GARDNER, Chief Judge.
This action was brought by appellants against appellee on a contract of insurance issued by appellee designated in the record as a combination automobile insurance policy. We shall refer to the parties as they were designated in the trial court. The policy contained provision for the payment, on conditions and limitations named in the policy, of unsatisfied judgments.
The unsatisfied judgment involved was obtained by plaintiffs in an action brought by them against one Robert A. Kay to recover property and personal injury damages suffered by them by reason of an automobile collision. The action against Kay was brought in the Circuit Court of Greene County, Arkansas. After recovery in the state court action execution issued and in due course was returned "nulla bona", no property found, whereupon plaintiffs brought the present action seeking to recover on their policy of insurance. In their complaint plaintiffs based their right to recover on coverage "G" of the policy which provides as follows:
As damages in their state court action they recovered for personal injuries, property damages, medical expense and loss of consortium, and in the present action they sought to recover the amount for which they secured judgment in the state court action, less a credit of one thousand dollars recovered in the state court action for loss of consortium. They also sought to recover statutory penalty for vexatious delay, besides attorney fees.
In its answer defendant pleaded that the policy contained provisions that:
It was then alleged that plaintiffs had failed to comply with these conditions and it was also pleaded that the so-called unsatisfied judgment was recovered in an action in which loss of services or consortium was an element of the damages sought. It was also denied that plaintiffs were entitled to recover for vexatious delay. It was affirmatively alleged that plaintiffs had not given notice of the date, time and place of rendering of default judgment, that plaintiffs had not offered testimony of attending physicians and that plaintiffs had failed to forward a copy of the summons and complaint to the company immediately upon filing suit.
By way of reply plaintiffs in effect alleged that defendant had actual knowledge of each and every step taken by plaintiffs in the action in which default judgment was taken; that it had knowledge more than twenty days before that default judgment would be taken; that it knew what the testimony of the attending physicians would be; that it was given an opportunity to become a party in the action; that no judgment was sought herein for loss of services or consortium, that copy of summons and complaint was forwarded to defendant or its attorneys upon filing suit, that "* * * the agents of this insurance company knew of each step taken by these Plaintiffs in the prosecution of this cause of action; that they advised with the Plaintiffs and had knowledge of all the proceedings," and that the knowledge of the attorneys, agents and others connected with the defendant company was knowledge of the defendant.
The action was tried to the court without a jury. The court found all the issues in favor of the defendant and among other things specifically found that:
It accordingly entered judgment dismissing the action on its merits.
There is no claimed ambiguity in the provisions of the policy and confessedly the parties had the right to contract for such limitations or conditions of liability as might be agreed upon. As said by the Supreme Court of Arkansas in Sun Mut. Ins. Co. v. Dudley, 65 Ark. 240, 45 S.W. 539, 542:
To entitle plaintiffs to recover on a default judgment under the provisions of the policy they were required (1) to forward a copy of the summons and complaint to the company immediately upon filing of suit, (2) to give the company at least twenty days notice in writing prior to rendition of the default judgment of the time, date and place of rendition of the judgment, (3) to present testimony of the attending physicians as to the nature and extent of injuries suffered and to give the company notice of such hearing, and (4) plaintiffs must not have sought damages for loss of services or consortium in the action resulting in the default judgment. Not having complied with these requirements, the default judgment secured against Kay was not a default judgment as defined by paragraph IV(d) and hence, not within the coverage of paragraph "G" of the policy. The court specifically found for the defendant as to each of these requirements and these findings are abundantly sustained by the evidence, in fact, they are sustained by undisputed evidence.
It is, however, argued that as counsel for the defendant had knowledge of the procedure taken by the plaintiffs in securing their default judgment this was in the nature of a waiver of compliance. This contention is based largely on the fact that following the accident the defendant paid plaintiffs Three Hundred Twenty-five Dollars as damages to property resulting from the collision, and having made such payment it claimed to be subrogated to the rights of the plaintiffs to this extent against Kay. In seeking thus to protect itself it employed certain lawyers and it was with reference to this claim that the defendant's lawyers communicated with counsel for the plaintiffs. They were not generally employed by the defendant but were employed only on this matter of subrogation. They so testified. They also testified that they knew nothing with reference to the provisions of the policy providing for recovery for a default judgment. The court found the fact to be that:
As these considerations require an affirmance of the judgment we pretermit discussion of further contentions of counsel. The judgment appealed from is therefore affirmed.
A true copy.