This is a suit in equity brought by Charles L. Farrell, a resident of Pawtucket, Rhode Island, to reach and apply, in satisfaction of a judgment obtained by the complainant in an action of the case against Adolphus J. Holmes, of North Attleboro, Massachusetts, certain money under a policy issued in Massachusetts by the respondent, a foreign insurance company, which insured Holmes for automobile liability. It was heard by a justice of the Superior Court upon bill, answer and evidence, whereupon a final decree was entered, ordering the respondent to pay to the complainant the amount of said judgment with interest from May 25, 1932. The cause is now before this court upon the respondent's appeal from this decree.
It appears that in April, 1930, the respondent issued to Mr. Holmes, the insured, a liability insurance policy covering his Pontiac automobile for the period commencing April 1, 1930, and ending December 31, 1930. The policy contained different kinds of insurance including extraterritorial coverage, for which an additional premium was paid. Holmes thereafter disposed of this automobile, purchased
an Oakland sedan, and applied to the respondent's agent in North Attleboro, for a transfer of said insurance to the Oakland. All the respondent's forms, required to transfer the insurance to cover the Oakland, were provided by the respondent's agent, signed by Holmes and delivered to the agent. A week or so later — on August 8, 1930 — the Oakland automobile, while being driven by Holmes' son upon a public highway in Pawtucket, collided with a taxicab in which the complainant was a passenger. The complainant, in July, 1931, brought an action at law against Holmes for negligence, to recover for personal injuries received in this collision. The writ was served personally upon the defendant Holmes within this State. The respondent received regular notice of the accident and writ, and authorized its attorneys to enter appearance for the defendant Holmes, and they then took complete control of the investigation and defense of the case. Some misunderstanding between the insured and the company developed, resulting in the failure of the defendant to appear on April 28, 1932, the day set for trial. A continuance to May 16 was obtained by the respondent's attorneys, who then filed a motion for permission to withdraw from the case, assigning as the only reason therefor the lack of cooperation by the defendant insured. This motion was granted on condition that the defendant Holmes be notified of the withdrawal of the attorneys and of the new assignment date for trial. Notice of this motion and of the new trial date was served by the respondent upon defendant Holmes as ordered by the court, again the only reason given for the motion being his lack of cooperation; and, when the case was reached for trial on May 16, 1932, in the absence of Holmes, the motion of the respondent's attorneys to withdraw from the case was granted. The plaintiff then proceeded to obtain a judgment in this action against the defendant Holmes by default in the amount of $4,006.35.
On June 9, 1932, the complainant brought an action of debt, based upon this judgment, against the respondent, in
accordance with the statute of this State governing like cases involving policies issued here. The respondent appeared through the same attorneys and contested the action. The case was tried, jury trial waived, before a justice of the Superior Court, who rendered decision for the plaintiff, to which the defendant duly excepted and prosecuted its bill of exceptions to the Supreme Court. The case was there pending on exceptions from April 21, 1933, until November 15, 1933, when the court rendered its opinion, in which the defendant's exception to the decision of the Superior Court was sustained, solely on the ground that that court had no jurisdiction at law to entertain the action, and directing the Superior Court to dismiss the action of debt on judgment "without prejudice to the right of the plaintiff to prosecute his claim in equity", as provided in the Massachusetts statute. See Farrell v. The Employers Liability AssuranceCorp., Ltd., 54 R.I. 18.
Thereupon, in December, 1933, the complainant brought the present suit in equity in the manner suggested by the court's opinion, supra, and as provided by Sec. 113 of Chapter 175, General Laws of Massachusetts. This statute substantially permits a judgment creditor to sue the insurance company in equity to reach and apply in satisfaction of the judgment, the insurance money due for loss or damage from bodily injury, where the judgment debtor was, at the accrual of the cause of action, insured against automobile liability therefor.
The policy issued by the respondent to Holmes on his Pontiac automobile, and later transferred by it to cover the Oakland, incorporates certain provisions of the Massachusetts law and makes them a part of the contract of insurance. Insuring Clause I provides insurance in accordance with and as required by Chap. 346, acts of 1925 of Massachusetts and all acts amendatory thereof and supplemental thereto. Insuring Clause II, "in addition to the insurance provided by Insuring Clause I of this Policy" provides extraterritorial coverage within the United States
and Canada. Insuring Clause III provides insurance for property damage, with which we are not concerned. The policy contains numerous references, agreements and conditions, some relating to all and others relating to some of the different kinds of insurance above referred to, requiring the reading as a whole for proper construction.
