Northwestern National Insurance v. Samuel R. Rosoff, Ltd.
Northwestern National Insurance v. Samuel R. Rosoff, Ltd.
Opinion of the Court
delivered the opinion of the Court.
These two cases are samples of 40 odd cases in which the same questions have been raised below. Appeals in the other cases are contingent, as to their completion, upon the decision in the cases before us. All of the cases are suits by homeowners against their insurance companies for damages to their premises alleged to have been caused by explosions in the period from February through July, 1948. The several insurance companies in each case filed motions to implead Samuel A. Rosoff, Ltd., a corporation, and the Mayor and City Council of Baltimore City, contending that the explosions occurred during the construction of a water tunnel in the City of Baltimore by the use of dynamite and other explosive materials by Rosoff, the contractor. The City and Rosoff were made third party defendants, declarations were filed against them by the insurance companies, and, thereafter, motions were filed by the City and Rosoff to strike out the orders impleading them. The motions in the two cases before us were heard by Chief Judge Smith in the Superior Court of Baltimore City. Other
It may be noted that in some of the cases the plaintiffs also filed motions to strike out the impleading orders, but we are advised that these were all withdrawn with the exception of two. In case No. 163, the plaintiff did not file such a motion. In case No. 164, the plaintiff did, but later withdrew it in open court at the hearing.
The original suits are in contract, alleging that the plaintiffs were insured by their companies against explosions. The third party suits, which the defendants desired to have heard with the original suits, are in tort for damages done by the City and its contractor through the same explosions. The plaintiffs in these cases have not attempted to bring separate tort actions against the City or the contractor, but the insurance companies say that if and when they are found liable to the plaintiffs, and have to pay the damages, they will then become subrogated to the rights of the original plaintiffs against the City and the contractor, and, therefore, the question of who is ultimately to pay the damages, if any are found, should be settled in one suit as to each house or building damaged.
The theory of impleading third parties is an outgrowth of what was found to be a defect in the common law. There were frequent cases where it was necessary to give relief to a defendant when he had a genuine claim for exoneration against some person not a party to the suit. For example, when the payee of a note sued the
Our Rule 4 of the General Rules of Practice and Procedure, Part Two, III, is based upon Federal Rule 14. It will be found in the 1947 Supplement to the Annotated Code, pages 2042, 2043, and the explanatory notes on pages 2103-2105. The procedure outlined in the Rule was followed in the cases before us, and the questions we are now called on to decide are first the right of immediate appeal from the order striking out the impleader, and, secondly, if such an appeal is now permissible, did the trial court abuse its discretion? The appellees in each of the cases have filed motions to dismiss the appeals on the ground that they were prematurely taken, because the orders are not final judgments.
Article 5, Section 2, Code 1939, allows an appeal from any judgment or determination of any court of law in any civil suit or action. That has been construed to mean a final judgment or determination which settles the rights of parties. Thus in the early case of Mitchell v. Smith, 2 Md. 271, 274, which was an appeal from an order of the County Court consolidating two cases, the Court said that such an order was not a proper subject of appeal before trial, although it might form such a basis after the determination of the suit, the reason being that no right of the parties was finally settled by it. This rule has been generally followed, two of the latest cases being Dermer v. Faunce, 187 Md. 610, 613, 51 A. 2d 76, and Goodman v. Clark, 193 Md. 521, 69 A. 2d 496. The appellees contend that the orders appealed from do not deny the appellants the means of further prosecuting suits against appellees, as the orders complained of dismissed the third party complaints without prejudice. They further say that the right to implead is not absolute but is in the discretion of the trial court, and, therefore, the appellees have been denied no rights. Appellants, on the other hand, say that the orders appealed from terminate finally the present litigation between appellants and appellees, that it is a matter vitally affect
In the case of Baltimore Transit Co. v. State to use of Schriefer, 188 Md. 674, 39 A. 2d 858, 156 A. L. R. 460, which was a tort action, the Transit Company obtained an order making the Mayor and City Council of Baltimore a third party defendant. The City subsequently moved to strike out this order. This was granted, and the Transit Company appealed. The facts in the case were that an employee of the City, while collecting ashes, was struck by a street car and killed. His dependents filed a suit against the Transit Company. The Transit Company claimed that the truck with which the deceased was collecting ashes was being operated by a servant of the City, and that his negligence caused the accident. In that case the claim was under the Maryland Joint Tort Feasor Act, Chapter 344 of the Acts of 1941, Art. .50, sections 21 to 30 of the 1943 Supplement to the Code. The City had been paying the employee compensation under an award of the State Industrial Accident Commission, and we held that under such circumstances the Workmens’ Compensation
Our Rule, as we have stated, is based upon the Federal rule, and there is, so far, only one case which has directly decided this issue. That is the case of Baltimore & Ohio R. R. Co. v. United Fuel Gas Co., 154 F. 2d 545, decided by the 4th Circuit Court of Appeals. In that case the Court held that the order dismissing the third party complaint was not appealable because it was an interlocutory order and not a final judgment. Judge Dobie, delivering the opinion, said the problem of what constitutes, for the purpose of appeal, final judgment, is often difficult. Three cases are referred to in other circuits where the court, on appeal, considered the merits of a motion to implead, but none of these cases discussed whether the judgment on review was a final judgment.
