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Dostal v. Saint Paul-Mercury Indemnity Co.

Supreme Court of Wisconsin
Apr 9, 1958
89 N.W.2d 545 (Wis. 1958)


In Dostal, where the insurer pleaded that its policy was subject to limitations but did not prove its policy limits during trial, the supreme court held that it was within the trial court's discretion to grant the insurer's post-verdict motions to receive evidence of the policy limits and to limit recovery to the amount of those limits.

Summary of this case from Price v. Hart


March 3, 1958 —

April 9, 1958.

APPEAL from a judgment of the circuit court for Pierce county: CLARENCE E. RINEHARD, Circuit Judge of the Nineteenth circuit, Presiding. Affirmed in part; reversed in part.

For the appellant there were briefs by Doar Knowles of New Richmond, attorneys, and Roberts, Boardman, Suhr, Bjork Curry of Madison of counsel, and oral argument by John Doar and Walter M. Bjork.

For the respondent there were briefs by Gwin Fetzner of Hudson, attorneys, and Arthur Wickham and John J. Ottusch, both of Milwaukee, of counsel, and oral argument by Mr. Wickham and Mr. John W. Fetzner.

On June 16, 1953, Rita Dostal, a minor, by guardian ad litem, brought action against the Saint Paul-Mercury Indemnity Company, by service of summons. The complaint was served February 22, 1955, and sought damages for personal injuries resulting from upset of an automobile on May 6, 1953. Rita was a passenger in the car. It was owned by defendant's insured and operated with permission by John Magee, the insured's minor son. John Magee was originally named a defendant and the summons and complaint were served on him. Personal jurisdiction was not obtained, however, because the guardian of Magee's property was not served and the appearances made on his behalf by the attorney for the Insurance Company were not properly authorized nor ratified by Magee after becoming of age. See Dostal v. Magee (1956), 272 Wis. 509, 76 N.W.2d 349.

The case was tried in January, 1957, together with a case in which Rita's father sought to recover medical expense. The jury found that Rita's injuries were caused by Magee's negligent management and control of the automobile. Medical expense incurred by her after becoming of age was determined by the court in the amount of $247.50, and the jury awarded $150,000 for her injuries. Plaintiff moved for judgment on the verdict. Defendant moved for judgment notwithstanding the verdict, for a change of answers and judgment accordingly, and for a new trial, and in the event of the denial of its other motions, that any judgment for the two plaintiffs, Rita and her father, be limited to $40,000. The insurance policy had not previously become a part of the record and was tendered with defendant's motion. Plaintiffs opposed this motion on several grounds including equitable estoppel of the Insurance Company because its attorney had made unauthorized appearances for John Magee until more than two years after the date of injury; plaintiffs had not known of the lack of authority, had relied upon the appearances, and had thereby lost their rights to bring action against John Magee. The circuit court received the insurance policy in evidence, denied plaintiff's motion to take testimony on the allegations of estoppel and ordered judgment for Rita in the amount of $36,475.95, plus costs. The amount awarded to her, plus the amount awarded to her father, totaled $40,000, the limit of coverage in the policy. Judgment was entered May 8, 1957. Both plaintiff and defendant appealed.

Facts Material to the Issue of Negligence.

In the evening of May 6, 1953, Rita Dostal and her friend, Marlys Tyler, attended a dance at Ellsworth. Marlys lived at River Falls and Rita was staying there while attending college. John Magee was at the dance and invited the two girls to ride to River Falls with him. They had come to the dance with another couple and accepted his invitation. They left the dance pavilion at about 11:30 and drove north toward River Falls on Highway 35. About one and one-fourth miles north of Ellsworth the accident occurred. A short distance to the south of the scene of the accident the highway reaches the crest of a hill and proceeds downgrade, descending about five feet in each 100 feet. Part way down the hill there is a three-degree curve to the left, when driving north. The pavement was dry and the weather clear. A southbound car was approaching but there is a conflict in the testimony as to the degree to which it figured in the event. It is undisputed that Magee's car suddenly swerved to Magee's right onto the east shoulder of the highway and then turned left, back onto the pavement, and across it at an angle. His car left a semicircular mark on the east shoulder, going out to the edge of it, and then back toward the pavement. The pavement was 20 to 22 feet wide and each shoulder approximately six feet. In crossing the highway at an angle, Magee's car left a tire mark from the east edge of the pavement across the east lane and some distance into the west lane and this tire mark measured 64 feet. Magee's car continued on across the pavement, across the west shoulder, and down the bank at an angle into a ditch. The car apparently hit a bank on the west side of the ditch and traveled northward along the ditch overturning in the process. It came to rest in the ditch on its top with the front end toward the west. From the point where the tire mark showed that it regained the pavement after being on the east shoulder to the point where it came to rest was 385 feet. Magee testified that his speed was about 40 miles per hour and this was not disputed. The identity of the occupants of the southbound car was never learned.