Among the statutory provisions in the policy, pertinent here, are conditions L(2) and L(3). L(2) is expressly made a part of the insurance under both Insuring Clauses I and II, above referred to, and reads as follows:
"This Policy, the written application therefor, if any, and any rider or endorsement which shall not conflict with the provisions of Chapter 346 of the Acts of 1925, and all acts amendatory thereof and supplementary thereto, and/or Section 34A of Chapter 90 of the General Laws constitutes the entire contract between the Corporation and the Assured as respects the motor vehicle or trailer herein described."
L(3) is substantially a provision of Chapter 346, acts of 1925 of Massachusetts, as amended, referred to in condition L(2), and reads as follows:
"No statement made by the Assured or on his behalf either in securing this Policy or in securing the registration of the motor vehicle or trailer covered thereby and no violation of the terms of this Policy and no act or default of the Assured, either prior or subsequent to the issuance of this Policy, shall operate to defeat or avoid this Policy, so as to bar recovery within the limit provided in this Policy by a judgment creditor proceeding under the provisions of Section 113 of Chapter 175 and Clause 10 of Section 3 of Chapter 214 of the General Laws."
Condition L(3) is expressly made part of Insuring Clause I. On the other hand, the policy does not exclude in express terms the operation of condition L(3) from insurance given under its extraterritorial coverage.
There was no question but that the insured had applied for the transfer of insurance to the Oakland, on the respondent company's forms, properly signed and delivered
to the respondent's agent, Holbrook, before the accident; that the company had received and indorsed it, and had actually transferred the coverage to the Oakland sedan and delivered the policy and rider to Holmes; and that, after immediate notice of the accident, it had taken over, through its attorneys, the complete control of the defense of the case, although it fully knew that the Oakland sedan, and not the Pontiac, was involved.
Although application for the transfer of this insurance to the Oakland automobile was admittedly received by the company's agent a week or more before the accident, and later approved, there was some dispute in the testimony as to when the transfer took effect. There was testimony indicating that the respondent's agent notified Holmes or his son before the accident that the insurance applied for had been approved and transferred. The rider making the transfer of insurance was traced in evidence, with the policy, to the possession of the respondent at its home office in Boston, following cancellation of the policy in October, 1930, after the accident. The respondent did not present this rider, as the best evidence of when it was actually dated and became effective, or of what change, if any, it made in the coverage and terms of the policy; nor did the respondent satisfactorily explain its absence. The respondent reluctantly presented the original policy after it previously had indicated the loss thereof, and then only after the court had strongly suggested the desirability of this presentation. Even then it offered the policy in evidence, without the rider, which was considered by the respondent so vital to its contention. The policy bore pin perforations thereon where the rider might ordinarily have been attached.
It is also significant, upon the question of what date the insurance upon the Oakland really became effective, and how far its other clauses may have affected the extraterritorial coverage, that Mr. Holbrook, the company's agent who made it out, countersigned it for the company and
handled the entire matter, was not called by the defendant to testify, although he still retained the same connection with the respondent company.
The trial justice, upon the evidence, found that the respondent had transferred the policy from the Pontiac automobile to the Oakland automobile with full knowledge of the accident involving the Oakland, and had taken over the control and defense of the case for the insured, and that thereby the respondent was estopped to deny that the Oakland was insured on the day of the accident. He also ruled that, by the terms of the statute and policy, the respondent was barred from interposing the defense of lack of cooperation on the part of the insured, and that the complainant's suit in equity was not barred by the statute of limitations.
The respondent now contends chiefly that there was no contract of insurance covering the Oakland at the time of the accident and that the court erred in holding that the respondent was estopped to deny its existence; that it was error, if there was a contract, to deprive it of the defense of lack of cooperation upon the part of the insured; and that, in any event, the suit was begun more than one year after the judgment was obtained and, therefore, was barred, according to the terms of the Massachusetts statute which created the right and remedy to sue the company.
