Browne, J.
This is an action on an insurance policy-issued to M. Leo Elliott, plaintiff in error, by the Belt Automobile Indemnity Association.
The policy, as read by the ordinary person, would seem, among other things, to insure the owner of an automobile against liability for injuries to persons or property accidently inflicted by the owner, or by any member of his 'immediate family over 16 years of age. It is because the insurance company does not so regard its contract, that the case is here.
Under the title “LIABILITY,” there is a provision, “Against actual loss sustained by subscriber on account of legal liability imposed upon him on account of bodily injuries (including death resulting therefrom) accidentally inflicted upon any person, while this contract is in force, through the ownership, maintenance or use of said automobile. The liability of this association is limited to not more than $5,000, for injury to, or death of, any one person, and, subject to the same limit for each person, limited to not more than $10,000.00 for any one accident involving injury to, or death of more than one person.”
In the rider attached to and made a part of the policy, are these clauses:
“DEFENSE ■ 3. .The association will also defend in the name and on behalf of the subscriber or other person or persons covered, any suits, even if groundless, brought against the subscriber or other person or persons covered to recover damages on account of such happenings as are provided for by the terms of the two preceding paragraphs, where the loss sustained by subscriber as a result of the judgment, if rendered - against. the subscriber. or- other person or persons, would be covered by this policy.
“¡COSTS -4.- In-,.addition to- the coverage;-granted above, the association will also pay the cost and expenses [547]*547attendant, upon the investigation, adjustment and settlement of claims, and will reimburse subscriber or other person or persons covered for all costs taxed and paid by subscriber or other persons covered, in any legal proceedings defended by this Association and all interest accruing after entry of judgment upon such part thereof as shall not be in excess of the Association’s liability as above limited, where the suit is appealed by or with the consent of the Association.”
On February 21st, during the life of the policy, the plaintiff’s wife- while driving the automobile, inflicted personal injuries on O. D. Knowles, who brought an action for damages against the plaintiff, and recovered a judg-' ment for $3500.00.
The insurance company in accordance with its contract, defended the action, but did not take writ of error, and the judgment stands of record unpaid.
Upon the refusal of the insurance company to pay the judgment, Elliott brought suit against it, in which he alleges his inability to pay the judgment without sacrificing his property at forced sale, and that he is embarrassed in transacting his ordinary business and dealing with his property because of the existence of the unsatisfied judgment.
The defendants demurred to the declaration upon the grounds that it does not allege any actual loss by the plaintiff; the contention being that until the judgment is paid by the plaintiff, the defendants are not liable upon the contract of indemnity.
The. demurrer was sustained and the plaintiff obtained a writ of error, and brought the case to this court for review. .
Notwithstanding the peculiar language used in the rider under the title “LIABILITY,” we cannot see how the [548]*548plaintiff below could have alleged; that he had sustained any actual loss, if the policy is good for anything, unless the unpaid judgment against him constitute a loss. What-other loss could the insurer have sustained ? If the answer be, “that he must have paid the judgment, that would not be a loss, if the policy is with a responsible company. Paying the judgment would not be a loss, but a mere outlay of money that would be promptly repaid to him by the insurance company. At least the insurance' company says it would do so.
• Money paid to satisfy a judgment, is not a loss, if a responsible person is obliged to reimburse the one against whom the judgment is held and who pays it.
If we adopt the contention of the insurance company, that upon the payment- of the judgment by the insured, the company then becomes liable' to indemnify him and will-do so, the insured could sustain no loss. ■■
Handing money to a judgment plaintiff with one hand, ánd receiving the same amount of money from the insurance company in the other, is certainly not a loss. On the-other hand, an unpaid, valid judgment may be very substantial loss to' a person against whom it stands. ' It works a loss of credit, and stands over him with strong hand extended to take from him his property as fast as he acquires any, until-the judgment is satisfied.