Rita had no memory of the accident. The only other eyewitnesses, except occupants of the southbound car, were John and Marlys and their testimony was partially in conflict. John testified that he saw the southbound car approaching in its own lane; that each driver dimmed his lights; that John was in his own lane; that when the cars were 30 or 40 feet apart, the southbound car swerved into the east lane; that in order to avoid a head-on collision, John turned his car sharply onto the east shoulder; that it "jackknifed" back to the left and went slanting across the road; that John's car narrowly missed the rear end of the southbound car; that he was trying to straighten it out but could not get it under control; that he did not think it would be helpful to apply the brakes and did not apply them.

Marlys was seated in the middle of the front seat and Rita on the right. Marlys testified that at some point John had lit a cigarette for Rita. She could not say just when this was in relation to the accident. The first thing she knew about the accident was that she looked up and they were on the east shoulder with no road in front of them; then John pulled the car back onto the highway and she saw car lights right in front of them; that the southbound car passed the Magee car on Magee's right; that she remembers the car turning over onto its top and that is the last she remembers. Defendant offered a written statement and affidavit signed by Marlys on May 7th. In part it reads:

". . . and that at about 11:20 or 11:30 p. m. on said date she left said dance hall with said Rita Dostal and John F. Magee, for the purpose of riding in an automobile driven by said John F. Magee from said dance hall to River Falls, Wisconsin; that affiant and said two persons started out on State Highway No. 35 from said dance hall, and at a point on said highway, about 1 1/2 miles from said dance pavilion, and while said John F. Magee was proceeding on his right half of said highway en route from said Ellsworth to said River Falls, an automobile driven by a person unknown to this affiant nearly drove his automobile into the automobile being then and there driven by said John F. Magee, affiant then and there riding in said Magee automobile, and said John F. Magee then and there, in order to avert a head-on collision, suddenly turned his car onto the right shoulder of the highway in the direction in which he was proceeding; that in so quickly turning, to avoid a collision, the automobile being driven by said John F. Magee immediately jackknifed and barely missed the back end of the automobile being driven by the person unknown to this affiant, and thereupon the Magee car zigzagged across said highway and into a drainage ditch on the left side of the highway in the direction the Magee car was traveling; that the impact upon hitting said drainage ditch buckled the doors on said Magee car, and said John F. Magee was thrown out of said car through its left door; that from said impact the Magee car again jackknifed and thereupon continued down said drainage ditch until it upset; that at just what point or time during the accident that affiant and said Rita Dostal were thrown out of said Magee car affiant does not know;

"That said car that nearly ran into the Magee car in which affiant was riding appeared to be heading directly for said Magee car, and affiant, who was then and there talking to said Rita Dostal, remembers distinctly that the lights on the other car were directly in front of the Magee car;"

Marlys had been interviewed and the statement typed, witnessed, and notarized by John Magee's father, who is an attorney. He had talked over the accident with his son, John, before taking the statement. He testified that he put the statement into legal phraseology but that he had typed tip the substance of what Marlys told him. She testified that she had not been hurt seriously in the accident, but that she was excited and disturbed and did not know whether Rita was going to live; that she had answered "Yes" or "No" to Mr. Magee's questions and believed she must have said "Yes" to what was in the statement. She thought she knew what was in it when she signed it and she thought that "John had told his dad what happened and that his dad had the same idea of the accident as I did." She testified that many of the statements in the affidavit were not true. Two witnesses testified that while still at the scene of the accident, John had told Marlys that she should remember the 1940 Chevrolet that crowded them off the road and that she said, "I will remember." Three other witnesses testified to statements made by her shortly after the accident to the effect that she turned and said something to Rita and suddenly there were bright lights directly in front of them.

Facts as to Alleged Misconduct of Juror.