In our view, the questions raised are not available to the respondent at this time, in view of its conduct and contensions and of the previous opinion in the case of Farrell v. TheEmployers Liability Assurance Corp., Ltd., supra, which was introduced in evidence in the instant case by the complainant, without objection by the respondent, as a part of the law of the case. In that former case, the Superior Court held that the Oakland car was covered by the policy at the time of the accident; that the defense of lack of cooperation by the assured was excluded by the terms of the policy; that under the Massachusetts statutes
the plaintiff was entitled to recover from the defendant on the policy the amount of his judgment against Holmes; and that under the Rhode Island statute an action at law was a proper procedure for such recovery. That court therefore rendered decision for the plaintiff for the amount of the judgment and interest.
This court, in reviewing that decision on a bill of exceptions, said in its opinion: "The defendant issued in Massachusetts its policy of insurance to said Holmes and incorporated therein the following provision: . . ." It then quoted the condition "L (3)", which we have quoted supra and which had been relied on by the Superior Court as excluding the defense of lack of cooperation by the assured, and which, if applicable to the case, could clearly exclude that defense. We think the language in that opinion can only be fairly interpreted as a determination that the Superior Court was right in holding that the policy did cover the Oakland car at the time of the accident and that the defense of lack of cooperation by the assured was not available to the defendant.
The respondent did not vigorously contest the existence of a contract of insurance between it and Holmes covering the car involved in the accident. Indeed its conduct in assuming, after due notice, complete defense of the plaintiff's action against Holmes, and the sole reason for its motion to withdraw from the case, because of the insured's lack of cooperation, and its defense based thereon, presuppose the existence of the contractual obligation. Having obtained the relief it sought in the former case upon a contention that the contract of insurance in question did exist but was to be governed by Massachusetts law, it should not be heard to assert in substantially the same case before us that there was no such contract in existence. Therefore, and in view of the opinion in the former case, the contention of the respondent, that the court below erred in holding the respondent estopped to deny the insurance contract covering the accident, is not open to the
respondent at this time. McAuslan v. Union Trust Co.,46 R.I. 176.
In connection with the respondent's defense because of the assured's failure to cooperate, it is to be noted that, in that case, the defendant did not deny that this defense would have been excluded, if the plaintiff had brought a suit in equity in Massachusetts to recover from the defendant the amount of his judgment. On the contrary, its only contentions on this phase of the former case were: (1) That by the law of Massachusetts, governing the policy, the above clause of exclusion applied only to suits in equity brought in Massachusetts; and (2) that the clause was against the public policy of Rhode Island and therefore could not apply to the case in this State.
The language of the former opinion, supra, indicates clearly that neither of these contentions then appealed to the court as sound. As to the latter contention, the court then said: "The purpose of the statute of both states is to secure to an injured party the benefit of a contract of insurance entered into between the party causing the injury and the insuring company. The fact that the Massachusetts statute makes recovery more certain by depriving the insuring company of certain defenses is not so contrary to our public policy as to warrant a denial of a remedy in our courts to one seeking recovery, in a proper action, on a policy of insurance similar to the one in suit."
This court then reversed the decision of the Superior Court on the sole ground "that the plaintiff has mistaken his remedy," and that recovery must be sought in equity, as prescribed by the Massachusetts statute; and therefore it directed the Superior Court "to dismiss the action without prejudice to the right of the plaintiff to prosecute his claim in equity."
That case, as already noted, was between the same parties and was based on the same contract, and the same substantive rights were at issue, as in the instant case, the only difference being as to the form of the proceeding and
as to the possible application here of the statute of limitations. The evidence also was substantially the same. Therefore, in view of the facts above stated, as to the admissions and contentions made by the present respondent in the former case and previously, and as to the determinations and statements set forth by this court in its opinion in that case, we are convinced that the finding of the Superior Court in the instant case, that the defense of refusal of cooperation by the assured was not available to the respondent, should be sustained.
But the respondent now seeks, notwithstanding the previous adverse disposition by the court, to urge that the excluded proof was admissible for a reason other than was then assigned. It now claims that the defense of lack of cooperation by the insured was excluded only from the part of the policy coverage within Massachusetts, and not from its extraterritorial coverage. Strangely, the respondent did not bring this to the attention of the court in the earlier case. If it felt the court had misconceived or misstated the law in that opinion, it never requested an opportunity to reargue the law on that point.
