Griffith v. Frankfort General Insurance

Goss, J. Tbe questions for decision in tbe main are merely of fact and within the pleadings. They arise from an examination of the testimony to ascertain whether there was sufficient conflict to take any issue of fact to the jury. In other words, the principal question, arising under the pleadings, proof, and motion for judgment for the defendant notwithstanding the verdict of the jury, is whether there is sufficient evidence to sustain the verdict upon the issues as framed by the pleadings. Plaintiff in 1913, through contractors, erected a block in Grand .Forks. Plaintiff procured of 'defendant an employer’s liability insurance policy indemnifying plaintiff against liability for damages from any injuries from negligence that might occur to the workmen in the erection of said building. On August 4, 1913, one John Westby was injured while working on said building. Griffith saw that doctors were secured and that Westby was taken to the hospital, and then notified Holmes, the agent of defendant company and who issued the policy to the plaintiff, and received from him instructions to see Westby and find out the best settlement that could be made with him. Westby subsequently demanded a settlement of plaintiff, who told him that he had nothing to do with the settlement, but that Holmes wanted him to see what Westby would take to settle, and tallied with Westby about a settlement. Westby demanded $250 damages and the doctor’s bills and pay for lost time. He was told to see the insurance company; that he would have to settle with them. Griffith, however, took the matter up with Murphy & Toner, defendant’s attorneys, and reported to them what Westby wanted in settlement, and sent Westby to their office. No settlement was made. As the time passed Griffith paid Westby $30 that he was owing him for wages at the time of the accident, and at different dates further amounts aggregating an advance of $150. Griffith informed the office of Murphy & Toner of this advance, leaving a state — 552 — mént of tbe amount with their clerk. He 'was directed by Holmes not to make any further advances to Westby, and did not do so. On November 23, 1913, nearly four months after the injury, Westby met at Murphy & Toner’s office one Hogsett, an adjusting agent or claim agent of the defendant company, and talked with him about settling his claim against Griffith and the contractors. Westby made the same demand that he had made of Griffith. “I asked him for the same thing as I asked Griffith, for $250 and full time, and he was going to see the insurance company about it, — he was going to find out.” “He asked me what I wanted, and I told him I wanted $250 and full time.” Westby had a statement of his time along with him, and gave it to Hogsett. The copy in evidence shows an itemized claim from October 5th to November 5th, amounting to $276.50, for wages claimed due during the time lost. On the back thereof are figures which West-by swears were written upon the back of the original statement at that time by the agent, viz., 250. 276.50 526.50 150. 376.50 This computation is quite material under testimony as to the subsequent transaction when the claim was settled. The whole issue of fact is whether this adjuster, in the subsequent settlement in which $376.50 was paid, told Westby, or knowingly lead him to settle under the belief, that the defendant company would pay Griffith this $150 deducted as above in addition to the $376.50 it paid on such settlement to W. Westby saw the agent do this figuring, and the agent then and there made him an offer of $100 damages and full time in full settlement, and which Westby refused to accept. The parties separated without effecting a settlement. Three days later, November 26, 1913, Griffith received a phone call from Murphy & Toner’s office to send Westby over, and found him and sent him over. Hogsett was there, and Westby’s testimony is that “he asked me if I — 553 — felt any different or if I conld do a little cheaper, I don’t know for sure how he said it. I said, ‘No,’ I wanted the same as I asked for the first time.” Q. “What did he say to you then ?” A. “ ‘Well, come in here and we will settle.’ And he took me into the other room,” where Murphy was. They produced a paper, the release that had been prepared for West-by’s signature, and as he could not read it, read it to him and gave him a check for $376.50. Q. “Then, what did you do next ?” A. “Well, Murphy cashed the check and gave me the cash money.” Q. “Yes, what was said at the time?” A. “I asked him before I signed my name if he was going to settle everything there was against me. He says ‘Yes, and this money is all yours, he says.’ ” The agent testifies to a different statement. He agrees that when Westby was just about to put the pen to the settlement, Westby interrogated him concerning what was settled. And that Westby had claimed for lost time amounting to $276.50, but says that Westby stated: “I have lost time amounting to $276.50, and I want to get $126.50 and $250. damages.” He also admits that Westby told him, he, Westby, had received $150 from Griffith; that “there wasn’t any question but what he was asking $250 additional” for damages, nor that the statement was presented for $276.50 for lost time. Hogsett was asked on cross-examination, “Did you tell him he would have to pay out of the $376.50 any expenses incurred? A. “I did not.” Q. “You testified that you specifically called the attention of Westby at the time this settlement was made that the $150 that Griffith had advanced didn’t concern him ? A. “No, I wouldn't, put it that way. He specifically called that subject to my attention and that is what I said. I didn’t go out of my way to say that. It came up naturally in answer to his question, and I didn’t put it quite as you state. He simply says: ‘What about this $150 that Griffith has paid me,’ and I told him that that was a matter that had nothing to do with this settlement, possibly I might have used the expression you used, it didn’t concern him, I don’t know how I put — 554 — it, but that was tbe gist of it, and that I was not authorized to make any payment of that amount as is the fact.” Q. “Did you tell Westby that he would have to pay