The trial began on Friday, January 25, 1957, and continued on Saturday, Monday, Tuesday, and Wednesday. Just before court convened after the noon recess on Saturday, counsel appeared before the trial judge in chambers and Mr. Geer, an attorney for defendant, said that during the preceding eight or ten minutes he had observed four ladies sitting together in the courtroom. One was Mrs. Lindquist who had testified on Friday as one of the plaintiff's witnesses. One was Mrs. Matzek, a juror. One was Mrs. Peterson, a member of the jury panel against whom defendant had exercised a peremptory challenge, she having indicated a close family friendship with Marlys Tyler. The fourth was Miss Tyler who had not yet testified but who was going to be a witness for the plaintiff. Mr. Geer said he did not know anything about what the ladies had said but their appearance was convivial, friendly, and smiling. He claimed that John Doar, one of plaintiff's counsel, had been in the courtroom at the same time and had walked in front of the group and had some responsibility to keep his witnesses from such contacts. Mr. Doar asserted that he had paid no attention to who was sitting there although he had at times observed Marlys sitting with Mrs. Peterson. Mr. Geer asked for an agreement that Mrs. Matzek be withdrawn from the jury and stated that in the alternative, he must move for a mistrial. Mr. Doar felt that there was no reason why the juror should be excused. The trial court denied the motions saying that he thought that he could keep the matter in balance. At the opening of the trial he had made some general remarks to the jury advising the jurors to hold aloof from persons connected with the case even though the conversation be about other matters and above all, not to talk to anyone about the case or permit anyone to talk to them. He advised them to reject and report to the court any attempt to talk to them about the case. When recessing at the close of the afternoon session on Saturday, the court cautioned the jury again about not discussing the case and said, "It's not only well not to talk to anyone about the case but to be seen talking with anyone connected with the case, either a party or a witness because it raises doubts and questions."

Facts Material to Alleged Liability of Defendant in Excess of Policy Limits.

John Magee was born March 24, 1934. On January 28, 1947, James F. Hines was appointed guardian of his estate. John became twenty-one March 24, 1955, and Hines was discharged as guardian in April, 1955. At the time the summons in this action was personally served upon John, he was nineteen years of age and the letters of guardianship issued in 1947 were still in force. Shortly after service of the summons, Attorney Wendell Petersen of the firm of Gwin Petersen entered an appearance on behalf of John Magee and continued to appear in his behalf and represent him thereafter. No guardian ad litem was appointed. On May 21, 1955, more than two years after Rita Dostal was injured, John Magee wrote to Petersen repudiating any acts or appearances on Magee's behalf. On June 4, 1955, there was served upon plaintiff's attorneys a notice of special appearance of John Magee and a motion to set aside the service of summons and complaint upon him. The circuit court set aside the service and this court affirmed in Dostal v. Magee (1956), 272 Wis. 509, 76 N.W.2d 349. It was decided that effective service was not accomplished because there was no service upon Hines, further that appearance and representation by Gwin Petersen were unauthorized because Magee had no capacity to employ an attorney while a minor and that their acts were not authorized nor ratified by Magee after he became of age. The opinion on the earlier appeal refers to many of the appearances and acts of representation of Gwin Petersen on behalf of John Magee commencing with an appearance entered at an adverse examination on June 23, 1953. After Magee's twenty-first birthday, Petersen appeared for him at an adverse examination of Rita on April 15th, and at the call of the calendar on April 18, 1955; he discussed the case with plaintiff's attorneys on several occasions.

On June 8, 1955, Gwin Petersen gave plaintiff's counsel notice of a motion for an order permitting them to remove from the record any appearance made on behalf of John Magee. This motion was later granted. In an affidavit supporting the motion, Petersen stated that his firm had been retained by the defendant Insurance Company to defend the action on behalf of the Insurance Company and on behalf of John Magee and that his appearance and representation on behalf of the defendants "were done at the instance and request of the Saint Paul-Mercury Indemnity Company . . . that any appearance made or entered in said matter on behalf of John F. Magee was done as is the customary practice at the instance, request, and direction of the defendant, Saint Paul-Mercury Indemnity Company." Testimony of three employees of the Insurance Company, supervising claims, tended to support Petersen's claim of authority from the company to appear for Magee.