However, if we assume that the question now is properly open to it, we think that, in the present circumstances, the respondent's contention is more ingenious than sound. It makes the mistake of treating the Massachusetts statutes and their construction as they affect the interpretation of the policy in this case, a question purely of law for the trial court's independent opinion. The real question presented was not how the trial court as a matter of law would interpret the pertinent Massachusetts statutes and their effect upon the policy, but rather how the courts of Massachusetts have interpreted their own statutes and how, in the present circumstances, their interpretation affects the policy in this case. The interpretation of the policy apparently depended upon the construction and effect of certain Massachusetts statutes, incorporated therein.
In the absence of an appropriate statute, the trial court could not take judicial notice of the statutes of Massachusetts
and their interpretation. Generally, the statutes of another State and their particular interpretation are facts to be pleaded and proved as any other material fact in the case. In Callender,McAuslan Troup Co. v. Flint, 187 Mass. 104 at 107, the court said "that the construction of the agreement depends on the law of the place of acceptance may be conceded. Nashua Savings Bank
v. Sayles, 184 Mass. 520, 522. But judicial notice cannot be taken of the laws of another State, which must be proved, and determined like other facts, and no evidence of their provisions can be received for the first time at the argument of a case in this court."
In Cherry v. Sprague, 187 Mass. 113 at 117, where the appellant sought to cite the statutes, and two cases of South Dakota appropriate to the subject-matter of the statute, the court said: "But the bill of exceptions upon which the case is here contains no statement of these citations nor of any evidence of the law of South Dakota, and it is apparent that the decision of the judge was made without taking into consideration the cases and the statute mentioned, and that we cannot consider them." See also Johnson v. Scott, 205 Mass. 294, at 301, 302;O'Donnell v. Johnson, 36 R.I. 308, at 313; Taylor v.Slater, 21 R.I. 104.
The trial court's interpretation of the statutes incorporated in the policy was a fact to be found upon the evidence. If the respondent relied upon a particular interpretation of the related statutes as they affected the rights of the parties under the policy, and of this complainant, which was different from the interpretation reached by the court, the burden was upon it to prove by proper evidence the validity of such interpretation.
This court has held: "The question of what is the law of Massachusetts is a question of fact, to be decided on evidence, and on such a question we can have no better evidence than the decisions of the highest judicial court of the State." Horton
v. Reed, 13 R.I. 366.
But the transcript in the instant case discloses that no judicial decision of any Massachusetts court was introduced in evidence to support the respondent's particular construction of these statutes incorporated in the policy; nor was any such decision ever cited or brought to the attention of the trial court during a rather extended argument, and no other evidence was presented to show how the Supreme Judicial Court of Massachusetts construed the statutes or kind of policy in question. Without this assistance, the trial justice was forced to make an interpretation thereof solely on the evidence before him. He said: "In reading from this policy, I am led to believe that these so-called agreements and conditions do not specifically state that this defense shall be open to the company. In fact it is silent upon that question, looking at it from the best point of view from your" (meaning the respondent's) "standpoint. In reading the policy, I confess I can't say that it was the intention of the company when it made this contract to exclude that particular language from operation under the circumstances where the accident has happened outside the state." Apparently he noted that the respondent voluntarily, by its own writing, specifically made condition L(2) a part of the extraterritorial coverage. The terms of that condition quoted above, in substance, provide that this policy and any rider or indorsement which does not conflict with the provisions ofChapter 346, as amended, constitute the entire contract. The converse seems to be that, if a policy and rider or indorsement do conflict with Chapter 346, as amended, it will not constitute such a contract.
If that be so, the respondent apparently contended for a rider which it did not produce and which might well have been interpreted as conflicting with the provisions of Chapter 346, as amended. Such contention sought to eliminate condition L(3), quoted above, which deprived the respondent of certain defenses; condition L(3) was a necessary part of Chapter 346, as amended; and condition
L(2) in turn, by reference and effect, made condition L(3) a part of the contract. Significantly, as noted by the trial justice, the policy did not exclude condition L(3) by express terms from the extraterritorial coverage, as it could have done if intended.
