Epitomized Opinion

Published Only in Ohio Law Abstract

Strachan brought an action for personal injuries and property damage against the Rapid Transit Co. having its principal place of business at Akron, Ohio. He was struck by one of its trucks while he was operating his automobile at or near Akron. In February, 1921, he recovered a judgment against the Rapid Transit Co. for $16,200. Execution was returned “No property upon which to levy.” He then brought an action against the Commercial Rapid Transit Co. and the Hartford Accident and Indemnity Co., alleging that the Hartford Co. had written insurance on the Commercial Transit Co. trucks, which was in force at the time of the accident. A judgment was rendered for the defendants. The Hartford Co. took charge of the defense of the original case, but later withdrew thare-from. The insurance policy provided that the Hartford Co. was to indemnify the insured for all sums paid out for judgments. Strachan prosecuted error, claiming the Indemnity Co. was liable while it claimed that inasmuch as the Transit Co. had not paid the judgment it, the Indemnity Co , owed nothing. In affirming the judgment of the lower cort, the Court of Appeals held:

1. As there was nothing unlawful or illegal in the provisions of the insurance policy re-cuiring the insured to pay the judgment to the injured party before the Insurance Co. was to be liable, the failure of the insured to pay the same relieved the Insurance Co. from any liability in that regard.

2. The mere taking charge of the action by the Insurance-Co. did not enlarge its liability or affect the contract limiting its liability.

3. Any law enacted by the state cannot apply to a contract entered into by the parties prior to the enactment of this law, if it changes either by enlarging or reducing the obligation in favor of one party and against the other; and therefore, the provisions of 9510-3 and 9510-4 GC. do not apply to the facts of this case, as these provisions were enacted subsequent to the making of the insurance contract.