An affidavit of John Doar presented at the hearing upon the motion to set aside service and not controverted by Petersen in testimony given at that hearing stated that Doar, Petersen, and another representative of defendant had a conversation April 15, 1955, in which Doar demanded $165,000 in settlement and Petersen advised Doar that the limits of the policy were $50,000; that on April 18, 1955, Petersen advised the court that there would be no point in a pretrial conference on April 19th, because Magee might want to retain other counsel; that on April 28, 1955, Petersen told Doar that Magee had not retained other counsel and Petersen was representing Magee.

The complaint alleged the existence of a policy of insurance covering loss by reason of liability imposed upon the insured or anyone operating the vehicle with consent of insured. There was no allegation as to policy limitation; the extent of the damage to Rita Dostal was alleged to be $300,000 and the prayer for relief was in that amount. The answer commenced with an introductory paragraph "Now come the defendants, by Gwin Petersen, their attorneys, and for an answer to the complaint of the plaintiff, deny . . ." Then followed paragraphs 1, 2, and 3 dealing with negligence, causation, and plaintiff's injuries. Paragraph 4 read as follows: "That the defendant, Saint Paul-Mercury Indemnity Company, by its policy of insurance agreed to pay to others for damages for personal injuries by reason of liability imposed upon Irwin E. Magee, or anyone operating his said vehicle with his knowledge, consent, and approval, and further states that said policy of insurance that was issued and in force was subject to conditions, exceptions, and limitations more fully set forth in the policy." The answer contained no allegation specifying the amount of coverage.

Neither the complaint nor answer was amended in any way after the question as to the sufficiency of service upon John Magee or the effect of the appearances for him was raised or decided. Neither party offered the policy of insurance upon the trial nor in any way prior to the verdict of the jury upon the issues of negligence, causation, and damages. The defendant did not move for a separate trial upon the issue of coverage and it did not support its motion after verdict with any assertion of mistake, inadvertence, or excusable neglect in failing to raise the issue at an earlier point or offer the policy before the trial on the merits had been completed.

Further facts will be referred to in the opinion.

Upon defendant's appeal the questions are, (1) whether the evidence supports the finding that John Magee was negligent as to management and control, and (2) whether there should be a new trial because of alleged misconduct of Mrs. Matzek, a juror. Plaintiff's appeal raises a third question: Did the trial court err in limiting the amount of the judgment so that the two judgments did not exceed the limits of the policy?

(1) Jury's finding of negligence sustained. The jury may have accepted the version of the accident related by Marlys Tyler. There was evidence of statements previously made by her, and her affidavit, at least, was in conflict with her testimony in important and material respects. Nevertheless, it was a jury question whether her affidavit or her testimony upon the trial set forth the truth. There was no fact which made her testimony inherently incredible. True, she left to conjecture whether John's lighting of a cigarette for Rita was related to his sudden turn to the right and onto the east shoulder. Her testimony offers no other explanation for that turn. Magee's testimony does make an explanation that is quite adequate, if true. On the other hand, Marlys' testimony explains another matter in a way the jury could have considered more adequate than Magee's. According to Marlys the southbound automobile passed the Magee's car on Magee's right. If true, the southbound car was still north of Magee when he crossed the pavement to the west side in an almost straight course but at an angle with the direction of the highway. The presence of the southbound car might be considered a more-adequate explanation of why John did not apply his brakes or turn his wheels so as again to follow the highway than any explanation he offered. Defendant's trial counsel appears to have virtually conceded that if the jury believed Marlys, it would find Magee negligent, for his leaving the pavement would then raise an inference of negligence without any explanation which would permit a contrary inference.

We are of the opinion also that even if Marlys' testimony were disregarded, there was a jury question as to negligent management and control after John succeeded in getting out of the path of the oncoming car. His testimony does, of course, explain his sudden turn to the right as a response to an emergency which he did not create. Naturally, having turned to the right, he must turn to the left to approximately the same degree in order to avoid running off the east shoulder. He offered no explanation of why he turned so much to the left that he headed toward the west side of the highway except that his car "jackknifed." He then proceeded in an almost straight course, angling across the pavement. The jury could have found that he traveled some 100 feet in that straight course before reaching the edge of the west shoulder. He did not apply his brakes. He did not turn to the right. According to him, there was no car then preventing him from using any part of the highway to swing back into a safe course. The jury could have found that the angle between the course he pursued and the direction of the highway was in the neighborhood of 30 degrees. In our opinion, even if the actions of the driver of the southbound car precipitated Magee's maneuvers in the first instance, he could be properly found negligent in the manner in which he managed his car after avoiding the southbound car.

