E. O. Barnett Bros. v. Western Assurance Company

• Decision Date: 12 April 1920
• Docket Number: 328
• Citation: 220 S.W. 465,143 Ark. 358
• Parties: E. O. BARNETT BROS. v. WESTERN ASSURANCE COMPANY
• Court: Arkansas Supreme Court

220 S.W. 465

143 Ark. 358

E. O. BARNETT BROS. v. WESTERN ASSURANCE COMPANY

No. 328

Supreme Court of Arkansas

April 12, 1920

Appeal from Hot Spring Chancery Court; J. P. Henderson, Chancellor affirmed.

Affirmed.

Oscar Barnett, for appellant.

1. The court erred in holding that the judgments and other proceedings referred to by counsel in his answer shows an adjudication of the relief asked in our complaint; in other words, erred in sustaining the plea of res judicata by the insurance company. The proceedings previously had proves that there was no good insurance on the property, and nothing has ever been paid for the loss. As the contract does not express the real and true intention of the parties at the time it was written, it should have been reformed as prayed and specifically performed. 78 Ark. 33; 1 Pom. Eq. Jur. (3 ed.) par. 171; 102 N.W. 246.

Appellants are not estopped. The law of Arkansas was a part of the contract (Kirby's Digest, § 4375) and was left out by mistake or fraud or equity had jurisdiction and the relief prayed should have been granted. The burden was on appellee to establish the plea of res judicata. Black on Judgm., p 700; 1 Freeman on Judg., p. 502.

2. Even if appellee had properly placed its plea and gotten all the judgments and pleadings into the records, appellants can not be deprived of the advantages of the judgments and pleadings in their favor. 174 S.W. 570. The instructions asked by appellee contravene Kirby's Digest, § 4375. The judgments show no adjudication of appellant's rights, and the court erred in dismissing the complaint. Cases supra. 45 Cal. 78; 48 Wis. 31; 17 Conn. 559; 78 N.Y. 618. This court will be governed by the records in the case and allow us to recover our loss from appellee, who took our money and promised to insure the property against all loss or damage by fire and has not done so, nor returned our premium paid.

Reid, Burrow & McDonnell, for appellee.

This whole matter is res judicata, and has been settled by this court. 132 Ark. 434; 126 Id. 562. Appellants do not come into equity with clean hands. Pom. Eq. Jur. (4 Ed.), § 307.

OPINION

WOOD, J.

This action was instituted by the appellant against the appellee in the Hot Spring Chancery Court.

The complaint, among other things, alleged that the appellee was a foreign insurance company doing business in the State of Arkansas; that, in consideration of the payment of $ 15 premium paid by appellant to the appellee, it issued to appellant a policy in the sum of $ 600, insuring a one-story frame building, which was then in process of construction, and afterward completed, on lots 3 and 4, in block 14 in Barnett's Second Addition in Malvern, Arkansas; that a description of the premises was not correctly given in the policy. The appellant set out what it alleges is the correct description. Appellant also alleges "that the said policy was written with the mutual intent of the parties thereto that it should, by its terms, insure the plaintiff against all direct loss or damage by fire to its said property. That in fact the said policy does not insure the plaintiff's property in any manner; that the appellee in the preparation of said policy either by fraud or mistake left out of the policy the following condition: "This policy of insurance, in case of total loss by fire of the property insured, shall be held and considered a liquidated demand against this company for the full amount stated in this policy, or the full amount upon which this company charges, collects and receives premiums."

Appellant further alleged that the omission of the above conditions was unknown to the appellant at the time the policy was received by it and paid for, and was not known to appellant until long after the property had been destroyed by fire. Appellant alleged that it had performed all the conditions of the contract on its part; that the premises insured had been totally destroyed by fire; that appellee did not deny liability under the terms of the policy until the building was destroyed.

The appellant prayed that the policy of insurance be reformed so as to recite a true description of the premises insured and to include the above condition; that appellant recover the sum of $ 600, with 12 per cent. penalty and reasonable attorney's fee.

The appellee answered and set up that "the identical matters and things between the identical parties involved in this litigation have been heretofore fully and finally adjudicated, including every issue of law and of fact arising therefrom, as will more fully appear by reference to the pleadings, orders and judgments had and done in the case of E. O. Barnett Bros. v. Western Assurance Co., on February 1, 1916," which said judgment is pleaded in bar of this proceeding.

The answer also further alleged that "said matters and things, including all the issues of law and of fact presented by the plaintiff in this cause, were again adjudicated in the case of Barnett Bros. v. Western Assur. Co., on July 31, 1917; that all the issues of law and fact presented by the complaint in this case were again adjudicated in the case of E. O. Barnett Bros. v. Western Assur. Co. on June 3, 1918, in the Hot Spring Chancery Court."

The appellee further alleged that each of these causes was prosecuted by an appeal to the Supreme Court and therein finally and fully affirmed.

The answer alleged that copies of the pleadings, orders and judgments are attached and made exhibits to the answer; that the answer contained the further allegation that "in all issues above referred to the plaintiff has complained upon identically the same contract of insurance and has never heretofore complained or averred that the same was not drawn or issued in full compliance with every term of the contract made and entered into by the respective parties thereto; * * * that the plaintiff is fully and completely estopped from contending that said policy for any reason should be modified or reformed."

The appellant introduced the policy, No. 5,461,639, issued by the appellee December 3, 1914, insuring a dwelling house for $ 600 in favor of E. O. Barnett Bros. for a premium of $ 15.

The testimony on behalf of the appellant on the issue of reformation was to the effect that it was the intention of...