Priddle v. Farm Bureau Mut. Ins. Co.

• Decision Date: 31 December 1955
• Docket Number: No. 4445,4445
• Citation: 119 A.2d 97,100 N.H. 73
• Parties: David E. PRIDDLE v. FARM BUREAU MUTUAL INSURANCE CO. et al.
• Court: New Hampshire Supreme Court

Page 97

119 A.2d 97

100 N.H. 73

David E. PRIDDLE v. FARM BUREAU MUTUAL INSURANCE CO. et al.

No. 4445.

Supreme Court of New Hampshire.

Argued Dec. 7, 1955.

Decided Dec. 31, 1955

Upton, Sanders & Upton and Wesley E. Whitney, Concord, for plaintiff.

Sulloway, Jones, Hollis & Godfrey and Guy A. Swenson, Jr., Concord, for defendant company.

H. Thornton Lorimer and Thomas F. Shannon, Concord, for defendant priddle.

DUNCAN, Justice.

It is well established by the law of this jurisdiction, which is controlling of the question, Miltimore v. Milford Motor Company, 89 N.H. 272, 197 A. 330, that the defendant Carole T. Priddle may maintain an action against her husband here for damages arising out of his negligent conduct in this jurisdiction. Lumbermens Mutual Casualty Co. v. Blake, 94 N.H. 141, 145, 47 A.2d 874 and cases cited. Her right to maintain her tort action is not called in question by these proceedings, but the rights and obligations of the parties by virtue of the contract of insurance are in dispute.

The basic undertakings of the defendant company are set forth in the policy. Under provisions styled 'Coverage F,' the company undertook to pay damages which the plaintiff should become obligated to pay 'because of bodily injury * * * sustained by any person' as a result of accident arising out of use of the automobile. However, by section 22 of the policy the parties also agreed: 'Terms of this policy which are in conflict with the statutes of the state wherein the policy is issued [New York] are hereby amended to conform to such statutes.'

Section 167(3) of the New York Insurance Law provides: 'No policy or contract shall be deemed to insure against any liability of an insured because of * * * injuries to his or her spouse * * * unless express provision relating specifically thereto is included in the policy.' 27 McKinney's Consol.Laws of New York, Ann. § 167(3). The policy of insurance issued to the plaintiff contains no provision expressly relating to his liability because of injuries to his wife. Thus by the express agreement of the parties, the broad undertaking of the company as set forth under 'Coverage F' must be considered limited by the provisions of the New York statute which they adopted as a term of the policy. Boisvert v. Boisvert, 94 N.H. 357, 358-359, 53 A.2d 515. Since the policy was issued in New York, to a resident of that state, and specifically refers to the statutes of that state, the parties must be deemed to have intended that the basic obligation of the insurer should be determined in accordance with the law of New York where the principal coverage was to be afforded. Hinchey v. National Surety Company, 99 N.H. 373, 377, 111 A.2d 827. See Davis v. Home Manufacturers' Insurance Company, 67 N.H. 218, 34 A. 464; Lovell v. Boston & Maine Railroad, 75 N.H. 568, 570, 78 A. 621, 34 L.R.A.,N.S., 67; Cunningham v. Ferguson, 81 N.H. 380, 382, 127 A. 436; Restatement: Conflict of Laws, s. 332(f), comment c; s. 358, comment b.

A literal interpretation of section 167(3) of the Insurance Law would support the argument of the defendant company that it is under no obligation to provide coverage with respect to 'any liability of an insured because of * * * injuries to his * * * spouse'. So far as the policy was intended to provide coverage against liabilities arising in New York it is plain that liability to a spouse was not included. Had this accident occurred in New York, the company would be under no obligation to the insured. Standard Accident Ins. Co. v. Newman, Sup., 47 N.Y.S.2d 804, affirmed 268 App.Div. 967, 51 N.Y.S.2d 767, appeal denied 268 App.Div. 1039, 52 N.Y.S.2d 948; Manhattan Cas. Co. v. Cholakis, 206 Misc. 287, 133 N.Y.S.2d 90. See also, Feinman v. Bernard Rice Sons, Sup., 133 N.Y.S.2d 639; Katz v. Wessel, 207 Misc. 456, 139 N.Y.S.2d 564.

The issue presented by this case is whether the provisions of the statute which the parties adopted as a part of their contract likewise relieve the company of any obligation to insure against the insured's liability to his spouse because of an accident which occurred in New Hampshire.

In ascertaining the intention of the parties consideration must be given to the meaning attributed in New York to the language of the New York statute. The statute was first adopted in 1937. Laws of New York (1937), c. 669. Prior to its adoption a married woman domiciled in New York lacked the capacity to enforce in the New York courts a cause of action which arose elsewhere against her husband also a resident of New York. Mertz v. Mertz, 271 N.Y. 466, 3 N.E.2d 597, 108 A.L.R. 1120. The 1937 statute amended the Domestic Relations Law of that state to permit the maintenance of suits between spouses, section 1. At the same time it amended the Insurance Law, relieving insurers of the obligation to insure against liability to a spouse, unless they expressly undertook to do so. In 1943 the dual purpose of this legislation was recognized by the Supreme Court of New York in the following language: 'These simultaneous enactments disclose a considered legislative intent to create a right of action theretofore denied, and at the same time to protect insurance carriers against loss through collusive actions between husband and wife.' Fuchs v. London & Lancashire Indemnity Co., 258 App.Div. 603, 17 N.Y.S.2d 338, 340. And as previously noted, the provisions of section 167(3) of the Insurance Law have since been consistently interpreted by the New York courts to preclude recovery from an insurance company on a New York policy because of a liability of the insured to his spouse arising in that jurisdiction.

This result does not depend however solely upon the circumstance that the insured's liability arose in New York. In Bradford v. Utica Mutual Ins. Co., 179 Misc. 919, 39 N.Y.S.2d 810, decided in 1943, it was held that the fact that the liability of a Massachusetts insured arose in New York so as to be enforceable under the amendment to the Domestic Relations Law, did not operate to relieve a New York insurer of an obligation undertaken by it in Massachusetts under the law of which state its obligation was to be determined. Thus it appears that prior to 1954 it was settled only that the insurer was under no obligation where the liability of the insured arose in New York and the policy was issued there. Apart from the comments of the Fuchs case, there was no indication one way or the other in the decided cases as to whether the change in the Insurance Law was intended to make policies issued in New York unenforceable as to causes of action which were not dependent for their enforcement upon the amended Domestic Relations Law of New York, because they arose elsewhere.

That issue, presented by the case before us, recently came before the Supreme Court of New York sitting at Special Term, in the case of New Amsterdam Casualty Co. v....