Case Name: Hilda Stapley, Respondent, v. United States Casualty Company, Appellant
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1932-11-22
Citations: 260 N.Y. 323
Docket Number: 
Parties: Hilda Stapley, Respondent, v. United States Casualty Company, Appellant.
Judges: 
Reporter: New York Reports
Volume: 260
Pages: 323–330

Head Matter:
Hilda Stapley, Respondent, v. United States Casualty Company, Appellant.
(Argued October 17, 1932;
decided November 22, 1932.)
Thomas G. Rickert for appellant.
The payments made by the defendant to the plaintiff constituted performance of the condition of the undertaking and discharged the defendant of all liability thereon, (,Shapiro v. Equitable Casualty & Surety Co., 256 N. Y. 341; Winter v. Kinney, 1 N. Y. 365; Toles v. Adee, 84 N. Y. 222.)
Charles F. Doehler for respondent.
The present undertaking on appeal having been given to perfect the appeal and to stay execution made the defendant herein liable for the whole judgment and the present undertaking on appeal inured as a common-law agreement and is enf orcible according to its terms. (Haskell v. Fidelity & Casualty Co., 193 N. Y. Supp. 738; 205 App. Div. 858; Rawlin v. New Jersey Fidelity & Plate Glass Ins. Co., 221 App. Div. 399.) The filing of and the language of the present undertaking on appeal shows and indicates clearly the defendant’s intention to enlarge its liability under its automobile liability policy. (McElroy v. Mumford, 128 N. Y. 303; Shapiro v. Equitable Casualty & Surety Co., 256 N. Y. 344.) The defendant is liable on the present undertaking for the balance due on the judgment and the payments made upon the automobile liability policy did not discharge the defendant of its liability on the appeal bond. (Haskell v. Fidelity & Casualty Co., 193 N. Y. Supp. 738; 205 App. Div. 858; McÉlroy v. Mumford, 128 N. Y. 303.)

Opinion:
Lehman, J.
The plaintiff recovered a judgment in the sum of $6,500 against Arthur Aldrich for damages caused by negligence. An appeal was taken from that judgment. The appellant could not stay the execution of the judgment without " a written undertaking to the effect that if the judgment appealed from is affirmed, or the appeal is dismissed, he will pay the sum recovered or directed to be paid by the judgment." (Civ. Pr. Act, § 594.) The undertaking on appeal recites that the " plaintiff has agreed to a stay' of execution of said judgment upon the filing of an undertaking in the sum of Five Thousand Dollars," and provides that the United States Casualty Company does " undertake that the appellant will pay all costs and damages which may be awarded against the appellant on said appeal, not exceeding Five Hundred Dollars, and does also undertake, in the sum of Five Thousand Dollars, that if the judgment or order so appealed from, or any part thereof, is affirmed, or the appeal is dismissed, the appellant will pay the sum recovered or directed to be paid by the judgment in all not to exceed said sum of Five Thousand Dollars."
The judgment in plaintiff's favor against Aldrich has been affirmed. At the time of the accident the United States Casualty Company had issued to Aldrich a policy, insuring him against liability for damages in the amount of $5,000. Under the terms of that policy the plaintiff, upon the return of execution unsatisfied, had the right to maintain an action against the casualty company to recover " the amount of the judgment not exceeding the amount of the policy." The casualty company paid to the plaintiff the amount of the policy, viz., $5,000, together with the costs of the action. The plaintiff then began this action against the casualty company to recover the sum of $1,500, viz., the excess of the amount of the judgment in the negligence action over the amount of the policy.
The defendant maintains that its obligation upon the undertaking on appeal is no wider than its obligation under the policy of insurance which it had previously issued; -that both are limited to $5,000, and that both are completely met when that amount has been paid upon the judgment. Doubtless the defendant's obligation upon its undertaking is defined solely by the language of the bond. It cannot be extended by the court to afford the plaintiff the protection which she probably supposed she was receiving, if the defendant did not agree to give such protection. The problem is whether the defendant's undertaking is only that $5,000 shall be paid upon the judgment, or whether it undertook that the judgment should be paid but limited its own liability to the sum of $5,000.
The same problem was presented under analogous conditions in Shapiro v. Equitable Casualty & Surety Co. (256 N. Y. 341, 345). There the bond recited that it was " conditioned to secure payment of $2,500 upon judg~ ?nents " and it provided that the surety undertook " that the appellant will pay such judgments not exceeding, however, the sum of $2,500 and does also undertake that if the judgments so appealed from are affirmed the appellant will pay the sum recovered up to the amount mentioned herein." A majority of the court concluded that the undertaking of the surety was only that the appellant will pay "up to " the sum of $2,500, and that the bond was, as it stated, conditioned to secure the payment of $2,500 on the judgments. When that payment was made by the appellant the condition was met, and no action could be maintained on the bonds.
In that case we pointed out that the problem would be different if the surety had " undertaken that the principal would pay the judgment but limited its liability to $2,500." Here, as we have pointed out, the recital in the undertaking is that the plaintiff has " agreed to a stay of execution of said judgment upon the filing of an undertaking in the sum of Five Thousand Dollars," not, as in Shapiro v.Equitable Casualty & Surety Co., that the undertaking is conditioned to secure the payment of that sum upon the judgment. From the recital in the bond it is evident that the parties intended that the usual appeal bond required by section 594 of the Civil Practice Act should be filed in order to obtain a stay of execution, except that the liability of the surety might be limited. Again, the contractual parts of the bond, fairly construed, carry out that intent. The surety company undertakes that the appellant will pay all costs and damages awarded against the appellant on the appeal not exceeding $500. That is the statutory undertaking to perfect the appeal. Then " it also undertakes in the sum of $5,000 " that " the appellant will pay the sum recovered," and the limitation " in all not to exceed the sum of Five Thousand Dollars " is to be construed merely as a limitation of the amount which the surety company may be called upon to pay under both parts of its undertaking.
Thus here we have a limitation only upon the amount of the defendant's liability under its bond if the judgment is not paid; while in the earlier case the limitation is upon the amount which the surety undertakes the appellant will pay. In that case the condition was met by the payment of the amount secured; in this case the condition is breached by failure of the appellant to pay the amount recovered. The judgment in this case is in accordance with our decision in the earlier case. The basis of that decision is wanting here, and we pointed out in our earlier decision the distinction which dictates the judgment granted here against the defendant.
The judgment should be affirmed, with costs.