Reilly v. Linden
| Decision Date | 23 December 1921 |
| Docket Number | 22,394 |
| Citation | 186 N.W. 121,151 Minn. 1 |
| Parties | WILLIAM J. REILLY, AS FATHER OF DOROTHY REILLY, A MINOR v. RAYMOND LINDEN, KANSAS CITY CASUALTY COMPANY, APPELLANT |
| Court | Minnesota Supreme Court |
Action in the district court for Ramsey county to recover $5,000 upon an insurance policy. Appellant company was served with garnishee summons. The facts are fully stated at the beginning of the opinion. The case was tried before Haupt J., who, at the beginning of the trial denied the garnishee's motion for judgment on the pleadings, and at the close of the testimony the garnishee's motion for a directed verdict, and a jury which returned a verdict in favor of plaintiff for the amount demanded. From an order denying its motion for judgment notwithstanding the verdict or for a new trial, Kansas City Casualty Company, garnishee appealed. Affirmed.
Automobile insurance -- written notice of accident -- waiver of condition.
1. Immediate service of written notice of an accident, under an indemnity policy, may be waived by parol, though the policy contains a clause that no condition, provision or agreement thereof shall be waived or altered except by written indorsement signed by certain designated officers.
Waiver of condition does not refer to notice of accident.
2. The clause of an indemnity policy providing that no officer, agent or other representative of the company shall have power to waive any condition thereof, except such as may be indorsed thereon or added thereto, has no reference to those stipulations which are to be performed after a loss has occurred, such as giving notice of the accident.
Defense of action -- payment of judgment by insured before suit against insurer.
3. Where, in an indemnity policy, the insurer agrees to defend any suit brought to enforce a claim for damages thereon, unless it elects to effect a settlement thereof, the insurer, by assuming to defend an action against the insured, is rendered liable for the judgment up to the amount of the policy, and the insured is not compelled to pay the judgment in order to recover from the insurer.
Garnishment of insurer to impound judgment.
4. In an action brought by a third party against the insured under an indemnity policy, where the insurer assumes the defense as it agreed to do under the policy, a judgment in the action becomes as between plaintiff, defendant and the insurer, a liability or debt owing unconditionally by the insurer to the insured, which may be reached by garnishment.
Sexton, Mordaunt & Kennedy, for appellant.
Olof L. Bruce and Charles E. Bowen, for respondents.
Appellant issued its indemnity contract covering defendant's automobile against loss by accident. On August 31, 1917, while the policy was in force, Dorothy Reilly, 6 years of age, was injured by the car. No written notice of the accident was served upon appellant until after the summons and complaint was served on January 2, 1918. On the following day defendant delivered a copy of the summons and complaint together with a notice of the accident to appellant's authorized representative, who directed him to deliver them to its attorneys. The attorneys received the summons and complaint and took a sworn statement of the accident from the insured, retained the summons and complaint for 12 days pending investigation, and on the fifteenth day of January returned the same to the insured with notice that appellant refused to defend the litigation. Thereafter the insured employed counsel, issue was joined and the case finally placed upon the calendar for trial. Shortly after the action was commenced insured entered the army and no further proceedings were had until March 24, 1920, when judgment was entered by stipulation for $5,000 in favor of plaintiff and against defendant, and approved by the court. There was no collusion in procuring the judgment. On March 26, 1920, the garnishee summons was served on appellant, and on April 17 it made disclosure through its said attorneys, admitting the policy and that it was in force at the time of the accident, but disclaiming any debt or liability thereon, for the reason that no written notice of the accident or claim was served upon it as provided therein. Thereafter, upon motion, plaintiff was permitted to file a supplemental complaint under the provisions of G.S. 1913, § 7870, setting forth a waiver of the conditions of the policy requiring immediate written notice of the accident, to which appellant interposed an answer alleging failure of defendant to comply with the conditions of the policy in respect to giving notice, that the insured was required to pay the loss in money before any action would lie against it, and that appellant had never interfered with the litigation. The court submitted the question of waiver to the jury and a verdict was returned adverse to appellant. From an order denying its alternative motion for judgment or a new trial, appellant appeals.
At the time of the accident insured was 24 years of age, in the employ of an ice company, and lived at home with his mother. Henry O'Meara had transacted insurance with the mother for a number of years. He solicited, countersigned and delivered the policy in question and is therein designated as appellant's authorized representative. The mother testified upon the trial, in effect, that on the morning following the accident O'Meara called her over the telephone and informed her that he had seen an account of the accident in the paper and that he would be over to see about it; that her son was at the ice house; that she informed him of the agent's coming and that he requested her to ask Mr. O'Meara what action he should take -- whether he should give written notice; that O'Meara appeared a few hours later, inquired about the matter and requested her to call the hospital and ask about the child's condition; that she did and informed him of the response; that she then told O'Meara her son had requested her to ask him what action he should take and whether he should give written notice; that O'Meara said he should let the matter go and not stir it up, that there would be nothing to it, that the child was not hurt badly, that he would take care of defendant and for him not to bother about it until suit was brought; that this talk was repeated in substance later in the season when the premium payments were made. The mother's testimony was corroborated in detail by that of Miss Larson.
Mr O'Meara was called as a witness and testified that he called the mother over the telephone on the morning following the accident, inquired about it and concerning the child, but that he told her that the insured must give written notice; that he collected $25 on the premium September 15 and a like amount on October 25 following the accident, but that no talk was had at these or at any other times concerning the...
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