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Richards v. Hamon

Supreme Court of Delaware

February 20, 1962

Amanda du Bree RICHARDS, Executrix of the Estate of Leonard Richards, Jr., and Leonard Richards, Inc., a corporation of the State of Delaware, Defendants, Appellants,
v.
Leona M. HAMON, Plaintiff, Appellee. Amanda du Bree RICHARDS, Executrix of the Estate of Leonard Richards, Jr., and Leonard Richards, Inc., a corporation of the State of Delaware, Defendants, Appellants,
v.
John SENTMAN, Jr., Alice D. Sentman, and John Sentman, III, an infant, and Kay Sentman, an infant, by John Sentman, Jr., their next friend, Plaintiffs, Appellees.

[54 Del. 323] Frank J. Miller, Wilmington, for appellants.

David B. Coxe, Jr., Wilmington, for appellees.

SOUTHERLAND, Chief Justice, and WOLCOTT, Justice, and SHORT, Vice Chancellor, sitting.

Page 141

[54 Del. 324] SOUTHERLAND, Chief Justice.

The questions raised in this case are mainly procedural; but two of the rulings below require review.

On October 15, 1959, appellee Hamon filed a complaint against the executrix of the estate of Leonard Richards, Jr., seeking to recover damages for injuries suffered in an automobile accident in which Richards lost his life. On November 9, 1959, a similar complaint was filed against the estate by the Sentman appellees.

The executrix did not appear in either suit for more than a year later; and on January 29, 1960, plaintiffs moved for and were granted judgments by default against the estate, the amounts thereof to be ascertained by inquisitions. In the meantime, on January 15, 1960, plaintiffs in both cases moved to add as a party defendant Wilmington Truck Rental Co., Inc. The motions were granted; plaintiffs filed and served amended complaints; and the court, as required by the statute hereafter referred to, set a day for a hearing upon the issue raised by the amended complaints.

We pause to explain what that issue was.

Leonard Richards, Jr., the deceased, was at the time of the accident driving a car rented by him from Truck Rental. Section 6102 of Title 21 of the Code imposes certain requirements and liabilities with respect to such rental transactions. Any company engaged in the car rental business is required to carry approved public liability insurance insuring the renter against liability for negligent operation of the rented vehicle in certain amounts, i. e., not less than the usual limits of $5,000 and $10,000 for personal injuries and $1,000 for property damage. Any such company failing to do so 'shall be [54 Del. 325] jointly and severally liable with the renter for any damages caused by the negligence' of the renter in operating the vehicle. The amended complaints alleged that Truck Rental had failed to carry the required liability insurance in respect of the accident sued on and hence was jointly and severally liable with the Richards estate. This charge was apparently based on the exclusion from Truck Rental's insurance policy of any liability for accidents involving an intoxicated driver, as appears from the following:

On January 18, 1960, Continental Casualty Company of Chicago informed the executrix of the estate that it had insured Truck Rental in respect of risks involving damage to others from negligent operation by the drivers of rented cars; and that Leonard Richards, Jr., deceased, had rented a car shortly before the accident. The letter specifically referred to the pending suits against the estate. The company advised Mrs. Richards, however, that its investigation of the matter disclosed that Mr. Richards was under the influence of an intoxicant at the time of the accident, and therefore that the risk involved was not covered by the insurance.

On February 19, 1960, the defendant Truck Rental filed petitions alleging that Continental Casualty Company had issued to Truck Rental a policy insuring the drivers of rented cars from liability for negligence which policy excluded from its coverage any person who was operating a motor vehicle under the influence of a narcotic or intoxicant. The petitions prayed for an order staying all proceedings in the cases pending determination of the issue tendered by the amended complaints, i. e., whether Truck Rental had carried proper insurance. Plaintiffs agreed, and it was so ordered.

While the proceeding was pending, the insurance company on March 17, 1960, wrote Mrs. Richards a second letter advising her that it had 'reconsidered the position of the Richards estate' and would afford the estate a defense under the policy, its liability, however, to extend only to the statutory[54 Del. 326] limits. Calling her attention to the amount of the claims, the amount of which substantially exceeded these limits, it notified her that she was entitled to engage her own counsel in the matter.

Page 142

Mrs. Richards' counsel replied, contending that if the company policy with Truck Rental covered the accident its liability would extend to the policy limits, as opposed to the statutory limits.

On July 13, 1960, plaintiffs filed motions to add an additional party defendant in each case, i. e., Leonard Richards, Inc., a Delaware corporation, one of the appellants herein. An order was entered accordingly; amended complaints were filed; and on July 19, 1960, service of summons was made on the ...


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