Allen v. Allemania Fire Ins. Co.

• Decision Date: 25 May 1938
• Docket Number: 461.
• Parties: ALLEN et al. v. ALLEMANIA FIRE INS. CO.
• Court: North Carolina Supreme Court

197 S.E. 200

213 N.C. 586

ALLEN et al. v. ALLEMANIA FIRE INS. CO.

No. 461.

Supreme Court of North Carolina

May 25, 1938

Appeal from Superior Court, Wake County; W. C. Harris, Judge.

Civil action by C. H. Allen and another against the Allemania Fire Insurance Company to recover on a hail insurance policy for damage to a tobacco crop. The judge of the recorder's court rendered a judgment for the plaintiffs, and the defendant appealed to the superior court. From an order of the superior court allowing certain amendments to the complaint, the defendant appeals.

Reversed.

Where there are courts of equal and concurrent jurisdiction, the court whose jurisdiction first attaches possesses the case.

Civil action to recover on hail insurance policy for damage to tobacco crop.

This action was instituted in Recorder's Court of White Oak and Buckhorn Townships in Wake County. Plaintiffs filed complaint and allege in substance: That in July, 1936 plaintiff, C. H. Allen owned a farm in Buckhorn Township on which the plaintiff, R. W. Allen, as tenant was cultivating twelve acres in tobacco; that defendant, under policy of hail insurance dated July 11, 1936, and delivered to plaintiffs insured against loss or damage by hail to the tobacco growing on said twelve acres on the farm of C. H. Allen, not to exceed $150 per acre, or total amount of $1,800; that on July 13, 1936, while the policy was in effect, said tobacco crop was damaged; that the authorized adjuster and representative of defendant agreed that the percentage of such damage is $451.24; that notice was given and proof of loss furnished to defendant as required under the terms of the policy; and that thereafter and on September 30, 1936, defendant in letter to plaintiff, R. W. Allen, in whose name the policy was issued denied liability under the policy.

Defendant filed answer denying the material allegations of the complaint, and avers in substance: That the policy of insurance was never in force; that plaintiffs are not entitled to recover for that in the application "R. W Allen claimed to have one hundred per cent in twelve acres of tobacco for insurance on which he made application, whereas in fact the said R. W. Allen did not have twelve acres in tobacco * * * but at most had only two acres"; that this misrepresentation constitutes complete bar to recovery as provided in the application for the insurance executed by R. W. Allen; that the damage to the tobacco was done prior to the application for and issuance of policy of insurance; that C. H. Allen has no insurable interest whatever under the policy and no right to recover thereunder. Defendant tenders return of premium paid.

The cause was heard before Judge of Recorder's Court, who rendered judgment against defendant for amount claimed with interest. Defendant appealed to Superior Court. At Third June Term, 1937, of Superior Court plaintiffs moved before Spears, J., for permission to amend complaint to set out mistake in the policy. This motion was denied. Thereafter at the Second October Term, 1937, and after a jury had been drawn and empanelled, plaintiffs again moved to amend the complaint to allege that it was the intention of the parties to include the name of C. H. Allen and his interest in the crop in the application and coverage of the policy, but that by mutual mistake and inadvertence of the defendant's agent only the name and interest of R. W. Allen were included, upon which plaintiff asked reformation of the policy contract and renewed prayer for relief. A mistrial was ordered, and by order the amendment was allowed, from which defendant appealed to the Supreme Court and assigns error.

Little & Wilson, of Raleigh, for appellant.

Chas. U. Harris, of Raleigh, and Wm. B. Oliver, of Fuquay Springs, for appellees.

WINBORNE Justice.

The decisive question arising on this appeal is: Where an appeal has been taken to the Superior Court from judgment of a specially created Recorder's Court in action on contract over which that court has concurrent original jurisdiction with the Superior Court, can the Superior Court permit an amendment to the complaint which sets up an equitable cause of action for the reformation of contract, over which the Recorder's Court has no jurisdiction? The answer is No.

The Recorder's Court of White Oak and Buckhorn Townships, Wake County, created by special act of the Legislature, P.L.L.1917, Chap. 282, as amended by P.L.L.1929, Chap. 497, is a court of limited jurisdiction, both as to territory and subject matter. The original act, Sec. 12 1/2, provides in part that the court "shall have concurrent original jurisdiction with the Superior Court of all other civil actions arising out of contract where the sum demanded does not exceed the sum of five hundred dollars * * *." It further provides, Sec. 14, that "in all civil actions and matters where this court has jurisdiction and where a justice of the peace does not have jurisdiction the plaintiff in such actions may bring an original suit either in said recorder's court as prescribed by this act or in the Superior Court of Wake County, at his election * * *."

The Recorder's Court, in the case before us, had original concurrent jurisdiction with the Superior Court of the cause of action as originally alleged. Having been instituted in the Recorder's Court, the action is limited in its scope by the jurisdiction with which that court is clothed by the acts of the Legislature creating it. "The rule is, where there are courts of equal and concurrent jurisdiction, that the court possesses the case in which jurisdiction first attaches." Merrill v. Lake, 16 Ohio 373, 47 Am.Dec. 377, quoted by Pearson, C.J., in Childs v Martin, 69 N.C. 126. This rule has been applied in numerous cases in this State. In re Schenck, 74 N.C. 607; Haywood v....