Seltzer v. Indem. Ins. Co. of North America

• Decision Date: 03 December 1929
• Parties: SELTZER v. INDEMNITY INS. CO. OF NORTH AMERICA (two cases). GILBERT v. SAME.
• Court: New York Court of Appeals Court of Appeals

252 N.Y. 330

169 N.E. 403

SELTZER

v.INDEMNITY INS. CO. OF NORTH AMERICA (two cases).

GILBERT

v.SAME.

Court of Appeals of New York.

Dec. 3, 1929.

Actions by Michael Seltzer, by Ruth Seltzer, and by Rose Gilbert, against the Indemnity Insurance Company of North America. Judgments of the Trial Term for plaintiffs, entered on directed verdict, were affirmed by the Appellate Division (226 App. Div. 682, 233 N. Y. S. 763; 226 App. Div. 687, 233 N. Y. S. 892), and defendant appeals.

Judgments reversed, and new trial granted.

Appeal from Supreme Court, Appellate Division, Second Department.

Grattan B. Shults, of New York City, James I. Cuff, of Brooklyn, and Harold V. Angevine, of New York City, for appellant.

Jacob C. Brand and Harry H. Bernstein, both of New York City, for respondents.

CRANE, J.

Jacob Wasserman, residing in Brooklyn, Kings county, owned an automobile and was insured by the Indemnity Insurance Company of North America against personal liability for negligence. On the 24th day of July, 1923, he was driving on the State road near Highview, Sullivan county, N. Y., when his automobile turned over and three people were injured, Michael Seltzer, Ruth Seltzer, and Rose Gilbert. These people were close personal friends of Wasserman. Michael Seltzer had been in the real estate business with Wasserman for some years. Although the real estate transactions were carried on through a corporation, Wasserman and Seltzer acted toward each other as if they were partners. Ruth Seltzer was the daughter of Michael Seltzer. Rose Gilbert was the daughter of another partner of Wasserman's and worked for the Thirteenth Avenue Building Corporation, through which the partners or associates did business.

These three people sued Wasserman and retained for this purpose the law firm of Barnett & Mintz, who were Jacob Wasserman's personal attorneys and legal advisers. The actions came on for trial resulting in judgments; one for Michael Seltzer for $987, one in favor of Ruth Seltzer for $987, and one in favor of Rose Gilbert for $1,427.

Jacob Wasserman was insolvent, whereupon these actions were brought against the insurance company pursuant to section 109 of the Insurance Law (Consol. Laws, c. 28) of the State of New York, which provides that the insolvency of the person insured shall not release the insurance carrier from the payment of damages sustained and that an action may be maintained by the injured person against the insurance company under the terms of the policy for the amount of the judgment which has been recovered. The policies of the defendant, in compliance with this law, contained the same provision. The company is liable according to the terms of the policy. The policy contained the following: ‘The assured shall at all times render to the company all co-operation and assistance in his power and whenever requested shall aid in securing information as evidence and the attendance of witnesses and in prosecuting appeals.’ If Jacob Wasserman failed to comply with this condition of the policy, he could not recover for any liability which he had met by payment, neither could the persons recovering the judgments,in case of his insolvency and nonpayment. They stand in his shoes and can only recover under the policy and this section of the Insurance Law when the assured has complied with this condition of the policy. Coleman v. New Amsterdam Casualty Co., 247 N. Y. 271, 160 N. E. 367.

The insurance company defended on the trial, pressed upon the attention of the court that Jacob Wasserman had not only failed to co-operate and assist the defendant in resisting these claims but had gone so far as to wrongfully aid and assist a recovery by the plaintiffs. The court, however, took the question from the jury and directed a verdict in favor of the plaintiffs for the amount of the judgments above stated. In this we think he was in error. The evidence should be submitted to the jury to determine whether Jacob Wasserman failed to comply with the above-quoted condition in the policy.

[3] After the commencement of the actions by his friends and associates, through his own attorneys, he made an affidavit for the insurance company which was the reason for its defending the claims. The negligence charged against Wasserman was fast driving. In this affidavit he swore that he...