Appeal, No. 5, March T., 1952, from judgment of Court of Common Pleas of Westmoreland County, Feb. T., 1949, No. 124, in case of The Jeannette Glass Company v. Indemnity Insurance Company of North America. Judgment affirmed; reargument refused May 27, 1952.
Fred B. Trescher, with him Kunkle & Trescher and Francis S. McMichael, for appellant.
R. E. Best, with him Smith, Best & Horn, for appellee.
Before Drew, C.j., Stearne, Jones, Bell, Chidsey and Musmanno, JJ.
OPINION BY MR. CHIEF JUSTICE DREW
Under the notice provision of an insurance policy covering liability for personal injuries, must notice be given promptly after an accident or, is the provision satisfied by the giving of notice only after the insured has learned of its potential liability by having suit filed against it eight months later? The learned court below held in this case that notice was required promptly after the accident and directed a verdict for defendant, Indemnity Insurance Company of North America. Judgment was entered on that verdict and the insured, The Jeannette Glass Company, plaintiff, has appealed.
On May 24, 1944, defendant issued to plaintiff a contract of insurance covering liability for personal injuries and property damage for a period of three years. That policy provided: "Upon the occurrence of an accident, written notice shall be given by or on behalf of the insured to the company or any of its authorized agents as soon as practicable after notice thereof has been received by its executive officers at the insured's headquarters." It is that clause out of which this dispute arises.
While the policy was in force plaintiff, through Eichleay Engineering Company, began constructing some large tanks in its factory. On November 26, 1945, in the course of that construction work a steel beam fell and injured one Stucker, an employe of Eichleay. Carl T. Sloan, vice president of plaintiff, learned of the accident and arrived at the scene just as Stucker was being placed in an ambulance. He and two of plaintiff's employes immediately conducted investigations which satisfied them that plaintiff was not liable. Two or three days later, Kirkland W. Todd, president of plaintiff, learned of the accident and after a summary investigation reached the same conclusion. Plaintiff did nothing to notify defendant of the accident until August 10, 1946, when a complaint in trespass, filed by Stucker, was served on it. Defendant denied liability on its policy because of plaintiff's failure to give prompt notice. Stucker eventually recovered a verdict against plaintiff in the sum of $7000.00 which plaintiff settled in full by paying to Stucker $4000.00. To recover that sum plus the costs of defending that suit, plaintiff brought this action in assumpsit.
The rule is well established that notice must be given to the insurer within a reasonable time and what constitutes a reasonable time necessarily depends on the facts and circumstances of each case: Unverzagt
to enable the insurer to investigate the circumstances of the accident while the matter is yet fresh in the minds of all, and to make timely defense against any claim filed." It might well be that had defendant been notified promptly its investigation by men trained in that work would have revealed a defense to that action. It is equally possible that defendant could have obtained a more favorable settlement had it learned of the accident immediately. It is for these reasons that the failure to give notice releases the insurer from the obligation of the contract: Unverzagt v. Prestera, supra. And this is true even though the insurer does not show that he was in fact prejudiced: Ibid.
A case very similar to this one on that point is Ross v. Mayfl'er D. Stores, Inc., 338 Pa. 211, 12 A.2d 569. There the insured notified the wrong company. That company conducted an investigation before it learned of the error. The proper company was not notified until one year later at which time all investigation reports were turned over to it. We stated, at p. 215: "... the St. Paul Company may well have suffered a disadvantage in not having the opportunity to make its own inquiries, and, more especially, in being deprived for an entire year of the opportunity to settle the claim before the prosecution of the suit had increased the difficulties of adjustment."
Appellant cites that case for the proposition that the issue here should have been left for the jury to decide. It is true that there it was left to the jury but we said, at p. 214: "Ordinarily, in the absence of special circumstances, the question whether an insured has failed to meet the requirements of the policy in regard to the time of giving the notice stipulated therein is one for the ...