Teters v. Gass
| Decision Date | 21 November 1927 |
| Citation | 299 S.W. 788 |
| Parties | TETERS v. GASS et al. |
| Court | Tennessee Supreme Court |
Action by Arminda Teters against A. J. Gass and another in which defendant last named filed a cross-bill. From a decree dismissing the cross-bill on demurrer, defendant first named appeals. Affirmed.
Tatum & Tatum, of Chattanooga, for appellant.
Thompson & Ballard and Estill & Spurlock, all of Chattanooga, for appellee.
The complainant herein charges that she had recovered a judgment against the defendant Gass for damages growing out of an automobile accident; that Gass had no property subject to execution; that he was insured by his codefendant, Belt Automobile Indemnity Association, which was, by reason of its contract of insurance, indebted to Gass in the amount of the judgment, and it was sought to impound and subject this fund to the satisfaction of this judgment.
The insurance company answered, denying all the allegations of the bill. Defendant Gass filed an answer and cross-bill admitting the allegations and setting up the policy of insurance. He charged that the attorneys of the company, who had conducted the defense on the trial, after the verdict abandoned the case, on the theory that defendant Gass had been shown to have been drinking at the time of the accident, which fact he denied, and that the company thus breached its contract to defend.
Conceding that he had not paid, and was unable to pay, the judgment, defendant sought as cross-complainant to recover of the insurance company the amount of the judgment. The chancellor sustained the demurrer of the company to the cross-bill on the ground that the policy was one of indemnity against actual loss only, and that by the express terms of the contract no recovery could be had by the insured except for a sum shown to have been paid by him. Cross-complainant has appealed.
The theory of appellant, plausibly presented, is that (1) the "no action clause"; and (2) eliminating this "no action clause," the contract is not limited to indemnity against loss actually sustained and paid; and (3) the company, having breached its contract to defend, was liable for the natural consequence of its breach, and the measure of damages was the amount of the judgment.
Authorities from other jurisdictions are relied on, but, without a review of them here, it is clear that those which appear to sustain the insistence of counsel for appellant are not in harmony with our own reported cases. The questions presented have been definitely ruled by this court against the appellant in Finley v. Casualty Co., 113 Tenn. 592, 83 S. W. 2, 3 Ann. Cas. 962; Cayard v. Robertson, 123 Tenn. 382, 131 S. W. 864, 30 L. R. A. ...
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Haun v. Guaranty Sec. Ins. Co.
...in the instant case is one of liability or indemnity. This rule of construction was followed in the later case of Teters v. Gass, 156 Tenn. 127, 299 S.W. 788 (1927). The language of the contract in the instant case is perhaps even more clearly that of indemnity against loss only, than that ......