We do not, however, rest our decision upon the- proposition that a judgment against a person is a loss, but we hold that the words “actual loss sustained” as used in the policy and taken in connection with the entire policy are meaningless, and serve only to make the policy uncertain "and ambiguous.
This part of the policy must therefore be considered as insuring the owner against “legal liability imposed-upon him on account df -bodily injuries (including death' résult[549]*549ing therefrom) accidentally inflicted Upon any person, while this contract is in force.”
Clause P. of the policy, under the title “SUIT ON POLICY,” provides that “no suit or action on this contract for the recovery of any loss or expense covered by this contract arising or resulting from claims upon the subscriber for damages, either for personal injuries or property damage, shall be sustainable in any court of law or equity * * * unless such action shall be brought by the subscriber for loss or expense actually sustained and paid in money by the subscriber after trial of the issue.”
This seeks to defer the insured’s right of recovery until he has paid in full, the judgment obtained against him.
We cannot reconcile the provisions of the rider under the title “LIABILITY,” with Clause P, under the title “SUIT ON POLICY.”
If we accept the first and exclude the second, the liability of the insurance company to pay the judgment is clear; if we accept the second and exclude the first there seems to be no liability on the part of the insurance company until the insured pays the judgment in full; and if we consider them together as we must do in construing the contract, the policy is ambiguous and uncertain. , . "
The rule is well established in this jurisdiction that where “two interpretations equally fair may be given, that which gives the greater indemnity will prevail.” L’Engle v. Scottish Union & National Fire Ins. Co., 48 Fla. 82, 37 South. Rep. 462; Caledonian Ins. Co. v. Smith, 65 Fla. 429, 62 South. Rep. 595.; Queen Ins. Co. v. Patterson Drug Co., 73 Fla. 665, 74 South. Rep.. 807; National Surety Co. v. Williams, 74 Fla. 446, 77 South. Rep. 212; Massachusetts Bonding & Insurance Co. v. Grambling, 75 Fla. 409, 78 South. Rep. 337.
[550]*550Passing from this phase of the case to the next, we find that clauses similiar to these,.have received consideration in other jurisdictions, and there is conflict in the authorities,
Free access — add to your briefcase to read the full text and ask questions with AI
Browne, J.
This is an action on an insurance policy-issued to M. Leo Elliott, plaintiff in error, by the Belt Automobile Indemnity Association.
The policy, as read by the ordinary person, would seem, among other things, to insure the owner of an automobile against liability for injuries to persons or property accidently inflicted by the owner, or by any member of his 'immediate family over 16 years of age. It is because the insurance company does not so regard its contract, that the case is here.
Under the title “LIABILITY,” there is a provision, “Against actual loss sustained by subscriber on account of legal liability imposed upon him on account of bodily injuries (including death resulting therefrom) accidentally inflicted upon any person, while this contract is in force, through the ownership, maintenance or use of said automobile. The liability of this association is limited to not more than $5,000, for injury to, or death of, any one person, and, subject to the same limit for each person, limited to not more than $10,000.00 for any one accident involving injury to, or death of more than one person.”
In the rider attached to and made a part of the policy, are these clauses:
“DEFENSE ■ 3. .The association will also defend in the name and on behalf of the subscriber or other person or persons covered, any suits, even if groundless, brought against the subscriber or other person or persons covered to recover damages on account of such happenings as are provided for by the terms of the two preceding paragraphs, where the loss sustained by subscriber as a result of the judgment, if rendered - against. the subscriber. or- other person or persons, would be covered by this policy.
“¡COSTS -4.- In-,.addition to- the coverage;-granted above, the association will also pay the cost and expenses [547]*547attendant, upon the investigation, adjustment and settlement of claims, and will reimburse subscriber or other person or persons covered for all costs taxed and paid by subscriber or other persons covered, in any legal proceedings defended by this Association and all interest accruing after entry of judgment upon such part thereof as shall not be in excess of the Association’s liability as above limited, where the suit is appealed by or with the consent of the Association.”
