Standard Accident Ins. Co. of Detroit v. Hull

• Decision Date: 24 May 1950
• Docket Number: No. 10550-C.,10550-C.
• Citation: Standard Accident Ins. Co. of Detroit v. Hull, 91 F.Supp. 65 (S.D. Cal. 1950)
• Court: U.S. District Court — Southern District of California
• Parties: STANDARD ACCIDENT INS. CO. OF DETROIT, MICH. v. HULL et al.

91 F. Supp. 65

STANDARD ACCIDENT INS. CO. OF DETROIT, MICH. v. HULL et al.

No. 10550-C.

United States District Court S. D. California, Central Division.

May 24, 1950.

Bauder, Gilbert, Thompson, Kelly & Veatch, Los Angeles, Cal., attorneys for plaintiff.

Cletus J. Hanifin, Los Angeles, Cal., attorney for defendant Amelia Hull.

David Licker, Los Angeles, Cal., attorney for defendant Celia Rogow.

Levy, Bernard & Jaffe, Los Angeles, Cal., attorneys for defendant Wallace Berry.

CARTER, District Judge.

This case presents the question of the liability of an insurance carrier for attorney's fees in a declaratory relief action filed to determine whether or not it must defend an action commenced in the State courts against its assured.

The Facts

On April 17, 1949, Standard Accident Insurance Company, herein called the Company, issued its "Automobile, bodily injury, liability policy" to Amelia Hull, defendant herein.

The insuring agreements therein contain, under Coverage A—an agreement to pay in behalf of the insured all sums for which the insured shall become legally obligated as damages for bodily injury; and under Coverage C—entitled "Medical Payments" to pay all expenses incurred within one year from the date of accident for necessary medical and related services "to or for each person who sustains bodily injury" caused by accident while in the automobile used by the insured, or with her permission.

The policy also contained a section on exclusions, providing for certain instances where the coverages under A—"Bodily injury liability" and C—"Medical payments" should not apply. The wording of these exclusion provisions are of no interest in this opinion on attorney's fees.

Thereafter on July 23, 1949, while Amelia Hull was riding in the automobile named in the insurance policy, together with Celia Rogow and Wallace Berry, and while Wallace Berry was driving the car with the consent of Amelia Hull, owner, an accident occurred in which Celia Rogow claimed to have sustained personal injuries and out of which accident claims for medical payments under Coverage C of the policy were made against the Company by Wallace Berry and Celia Rogow.

On or about September 13, 1949, Celia Rogow commenced an action in the Superior Court of the State of California against Amelia Hull and Wallace Berry for personal injuries and special damage. The Company, relying upon the exclusion provisions of the policy referred to above, then commenced on November 10, 1948, this action in the District Court for declaratory relief, naming as defendants, Amelia Hull, Celia Rogow and Wallace Berry, and alleging that claims had been made against the Company by them and that the Superior court action had been filed, and praying an adjudication that the Company was not obligated to defend Hull or Berry, owner and driver, or to make the medical payments to Rogow and Berry claimed under Coverage C of the policy.

Issues were drawn and the case tried, resulting in a decision by this court in favor of the defendants and against the plaintiff and deciding in substance that the Company was required to defend the Superior court action, and to make the medical payments provided for in the policy.

Each of the defendants, Hull, Rogow and Berry have filed a counter-claim in which each asks a reasonable attorney's fee for the defense of this action.

Attorney's fees can ordinarily be obtained by a prevailing party against an adverse party only by virtue of:—

1. A statute or a rule of court, or

2. The provisions of a written agreement or contract.

In cases such as Phoenix Indemnity Co. v. Anderson's Groves, Inc., 5 Cir., 176 F.2d 246, attorney's fees were allowed by virtue of a state statute so providing. There is no such statute in California.

The question remains, whether or not the agreement, i. e. the policy of insurance, affords this relief. In London Guarantee & Accident Co., Ltd., v. Shafer et al., D.C., 35 F.Supp. 647, and State Farm Mutual Automobile Ins. Co. v. Brooks, D.C., 43 F. Supp. 870, the basis for the fees were the provisions of the written insurance agreements and the fees were allowed for defending the primary actions and not as fees in the declaratory relief proceedings. A careful reading of Ocean Accident & Guarantee Corp., Ltd., v. Heald et al., D.C.E.D.Pa. 1939, 30 F.Supp. 991, shows that in this case also attorney's fees arose under the policy. The court in that case directed the opening of the judgment and a new trial "limited to the issue whether, under the policy, the insurer is liable for the insured's attorney fee, and, if so, the proper amount."

The claim of Rogow and Berry based on Coverage C — Medical Payments.

The "insuring agreements" as to Coverage C, Medical Payments, provide as follows:

"Standard Accident Insurance Company * * * agrees with the insured * * * to pay all...