There was no evidence that Magee was not an ordinarily prudent driver. Plaintiff guest could meet her burden of showing that he failed to exercise the skill and judgment he possessed by showing that he failed to exercise ordinary care as to management and control. Heagney v. Sellen (1956), 272 Wis. 107, 113, 74 N.W.2d 745, 7 5 N.W.2d 801. It may be granted that had the southbound car invaded the east lane and rendered a head-on collision imminent, as Magee claimed, Magee's response by turning onto the east shoulder may have been free from negligence as a matter of law, under the emergency doctrine, even though he had gone into the east ditch and injured plaintiff. Whether all that he did after swerving onto the shoulder was a necessary result of the act by which he avoided the head-on collision was a jury question. See Wheeler v. Rural Mut. Casualty Ins. Co. (1952), 261 Wis. 528, 533, 53 N.W.2d 190. We cannot say as a matter of law that as Magee crossed the road at an angle, he did not have a reasonable opportunity to apply brakes and turn to the right nor that due care did not call for such actions nor that such operations would not have avoided the injury.

(2) The court did not abuse its discretion in disposing of claim of misconduct of juror. Four ladies were sitting together in the courtroom, talking. They were a juror, a member of the panel who had been excused, and two witnesses for plaintiff. The two witnesses were friends and one of them was a friend of the panel member. The situation existed for some eight minutes or more at the noon recess and shortly before the convening of court. This was not a contact between a party or attorney and a juror. No circumstance suggested any impropriety in the content of the conversation. The incident occurred early in the trial. The trial court fully recognized the importance of jurors' avoiding contacts which would arouse doubts or suspicions. Evidently he viewed the incident as something which it would be better not to have repeated, but not as threatening the integrity of the jury or confidence in it in any serious sense.

The cases relied upon by defendant involve situations which raise more-palpable questions of propriety: La Valley v. State (1925), 188 Wis. 68, 205 N.W. 412, — in a criminal prosecution where the sheriff was virtually a representative of the plaintiff state, the sheriff gave a juror a ride to a dance; Shefelker v. First Nat. Bank (1933), 212 Wis. 659, 250 N.W. 870, — a witness who showed partiality to plaintiff gave a juror a ride home, 35 miles, and the plaintiff and two other witnesses rode along; State v. Cotter (1952), 262 Wis. 168, 54 N.W.2d 43, — the sheriff told the jurors on a criminal case, after it was submitted to them, that it would not hurt his feelings if they hurried; Rasmussen v. Miller (1955), 268 Wis. 436, 68 N.W.2d 16, — a juror was seen in contact twice with the same unidentified man after the case had gone to the jury, once in the basement of the courthouse and once at the hotel.

In Sandeen v. Willow River Power Co. (1934), 214 Wis. 166, 181, 252 N.W. 706, this court found no abuse of a trial court's discretion in refusing a new trial where a member of the term panel attended the entire trial and "manifested an undue personal interest in favor of one of the attorneys for plaintiff, as well as their cause."

Similarly in the instant case, we find no abuse of discretion either in denying the motion for mistrial immediately after the incident, nor in denying a new trial on that ground after verdict.

(3) The problem of the damages in excess of policy limits. After the verdict was rendered, the record would have supported a judgment against defendant for $150,247.50, plus costs. The complaint alleged the issuance of a policy. Although paragraph 4 of the answer was preceded by the word "deny," it was clear enough that the existence of the policy, if not its legal effect, was admitted, and it was alleged generally that it was subject to conditions, exceptions, and limitations. By virtue of the admission of the existence of the policy, plaintiff was relieved from the burden of proving that fact. Defendant thus was directly liable to plaintiff under sec. 85.93, Stats., "such liability not to exceed the amount named in said bond or policy." The insurer is a party to the contract which contains the limits, and the person seeking recovery ordinarily is not a party to the policy and in most cases does not have ready access to it. We think the burden of pleading and proving the policy limits was upon the insurer. Masaracchia v. Inter-City Express Lines (La.App. 1935), 162 So. 221.

