Aetna Cas. & Sur. Co. v. Federal Ins. Co. of New York

• Citation: 133 S.E.2d 770,148 W.Va. 160
• Decision Date: 10 December 1963
• Docket Number: No. 12220,12220
• Parties: AETNA CASUALTY AND SURETY COMPANY v. FEDERAL INSURANCE COMPANY OF NEW YORK.
• Court: West Virginia Supreme Court

Page 770

133 S.E.2d 770

148 W.Va. 160

AETNA CASUALTY AND SURETY COMPANY v. FEDERAL INSURANCE COMPANY OF NEW YORK.

No. 12220.

Supreme Court of Appeals of West Virginia.

Submitted Sept. 17, 1963.

Decided Dec. 10, 1963.

Syllabus by the Court

1. In ordinary transactions, a check given by a debtor in payment of his indebtedness to the payeee does not constitute payment of the debt unless there is an agreement, express or implied, that the check constitutes such payment.

2. On a motion for summary judgment all papers of record and all matters submitted by both parties should be considered by the court.

3. A motion for summary judgment should be granted only when it is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts is not desirable to clarify the application of the law.

4. If there is no genuine issue as to any material fact summary judgment should be granted but such judgment must be denied if there is a genuine issue as to a material fact.

5. The question to be decided on a motion for summary judgment is whether there is a genuine issue of fact and not how that issue should be determined.

6. A party who moves for summary judgment has the burden of showing that there is no genuine issue of fact and any doubt as to the existence of such issue is resolved against the movant for such judgment.

7. The summary judgment procedure provided by Rule 56 of the West Virginia Rules of Civil Procedure does not infringe upon the constitutional right of a party to a trial by jury; it is not a substitute for a trial, or a trial either by a jury or by the court of an issue of fact, but is a determination that, as a matter of law, there is no issue of fact to be tried.

8. An order denying a motion for summary judgment is merely interlocutory, leaves the case pending for trial, and is not appealable except in special instances in which an interlocutory order is appealable.

9. A motion by each of two parties for summary judgment does not constitute a determination that there is no issue of fact to be tried; and both motions should be denied if there is actually a genuine issue as to a material fact. When both parties move for summary judgment each party concedes only that there is no issue of fact with respect to his particular motion.

10. The Supreme Court of Appeals has original jurisdiction in cases of habeas corpus, mandamus and prohibition and appellate jurisdiction in all other cases mentioned in Article VIII, Section 3, of the Constitution of this State and in such additional cases as may be prescribed by law; and in cases within its appellate jurisdiction it will not consider or decide nonjurisdictional questions which have not been determined by the trial court.

Donell & Tarr, Donald R. Donell, Floyd R. Tarr, W. Dean DeLaMater, Weirton, for appellant.

Thomas B. Miller, Schmidt, Laas, Schrader & Miller, Arthur M. Recht, Wheeling, for appellee.

HAYMOND, Judge.

This is a controversy between two insurance companies which issued separate policies of fire insurance upon personal property owned by John T. Defibaugh and Edward Shane, doing business as Modern Home Appliance, in Weirton, Hancock County, West Virginia, consisting of household appliances and merchandise. A considerable quantity of the insured property, located in the store of Modern Home Appliance at 3166 Main Street, in Weirton, West Virginia, was destroyed or damaged by fire which occurred on August 15, 1961. All the property so destroyed or damaged was insured by policies issued by the plaintiff Aetna Casualty and Surety Company, a corporation, and a portion of the property was also included in and allegedly insured by a policy issued by the defendant Federal Insurance Company of New York, a corporation. Morris Plan Savings and Loan Company, a corporation, was a creditor of Modern Home Appliance in the principal amount of $3,812.84 before the fire occurred and the indebtedness of Modern Home Appliance to Morris Plan Savings and Loan Company was secured by liens or encumbrances upon the property insured by the defendant for the benefit of Morris Plan Savings and Loan Company during the existence of the indebtedness of Modern Home Appliance. After negotiations between the plaintiff and the defendant, in which the defendant refused to recognize liability and pay for the fire loss to the property included in its policy of insurance, the plaintiff paid the total net loss incurred by Modern Home Appliance, including the net loss of $2,490.50 to the property mentioned in the policy issued by the defendant. The plaintiff then instituted this action in the Circuit Court of Hancock County to recover that sum with interest from the defendant.