The sequel to the Baltimore & Ohio case is instructive. It was tried below without the United Gas Fuel Co. A judgment was entered against the Baltimore & Ohio, and a second appeal was taken. On that appeal the ruling declining to implead the United Gas Fuel Co. was considered by the court at some length. The ground of the refusal by the District Court had been that the third parties sought to be impleaded were citizens of West Virginia which was the state of the original plaintiff. Under these circumstances, the Circuit Court of Appeals, speaking through Judge Parker, (Baltimore & Ohio R. Co. v. Saunders, 4 Cir., 159 F. 2d 481), held that the United States Court would be without jurisdiction in.the third party suit, and that the joining of these third parties would oust the jurisdiction of the court in the entire case, which had been based on diversity of citizenship between the plaintiffs and the Baltimore & Ohio Railroad. Had Judge Parker held differently, the result would have sent the case back for another
There are other Federal cases which have entertained similar appeals before trial without any suggestion that they were premature, and where it does not appear that the point was made. One of these is Brown v. Cranston, 132 F. 2d 631, 148 A. L. R. 1178, decided by the Circuit Court of Appeals for the Second Circuit in 1942, where the Court applied the New York law against joint tort feasors under Erie Railroad Co. v. Tompkins, 304 U. S. 64, 58 S. Ct. 817, 82 L. Ed. 1188, and affirmed an order setting aside orders bringing in such third party defendants. In another case, City of Philadelphia to Use of Warner Co. v. National Surety Corp., 140 F. 2d 805, decided by the Circuit Court of Appeals for the Third Circuit in 1944, the District Court’s order granting a motion to dismiss a third party complaint
Both before and after the decision in Baltimore & Ohio R. R. v. United Fuel Gas Co., supra, therefore, in three other Federal Circuits, four immediate appeals were considered and decided, and district courts were affirmed in denying impleader without a suggestion that the appeals were premature. We cannot consider these decisions as deciding that question since it was not specifically raised, but, on the other hand, we cannot assume that the judges, who passed upon these cases, were ignorant of it, or that it did not occur to them. We have, in this State, as we have shown, decided two cases in which it was tacitly assumed that the orders were immediately appealable. It seems to us in the nature of things that to decline to hear an appeal from an order dismissing third party complaints, thereby requiring the original defendant to try his case without having the third party in it, and then, on a second appeal to have a judgment against the original defendant reversed on the ground that the. third party defendant should have been in,
That brings us to the other question, which is whether the court below abused its discretion in striking out the orders. The rule for making third parties was designed to facilitate trials, and was intended to be administered
The appellants contend that the spirit of the rule requires that all suits growing out of the same transaction be tried together if possible. They say that in this case the claim of the plaintiffs is based upon an explosion caused by the blasting of a tunnel for the City by Rosoff. That it will be necessary to prove in the case against them that the damage was caused by such an explosion, and the question whether it is necessary for them to allege negligence in their suit against the City and the Contractor, can, and probably will, be raised by demurrers, so that when the cases are tried, if they have to be tried separately, there will be duplication of a great deal of the evidence, and a possibility of two juries disagreeing on the same facts. They state that the rule permits an action of contract and an action of tort to be tried together, and that the fact that they may have a right of subrogation against appellees brings them within the rule. See Lee’s, Inc. v. Transcontinental Underwriters of Transcontinental Ins. Co., D. C., 9 F. R. D. 470, and cases cited. They also contend that since their claim will be by way of subrogation, and they will succeed only to such rights as their principals may have, the statute of limitations is already running against them, although they cannot now bring a suit, and, therefore, it is quite possible, if the appellees are not now impleaded, the appellants may be forever barred from bringing a suit against them.
On this last question there is authority for the appellant’s construction of the running of the statute.
As to the other arguments of the appellants, the reasons why they are not controlling, are set forth in the opinion of Judge Chesnut in the case of Lee’s, Inc. v. Transcontinental Underwriters, supra. This was one of these cases in which the question was decided in the United States Court. Judge Chesnut held that the impleader was within the authority of the Federal rule because that rule contemplated the service of a third party complaint on a person not a party “who is or may be liable to him for all or part of the plaintiff’s claim against him.” [9 F. R. D. 471] The same wording appears in Rule 4, and we think the same construction applies, and that our rule is broad enough to include a claim by subrogation. While admitting that the main purpose to be gained by applying the rule is economy of time of the courts, parties and witnesses, and avoidance of expense for delay involved in trying a case twice where once would suffice, Judge Chesnut pointed out that it was quite possible to visualize difficult questions of evidence with respect to admissibility on the claim of
We are unable to find any abuse of discretion in the conclusions reached by Chief Judge Smith in the instant cases, which it may be presumed were based upon the same reasons as those set out by Judge Chesnut. Even if we thought that time might be saved and other considerations might lead to a better result, if the cases were tried together, we could not hold that the judge of the nisi prius court, which is to hear the cases, has abused his discretion in holding otherwise. Questions of this nature are much better decided by the trial judges than by appellate courts, and the decisions of such judges should only be disturbed where it is apparent that some serious error or abuse of discretion or autocratic action has occurred. There is nothing in the cases before us which shows any of these considerations to be present in the slightest degree, and we will, therefore, affirm the orders of the lower court.
In No. 16S motion to dismiss denied, order affirmed with costs.
In No. 16It- motion to dismiss denied,, order affirmed with costs.
Reference
- Full Case Name
- NORTHWESTERN NATIONAL INSURANCE COMPANY v. SAMUEL R. ROSOFF, LTD. HOME INSURANCE COMPANY v. SAMUEL R. ROSOFF, LTD.
- Cited By
- 23 cases
- Status
- Published