Davy v. Public National Insurance

The plaintiff Davy, who conducted a business operating 27 taxicabs under the name of Yellow Cab Company, obtained a policy of public liability insurance from the defendant insurance company covering such operation. The coverage under this policy was limited to $5,000 for injury to one person. The policy provided that the company “shall defend” any suit brought against the insured alleging injury arising out of an accident in which any of his cabs was involved, but “may make such investigation, negotiation and settlement of any claim or suit as it deems expedient. ’ ’

On January 8, 1956, while…