American Fidelity & Casualty Co. v. Mahon

Sloan, J., delivered the opinion of the Court. The plaintiff, John J. Mahon, Jr., appellee, had recovered a judgment against Harry Abrams, the owner of a taxicab, for loss of services, medical and hospital expenses, of his wife, Lillian C. Mahon, who had been injured while a passenger in one of Abrams’ taxicabs. Abrams had been insured by the defendant, the American Fidelity & Casualty Company, Inc. Execution had been issued on the judgment of the plaintiff against Abrams and returned “Nulla bona,.” The plaintiff then brought suit against the defendant, Abrams’ insurer, and from a judgment in favor of the plaintiff, the defendant appeals. ⁵⁷⁵ It was alleged in the declaration that on November 1st, 1933, the defendant, in consideration of the payment of $554.40, had issued its policy of insurance in writing, whereby it agreed to insure Harry Abrams in the sum of $5,000 against loss from liability imposed by law against the assured for damages arising or resulting from claims upon him for “actual damages to persons accidently receiving bodily injuries and damage to property by reason of the ownership, maintenance or use by the assured” of a. certain automobile, used as a taxicab, mentioned in the policy; that on or about the 17th day of May, 1934, while the policy was in force, Lillian C. Mahon, wife of the plaintiff, was injured when the taxicab collided with another automobile; that the plaintiff lost the services of his wife and was put to considerable expense for hospitalization and medical treatment, as a result of the injuries so sustained; that thereafter the plaintiff brought suit against Harry Abrams, and recovered a judgment against him for the loss of services of Mrs. Mahon, and his expense as a result of her hospitalization and medical treatment; that execution was issued on the plaintiff’s judgment against Harry Abrams and “returned unsatisfied because of the insolvency of the assured,” whereby a cause of action accrued to the plaintiff on the policy of insurance. The defendant demurred to the declaration, and its demurrer being overruled, the case proceeded to trial and judgment for the plaintiff.

The first question that arises here is the legal sufficiency of the declaration to entitle the plaintiff to recover against the defendant insurer. By the contract of insurance the defendant agrees “to indemnify the assured * * * against loss from the liability imposed by law upon the assured arising or resulting from claims upon the assured for actual damages to persons accidentally receiving bodily injuries * * * if such claims are made on account of (1) Bodily injury or death suffered by any person or persons, other than the assured or his employees, as the result of an accident ⁵⁷⁶ occurring while this policy is in force; including such first medical aid as shall be imperative at the time of any such accident; and (2) damage to or destruction of property of others,” with a provision for recourse against the insurer in case of the insolvency or bankruptcy of the insured. Liability insurance policies are required by statute to be taken out by all owners of taxicabs in this state in all towns and cities of Maryland having a population of over 50,000 persons, which at present means only Baltimore City. Code (Supp. 1935) art. 23, sec. 361B, Acts 1931, ch. 485.

The provision of the section 361B applicable to this case, and which it is contended is integrated with the policy, is: “The owner of every taxicab for which a permit is required under the provisions of this sub-title [sec. 361 A], shall, before operating or continuing to operate the same on public streets or highways in this State, * * * take out a liability insurance policy, or policies, in some responsible insurance company authorized to transact business in this State, insuring such owner against liability for personal injury or injuries, to a passenger or passengers in such taxicab, or to a member or members of the general public, resulting from an accident or accidents, casualty or casualties, in which such taxicab may become involved, through the recklessness or negligence of its owner or operator as well as against any damage to property, resulting from such an accident or accidents, casualty or casualties.” There are many authorities to the effect that the statutory provisions must be taken as written into the policy of insurance, where the operation of the business is forbidden until the bond required is filed with the proper official, and that the language and meaning of the contract must be construed in the light of the statute. 28 C. J. 81, and cases there cited. The rule as stated by this court in Brown v. Smart, 69 Md.