In this situation and condition of the evidence, the terms of the policy may well have appeared to the trial justice as open, at best, to different interpretations. He evidently sought the intention of the parties on the evidence and applied the general rule of construction of insurance contracts by resolving all doubtful language or interpretation against the insurer. He also had in mind, according to the transcript, the earlier opinion in this case which indicated that the public policy of both Massachusetts and Rhode Island in these statutes was intended to assist the injured person.
In the absence of the rider, and of any provision in the policy expressly excluding from its extraterritorial coverage the operation of certain Massachusetts statutes, therein incorporated, and without the assistance of any pertinent judicial decisions of the Massachusetts court, the trial justice found his interpretations of the statutes and policy as a fact
upon the evidence before him. The terms of the policy were in dispute and were open at least to different inferences and interpretations. He was entitled to construe the policy, written in this special form by the respondent company, most favorably to the insured and the complainant. We cannot say that the justice was clearly wrong or that his decision failed to do justice between the parties. Simeone v. Antonelli, 52 R.I. 41;Dwyer v. Curria, 52 R.I. 264. Whether or not the interpretation of the policy and statutes, reached by the trial justice as a fact upon the evidence, is in harmony with some later decisions of the Massachusetts Supreme Judicial Court upon such statutes and policy, as a matter of law, is not open in this case to the respondent, and is not here decided.
We also think the trial justice was justified, in the circumstances of this case, in finding that the respondent was not entitled to prevail upon its contention that the complainant's right to sue in equity was barred by the expiration of the one year mentioned in the Massachusetts statute of limitations.
In its earlier opinion, supra, our Supreme Court qualified its dismissal of the action at law, not with the general words, "without prejudice", but with the special words: "Withoutprejudice to the complainant's right to sue in equity," under the Massachusetts statute. (Italics ours.) These words seem to indicate the court's intention to cover a special case and not an ordinary one.
In a case involving an election of remedies, which the instant case does not, this court has said that the effect of a dismissal without prejudice, in such ordinary case, was to leave the parties as if no action had been instituted. Reynolds v.Hennessey, 17 R.I. 169, at 175.
In Taylor v. Slater, 21 R.I. 104, at 108, the court cites the Reynolds case, supra, on the effect of the words "without prejudice" in a decree of dismissal, saying: "It gives to a complainant the right to state a new and proper case, if he can, but it takes away no right to defence to such suit on any ground other than that of the judgment as a bar." But the court then added significantly: "Had that bill been filed with reasonablediligence, resulting in such a decree, the case would have beendifferent, but, as it stands, injurious delay without excuseis apparent in both bills." (Italics ours.)
The latter portion of this quotation seems to indicate clearly that, if the original action had been brought with reasonable diligence, but was dismissed without prejudice on some other ground, the court would have given the words "without prejudice" a different effect from that previously indicated for the ordinary case.
In the instant case, the original action was brought in time, and the respondent's contention, at least in effect,
would seem to make the judgment thereon operate as a bar to the suit in equity, notwithstanding the language of the court in theTaylor case, supra.
In any event, the cases above referred to in addition to resting on somewhat different facts, do not seem to prevent our giving to a specially qualified order of dismissal by this court, in an exceptional case, a different effect from a decree of voluntary dismissal "without prejudice" in an ordinary case. It must be remembered that this was not an ordinary case. The court was then confronted with inescapable facts which were exceptional and peculiar to the instant case. The complainant had recovered his original judgment on May 25, 1932; had begun his action of debt against this respondent on June 9, 1932, or well within the period of one year from the judgment, if there were such a limitation on the right to sue the respondent company; the respondent's bill of exceptions was filed in this court on April 21, 1933, but was not heard until October 16, 1933, and was not decided until November 15, 1933, almost six months after the expiration of the alleged one-year statutory limitation. If the court intended to adopt the view urged by the respondent, that the one-year limitation is an indispensable condition imposed by the statute upon the right to sue in equity, then obviously there existed, on November 15, 1933, no right at all to sue in equity and no reason to order dismissal of the action at law with the special qualification "without prejudice to thecomplainant's right to sue in equity" under the Massachusetts statute rather than to enter an unqualified order of dismissal. (Italics ours.) It would seem that the court intended to treat it as a special case.
