200 A.2d 12
No. 5160.Supreme Court of New Hampshire Hillsborough.Argued February 4, 1964.
Decided April 24, 1964.
1. A bill of interpleader is a proper and appropriate remedy to pursue where insurance proceeds are inadequate to satisfy pending claims.
2. A liability insurer may by a bill of interpleader effect a ratable allocation of the proceeds of its policy among all the claimants in order to avoid any contention of negligence, bad faith or preferential treatment on its part in making a settlement with any of the claimants.
3. Where a liability insurer has waived any question of liability of its insured and has either paid the agreed allocation to the parties or deposited the amounts in court, such allocation which received the sanction of the Court is binding on all the parties.
4. Where a liability insurer has waived any question of liability of its insured and has either paid the agreed allocation to the parties or deposited the amounts in court, the claimant plaintiffs in negligence actions against the insured are prevailing parties within the meaning of the statute on costs (RSA 525:1) and upon judgment are entitled to recover their taxable costs even though they may exceed the policy limit.
Bill of interpleader brought by the plaintiff insurance company requesting a judicial allocation of its policy limit of $20,000 among claims arising out of an automobile accident which occurred on June 22, 1960 made by several personal injury claimants and the estates of two decedents. The named defendant LePage, was the plaintiffs assured who is an insolvent
Page 328
minor. At the time of the filing of the bill of interpleader, actions at law brought by each of the claimants against the named defendant LePage, seeking damages for personal injuries and deaths resulting from the accident, were pending in court and had been consolidated for trial. The claims were considerably in excess of the policy limit of $20,000 and settlement of the claims within this policy limit had not been achieved although negotiations had been conducted toward that end. For the purposes of the bill of interpleader, the plaintiff insurance company waived any question of the liability of its assured.
All of the claimants maintained that the liability insurer was also responsible under the terms of its policy for the payment of interest and costs in addition to the $20,000. Without waiver of any rights, the claimants and the insurer agreed to a definite allocation of the $20,000. Payment according to the allocation was made by the insurer without prejudice to the rights of the two claimants in the death cases to continue to claim that the insurer is responsible for the payment of interest and costs. For that purpose the claimants in the personal injury cases assigned all their rights and claims to interest and costs to the two claimants in the death cases.
The Court (Griffith, J.) reserved and transferred the following question without ruling: “To what extent is the [plaintiff insurance] company responsible for the payment of interest and costs in excess of its policy limits?”
Booth, Wadleigh, Langdell, Starr Peters and Robert F. McGinnis (Mr. McGinnis orally), for the plaintiff.
Broderick, Craig Bourque (by brief) for the claimants Gerald Labrie, adm’r of the estate of Anthony Labrie, and Patrick Cassidy, adm’r of the estate of Roland Cassidy.
KENISON, C.J.
A bill of interpleader is a proper and appropriate remedy to pursue where the insurance proceeds are inadequate to satisfy pending claims. It enables a liability insurer to effect a ratable allocation of the proceeds of its policy among all the claimants in order to avoid any contention of negligence, bad faith or preferential treatment on its part in making a settlement with any of the claimants. Travelers Ind. Co. v. N.E. Box Co., 102 N.H. 380, 387; Keeton, Preferential Settlement of Liability-Insurance Claims, 70 Harv. L. Rev. 27, 40 (1956).
Page 329
The claimants now concede they have no valid claim for interest because the liability insurer has either paid the agreed allocation to the parties or deposited the amounts in court. Powell v. T.A. C. Taxi Co., 104 N.H. 428. While no formal decree was made, the allocation received the implied sanction of the Trial Court and is binding on all of the parties. Burtman v. Butman, 94 N.H. 412, 415. This leaves only the question whether the claimants are entitled to costs.
Taxable costs in this jurisdiction are a combination of ancient history, ancient statutes and anachronisms. RSA ch. 525. The need for overhaul is long overdue. Abbey, Taxation of Costs in New Hampshire, 5 N.H. Bar J. 114 (1963). In 1842, in 1935 and in 1964 provisions for counsel fees allowable as taxable costs have been and continue to be totally unrealistic. RSA 525:13. As McCormick pointed out in 1935, exclamation point included: “In New Hampshire, counsel fees may be taxed in the sum of $1!” McCormick, Damages 236 (1935). Jacques v. Company, 78 N.H. 248. Although taxable costs are a small item, the claimants insist on their right to collect them in this case. The fact that the costs may exceed the policy limit is immaterial. Powell v. T.A. C. Taxi Co., supra.
Of course the parties by agreement or stipulation may settle a claim for a definite amount which is in effect a waiver of costs. But there is no waiver in the present case and the claimants are entitled to them whatever their amount may be. The claimants are prevailing parties within the meaning of RSA 525:1 and upon judgment are entitled to recover their taxable costs in the law actions brought against the plaintiff’s assured. See Bean v. Brackett, 35 N.H. 88; Annot. 76 A.L.R. 2d 983, 995 (s. 8). Note, Use of Taxable Costs to Regulate the Conduct of Litigants, 53 Colum. L. Rev. 78 (1953).
Remanded.
All concurred.
Page 330