Armstrong v. Employer's Liability Assur. Corp. , 125 Miss. 570 ( 1921 )

Sykes, J.,

delivered the opinion of the court.

The appellant sued the appellee company in the circuit court for three thousand five hundred dollars, based upon an indemnity insurance policy for the amount of a judgment rendered against appellant because of the accidental striking and killing of a man by the name of Kelly by appellant’s automobile while driven by a young lady. The sad accident occurred in the city of Brookhaven. At the time of this accident the appellant had an insurance policy with the appellee company. Agreement No. 1 in this policy is as follows:

“To pay any loss by reason of the liability imposed by law upon the assured for damages on account of bodily injuries, including death at any time resulting therefrom, accidently sustained during the policy period by any person or persons, other than employees engaged in operating or caring for the automobiles covered, as the result of the ownership, maintenance or use of any of the automobiles enumerated and described in item 8 of the Declarations.”

The appellee’s limit of liability for one person injured under this policy was five thousand dollars. 'Conditions C and D of the policy are as follows:

“C. Upon the occurrence of an accident covered by this policy, the assured shall give immediate written notice thereof, with the fullest information obtainable at the time, to the corporation’s home office at Boston, Mass., or to the corporation’s authorized agent. If a claim is made on account of such accident the assured shall give like notice thereof with full particulars. The assured shall at all times render to the corporation all co-operation and assistance in his power.

“D. If thereafter any suit, even if groundless, is brought against the assured to enforce a claim for damages on account of an accident covered by this policy, the assured shall immediately forward to the corporation every summons or other process as soon as the same shall have been served on him, and the corporation will, at its own cost, and subject to the limitations referred to in condition A hereof defend or at its option settle such suit in the name and on behalf of the assured.”

These are the agreements material for a decision of this case.

It is unnecessary to set out in detail the pleadings. The testimony in the case is practically undisputed. Briefly stated, this testimony is as follows: That immediately after the killing of Mr. Kelly, Mr. Armstrong notified the insurance company of the accident, and the insurance company made investigation of the facts. Shortly thereafter suit was filed by the Kelly heirs against Mr. Armstrong and the young, lady for forty thousand dollars. The insurance company was at once notified of this suit, and its attorney, Mr. Marshall, took active charge of the defense. Mr. Armstrong and the young lady each employed counsel to assist in the defense, all of which Avas agreeable, to the insurance company. Before the case came on for trial in the circuit court of Lincoln county, the question of a compromise Aims discussed by the attorneys of the insurance company, Mr. Armstrong, and the young lady. The attorney of the insurance company ascertained from the company that it Avould be willing to pay two thousand live hundred dollars in compromise of the case, and this fact was communicated to Mr. Armstrong’s attorney. Later on, through its attorney, the insurance company agreed to pay three thousand dollars as its part of a settlement. In these conferences it was stated by the attorney of the insurance company that he had no authority from the company to offer any amount over the sum of three thousand dollars. The suit Avas pending at Broolchaven, in Lincoln county. The attorney of the young lady lived there, the attorney of Mr. Armstrong lived in Jackson, and the attorney for the insurance company lived in Bay St. Louis. It was understood that neither the insurance company’s attorney nor Mr. Armstrong’s attorney would come to Brookhaven until notified by the attorney of the young lady.

Shortly after the convening of the circuit court at Brook-haven the question of compromise came up betAveen the attorney of the young lady and the attorney of the Kelly representatives, various proposals and counter proposals being suggested. These proposals were communicated to Mr. Armstrong’s attorney in Jackson. This attorney got in touch Avith the attorney of the insurance company at Bay St. Louis, and asked him if the appellee company Avould not increase its offer of compromise to three thousand five hundred dollars; that there Avas a probability of being able to settle the case for this amount. The attorney for the insurance company at once attempted to get in touch with the proper officer of the company to see whether or not the company would increase its offer of settlement. He failed, however, to do so, aiid promptly notified Mr. Armstrong’s attorney at Jackson to this effect, and that be was only authorized to offer for the company three thousand dollars in compromise. The attorneys for the Kelly heirs finally agreed to settle the case for three thousand five hundred dollars, provided this amount was paid at once, and Mi;. Armstrong and his attorney were notified of this fact by the Brookhaven attorney, and Mr. Armstrong promptly sent his check for three thousand five hundred in settlement of the claim. ' At the time this was done Mr. Armstrong and his attorney both knew that the insurance company had only offered to pay three thousand dollars as its part of the compromise. Releases were taken from the Kelly heirs when this amount was paid them, and their suit was marked dismissed upon the dockets of the court. The fact of, the settlement for three thousand five hundred dollars was then communicated to the attorney of the insurance company, and he Ayas informed that the suit had been dismissed, but that in case he preferred any other order to be entered in the ease, the Brookhaven attorney courteously offered to see that it was done. The attoimey of the insurance company then prepared a formal judgment to be entered in the case. This judgment recited a trial by jury, and a verdict in favor of the plaintiffs for three thousand five hundred dollars. Copies of this judg-ement were mailed to the Brookhaven attorney and to Mr. Armstrong’s attorney in Jackson, and the judgment was duly entered on the records of the circuit court of Lincoln county, the order of dismissal having previously thereto been set aside. This judgment was entered several days before that term of the circuit court adjourned. After the 'adjournment of the court, the insurance company through its attorney offered to pay the three thousand dollars as its share of the amount for which the case was settled. Mr. Armstrong declined to accept this amount, claiming that under the policy the insurance company should pay the whole am.ount of the judgment, namely three thousand five hundred dollars, together with all costs. This the insurance company declined to do, claiming that it was only liable for three thousand dollars. Before the adjournment of the circuit court of Lincoln county this judgment for three thousand five hundred dollars was marked satisfied by the Kelly heirs.

It is the contention of the appellant in this case, that all of the testimony relating to agreements 6f settlement, the settlement itself, and the amount that the insurance company offered to pay as its part of this settlement was inadmissible, because its effect was to impeach the verity of the judgment of the circuit court of Lincoln county in this case; that the insurance company was actively in defense of this suit, wrote the judgment in the case; consequently is a privy to the judgment and is bound thereby; that this judgment recites a trial by a jury and the rendition of a verdict for three thousand five hundred .dollars in favor of the plaintiffs; that under its policy of insurance (agreement No. 1) the insurance company agrees “to pay any loss by reason of the liability imposed by law upon the. assured for damages on account of personal injuriesand that the satisfied judgment is the best and only evidence of the loss sustained by the assured. The authorities relied upon by the appellant to the effect that this judgment imputes verity, and cannot be attacked or impeached, in this proceeding, except for fraud, are universally recognized in this state. The appellee is not attempting to impeach this judgment in this case. The testimony shows that the appellant did not sustain any loss because of this judgment, because he did not pay out any money by virtue of the rendition of the judgment. The money paid out by him, or the loss sustained by him, was paid out, or incurred, before the rendition of the judgment. Because of the payment of this money before the rendition of the judgment the judgment was voluntarily satisfied by the plaintiffs. The judgment itself is not impeached nor attacked by showing that the loss incurred by the appellant under agreement No. 1 of this policy was incurred before the rendition of the judgment. At the time the appellant paid out this money he understood that the insurance company was only willing to contribute three thousand dollars of this amount; consequently he cannot recover the overplus paid out by him.

There was a peremptory instruction in appellant’s favor for three thousand dollars, together with the costs of the circuit court of Lincoln county, and the judgment is affirmed.

Affirmed.