Defendant issued an automobile liability policy insuring "Hartigan Dwyer, No. 85-91 Congress St., Troy, Rensselaer County, New York, Department store merchant," against "loss and expense by reason of claims made upon the assured" by reason of accidents suffered by any person by reason of "the ownership, maintenance or use" of a delivery automobile described in the policy. Hartigan Dwyer is a copartnership composed of Maurice H. Hartigan and Joseph E. Dwyer. The copartnership of Hartigan, Dwyer O'Brien consists of the same individuals as the firm of Hartigan Dwyer and one John J. O'Brien. It conducts a department store in Albany. When the automobile was being used in the business of the Albany firm and driven by an employee of that firm, a child was run over and killed. *Page 178 The plaintiffs paid two-thirds of the amount for which the claim against the Albany firm arising out of the accident was settled and have maintained successfully an action on the policy to recover the amount thus paid by them. The question is whether the policy may be so construed as to bring within its terms such individual liability.
The plaintiffs direct attention to the findings of fact, unanimously affirmed, that the policy insures the plaintiffs "and each of them" and that at the time of the accident the automobile was in use "by an agent of the plaintiffs and one John J. O'Brien." The policy is incorporated in the decision. If its terms are unambiguous, its construction is a question of law for the court, which survives the unanimous decision of the Appellate Division and is subject to review by this court. (Poel v.Brunswick-Balke-Collender Co., 216 N.Y. 310.)
We think that the terms of the policy are unambiguous and limit the liability of the insurer to accidents which happen while the automobile is being used on the firm business of Hartigan Dwyer.
The plaintiffs have succeeded on the theory that they are individually liable for the torts of the firm of Hartigan, Dwyer O'Brien (Matter of Peck, 206 N.Y. 55), but it is the firm of Hartigan Dwyer, described in the policy as "department store merchant," that is insured and that firm has committed no wrong and incurred no liability. Hartigan and Dwyer, as individual members of the firm of Hartigan, Dwyer O'Brien, are not insured against liability for the acts of that firm. When a partnership is established, the liability of the individual partners is an incident of the partnership, merely, not a separate and independent liability. The policy protects Hartigan Dwyer from loss by reason of automobile accidents for which their partnership is liable and to that extent protects them individually as members of such firm; but the Troy partnership as such is not a *Page 179 member of and is not liable for the torts of the Albany partnership.
Furthermore, for the purpose of keeping partnership accounts, merchants constantly resort to the fiction that a partnership is a legal entity, separate and distinct from the partners therein. This rule of convenience is particularly serviceable to keep apart two firms having a common member. (Jones v. Blun,145 N.Y. 333.) The partnerships in this case are not for all purposes to be regarded as legal entities, but for the purpose of ascertaining the intention of the parties to the policy herein, we are governed by common parlance rather than legal parlance.
Speaking of a mortgage executed by John Thompson to secure the payment of all promissory notes made by him, this court said: "We think that among business men a distinction is made between the firm, as an entity, and the members who compose it, and that this language would not be understood as broad enough to cover the indebtedness of a firm of which Thompson was a member, and for whose debts, jointly with the other members of the firm, he could be made responsible." (Bank of Buffalo v. Thompson, 121 N.Y. 280,283.) So here, we think that among business men a distinction is made between the firm of Hartigan Dwyer and the members who compose it and that the policy is not broad enough to cover the liability of the members of the firm for which the firm itself was not liable.
The fact that the courts below have read the policy otherwise and found it susceptible of another meaning is urged as establishing the fact that reasonable and intelligent men may honestly differ as to its meaning and that it must, therefore, be construed against the insurer. It is, however, for this court to say, as matter of law, whether reasonable men may reasonably differ as to such meaning, or whether the indulgence of the lower courts has not written a new contract for the parties and extended the defendant's liability beyond the plain and unambiguous *Page 180 language of the policy. As a legal proposition, we must first find that the contract is ambiguous, before we may apply the rules governing the construction of ambiguous contracts.
The judgments should be reversed and complaint dismissed, with costs in all courts.
HISCOCK, Ch. J., CHASE, COLLIN, CARDOZO, CRANE and ANDREWS, JJ., concur.
Judgments reversed, etc.