When defendant moved, after verdict, that the recovery be limited to the amount of the policy, and asked that it be received in evidence, the issue before the court was whether in the interests of justice the defendant should be relieved from its failure to raise the issue of policy limits more particularly or to offer proof thereof at an earlier time. An order on this subject has been held to be discretionary. Catura v. Romanofsky (1954), 268 Wis. 11, 66 N.W.2d 693. Defendant did not explain its failure to present the policy at an earlier time and plaintiff asserted that defendant had withheld the policy in order to obtain some advantage in discussions of settlement. In connection with the decision as to the jurisdiction over John Magee, an affidavit of John Doar which had been made part of the record showed that Doar had been informed upon one occasion in April, 1955, that the limits of coverage were $50,000 and his affidavit in opposition to defendant's motion after verdict showed that he had been told later that the limits were $40,000. The trial court was within its discretion in determining that plaintiff's claim with respect to maneuvering for advantage did not render it unjust to permit the defendant to place the policy in the record.

The more-substantial question is raised by a theory which plaintiff first suggested, so far as the record shows, in an affidavit opposing defendant's motion for the receipt of the policy in evidence, and which plaintiff's counsel forcefully argued to this court upon this appeal. This theory is that plaintiff has a cause of action against defendant for the difference between the recovery based upon the policy and the total amount of plaintiff's damages, as found by the jury. The elements of this cause of action are: (1) Petersen made unauthorized appearances purporting to represent John Magee not only before, but after Magee became twenty-one. (2) Petersen so acted within the scope of his authority as an agent for defendant. (3) Plaintiff relied upon Petersen's appearances as being authorized by Magee. (4) Plaintiff lost rights against Magee as a result of plaintiff's reliance upon the acts of Petersen. This cause of action was never stated in the complaint or any amendment thereto.

Stated in other terms, plaintiff's right may be to, obtain from defendant Insurance Company the same relief she could have obtained from its codefendant Magee, had the appearances been authorized by Magee.

In support of plaintiff's theory, plaintiff cites cases suggesting that where a party's rights are prejudiced as a result of the unauthorized appearance of an attorney on behalf of another party, the party damaged may recover damages from the attorney. Cleveland v. Hopkins (1882), 55 Wis. 387, 389, 13 N.W. 225; McEachern v. Brackett (1894), 8 Wn. 652, 655, 36 P. 690, 691; Everett v. Warner Bank (1878), 58 N.H. 340, 341. We do not doubt the soundness of this theory. The questions presented by this record are whether the necessary elements have been established as facts in this case and whether, even if established as facts, the plaintiff cannot recover judgment thereon in this action unless and until the complaint be amended so as to state this cause of action, defenses be interposed thereto, and issues, if any, be tried.

Petersen's purported appearances for Magee after he reached age twenty-one are matters of record. We view the order permitting Gwin Petersen to remove from the record their appearances for Magee as an express determination of their lack of authority to appear for him. We do not interpret the order as determining in any sense that plaintiff could not assert rights against defendant, based upon the fact that the appearances were made. In any event the fact that the appearances were not authorized nor ratified has been established by the order which this court affirmed on the first appeal. Thus the first element of the cause of action above referred to is established beyond question.

We note that at least in part, the other elements mentioned have been made to appear rather persuasively even if they cannot be said to have been conclusively established. Nevertheless, after careful consideration, we have reached the conclusion that if judgment is to be granted plaintiff for the amount of her damages in excess of policy limits, judgment should be based upon proper pleadings, with issues resolved by appropriate proceedings, rather than upon the suggestion made by affidavits on motions after verdict, however persuasive.

Plaintiff should have the opportunity to seek this relief in the present action. If she was deficient in failing to amend her pleadings in the trial court, so was defendant in failing to move more promptly to prove its policy limits. The facts on which plaintiff will probably rely are already before the court, set forth both in the affidavits filed in 1955 in connection with the question of jurisdiction over Magee and in those filed in 1957 in opposition to defendant's motion to place the policy in the record. The extent of plaintiff's injuries has been tried and determined in this action.

We have therefore decided to affirm the present judgment in so far as it adjudicates defendant's liability under its policy. In this wise, plaintiff may, without prejudice to her other rights, accept the money deposited in court by defendant and the judgment upon this cause of action, limited to the policy, may be satisfied. We shall, however, reverse the judgment in so far as it denies plaintiff recovery of the difference between the full amount of her damages and the recovery under the policy. Plaintiff may amend her complaint by adding a cause of action upon which recovery of the excess may be based. Defendant's pleadings and other proceedings are to follow in the usual course.

