Cornell v. Travelers' Insurance

McLaughlin, J,:

On the 18th of July, 1895, the defendant issued to the plaintiff a policy of insurance, which, among other things, provided that the defendant, “ in consideration of the application for this policy, a copy of which is hereto attached and made part of this contract, and of Five thousand dollars, does hereby insure (the plaintiff) against loss from liability to employees of the insured who may, during a term-of twelve months from noon of July 3rd, 1895, accidentally sustain bodily injuries while actually occupied in the performance of duty in the trade or occupation for which they have been employed by .the insured under circumstances which shall impose upon the insured a common-law or statutory liability to such employees by reason thereof * * * this insurance also covers the liability of the insured to persons other than employees who may, during the same term, accidentally sustain bodily injuries directly occasioned by the business operations of the insured as described in the application for this policy under circumstances which shall .impose upon the insured a common-law or statutory liability to such persons therefor.”

The application referred to described the- plaintiff’s business ■ as manufacturing arid erecting structural iron work for. building, and stated that the policy to be issued in jiursuance of it was to cover plaintiff’s “ liability on shop work and general liability on outside work, including teams.” During the life of the policy a building in the city of New York, in process of construction, the structural iron work of which had been partially but not entirely completed by the. plaintiff, collapsed, and a number of workmen engaged thereon, not employees of the plaintiff, were either killed or injured. Following the accident several of the persons injured and the legal representa-; fives of those killed, commenced actions in the Supreme Court of. this State against the plaintiff, one Parker, the general contractor, and Ireland; the owner of the building, to recover damages for the deaths occasioned or the personal injuries sustained, upon the ground that the same were caused by the negligence of the defendants named in such actions. In all, eleven actions were .commenced. Immediately following the accident the plaintiff in this action notified the defendant of what had occurred, and thereafter, as the actions were commenced, gave it notice of that fact, at the same *561time transmitting to it a copy of the summons and complaint in each action, coupled with a request that it assume and take charge of the defense. In each instance the copy of the summons and complaint was returned and the request refused. The plaintiff thereafter took charge of the defense on his own account. Two of the actions were tried and verdicts rendered in favor of this plaintiff, and thereafter the other actions were discontinued so far as the same related to him. The defense of the actions thus began, so far ás the same related to this plaintiff, involved on his part the expenditure of a considerable sum of money, and this action was brought to recover that sum from the defendant upon the ground that under the terms of the policy referred to it was liable for the same. At the conclusion of the plaintiff’s case, on motion of defendant’s counsel, the complaint was dismissed, substantially upon the ground that the plaintiff had failed to establish that the death of any of the persons killed was caused by or the injuries to the other persons bringing actions were directly occasioned by' the business operations ” of the plaintiff; and that the defendant had not given. its written consent that the plaintiff incur any expense in the defense of such actions. Judgment was entered to this effect, from which the plaintiff has appealed.

We are of the opinion that the court erred in dismissing the complaint. It was stipulated upon the trial that the defendant refused to take charge of the defense in any of the actions, and having refused, the plaintiff was. justified under the terms of the policy in assuming the defense and looking to the defendant for whatever ■expense he incurred in connection therewith. Nor do we think there is any force in the other ground urged, viz., that the plaintiff failed to show that the deaths were caused or the injuries sustained by the plaintiffs in the respective actions were “ directly occasioned by the business operations of the plaintiff.” It is true that it appeared upon the trial, that the collapse of the building was not caused by any neglect or fault on the part of the plaintiff in this action, but was due solely to an insecure foundation of the building with which the plaintiff had nothing to do; but the fact that the work which the plaintiff did was in no way connected with the foundation of the building did not relieve the defendant from its liability under its *562policy of insurance to defend actions brought against' him upon the alleged ground that he was responsible, in whole or in part, for the collapse of the building. The deaths were caused and the injuries sustained, in whole or in part, by the fall of the iron structure which the plaintiff had erected, and when'Claims were made that his work was the cause of the collapse, or contributed to it, he was entitled to the protection provided by the policy. The contract was not one simply to indemnify him against damage, that is, legal claims which, from the very nature of things, could oiily be determined after atrial had, but was to indemnify him against all claims whether legal" or not, provided the same came fairly within the provisions of the policy. This is evident from a portion of .the policy which provides that “This Company shall have sole right and it shall be its duty to negotiate settlements and adjustments of all claims made against the insured and covered by this policy. If legal proceedings be commenced to enforce such claim or,- claims against the insured, this company may pay the insured the full amount for which it can be held liable in respect of such claim or claims, failing which it shall defend said proceedings on behalf of the insured, and shall have control of stich defense.” The policy, of course, must be liberally construed, and if there be any doubt about its construction, or if it be susceptible to two interpretations, then it should be most strongly construed against the insurer, because it prepared the contract and is responsible for the words used in it. (Janneck v. Met. Life Ins. Co., 162 N. Y. 574; Trenton Co. v. Title Guarantee Co., 50 App. Div. 490.) Claims off the nature referred to in the policy were made against the insured, based upon the ground that he was liable for the deaths occasioned' and the injuries sustained, to- enforce which the respective actions were brought. The very" purpose of the policy was to indemnify the plaintiff against any expense which he might sustain by reason of such claims being made, and, therefore, by the express provisions of the policy, it was the duty of the defendant to have assumed and taken charge of such defense ; it haying failed and neglected to do so, the only thing which the plaintiff could do was to assume and take charge of the defense himself and look to the defendant for any expense he might incur by reason thereof, and for .which it must be held liable. (Hoven v. Employers' Liability Assurance *563Corporation, 93 Wis. 201; Anoka lumber Co. v. Fidelity & Casualty Co., 63 Minn. 286.)

The judgment, therefore, must be reversed and a new trial ordered, with costs to the appellant to abide the event.

.Van Brunt, P. J., O’Brien and Hatch, JJ., concurred; Ingraham, J., dissented.