On February 21st, during the life of the policy, the plaintiff’s wife- while driving the automobile, inflicted personal injuries on O. D. Knowles, who brought an action for damages against the plaintiff, and recovered a judg-' ment for $3500.00.
The insurance company in accordance with its contract, defended the action, but did not take writ of error, and the judgment stands of record unpaid.
Upon the refusal of the insurance company to pay the judgment, Elliott brought suit against it, in which he alleges his inability to pay the judgment without sacrificing his property at forced sale, and that he is embarrassed in transacting his ordinary business and dealing with his property because of the existence of the unsatisfied judgment.
The defendants demurred to the declaration upon the grounds that it does not allege any actual loss by the plaintiff; the contention being that until the judgment is paid by the plaintiff, the defendants are not liable upon the contract of indemnity.
The. demurrer was sustained and the plaintiff obtained a writ of error, and brought the case to this court for review. .
Notwithstanding the peculiar language used in the rider under the title “LIABILITY,” we cannot see how the [548]*548plaintiff below could have alleged; that he had sustained any actual loss, if the policy is good for anything, unless the unpaid judgment against him constitute a loss. What-other loss could the insurer have sustained ? If the answer be, “that he must have paid the judgment, that would not be a loss, if the policy is with a responsible company. Paying the judgment would not be a loss, but a mere outlay of money that would be promptly repaid to him by the insurance company. At least the insurance' company says it would do so.
• Money paid to satisfy a judgment, is not a loss, if a responsible person is obliged to reimburse the one against whom the judgment is held and who pays it.
If we adopt the contention of the insurance company, that upon the payment- of the judgment by the insured, the company then becomes liable' to indemnify him and will-do so, the insured could sustain no loss. ■■
Handing money to a judgment plaintiff with one hand, ánd receiving the same amount of money from the insurance company in the other, is certainly not a loss. On the-other hand, an unpaid, valid judgment may be very substantial loss to' a person against whom it stands. ' It works a loss of credit, and stands over him with strong hand extended to take from him his property as fast as he acquires any, until-the judgment is satisfied.
We do not, however, rest our decision upon the- proposition that a judgment against a person is a loss, but we hold that the words “actual loss sustained” as used in the policy and taken in connection with the entire policy are meaningless, and serve only to make the policy uncertain "and ambiguous.
This part of the policy must therefore be considered as insuring the owner against “legal liability imposed-upon him on account df -bodily injuries (including death' résult[549]*549ing therefrom) accidentally inflicted Upon any person, while this contract is in force.”
Clause P. of the policy, under the title “SUIT ON POLICY,” provides that “no suit or action on this contract for the recovery of any loss or expense covered by this contract arising or resulting from claims upon the subscriber for damages, either for personal injuries or property damage, shall be sustainable in any court of law or equity * * * unless such action shall be brought by the subscriber for loss or expense actually sustained and paid in money by the subscriber after trial of the issue.”
This seeks to defer the insured’s right of recovery until he has paid in full, the judgment obtained against him.
We cannot reconcile the provisions of the rider under the title “LIABILITY,” with Clause P, under the title “SUIT ON POLICY.”
If we accept the first and exclude the second, the liability of the insurance company to pay the judgment is clear; if we accept the second and exclude the first there seems to be no liability on the part of the insurance company until the insured pays the judgment in full; and if we consider them together as we must do in construing the contract, the policy is ambiguous and uncertain. , . "
The rule is well established in this jurisdiction that where “two interpretations equally fair may be given, that which gives the greater indemnity will prevail.” L’Engle v. Scottish Union & National Fire Ins. Co., 48 Fla. 82, 37 South. Rep. 462; Caledonian Ins. Co. v. Smith, 65 Fla. 429, 62 South. Rep. 595.; Queen Ins. Co. v. Patterson Drug Co., 73 Fla. 665, 74 South. Rep.. 807; National Surety Co. v. Williams, 74 Fla. 446, 77 South. Rep. 212; Massachusetts Bonding & Insurance Co. v. Grambling, 75 Fla. 409, 78 South. Rep. 337.
