Wellman v. Hawkeye-Security Ins. Co.

• Decision Date: 10 February 1959
• Docket Number: No. 49534,HAWKEYE-SECURITY,49534
• Citation: 94 N.W.2d 761,250 Iowa 591
• Parties: Robert D. WELLMAN, Appellant, v.INSURANCE COMPANY, Defendant-Appellee. Paul E. HODGSON, Sheriff of Hardin County, Iowa, and Receiver of the Properties of Dale Reisinger, Intervenor-Appellant, v.INSURANCE COMPANY, Defendant-Appellee.
• Court: Iowa Supreme Court

Page 761

94 N.W.2d 761

250 Iowa 591

Robert D. WELLMAN, Appellant, v. HAWKEYE-SECURITY INSURANCE COMPANY, Defendant-Appellee.

Paul E. HODGSON, Sheriff of Hardin County, Iowa, and Receiver of the Properties of Dale Reisinger, Intervenor-Appellant, v. HAWKEYE-SECURITY INSURANCE COMPANY, Defendant-Appellee.

No. 49534.

Supreme Court of Iowa.

Feb. 10, 1959.

Lundy, Butler, Lundy & Wilson, Eldora, for intervenor appellants.

Smedal, Maurer & Seiser, Ames, and Boardman, Cartwright & Druker, Marshalltown, for appellee.

OLIVER, Justice.

Plaintiff Wellman started this case as an action at law under Chapter 516, Code of Iowa 1954 (1958) I.C.A., claiming $95,000, plus interest and costs, from defendant Insurance Company, upon a policy of liability insurance issued by it to Dale Reisinger, against whom plaintiff was the holder of a judgment for that amount, for injuries plaintiff suffered in a collision, with Reisinger's insured motor vehicle, upon which judgment execution had been returned wholly unsatisfied. Thereafter a Petition of Intervention against defendant Insurance Company was filed by Paul E. Hodgson, County Sheriff, as Receiver of the properties of the judgment debtor Reisinger.

Division I of the Petition of Intervention alleged defendant Insurance Company insured Reisinger for $25,000; plaintiff was injured in the automobile collision; plaintiff sued Reisinger and defendant assumed control of the defense; trial to a jury resulted in the $95,000 unsatisfied judgment against Reisinger; defendant concluded not to appeal and tendered into court $25,714.67, thus precluding appeal by Reisinger; defendant was guilty of negligence and bad faith in the matter of the defense and settlement of the claim and suit; Reisinger was damaged $95,000 by the judgment, was rendered insolvent and suffered emotional stress, mental pain and anguish to his damage in the sum of $50,000, for which amounts, plus $70,000 exemplary damages, intervenor prayed judgment.

Division II pleaded also, in part, that defendant negligently and in bad faith refused compromise offers of settlement of the personal injury claim and action, for $25,000, failed to communicate one such offer to the insured, and failed to properly defend the action.

Division III of the petition of intervention contained similar allegations and stated also that intervenor relied upon the doctrine of res ipsa loquitur. The trial court sustained a motion by defendant to strike Division III on the ground the doctrine of res ipsa loquitur was not applicable under the circumstances pleaded. Plaintiff and intervenor have appealed from this order.

I. We conclude this order was correct. Eaves v. City of Ottumwa, 240 Iowa 956, 969, 970, 38 N.W.2d 761, 769, 11 A.L.R.2d 1164, thus states the rule:

'Under this doctrine, where injury occurs by instrumentalities under the exclusive control and management of defendant and the occurrence is such as in the ordinary course of things would not happen if reasonable care had been used, the happening of the injury permits but does not compel an inference that defendant was negligent. See Orr v. Des Moines Electric Light Co., 207 Iowa 1149, 1154, 222 N.W. 560; Sutcliffe v. Fort Dodge Gas & Electric Co., supra, 218 Iowa 1386, 1394, 257 N.W. 406; Pearson v. Butts, supra, 224 Iowa 376, 380, 276 N.W. 65; Highland Golf Club of Iowa Falls, Iowa v. Sinclair Refining Co., D.C.Iowa, 59 F.Supp. 911, 915, Judge Graven; Annotations 53 A.L.R. 1494, 167 A.L.R. 658, 665, 38 Am.Jur., Negligence, section 295.

'The res ipsa rule should not be confused with the proposition that negligence, like other facts, may be proven by circumstantial evidence. Existence of circumstantial evidence of negligence in a particular case does not mean the res ipsa doctrine is applicable in that case. Nor does rejection of such doctrine in a given case mean that negligence may not be established in that case by circumstantial evidence.

'In considering the applicability of res ipsa loquitur, the question whether the particular occurrence is such as would not happen if reasonable care had been used rests on common experience and not at all on evidence in the particular case that tends in itself to show such occurrence was in fact the result of negligence. (Citations.'

In this case the injury and damage to the insured, pleaded by intervenor, stems from the $95,000 judgment against the insured, which exceeded the $25,000 limit of defendant's liability as shown on the face of its policy. However, the facts alleged do not indicate that the instrumentalities causing this were under the exclusive management and control of defendants. In truth, they negative this. Defendant had charge of the defense, only, of the claim against insured. Obviously it did not have exclusive management and control of the instrumentalities causing the judgment. Nor can it be said that, in the ordinary course of things, judgments for damages in excess of the limit of liability policies would not be secured in the absence of negligence of the insurer in defending and settling the claim against insured. Hence, it appears that neither of the two elements essential for res ipsa loquitur is present.

II. Defendant has appealed from the order overruling its motion to strike the petition of intervention filed by the receiver for Reisinger's property. Plaintiff Wellman's action against defendant Insurance Company was instituted June 11, 1957. In its Amended and Substituted Answer to plaintiff's petition, filed January 13, 1958, defendant pleaded, 'that on June 12, 1957, it deposited and paid into the Clerk of the above entitled (trial) Court, the sum of $25,714.67, the same representing the sum of $25,000.00, being the face of said policy referred to, plus interest at five per cent on said sum from March 27, 1957, the date when the jury returned said verdict above identified, together with taxable court costs made in said cause. That by reason of such payment, that this defendant has fully discharged its liability in this instant action and which, as alleged by plaintiff in his petition, is brought against this defendant by virtue of the provisions of Chapter 516 of the 1954 Code of Iowa.'

The Receiver's Petition of Intervention filed in this case January 23, 1958, alleged in part, that defendant, in disregard of Reisinger's rights, 'concluded not to appeal said case and tendered into court on the 12th day of June, 1957, in the case * * * the sum of $25,714.67, thus precluding appeal by the said Reisinger, which sum now remains in the hands of the Clerk of Court.' Intervenor prayed that said $25,714.67 now in the hands of the clerk be condemned to apply upon the judgment prayed by intervenor.

An Amendment to Petition of Intervention, filed March 29, 1958, states:

'Division 1.

'11th. That the Defendant, by and through its agent and representative, one Zeman, tendered said $25,714.67 by delivering to Fred L. Miller, Clerk of the District Court of Hardin County, Iowa, a check therefor demanding and causing to be entered a docket entry as follows:

"June 12, 1957. Received draft #224302 in the amount of Twenty Five thousand seven hundred fourteen and 67/100 Dollars, same having been tendered by the Hawkeye-Security Insurance Company of Des...