Certainly this was not mere language to prevent the conclusion of the complainant by any supposed election of remedies, which is the only explanation offered by the respondent. By the opinion in that case, as by the respondent's own contention, there was only one remedy open to the complainant. Consequently, on that basis,
there could have been no question in the court's mind of any election of remedies. On the contrary, the court refers, in the opinion, to the action at law as a mistaken remedy.
Whether, if the above-indicated view of this dismissal is taken, the court considered that the one year mentioned in the statute of limitations was not an indispensable condition imposed upon the created right, but related only to the remedy; or that this limitation was modified by some other provision of the Massachusetts statutes either of limitations; or that the so-called tolling statutes, either of Massachusetts or of Rhode Island, appeared to authorize another action within a given time after the abatement of the action at law, we are not prepared nor required to say here. The court may have intended to do, in that case, what it considered to be within its broad powers to prevent injustice between the parties. In any event, we think the language used is at least open to the interpretation that the court intended to indicate that the respondent's contention in this regard was not to be extended so as to bar the complainant's right to sue in equity.
But in the instant case there is a stronger reason to sustain the finding of the trial justice on this point. The respondent's defense upon the statute of limitations is based on the contention that this suit was not brought until more than one year after the recovery of judgment by the plaintiff against the assured, and on the fact that the Massachusetts statute requires that a suit in equity, such as this, "shall be commenced within one year next after the cause of action accrues." The statute, referred to in evidence, is apparently General Laws of Massachusetts, Chap. 260, § 4. But there was also in evidence § 32 of the same chapter, which is the general statute of limitations, providing as follows: "Proceedings Upon Failure ofOriginal Action. § 32. Extension of time in case of abatement.
If, in an action duly commenced within the time limited in this chapter, the writ fails of a sufficient service
or return by reason of an unavoidable accident or of a default or neglect of the officer to whom it is committed . . . or if the action is otherwise avoided or defeated by the death of a party thereto or for any matter of form . . ., the plaintiff or demandant or any person claiming under him may commence a new action for the same cause within one year after the abatement or other determination of the original action. . . ."
The trial justice, upon this state of the evidence, apparently found as a fact that § 4 of the statute of limitations was just as much subject to the provisions of § 32 of that statute as was any other of its sections which fix period of limitations for various causes of action; and that if the cause of action in the instant case was governed by § 4, as contended by the respondent, it was governed by it as qualified by § 32, just as it would have been if the former case between the same parties and the instant case had both been brought in Massachusetts; that the former case was brought within the period of one year fixed by § 4 of the Massachusetts statute, and it was dismissed solely on the ground that the proper form of remedy was in equity and not at law, and "without prejudice to the right of the plaintiff to prosecute his claim in equity"; and that the instant case was brought within one year after the former case was thus defeated for a matter of form. The only evidence that was before the Superior Court as to the Massachusetts law on this point was the bare language of the statutes above referred to.
We have stated, supra, the statutes of another State and their interpretation are facts to be proved as any other facts. This was not a case where there was only one statute and where the only reasonable interpretation was as the respondent contends, or where judicial decisions had been introduced in evidence and were in agreement. The best evidence would have been the interpretation of these Massachusetts statutes as they affect the policy, as made by the Massachusetts Supreme Judicial Court.Horton v. Reed, supra.
As was aptly said by Justice Gummere in the case of TitleGuarantee Trust Co. v. Trenton Potteries Co., 56 N.J. Eq. 441, and which was cited with approval in Coral Gables v.Kretschner, 184 A. 825: "In order to know what the law of a foreign state is on a given subject, we need something more than the production of the statute, for that only gives the words in which the law is written. The question to be determined is not what the language of the law is, but what the law is altogether, as shown by exposition, interpretation and adjudication."
In the absence of any assistance from the respondent by way of decisions of Massachusetts courts upon the subject-matter, either in evidence or cited, the trial justice interpreted what appeared as a conflict between sections of the Massachusetts statute in evidence and found as a fact that the suit in equity was not barred thereby. This finding was consistent with the evidence before him and with the court's earlier opinion,supra. In the particular circumstances of this case and in view of the earlier opinion, we can not say that the trial justice was clearly wrong in such a finding upon the evidence as presented.
The respondent's appeal is denied and dismissed, the decree appealed from is affirmed, and the cause is remanded to the Superior Court for further proceedings.