[550]*550Passing from this phase of the case to the next, we find that clauses similiar to these,.have received consideration in other jurisdictions, and there is conflict in the authorities,
Some, that seem to us to be founded on the soundest reasoning, hold that where the defendant insurance association undertakes to defend the action and does so, its , liability to pay any valid judgment obtained against the insured is established, and if it fails or refuses to pay the judgment, the insured may recover in an action on the policy.
The doctorine is thus stated in Patterson v. Adan, 119 Minn. 308, 138 N. W. Rep. 281, 48 L. R. A. (N. S.) 184: “A provision, in a policy that no action shall lie against the company, ‘unless it shall be brought by the assured for loss or expense actually sustained and paid in money by him after trial of the issue,’ applies only in case the company denies liability and refuses to defend.”
The cases that support this doctrine are those of Sanders v. Frankfort’ Marine, Accident and Plate Glass Ins. Co., 72 N. H. 485, 57 Atl. Rep. 655; Standard Printing Company v. Fidelity & Deposit Company of Maryland, 138 Minn. 304, 164 N. W. Rep. 1022; Reilly v. Linden, 151 Minn. 1, 186 N. W. Rep. 121; Davies v. Maryland Casualty Co., 89 Wash. 571, 154 Pac. Rep. 1116, L. R. A. 1916D 395; American Indemnity Co. v. Fellbaum, (Tex. Civ. App.) 225 S. W. Rep. 873; Elliott v. Aetna Life Ins. Co., 100 Neb. 833, 161 N. W. Rep. 579, L. R. A. 1917C 1061.
In the case of Davies v. Maryland Casualty Co. supra, the court said: “The Davies claim against the coal company was long resisted by the casualty company. To reimburse-for such a claim when established by judgment and paid was the purpose of its contract. The judgment [551]*551has established that claim. Nothing remains except a form. The casualty company, in effect, says to Mrs. Davies, that if the coal company will pay her at one end of the desk, the casualty company will repay the coal company at the other end. Not one thing besides, does it argue, is wanting to its liability except this formula. On that process it insists, not because, when the coal company shall have first paid and the casualty company shall then have given reimbursement there will result to it a right, claim, or even a salvage interest against the coal company or its assets, but because it wishes the thing done in just that way. It will pay a moment after, not a moment before, the coal company pays. If the latter will but get a loan for a few moments from some one else and pay the judgment, then the casualty company will hand it a cheek perhaps long previously prepared.
“Such mummeries are ill favored by the law. Technicality, indeed, is not only respectable, but is to be enforced by courts when even a remote right is exposed to danger. When technicality is invoked, however, to avoid an obligation morally established, the common law usually finds in its arsenal some weapon with which to confront it, and to make that a legal which is already a moral debt.”
We are not unmindful that there are respectable authorities that lay down a contrary rule: Fryo v. Bath Gas. & Electric Co., 97 Me. 241, 54 Atl. Rep. 395; Traveler’s Ins. Co. v. Moses, 63 N. J. Eq. 260, 149 Atl. Rep. 720; Connolly v. Bolster, 187 Mass. 266, 72 N. E. Rep. 981; Allen v. Aetna Life Ins. Co., 76 C. C. A. 265, 145 Fed. Rep. 881, 7 L. R. A. (N. S.) 958; Goodman v. Georgia Life Ins. Co., 189 Ala. 130, 66 South. Rep. 649.
No benefit will be derived from any analysis or discussion of the authorities that hold either way.- This court must take its stand with one line of authorities or [552]*552the other, and we prefer to adopt the doctrine that we think best conforms to the intent of the parties and promotes justice, affords the greatest protection to the insured, and deprives the insurance company of no legitimate protection.
The lower court erred .in sustaining the demurrer to the declaration and the judgment is reversed.
Taylor, C. J., and Whiteield, West and Terrell, J. J., concur.
Ellis, J., dissents: