Court Opinion

ID: 3716184
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:49:02.78922+00
Date Added: 2024-06-11T14:20:50.670716
License: Public Domain

The defendant insurance company defends on the ground that the failure of insured to co-operate worked a rescission and discharge of the policy.
In a suit by a judgment creditor to recover against the insurance policy, under Section 9510-4, General Code, the terms of the policy that are binding upon the insured are likewise binding upon the judgment creditor. Stacey v. Fidelity  CasualtyCo., 114 Ohio St. 633, 151 N.E. 718. The policy contained a clause requiring the insured to co-operate with the insurer in making defense against damage claims, and the court below held that, because the insured did not so co-operate, the plaintiff could not recover. The only manner in which it could be reasonably claimed the insured did not co-operate was in his failure to attend the trial in the action for damages. Under the undisputed evidence, the insured did not have any notice of the trial until at least two days after it was completed. The manner in which it was claimed he did not co-operate was in not giving notice of his whereabouts. The insurance *Page 217 
company knew that his address had been at the Spot Restaurant, 1202 Yondota street, Toledo, Ohio. Under the undisputed evidence, he told the representative of the insurance company that he would keep the office in touch as to where he was, so that they could get him at any time. This he evidently did to the extent of keeping the people at his address in Toledo informed of his whereabouts, as a letter addressed to that point followed him to Lorain, where he was at the time of the trial.
Assuming that there was enough evidence to warrant the court, a jury having been waived, in finding that the insured failed to co-operate, there is still another vital question involved in the case. The insurer agreed to defend the action for damages "in the name and on behalf of the insured." The damage case was assigned for trial in the common pleas court for Thursday, April 2, 1925. On the Monday before, the attorneys for the insurance company, who were also the only attorneys appearing for the insured at the trial, wrote a letter addressed to the insured's Toledo address, which the insured did not receive until two days after the trial was completed. The letter was registered, and a return receipt demanded. This return receipt was mailed back to the sender three days after the trial had been completed. The attorneys, therefore, knew the letter had not been delivered. They were attorneys for the insurer as well as the insured, and they made no further effort to get the insured by telephone or by process of court, and made no application for a postponement of the trial, nor any application for a continuance. In fact, it does not appear that any information was given to the trial *Page 218 
judge relative to the situation. The attorneys owed both of their clients the obligation of fidelity, and, if it was necessary to the proper defense of the action to have the defendant present, in order to make proper defense, surely counsel were in default in not further endeavoring to procure his attendance, and were therefore in default in bringing about the lack of co-operation on the part of the insured.
The principle applicable is well stated in 13 Corpus Juris, p. 614, Section 662:
"(2) Party Rescinding must not be in Default. A party who is himself in default of performance cannot rescind. The party seeking rescission must be willing and in a position to perform his part of the agreement. So where the contract is entire and performance by one party is a condition precedent to recovery on his part, he cannot rescind because payment for part performance is refused, although it would seem that where both parties are in default at the time for performance the contract is ipso facto
dissolved. Where both parties are in default and each seeks to assert the contract as against the other, it will not be regarded as terminated, and one party will not be permitted by his breach to create a condition which will tend to bring the other party into default and then assert that such party's rights are forfeited by a default so caused. Where one party has waived full performance by the other, such other is not entitled to assert such fact as a ground for rescission."
The insurance company, through its agents or attorneys, should not be permitted to bring about the lack of co-operation by its own default, and then *Page 219 
avoid liability under the policy by reason of such claim of lack of co-operation. As to the facts bearing upon the question of the default of the insurance company through its agents and attorneys, there is no dispute, and the writer is of the opinion that upon this ground the trial judge would have been required to have directed a verdict in favor of the plaintiff for the amount of the judgment and interest had there been a jury, and that he erred in not making a finding accordingly, a jury having been waived, and entering judgment thereon, and that this court should now reverse the judgment of the court below, and enter final judgment in favor of the plaintiff in error.