HOTOP v. MARYLAND CASUALTY CO., 274 N.Y. 327 (1937)

8 N.E.2d 879

ARTHUR HOTOP, Respondent, v. MARYLAND CASUALTY COMPANY, Appellant.

Court of Appeals of the State of New York.Argued April 23, 1937
Decided May 25, 1937

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Appeal from the Supreme Court, Appellate Division, Second Department.

Philip Huntington and David S. Hill, Jr., for appellant.

Phillip S. Rivlin, Eugene A. Leiman and Arthur A. Singer
for respondent.

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O’BRIEN, J.

Plaintiff was injured by a motor vehicle owned by English
Greenfader, Inc. Defendant Maryland Casualty Company had issued a liability policy to English Greenfader, Inc., for bodily injury limited to $20,000. In an action against English Greenfader, Inc., this plaintiff recovered a verdict for $25,000, which, on plaintiff’s stipulation, was reduced by the trial justice to $15,000. Both parties appealed. The Appellate Division modified the judgment by reinstating the verdict and judgment for $25,922.99 was entered. That judgment was not paid by English
Greenfader, Inc., and plaintiff instituted an action under section 109 of the Insurance Law (Cons. Laws, ch. 28) against the insurer, Maryland Casualty Company, present defendant, which then paid plaintiff $20,317.55.

The present action is brought to recover the sum of $5,605.44, which represents the difference between the judgment of $25,922.99 entered upon the decision of the Appellate Division, and the $20,317.55, the amount collected from defendant. The cause of action is based upon an appeal bond issued by defendant Maryland Casualty Company and filed by English Greenfader, Inc., on its appeal to the Appellate Division from the judgment for $15,000, as reduced by the trial justice, in the action of Hotop v. English Greenfader, Inc.

The undertaking on appeal recites the recovery of a judgment for $15,000 by Hotop against English Greenfader, Inc., the appealing party, and this defendant, Maryland Casualty Company, undertakes “that the appellant will pay all costs and damages which may be awarded against the appellant on said appeal, not exceeding Five Hundred ($500.00) dollars, and does also undertake, that if the judgment ____ so appealed from, or any part thereof, is affirmed, or the appeal is dismissed, the appellant will pay the sum recovered or directed to be paid by the judgment ____ or the part thereof as to which it is affirmed.” This bond does not in express

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language limit the amount to any fixed sum as was carefully done in Shapiro v. Equitable Casualty Surety Co. (256 N.Y. 341) and Stapley v. United States Casualty Co. (260 N.Y. 323). By its terms the surety undertakes to pay the judgment or the part thereof as to which it is affirmed. The only judgment to which the undertaking could refer is the judgment recited therein, that is the judgment for $15,000, from which the appeal was taken. The undertaking is expressed in the language of section 594 of the Civil Practice Act and its purpose must be deemed to be the staying of execution. This defendant obligated itself by that instrument to pay $15,000, in the event that the appeal was dismissed or the judgment was affirmed, or such part of $15,000, in the event that the judgment should be reduced. Nothing in the undertaking can lead to an inference that either party intended that, in the event of a modification by addition to the judgment, the surety would pay such additional sum. Since the plaintiff had stipulated on the trial to a reduction from $25,000 to $15,000, the only issues which could reasonably have been contemplated by the parties were affirmance of the judgment from which the appeal was taken, its reduction or a dismissal of the appeal. The language of the undertaking clearly indicates such an intention. By defendant’s payment of $20,317.55 to plaintiff it has fully discharged its obligation pursuant to its undertaking on appeal and also its obligation under its liability policy.

The judgment of the Appellate Division and that of the Special Term should be reversed and the complaint dismissed, with costs in all courts.

CRANE, Ch. J., LEHMAN, HUBBS, LOUGHRAN, FINCH and RIPPEY, JJ., concur.

Judgments reversed, etc.

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