insurer’s wrongful refusal to defend is breach of contract that releases the insured from agreement not to settle without consent of insurer and waives condition that limits insurer’s liability to judgments rendered against insured after trial
How later courts described this case
- insurer’s wrongful refusal to defend is breach of contract that releases the insured from agreement not to settle without consent of insurer and waives condition that limits insurer’s liability to judgments rendered against insured after trial
Written by the judges who cited it.
The opinion
McBRIDE, J.,
Dissenting in Part. — I do not think the pleadings in this case sufficiently broad to sustain the conclusion arrived at. There is no allegation of any liability on the part of the plaintiff to pay the claims, which it is alleged were adjusted and settled.
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In all of the cases I have examined, this allegation seems to have been made. Further, there is no positive allegation that the plaintiff has paid anything pursuant to the alleged “settlement and adjustment.” In the absence of this allegation, I am of the opinion ■that this phase of the case has not been met to justify the judgment against the defendant here.
The cases cited by Mr. Justice Brown seem fairly logical to sustain the contention, that by failure of the insurance company to defend, as they had agreed, the waiver arose which authorized the plaintiff in this case to settle and pay the claims. But such a course would be liable to frequent abuse unless plaintiff should positively plead and prove that there was an actual liability and an actual
bona fide
payment of money pursuant to such agreement. I do not think that sufficiently appears in the pleadings in this case, and that evidence on that subject was improperly admitted.