that back to Griffith?” A. “No, that question wasn’t discussed about his paying it back.” This reflects the contention on the facts of the parties. It might also be stated that there were other bills subsequently paid by the company, growing out of Westby’s injury, such as $6 to the Deaconess Hospital; $16 for doctor bills to Wheeler, Williamson, & Campbell, for treatment of Westby and two others; $3 for ambulance charge for conveying West-by and another to the hospital. Which bills were recommended for payment by the adjuster on November 26, 1913, in his report to the company, and in which letter is found the following significant paragraph: “I believe there is no good reason for reimbursing the assured (Griffith) for the $150 lost time he paid to Westby and $50 lost time to Olson, and understand from your telegram of the 26th that you think likewise. The payment of this lost time did not help matters at all, but on the contrary tended to make the claimant more arrogant and independent in our negotiations for settlement. I found it absolutely impossible to get either of them to reduce his offer a cent.” Several telegrams are in evidence between the agent and the company. The agent’s authority was undoubtedly limited, in fact, to following the instructions of the company; and the company evidently had determined not to reimburse Griffith for this $150 advanced. It evidently based its refusal upon a clause in the policy that, “except as requested by the company, the insured shall not interfere in any way respecting any negotiations for the settlement of any claim or suit, or in the conduct of any legal proceedings,” and asserts in. the answer that such advances were in violation of and contrary to the contract of insurance. This feature of the case will be later discussed. Westby’s testimony standing alone is sufficient to take the case to the jury on the facts. The testimony of the agent does not change the situation. If we were to weigh the testimony we would say that it strengthened it, all things considered. The jury could conclude from the evidence that Hogsett knew that Westby believed the $150 would be paid in addition to the amount that was paid him, and was deceived and mislead into accepting the money Horn the agent under the belief — 555 — that the $150 advance with other bills pending, would also be paid by the company. Westby had refused the same settlement, $100 and for full time, at the first interview. The agent knew this when, at the opening of the next one three days later, he asked if he could not settle cheaper than his original demand; and, on Westby’s statement that he would not take any less, says, “Well, come in here and we will settle,” —almost the equivalent of a statement that he would, settle at the .amount demanded which included the $150 item to Griffith, as Ifogsett well knew. And when about to sign the release the agent admits West-by asks him a question, “What about this $150 that Griffith has paid me?” While Westby says he asked “if he was going to settle everything there was against me,” and to which the agent replied, “Yes, ■and this money is all yours,” which could be well taken as an assurance that this amount paid was for Westby while the others, Griffith among them, would be paid. And the subsequent report of the agent that day to his company, that “I found it absolutely impossible to get either man to reduce his offer a cent,” impeaches his testimony wherein he would have the court believe (as it must conclude if defendant prevails) that Westby did actually cut his claim $150, and accept the .amount offered him in the first interview, at that time promptly rejected. Only one offer was made, so there can be no confusion on what ■offer was meant in that report. There was sufficient testimony to go to the jury on this question. But appellant claims that Westby knew the limitations, on the authority of Hogsett, to pay only the amount he was authorized by his company to pay, and that he knew the settlement as made was unauthorized. Two answers may be made to this, either of which is sufficient: 1st. This depends for proof entirely upon the agent’s testimony, which under the rule of false in part false in ioio, it might well be found that Westby knew nothing of any want of authority in the agent to settle according to the agreement entered into; and 2d. In order to avail of any such want of authority the company must repudiate the entire settlement. It could ratify any unauthorized settlement its agent made, and has ratified by not repudiating it in ioto. It could not stand on and rely on rights obtained by an unauthorized settlement, and assert at the same time that the settlement was void because unauthorized. If, by that settlement, it retained $150 to be — 556 — paid Griffith in release of Griffith’s claim against Westby for that amount advanced Westby by Griffith, it must pay Griffith or repudiate in boto the settlement with Westby. It cannot avail 'itself of a favorable settlement with Westby, relieving itself of liability on its insurance contract, and at the same time assert that the money it retained by its agreement with Westby shall not be paid to Griffith, to whom it agreed with Westby to pay it, simply because it had a defense and possibly co-uld have avoided its obligation to pay anything because of Griffith’s advances. Any right to interpose such a defense was waived when it settled Griffith’s liability to Westby, and thereby recognized its liability under the insurance contract by performing its contractual responsibility thereunder. It had the option to waive the effect of the advance, and did so by settling under the policy the liability of Griffith to Westby. After so doing, it cannot set up this provision of the policy to defeat Griffith’s recovery of money Westby left with it for Griffith under the settlement it made with knowledge of that advance. None of appellant’s authorities are applicable to these facts. The instructions were correct and within the issues. Appellant has sought to surround its case with questions of agency that are not properly in it. This lawsuit was born in the agent’s deception of West-by, and in his report to his company encouraging refusal to pay Griffith. Judgment is affirmed.