Volume 234 — Maryland Reports

UNSATISFIED CLAIM AND JUDGMENT FUND LAW — <italic>Timely Notice Of</italic><italic>Disclaimer By Insurer — Fund Not Estopped From Seeking</italic><italic>Declaratory Relief — Ruling Dismissing Attachments Against</italic><italic>Insurer Became Final, As To Insurer</italic>. In the present suit brought by the Unsatisfied Claim and Judgment Fund Board for declaratory relief with respect to certain matters arising out of an automobile collision and the litigation which followed, the Court found no merit to a suggestion that timely notice was not given of a disclaimer of liability by an insurer which had issued a policy to the owner of one of the vehicles involved. On the other hand, the Court <italic>held</italic> that the Fund was not estopped from bringing the instant suit. The claim seemed to be based upon the conduct of the Fund in consenting to the striking of default judgments obtained against the driver of this vehicle, but the trial judge's opinion in that case indicated that the judgments were stricken because he found that the Fund was legally entitled to defend the<page_number>Page 90</page_number> action and would not otherwise be liable. The Attorney General stated in a letter prior to the striking of the judgments that it should not be assumed that the Fund would honor the appellants' claims if the judgments were stricken or an appeal involving a related matter dismissed. The appellants had attachments issued against the insurer on these default judgments, but the trial court in that case had dismissed the attachments, after hearing, and ruled that the insurer was relieved of its obligations under the policy because of the driver's non-cooperation. When the appellants failed to prosecute their appeal from this ruling, it became final, insofar as the insurer was concerned, and even if that trial judge was wrong in holding as he did without a showing of prejudice, the Fund could not revive the claim. pp. 93-94 UNSATISFIED CLAIM AND JUDGMENT FUND LAW — <italic>Claimants Held Not</italic><italic>To Have Acted Without Reasonable Diligence Or Good Faith When</italic><italic>They Dismissed Their Suits Against Owner Of Vehicle Which</italic><italic>Collided With Their Vehicle</italic>. Under sec. 160 of the Unsatisfied Claim and Judgment Fund Law, Code (1957), Art. 66 1/2, the court must be satisfied that an applicant "* * * has fully pursued and exhausted all remedies available to him * * * by commencing action against all such persons against whom the applicant might reasonably be considered as having a cause of action * * * and prosecuting every such action in good faith to judgment and taking all reasonable steps available to him to collect on every judgment so obtained". The claimants in this case had first sued both the driver and the owner of the other vehicle involved in a collision with their own automobile. Thereafter counsel for the claimants dismissed their suits against the owner, and the trial court in this case, in declaring that the Fund was not obligated to make payment on any judgment obtained against the driver, held that in dismissing the suits against the owner, the claimants had failed to exhaust an available remedy. While the declaration and interrogatories had alleged that the owner was liable for lending his car to a known careless driver and a user of alcoholic beverages, they were merely allegations, and not proof, even assuming, without deciding, that they stated a cause<page_number>Page 91</page_number> of action. The driver was not charged with drunken driving at the time of the accident, and there was no evidence that he had had anything to drink at that time. If the driver had not imbibed prior to the accident, and if drinking was not a contributing cause of the accident, it was difficult to see how the owner's knowledge that the driver had imbibed on previous occasions could be material. It was neither alleged nor shown that he had ever driven while intoxicated, he had no record of a conviction for that offense, and his two prior convictions for exceeding the speed limit were hardly sufficient to establish such habitual recklessness as to make the lender liable. Therefore, the Court<italic>held</italic> that even if it assumed that the claimants, and not the Fund, carried the burden of showing reasonable diligence and good faith, the proof simply did not measure up so as to establish that a remedy against the owner was "available" to the claimants, or that they were "likely to receive" damages from that source within the meaning of Art. 66 1/2, § 162(b)(3). pp. 95-96 <italic>Decided March 9, 1964</italic>.

The cause was argued on 11/13/63 before Brune, C. J., and Henderson, Prescott, Horney and Marbury, JJ. The cause was reargued on 12/2/63 before Brune, C. J., and Henderson, Hammond, Prescott, Marbury, Sybert, JJ., and Gray, J., Chief Judge of the Seventh Judicial Circuit, specially assigned.