One question was raised in the briefs and oral argument on behalf of defendant which we do not now decide, but on which we think comment is appropriate. Up until counsel for defendant raised the question, everyone appears to have assumed that nothing done by plaintiff within two years after May 6, 1953, complied with the notice-of-injury requirement (sec. 330.19(5), Stats. 1953) and therefore plaintiff could not have brought a new action against Magee after he was let out of the present one. The opinion on the first appeal recites, "No notice of injury has been served." In the dissenting opinion on the first appeal it was pointed out that Magee failed to disaffirm Petersen's acts "until after the two-year period available to plaintiff for giving the notice of injury required by sec. 330.19(5), Stats., had expired on May 6, 1955. Such notice was not required to be given by the plaintiff unless John disaffirmed the voidable retainer of Petersen." Counsel for defendant now suggests that the complaint personally served on John Magee in February, 1955, within the two-year period constituted a sufficient notice of injury even if it served no other purpose.

Upon oral argument our attention was called to our decision in Burmek v. Miller Brewing Co. (1957), 2 Wis.2d 330, 86 N.W.2d 629. There we held that the mailing of a letter and acknowledgment of receipt thereof constituted sufficient compliance with the statute requiring service of a notice of injury. In the instant case, the complaint was served while Magee was still a minor and under guardianship but it was retained by him until he became of age and later handed to his own attorney.

We do not now decide whether the service of the complaint under these circumstances was sufficient notice of injury, nor that plaintiff cannot recover from defendant Insurance Company even if it was sufficient so that plaintiff could still proceed against Magee. At least Magee was let out of the present action, and he would not have been if the appearances for him had been authorized as they purported to be. It is arguable — at least we are not prepared to say now to the contrary — that it would be equitable to require defendant to stand in the shoes Magee would have been in had the appearances been authorized, and to accord to defendant, by subrogation, upon payment of that portion of plaintiff's damages which would have been Magee's sole responsibility, whatever right plaintiff still has to proceed against Magee.

At the time of oral argument the question was raised whether the extent to which a judgment creditor could collect or could have collected a judgment against Magee would have any bearing upon the amount plaintiff could recover from defendant Insurance Company in excess of its policy limits. This question had not been briefed and we do not now decide it.

We note, of course, that even if notice of injury has been sufficiently and timely served, the period of limitations will expire in 1959, and plaintiff or defendant, or both, may desire promptly to interplead Magee in this action and seek recovery from him, perhaps alternatively or conditionally.

It may well be said that the procedure we are following is unusual, but the circumstances of this case are also unusual.

By the Court. — In so far as the judgment awards plaintiff Rita Dostal recovery from the Saint Paul-Mercury Indemnity Company in the amount of $36,475.95 together with $1,315.49 costs, said recovery being the limits of defendant's liability under the policy of insurance issued by defendant and of record herein, the judgment is affirmed; in so far as the judgment denies plaintiff recovery from defendant of the amount by which $150,247.50, the damages determined by the verdict, exceeds $36,475.95, the judgment is reversed, and the cause remanded with directions to permit plaintiff, within twenty days after remittitur, to amend her complaint by adding a cause of action for recovery of said excess and for further proceedings according to law, not inconsistent with the opinion herein.

Summaries of

Dostal v. Saint Paul-Mercury Indemnity Co.

Supreme Court of Wisconsin
Apr 9, 1958
89 N.W.2d 545 (Wis. 1958)

In Dostal, where the insurer pleaded that its policy was subject to limitations but did not prove its policy limits during trial, the supreme court held that it was within the trial court's discretion to grant the insurer's post-verdict motions to receive evidence of the policy limits and to limit recovery to the amount of those limits.

Summary of this case from Price v. Hart
Case details for

Dostal v. Saint Paul-Mercury Indemnity Co.

Case Details

Full title:DOSTAL, by Guardian ad litem , Appellant, vs. SAINT PAUL-MERCURY INDEMNITY…

Court:Supreme Court of Wisconsin

Date published: Apr 9, 1958


89 N.W.2d 545 (Wis. 1958)
89 N.W.2d 545

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