Peabody v. Germain

Cullen, J.:

I think the plaintiff should have been allowed to serve a supplémental complaint setting forth his final recovery of judgment in the action brought against the attorney for the underwriters. The second judgment in that action was recovered after this action was at issue, and the plaintiff should not be debarred from pleading it unless the recovery is wholly immaterial and irrelevant. If the question of the effect of the second judgment is a close one and fairly debatable, its determination should be made not on an application to serve a supplemental or amended pleading, but on demurrer or at the trial. (Mitchell v. Allen, 25 Hun, 543.)

The question before us arises upon one of those perplexing and troublesome provisions of- the Lloyds insurance policies, which we have recently discussed in Gough v. Satterlee (32 App. Div. 33). The plaintiff first brought suit against the attorney for the underwriters, and recovered judgment by default. He issued execution on the judgment, which was returned unsatisfied. Thereafter he brought this action, and in his complaint set up the recovery of the judgment against the attorney. While this action was at issue, and about a year after the default was taken, the attorney obtained an order opening that default and vacating the judgment. The attornev’s action was tried on its merits, and the plaintiff again recovered judgment. This judgment he seeks to set up by supplemental complaint. The learned judge at Special Term denied the application, on the ground that the judgment' against the attorney having been vacated, the plaintiff had no cause of action against the defendant in this suit. I am unable to find, however, anything m the terms of the policy, so far as they'are set out in the pleadings, which makes the recovery of a judgment against the attorney a condition precedent to the institution of á suit against the other underwriters. " There is a provision that no suit under a policy shall be brought against more than one of the underwriters “ at any time.” If the plaintiff has violated this condition, that is a matter of defense for the defendant to plead. I think the language “ at any time ” must be construed as meaning at the same time; otherwise it is difficult to see how «the liability of the underwriters could ever be 'enforced. No stipulation made in a policy that one of the parties should be bound by a judgment recovered on the policy against any other party, could authorize the issue of process on a judgment .against the property of any persons except those against whom the judgment was recovered. The plaintiff did not. violate this condition of the policy as I have construed it; for at the time he brought this suit his action against the attorney was not pending, but had terminated in final judgment,

But while the recovery of the judgment in the first suit is no part of the plaintiff’s cause of action, it is material and relevant because of the stipulation in the policy that that judgment should be conclusive on the several underwriters as to the extent of their liabil- ' ities.. For this reason the plaintiff has the right to plead it.

The order should be reversed, with ten dollars costs and disbursements, and motion for leave to serve supplemental complaint granted, without costs.

■ All concurred, except Goodrich, P. J., who read for affirmance, and Hatch, J., not sitting.