Pursuant to Rule 12 and Rule 56 of the West Virginia Rules of Civil Procedure the defendant filed a motion to dismiss the complaint and for summary judgment in its behalf upon the grounds, among others, that the complaint failed to state a cause of action upon which relief can be granted, that the plaintiff and the defendant were parties to an agreement and other written instruments, copies of which were filed as an exhibit, which provided that the insurance policy of the defendant was in excess of the specific fire insurance issued by the plaintiff and precluded any recovery by the plaintiff from the defendant, and that before the fire occurred Modern Home Appliance had discharged its indebtedness to Morris Plan Savings and Loan Company, the assured in the policy issued by the defendant, and, as the interest of Morris Plan Savings and Loan Company had terminated, the policy issued by the defendant was not in effect and afforded no coverage at the time of the fire. The defendant attached and filed with its motion a copy of the insurance policy issued by it, designated 'Exhibit A', copies of the agreement and other written instruments, designated 'Exhibit B', and an affidavit of E. R. Moore, a representative of Morris Plan Savings and Loan Company, designated 'Exhibit C'.

Under Rule 56 of the West Virginia Rules of Civil Procedure the plaintiff filed a counter motion for summary judgment in its behalf and attached and filed with its motion the affidavit of Edward Shane, one of the owners of Modern Home Appliance, designated 'Exhibit 1'. The ground assigned in support of the motion of the plaintiff was that the pleadings and the exhibits filed with the motion of the defendant and the affidavit filed with the motion of the plaintiff entitled the plaintiff to summary judgment in its behalf.

The matters arising upon the respective motions of the plaintiff and of the defendant for summary judgment were submitted for decision and by its final order entered October 30, 1962, the circuit court, in accordance with its corrected memorandum of opinion filed as a part of the record in this proceeding, sustained the motion of the defendant and overruled the motion of the plaintiff, and rendered summary judgment in favor of the defendant which adjudged that the plaintiff take nothing and that the defendant recover its costs from the plaintiff. From this final judgment this Court granted this appeal upon the application of the plaintiff.

It affirmatively appears from the memorandum of opinion filed by the circuit court that it entertained the view that in its consideration of the case only two questions were presented for its decision. These were (1) whether, at the time of the fire, the policy issued by the defendant was in effect and afforded insurance coverage as a matter of law; and (2) whether, if there was insurance coverage, the plaintiff was entitled to contribution or contribution was precluded by the agreement between the plaintiff and the defendant embraced in 'Exhibit B', filed with the motion of the defendant for summary judgment. It also clearly appears from the memorandum of opinion that the circuit court sustained the motion of the defendant on the ground that the delivery of a check for the amount of its indebtedness by Modern Home Appliance to a representative of Morris Plan Savings and Loan Company, a short time before the fire occurred on August 15, 1961, payment of which was stopped by Modern Home Appliance on the following day and within several hours after the fire occurred, terminated the interest of Morris Plan Savings and Loan Company in the property insured by the defendant and relieved it from liability under the policy, and that in reaching its decision the circuit court did not consider or determine the question of the effect of the agreement between the plaintiff and the defendant with respect to the right of the plaintiff to contribution from the defendant.

Though the plaintiff assigns numerous errors for reversal of the judgment, the controlling question presented by its assignment of errors is whether delivery of the check in the circumstances disclosed by the record constituted an absolute or a conditional payment by Modern Home Appliance of its indebtedness to Morris Plan Savings and Loan Company and whether such check terminated the interest of Morris Plan Savings and Loan Company in the property destroyed or damaged by the fire and operated to relieve the defendant of liability under its policy of insurance.

On and prior to August 15, 1961, the plaintiff insured against fire loss by two policies the contents of the store of Modern Home Appliance. As already indicated the insured property consisted of household appliances and merchandise. In connection with floor plan arrangements between Modern Home Appliance and Morris Plan Savings and Loan Company, the defendant also insured a portion of the property in the store of Modern Home Appliance under a fire insurance policy issued August 1, 1958, which was obtained by Morris Plan Savings and Loan Company at the expense of Modern Home Appliance. This policy provided that liability should attach only when the insured property was subject to the risk of Morris Plan Savings and Loan Company, the...