Court Opinion

ID: 7949059
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:24:17.665699+00
Date Added: 2024-06-11T16:33:58.334031
License: Public Domain

Bird, J.
(dissenting). Plaintiffs are building contractors, While erecting a school building in the city of Flint, in 1911, they carried a policy in the defendant company, indemnifying them against loss on account of injury to their employees by accident. On July 5th, while Reuben Ritter, one of the employees, was engaged in cleaning the walls, he fell from the scaffold upon which he was standing and sustained an injury. On September 21st, he commenced suit against plaintiffs, claiming that his fall was due to the negligence of plaintiffs in failing to furnish him a safe place in which to work. Plaintiffs transmitted the summons to Stevens- T. Mason, who represented the defendant as counsel in this State. Mr. Mason, upon receiving it, caused defendant’s appearance to be entered in the cause, and later filed a plea therein. He was in attendance upon the trial and participated in it, although plaintiffs had their own counsel. The trial resulted in a judgment for Ritter of $900. Plaintiffs’ attorneys thereupon secured a stay of proceedings, so that an appeal to this court could be taken if desired by defendant, and Mr. Mason was ■ notified of this fact, and plaintiffs demanded that defendant pay the judgment in accordance with the terms of this policy, or effect an appeal. Defendant., refused to do either, *180whereupon plaintiffs paid the judgment against them, and instituted this suit to recover the amount. They recovered a verdict by direction of the court. Several assignments of error are relied upon in the brief, but we understand the number was reduced on oral argument to the following:
1. Did the fact that the defendant permitted its attorney to assist in the trial of the case of Ritter v. Burke, Smith & Nelson operate as a waiver or an estoppel?
3. Was the verdict in the case of Ritter v. Burke et al., binding upon the defendant herein?
6. Did the failure to give immediate notice of the Ritter accident relieve the defendant of liability under the policy?
1. The question as to' how far the judgment in the Ritter case is binding on the defendant is the principal question to be determined. The general rule with reference to the conclusiveness of a judgment on indemnitors is stated to be that:
“One who is notified of the pendency of an action and is given an opportunity to defend is concluded as to all questions determined therein which are material to a recovery against him in an action for indemnity brought by defendant in the original suit.” 22 Cyc. p. 106.
In Littleton v. Richardson, 34 N. H. 179 (66 Am. Dec. 759), the rule is stated as follows:
“The record of a verdict and judgment is always admissible to prove the fact that such judgment was rendered, or such verdict returned, in any case where the fact of such verdict or judgment, or the nature or amount of such judgment becomes material. * * * For any other purpose it is not evidence against a stranger, * * * but when a person is responsible over to another, either by operation of law or by express contract, * * * and he is duly notified of the pendency of the suit and requested to take upon him the defense of it, he is no longer regarded as a *181stranger, because he has the right to appear and defend the action, and has the same means and advantages of controverting the claim as if he was the real and nominal party upon the record. In every such case, if due notice is given to such person,, the judgment, if obtained without fraud or collusion, * * * will be conclusive against him, whether he has appeared or not, * * * of every fact established by it.”
See, also, Village of Port Jarvis v. First Nat. Bank, 96 N. Y. 550; City of Portland v. Richardson, 54 Me. 46 (89 Am. Dec. 720); Mayor, etc., of New York v. Brady, 151 N. Y. 611 (45 N. E. 1122); City of Lansing v. Railroad Co., 129 Mich. 403 (89 N. W. 54). The stipulation of facts in the present case shows beyond question that defendant had notice of the Ritter suit, and that its attorneys perfected the pleadings and was present and participated in the trial. This would make the judgment in the Ritter case conclusive upon it as to all material issues therein involved.
It is claimed, however, by defendant’s counsel that the defendant is saved from the operation of this general rule by the fact that when he was notified that Ritter had commenced suit, defendant’s participation thereafter was with the distinct understanding that it should waive none of its defenses of liability to the plaintiffs. The fact that defendant made this reservation in the Ritter case will not exempt it from the effect of notice of that suit. The reservation had .the effect simply of reserving to it the right to contest its liability. This precise situation occurred in the case of City of Lansing v. Railroad Co., supra, and the same claim was made, but the court there said in response to this contention that:
“The evidence was sufficient to charge the defendants with notice of the existence of the suit against the city. Robbins v. City of Chicago, 4 Wall. 657. The stipulation between the attorneys that the ap*182pearance of the attorney for the defendants should not bind them was not intended to relieve from the effect of the notice of the existence of the suit and the opportunity to appear. The stipulation meant no more than it should not prevent the railroad companies from raising any defense they had to the suit by the city against them upon any judgment that might be rendered against the city.”
We are of the opinion that the Ritter judgment was conclusive against the defendant in this suit as to all the material issues in the former one.
6. Did the failure to give immediate notice of the Ritter accident relieve the defendant of liability under the policy? The defendant sought to avoid liability under its contract by showing that plaintiffs did not comply with the terms of it in giving immediate notice to defendant of the accident. This question \yas not an issue in the Ritter case, and therefore was open as a defense in the present case. The accident occurred on July 5th¿ and the first notice defendant received was on September 21st. In fact, that was the first notice that plaintiffs had that any claim would be made against them. At the time defendant received the summons it made no objection on this account, but its counsel suggested that the blank form for giving notice thereof should be filled out as a matter of form, so that he might have it among his files in the case, and no objection was raised upon this ground until after judgment was rendered in the Ritter case. The failure to raise the question at that time and the subsequent participation in the trial and the perfection of the pleadings amounted to a waiver by defendant of plaintiffs’ failure to give immediate notice of the accident. We think the action of the trial court in directing a verdict for the plaintiffs was proper, and the judgment should be affirmed.
The late Justice McAlvay took no part in this decision.