The petition alleged facts authorizing recovery for a breach of the policy of insurance sued on, and was not subject to any of the demurrers, general or special, interposed thereto.
The defendant demurred generally to the petition on the ground that no cause of action was alleged, and because it appeared from the petition and exhibits that the expenses for which recovery was sought were incurred by the plaintiff in the defense of a suit expressly excluded from the coverage afforded by the policy sued on; and also on the ground that it appeared from the allegations of the petition in the case of Maudie Lee Bryant against the plaintiff, a copy of which was attached to the present petition, that the death of Bryant occurred as a result of bodily injuries such as were expressly excluded from the protection afforded by the policy. The defendant demurred specially to various paragraphs of the petition. The defendant also demurred to that part of the petition that sought to recover of it $500 as attorneys' fees and $7.35 as costs for making a photostatic copy of the policy, for the reasons that the allegations thereof showed that no right of recovery existed in the plaintiff for the attorneys' fees claimed; that the plaintiff has suffered no pecuniary loss by reason of its defense of the suit for which it can seek indemnity from this defendant, and because the plaintiff can not recover such fee for the use of its attorneys since they are not entitled to receive such fee from the plaintiff, and the plaintiff can not retain such fee for itself; and because the expense incurred by the plaintiff for a photostatic copy of the policy upon which this defendant is sued is not a lawful item of recovery. The defendant further demurred to the allegations of the petition seeking to recover damages and attorneys' fees under Code § 56-706 on the ground that there was no allegation which met the requirements of that section.
The judge overruled the demurrers, and the defendant excepted.
Counsel for the insurance company state that under the pleadings and facts three important issues are presented for determination by this court: (1) Is the accident which resulted in the death of Lonnie Preston Bryant covered by the policy of insurance, which is the basis of this suit? (2) Can the plaintiff recover either for itself or for the use of its annually retained counsel *Page 831 a reasonable attorneys' fee for defending the suit brought against it by Maudie Lee Bryant as the widow of the deceased to recover for his homicide? (3) Is the plaintiff entitled to sue for the penalties provided by Code § 56-706? Counsel for the railroad assent to the foregoing statement of the questions involved.
1. By the rider endorsed on the policy it appears that the defendant obligated itself to pay in behalf of the assured, the plaintiff, "all claims for damages . . arising from bodily injury . . including death . . accidentally suffered . . by reason of the prosecution of the work [all work in connection with the construction of a certain described overpass bridge and the road approaches thereto] . . by H. G. Smith, contractor, his agents, employees or subcontractors;" and also agreed that it would "defend in the name of and on behalf of the assured any suit brought against the assured seeking damages on account of such bodily injury or death even if such suit is groundless, false or fraudulent." Among the "exceptions" embodied in the policy is the following: "Said agreement as respects protection afforded by virtue of this coverage rider shall not apply to . . (D) liability for bodily injuries or damage to property (1) caused by any employee of the assured."
It appears from the allegations of the petition that Bryant, the deceased, was employed as a crossing watchman by the contractor, Smith; that the overpass bridge was being constructed over several railroad tracks, including the tracks of the plaintiff; that about midnight April 3, 1939, while the deceased was so employed by the contractor, he was found dead beside the tracks of the plaintiff, and that the widow of the deceased brought a suit for damages against the plaintiff to recover for the death of her husband, in which she alleged that her husband's death was the result of the negligence of the employees of the plaintiff in the operation of one of its trains. It is this suit that the plaintiff contends the defendant should have defended, pursuant to the obligation imposed on it under the policy sued on. The suit brought by the widow of Bryant did not terminate in her favor, but finally resulted in a voluntary dismissal by the plaintiff therein, and it appears that more than six months elapsed between such dismissal and the filing of the present suit, and it also appears that any right of action which the widow of Bryant might have had for his homicide by the alleged *Page 832 negligence of the employees of the plaintiff is now barred by the statute of limitations.
It is urged by the defendant that it was not called on, under the terms of the policy, to defend the suit by Mrs. Bryant against the plaintiff, because it was not a suit for a bodily injury such as it had obligated itself to defend for the plaintiff. It bases this contention on the exception contained in the policy and which is quoted above to the effect that the protection offered by the coverage rider endorsed on the policy "shall not apply to . . liability for bodily injuries . . caused by any employee of the assured." In making this contention counsel for the insurance company necessarily assumed that Bryant was killed as the result of the negligence of an employee of the railroad. In fact it is stated in their brief that counsel for the railroad will not deny such assertion. They were mistaken in making this statement. Counsel for the railroad do deny that Bryant was so killed.
