Puget Sound Imp. Co. v. Frankfort Marine, Acc. & Plate Glass Ins. Co.

• Decision Date: 09 March 1909
• Citation: 100 P. 190,52 Wash. 124
• Court: Washington Supreme Court
• Parties: PUGET SOUND IMP. CO. v. FRANKFORT MARINE, ACCIDENT & PLATE GLASS INS. CO.

100 P. 190

52 Wash. 124

PUGET SOUND IMP. CO. v. FRANKFORT MARINE, ACCIDENT & PLATE GLASS INS. CO.

Supreme Court of Washington

March 9, 1909

Appeal from Superior Court, King County; Arthur E. Griffith, Judge.

Action by the Puget Sound Improvement Company against the Frankfort Marine, Accident & Plate Glass Insurance Company. From a judgment for plaintiff, defendant appeals. Reversed, with directions.

Roberts & Hulbert, for appellant.

Peters & Powell, for respondent.

RUDKIN C.J.

Some time during the month of June, 1901, the defendant executed and delivered to the plaintiff its certain indemnity insurance policy, whereby it agreed to indemnify the plaintiff for the period of one year from the date of the policy against loss from common law or statutory liability for damages on account of bodily injury, fatal or nonfatal accidentally suffered within the period of the policy by any person or persons while within the building premises of the plaintiff situate at the southeast corner of Second avenue and Columbia street, in the city of Seattle, or upon the sidewalks or other ways immediately adjacent thereto. The policy contained the following stipulations and conditions among others:

'(A) The company's liability for an accident resulting in injuries to or in the death of one person is limited to $5,000, and, subject to the same limit for each person, total liablity for any one accident resulting in injuries to or in the death of several persons is limited to $10,000.'

'(1) The assured upon the occurrence of an accident shall give immediate written notice thereof, with the fullest information obtainable at the time, to the general managers of the company for the United States of America, or to its duly authorized local agent. He shall give like notice with full particulars of any claim that may be made on account of such accident, and shall at all times render the company all co-operation and assistance in his power.

'(2) If, thereafter, any suit is brought against the assured to enforce a claim for damages on account of an accident covered by this policy, the assured shall immediately forward to the general manager of the company for the United States of America, or to its duly authorized local agent, every summons or other process or paper as soon as the same shall have been served on him, and the company will, at its own cost, defend against such proceedings in the name and on behalf of the assured, or settle the same, unless it shall elect to pay to the assured the indemnity provided for in clause 'a' of special agreements, as limited therein.

'(3) The assured shall not settle any claim, except at his own cost, nor incur any expense nor interfere in any of the negotiations for settlement or in any legal proceeding, without the consent of the company previously given, in writing; but he may provide at the time of the accident such immediate surgical relief as is imperative. The assured when requested by the company shall aid in securing information, evidence, and the attendance of witnesses, and in effecting settlements, and in prosecuting appeals, and in case the company requires the attendance of any employé or employés of the assured, as witnesses at inquests or in suits, the assured will secure his or their attendance, making no charge for his or their loss of time.'

'(7) No action shall lie against the company as respects any loss under this policy, unless it shall be brought by the assured himself to reimburse him for loss actually sustained and paid by him in satisfaction of a judgment after trial of the issue. No such action shall lie unless brought within the period within which a claimant might sue the assured for damages, unless at the expiry of such period there is such an action pending against the assured, in which case an action may be brought against the company by the assured within 60 days after final judgment has been rendered and satisfied as above. The company does not prejudice by this clause any defense to such action which it may be entitled to make under this policy.'

On the 11th day of February, 1902, one Christina D. Smith suffered bodily injury by slipping on the hinge of an iron door in the sidewalk adjacent to the building described in the policy, and instituted an action against the city of Seattle to recover damages for the injury thus sustained. The city notified the plaintiff herein of the commencement and pendency of the action, and demanded that it appear and defend or be bound by the judgment rendered. The plaintiff, in turn, notified the defendant company, but neither the plaintiff nor the defendant in the present action appeared in or defended the action against the city. The plaintiff in the lastmentioned action recovered judgment against the city in the sum of $7,633 and costs, which was affirmed by this court on appeal. Smith v. Seattle, 33 Wash. 481, 74 P. 674. On the 23d day of december, 1903, the city paid the judgment, amounting to the sum of $8,151.91 in all, and, in addition thereto, necessarily paid out and expended the sum of $500 in defending the action and prosecuting the appeal therein. The city then demanded payment of the amount of the judgment from the plaintiff in this action, and the plaintiff notified the defendant of such demand, but the defendant elected to litigate the question of liability with the city, and the demand was not complied with. Suit was thereupon instituted, and the city recovered judgment against the plaintiff herein in the superior court, and the judgment was affirmed by this court on appeal. Seattle v. Puget Sound Improvement Co., 47 Wash. 22, 91 P. 255. The plaintiff paid the judgment, amounting to the sum of $10,555.75, and instituted the present action on the indemnity policy. The defendant paid all court costs of the plaintiff in the action prosecuted against it by the city, except its attorney fees, and tendered to the plaintiff the sum of $5,000 before this action was commenced. The tender was refused and the money was paid into court. The foregoing facts were stipulated in the court below, and upon them the plaintiff contended, and now contends, that of the original judgment of $8,155.91 paid by the city the defendant was liable for the sum of $5,000, and the plaintiff for the residue or $3,151.91, that the defendant agreed to defend the action in the name of the plaintiff at its own costs, and that, therefore, the defendant should pay all costs of the action, including all accumulations of interest. In other words, that the plaintiff is still liable for $3,151.91 of the judgment, and the defendant should pay the balance of the $10,555.75 or $7,403.84. The defendant contends, on the other hand, that when it paid all court costs of the plaintiff in the action prosecuted by the city, and tendered and paid into court the sum of $5,000, it fully satisfied the terms and conditions of its contract with the plaintiff, and should be discharged from further liability. The court below adopted plaintiff's view of the law in construing the contract, and gave judgment accordingly. From that judgment, the defendant has appealed.

The liability of the appellant is fixed by the terms of its contract, and the terms of that contract, if plain and free from ambiguity,...