East Carolina Railway Co. v. Maryland Casualty Co.

*116 Walker, J., .after stating the case: Tbe policy upon which this suit was brought is most clearly restricted to cases where the injury results to an employee of the insured from the negligence of some other employee, whose wages were on the pay roll of the company and included or considered in the estimate upon which the .premium was computed. Parties who are sui juris must be permitted to make contracts for themselves, and the Court, in the absence of any equitable element invoking its protection in favor of one or the other of the parties, must take the contract as it finds it and so construe it. It is true that, in passing upon contracts of insurance or indemnity like the one now in hand, the courts have adopted certain canons of interpretation, one of which is, that the contract will be liberally construed in favor of the assured, so as not to defeat, without a clear necessity, his claim for indemnity. When doubt arises by reason of the language employed to express the agreement, so that it admits of two interpretations, the courts, as a general rule, adopt that one which, without any violence to the words selected by the parties, will sanction the claim and cover the loss. Goodwin v. Assurance Society, 97 Iowa, 226; Kendrick v. Insurance Co., 124 N. C., 315. The leading idea which controls in such cases was well stated by Judge Douglas in Grabbs v. Insurance Co., 125 N. C., 399: “The extraordinary development of insurance, and its necessary adaptation to the varying and complicated business relations of a progressive age, tax the utmost ability of the courts. But, while different conditions may require the application of different rules, one great’ principle must always be kept in view, and that is, the ultimate object of all insurance. While we should protect the companies against all unjust claims and enforce all reasonable regulations necessary for their protection, we must not forget that the primary object of all insurance is to insure. We cannot permit insurance companies, by unreasonable stipulations, to evade the payment of such indemnity when *117 justly due, and thus defeat the very object of their existence.” And so in Bank v. Fidelity and Deposit Co., 128 N. C., 371, the same learned Judge tersely restated the rule: “The object of an indemnifying bond is to indemnify; and if it fails to do this, either directly or indirectly, it fails to accomplish its primary purpose .and becomes worse than useless. It is worthless as an actual security, and misleading as a pretended one.” The Supreme Court of the United States is equally explicit: “If, looking at its provisions, the bond is fairly and reasonably susceptible of two constructions — one favorable to the bank .and the other favorable to the surety company — the former, if consistent with the objects for which the bond was given, must be adopted, and this for the reason that the instrument which the Court is invited to interpret was drawn by the attorneys, officers or agents of the surety company. This is a well-established rule in the law of insurance.”. Am. and Surety Co. v. Pauly, 170 U. S., 144. In Bray v. Insurance Co., 139 N. C., 393, in considering the same principle of construction, where the meaning of any provision or of the entire policy is uncertain, we held that the interpretation should be such as to favor the plaintiff, or party insured or indemnified, assigning as one all-sufficient reason for this view of-the matter, “that the company has had the time and the opportunity, with a view to its own interest, to make clear its meaning by selecting with care and precision language fit to convey it, and if it has failed to do so, the consequences of failure should not even be shared by the assured, so as to deprive him of the benefit of the contract as one of indemnity for his loss.” Probably the most important general rule guiding courts in the construction of insurance policies is, that all doubt or uncertainty as to the meaning of the contract shall be resolved in favor of the insured. Vance on Insurance, p. 592. The latter author also says: “This rule, it is well settled, applies in full force to those contracts of special insurance which, unfortunately for both insurers and *118 insured., are often filled with, numerous conditions, the legal significance and economic purpose of which are alike uncertain.” Jones v. Casualty Co., 140 N. C., 264; Bank v. Insurance Co., 5 Otto, 673; Lumber Co. v. Fidelity and Casualty Co., 30 L. R. A., 691; Fenton v. Fidelity and Casualty Co., 48 L. R. A., 770. This Court has distinctly declared that, if a contract of insurance is'reasonably susceptible of two constructions, the uniform rule in all courts is to adopt that which is most favorable to the insured. Rayburn v. Casualty Co., 138 N. C., 382; Bank v. Insurance Co., 95 U. S., 673; Jones v. Casualty Co., 140 N. C., 265. But, while this salutary rule is well established, it is never enforced except in those cases to which it is strictly applicable and which come within its reason and purpose; and while we generally favor the insured when the company, by the language of its own selection, has created a doubt as to. what was meant, the rule will never be carried so far as to make a contract for the parties different from what they have made for themselves, and it is not "applicable when the intent of the parties has been clearly expressed and their rights can with certainty be ascertained from the language as used. Bray v. Insurance Co., 139 N. C., 393; Durand v. Insurance Co., 63 Vt., 437 (25 Am. St. Bep., 773) ; Vance on Insurance, p. 593. In this case it is perfectly clear what the parties meant. Indeed, there cannot well be two opinions about it. They have plainly contracted that the plaintiff should not be indemnified for any loss arising to one of its servants who is injured and who is either not on' the pay roll or within the list of estimated wages, or who was injured by a fellow-servant not within the same category. If the employee injured is not on the pay roll, or if the employee who injured him by his negligence is not, there is no liability. The exception is inclusive of both classes of servants, although expressed alternatively, or, as counsel said, disjunctively. Stated differently, the plaintiff, in order to recover, must have shown that both of the servants, *119 tbe injurer and tbe injured, were on tbe pay roll and not witbin tbe descriptive words of tbe exception from liability. Tbis is not an unreasonable view of tbe matter, as tbe basis of calculating tbe premium to be paid is just tbis very stipulation and requirement. If we should bold tbe plaintiff entitled to recover,-be would clearly receive a benefit and indemnity for which be bad never paid tbe defendant; and when it asserts tbe defendant’s liability to it, tbe latter may well reply non haec in federa veni. Tbe able and learned brief of Judge Battle is conclusive upon the question, and we do not hesitate to follow it, although confronted by a very .able and ingenious one by Mr. Bridgers. We do not understand why plaintiffs sue generally for $1,999, when a sum demanded not exceeding $2,000, exclusive of interest and costs, takes tbe case out of tbe jurisdiction of tbe Federal courts. 4 Anno. Fed. Statutes, pp. 265 and 312; Coffin v. Railroad, 118 Fed. Rep., 688. The judgment of tbe Court upon tbe verdict was correct, and we affirm it. Affirmed.