Irrespective of whether or not the insurance company would not be liable if it appeared that the death of Bryant was caused by an employee of the railroad company, under the exception contained in the policy to the effect that the protection offered thereby did not extend to bodily injuries or death caused by an employee of the assured, it does not appear as a matter of law that Bryant's death was so caused. In the suit instituted by Maudie Lee Bryant against the railroad company to recover for Bryant's death there was no adjudication that Bryant's death was caused by an employee of the assured. The Bryant suit was voluntarily dismissed by the plaintiff therein, and there was no admission by the railroad company in the pleadings of that case that Bryant met his death as the result of the running of its switch engine and cars. Bryant was found dead by or near the tracks of the railroad some time after this train had passed along this portion of the track, and under circumstances which indicated that he had been struck by something, possibly by a train. However, Bryant was on duty as a watchman at a crossing where there were several railroad tracks, including main-line tracks of other railroads. Therefore the Bryant suit did not as a matter of law establish that Bryant's death was caused by an employee of the railroad company. The claim of the insurance company that the present suit was therefore subject to demurrer because Bryant's death was caused by an employee of the railroad company and was therefore within the exception contained *Page 833 in the policy, conceding that this exception would in such a case relieve the insurance company from liability here, is without merit.
2. It is the opinion of the court that under the policy sued on the defendant was obligated to defend any action brought against the plaintiff for damages on account of bodily injury resulting in death alleged to have been accidentally suffered by reason of the prosecution of the work of the contractor Smith, in the construction of the described overpass bridge and road approaches thereto, "even if such suit is groundless, false or fraudulent," and that the insurance company, by refusing to undertake the defense of such action, breached the contract of insurance and is liable to the railroad company for all damages resulting to it as a direct result of such refusal and breach. Bryant, at the time of his death, was engaged by Smith, the contractor, as a watchman at the crossing at which the work was being performed. Bryant suffered death by reason of the prosecution of the work. In such a case the plaintiff would be entitled to recover of the defendant for violating the terms of the policy by refusing to perform the obligations undertaken therein. The plaintiff would be entitled to recover, for a breach of contract, the damages contemplated by the parties. See Code, § 20-1407. It was not necessary for the plaintiff to show that it had paid out any moneys as the result of the failure of the defendant to perform the obligations imposed on it by the contract of insurance, in order to maintain a suit for damages on account of a breach of such contract. See Waldon v. MarylandCasualty Co., 155 Ga. 76 (4) 88 (116 S.E. 828). The contract created by the policy was not one of indemnity, but was one wherein the defendant agreed to do certain things, which included the defense of any suit brought against the plaintiff seeking damages on account of an accidental death suffered by any person during the policy period by reason of the prosecution of certain work, consisting of the construction of an overpass bridge and road approaches by one H. G. Smith, contractor, no matter how groundless the suit might be. By the contract the defendant agreed to pay all expenses incurred by the railroad in defending any such suit brought against it, even though the suit were groundless. The defendant having failed to defend such suit the plaintiff was forced to defend it. The plaintiff employed counsel for this purpose. The contract contemplated this in *Page 834 the event of its breach. The plaintiff retained counsel by the year to represent it generally in all legal matters. Counsel for the plaintiff, in defending the suit against it, notwithstanding they were employed by the year, were being compensated by the plaintiff for their services in the particular suit. Counsel represented the railroad in defense of a suit against it, the defense of which another had contracted for a consideration to undertake, and the plaintiff, if entitled to recover on the policy, would be entitled to recover for such services a reasonable fee. The defendant, in its contract of insurance, agreed "to defend in the name of and on behalf of" the railroad company any suit, etc. The contract contemplated that the insurance company would employ counsel in conducting the defense of any suit which it was obligated to defend "in the name of and on behalf of" the railroad. The plaintiff only had to show that this expense had been incurred, for as we have seen the contract of insurance sued on was not one of indemnity but one whereby the company agreed to defend such a suit and obligated itself so to do. See Stokes v. Robertson, 143 Ga. 721, 722 (85 S.E. 895); Detrick v. Trust Co. of Ga., 49 Ga. App. 587, 589 (176 S.E. 686).
3. The pleadings made a case for submission to a jury whether the defendant was liable for the damages and attorneys' fees provided for under Code § 56-706. It does not appear as a matter of law that a jury could not find that there was such an unfounded refusal in law or in fact to comply with the provisions of the policy imposing an obligation on the defendant to defend the lawsuit involved as to take this question away from the jury. See Cotton States Life Insurance Co. v. Edwards, 74 Ga. 220,221 (4); Travelers Insurance Co. v. Sheppard, 85 Ga. 751 (12 S.E. 18); Life Casualty Co. v. Smith, 51 Ga. App. 122 (179 S.E. 744). The questions of law made in this case were not of such a character as would, as a matter of law, acquit the defendant of bad faith in refusing to undertake to perform the obligations assumed by it under the contract of insurance sued on. Bad faith is usually a jury question. AEtna LifeInsurance Co. v. Stewart, 49 Ga. App. 786 (5) (176 S.E. 777).
The allegations relative to a demand for performance and refusal thereof and as to waiting sixty days before bringing the present suit were plainly averred. The petition was not subject to demurrer on the ground that it appeared as a matter of law that the plaintiff was not entitled to recover the statutory penalties provided for in *Page 835 Code § 56-706. North British c. Insurance Co. v. Parnell,53 Ga. App. 178 (185 S.E. 122); Commercial Casualty InsuranceCo. v. Campbell, 54 Ga. App. 530 (188 S.E. 362).
4. Applying the foregoing rulings, the trial court properly overruled the demurrer.
Judgment affirmed. Sutton, J., concurs.