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CASSIDY v. SOUTHERN FARM BUREAU CASUALTY INS. CO.

November 28, 1955

FLORENCE D. CASSIDY, PLAINTIFF,
v.
SOUTHERN FARM BUREAU CASUALTY INSURANCE COMPANY, DEFENDANT.



The opinion of the court was delivered by: John E. Miller, District Judge.

The motion to dismiss the complaint is before the Court for determination.

The question involved has been thoroughly briefed by the attorneys for the respective parties. The attorneys for defendant have requested that the Court hear oral arguments in addition to the briefs filed by the parties, but the Court is of the opinion that no useful purpose would be served by hearing oral arguments, and that the question should be disposed of upon the record and the briefs now before the Court.

Local Rule 8(c) provides:

    "The moving party or party filing a response to the
  motion, at the time of filing such motion or
  response, may request oral argument or that ore tenus
  testimony be heard by the court before disposing of
  said motion, and the Judge, in the exercise of his
  discretion, for valid cause shown or upon his own
  initiative, may order, upon reasonable notice, that
  oral argument be had or that ore tenus testimony be
  introduced, or may proceed after the filing of a
  response, as provided in paragraph `b' hereof, or
  upon the expiration of 10 days from the service of
  the filing of the motion and supporting papers, as
  provided in paragraph `a' hereof, to dispose of the
  motion by entry of any appropriate order."

It is admitted that the facts are undisputed, and thus they require no elucidation. The able attorneys have cited to the Court practically every adjudicated case which it is thought might sustain their contention.

The defendant in its brief states:

    "The sole question of law here to be decided is
  whether or not plaintiff can maintain this suit while
  an appeal is pending from a judgment upon which the
  suit is based."

This statement of the case is not entirely correct, since the judgment of the Washington County Circuit Court has not been superseded, and an appeal is being prosecuted without the judgment having been superseded.

The plaintiff, Florence D. Cassidy, a citizen of Arkansas, obtained a judgment on July 7, 1955, in the Circuit Court of Washington County, Arkansas, against the defendant's assured, Marjorie Holt Rudolph, in the sum of $30,000. After the rendition of the judgment, a motion for new trial was filed, overruled, and notice of appeal given. No supersedeas bond was filed by the defendant, a corporation, organized under the law of the State of Mississippi and authorized to do business in Arkansas. On August 17, 1955, execution was issued on the judgment and returned nulla bona. The defendant's insured is insolvent, and the judgment plaintiff is now attempting to enforce collection of the judgment against the defendant. The judgment obtained by the plaintiff against defendant's insured in the Washington Circuit Court exceeds by $5,000 the limits of coverage in the policy issued by defendant to its assured, Marjorie Holt Rudolph. The complaint originally filed herein was for the recovery of the entire amount of the judgment of $30,000, together with interest thereon from July 7, 1955, and $56.50 costs in the Washington Circuit Court. On October 12, 1955, before defendant had pleaded to the complaint, the plaintiff filed an amendment alleging that she was entitled to recover 12 percent penalty and a reasonable attorney's fee.

On October 21, 1955, the defendant filed its motion to dismiss the complaint, and alleged that the complaint failed to state a claim against the defendant upon which relief can be granted. On October 26, 1955, the plaintiff filed a motion for permission to further amend her complaint, and on October 27 leave was granted the plaintiff to further amend the complaint. The second amendment alleged:

    "That through inadvertence the prayer of the
  original complaint in the above entitled cause asks
  the recovery from the defendant in the sum of
  $30,000, when in fact the limits of the liability
  under the policy at this time is $25,000; that the
  prayer of the complaint should be amended to conform
  and ask for $25,000 rather than $30,000."

On March 23, 1927, the General Assembly of Arkansas passed an act to regulate accident and liability insurance companies doing business in the State. Section 1 of the Act now appears as Section 66-526, Ark.Stats., 1947, and provides that no policy of insurance against loss or damage resulting from accident to, or injuries suffered by, an employee or other person and for which the insured person is liable, or against loss or damage to property, shall be issued or delivered in the State of Arkansas,

  "unless there shall be contained within such policy a
  provision that the insolvency or bankruptcy of person
  insured shall not release the insurance carrier from
  the payment of damages for injury sustained or loss
  occasioned during the life of such policy, and
  stating that in case execution against the insured is
  returned unsatisfied in an action brought by the
  injured, or his or her personal representative in
  case death results from the accident, because of such
  insolvency or bankruptcy, that then an action may be
  maintained by the injured person, or his or her
  personal representative, against such corporation
  under the terms of the policy for the amount of the
  judgment in the said action not exceeding the amount
  of the policy."

As a matter of law, if the conditions stated in the Statute are not contained in the policy of insurance, the law implies that such policy was issued with reference to the Act, and the legal effect is the same as if the statutory conditions were actually and fully complied with. Maryland Cas. Co. v. Waggoner, 193 Ark. 550, 101 ...


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