the truck, Horner proceeded on his way. The discovery of the hub caps by the police resulted in his identity and a few days after the collision he was charged in City Court with hit-and-run driving. Apparently fearing Federal prosecution Horner sought out the proper postal authority in Knoxville, and on February 10, 1953, signed a statement admitting that he was driving at a speed of 30, or 35, miles per hour and admitting that the accident was his fault, and thinking the damage to the truck negligible kept on going. By the terms of the statement Horner assumed all costs connected with any necessary repairs to the mail truck and all costs incident to any hospital, or medical treatment of any person suffering any bodily injury as a result of the accident.

There is no proof that the company was advised of any injury to Kerr, or that there was an occupant of the truck at the time of the collision until suit was filed in the Circuit Court June 23, 1953, or nearly five months after the collision. On the same day the company was notified and promptly began an investigation of the collision under a reservation of rights.

There is no insistence that Horner had any possible defense to any claim on the part of Kerr for personal injuries.

Complainant insists however that one purpose of the policy provisions is to enable the company to conduct settlement negotiations. However, the Court of Appeals found...