Barnett v. Wolfolk

• Decision Date: 23 February 1965
• Docket Number: No. 12354,12354
• Citation: 140 S.E.2d 466,149 W.Va. 246
• Court: West Virginia Supreme Court
• Parties: Lindy BARNETT, etc. v. Robert WOLFOLK, etc., et al.

Page 466

140 S.E.2d 466

149 W.Va. 246

Lindy BARNETT, etc. v. Robert WOLFOLK, etc., et al.

No. 12354.

Supreme Court of Appeals of West Virginia.

Submitted Jan. 20, 1965.

Decided Feb. 23, 1965.

Syllabus by the Court

1. The general rule is that a judgment rendered in an in personam action is not res judicata as to one who was not a party to the action in which the judgment was rendered

2. The mere relationship of master and servant cannot, as against the servant, form a basis for application of the doctrine of res judicata in respect to a judgment rendered in a former in personam action to which the master was a party but to which the servant was not a party; and this is true notwithstanding the fact that the servant testified as a witness for the master at the trial of the former action.

3. This Court may, on appeal, affirm the judgment of the lower court when it appears that such judgment is correct on any legal ground disclosed by the record, regardless of the ground, reason or theory assigned by the lower court as the basis for its judgment.

4. Equitable estoppel cannot arise merely because of action taken by one on a misleading statement made by another. In addition thereto, it must appear that the one who made the statement intended or reasonably should have expected that the statement would be acted upon by the one claiming the benefit of estoppel, and that he, without fault himself, did act upon it to his prejudice.

H. D. Rollins, Charleston, for appellant.

John T. Kay, Jr., Robert H. C. Kay, Charleston, Philip A. Baer, Huntington, for appellees.

CALHOUN, Judge:

This case is before the Court on an appeal by the plaintiff from a final judgment rendered by the Circuit Court of Cabell County in a civil action involving an insurance subrogation claim in the amount of $4,498.19. By an order entered on April 27, 1964, the trial court sustained a plea of res judicata and rendered judgment for the defendants.

The primary question presented for decision on this appeal involves the sufficiency of the plea of res judicata. This calls for a statement of the factual background which furnished the basis for the trial court's final judgment.

The traffic accident out of which this case arose occurred on U. S. Route 60 east of Huntington in Cabell County on May 3, 1957. Immediately before the time of the occurrence of the accident, Joseph Frederick McDonald was driving and operating westward on the highway a tractor-trailer truck owned by Robert Wolfolk, who was doing business as Huntington Mine Supplies and Service. The truck developed motor trouble and consequently was stopped on the highway at the place where the accident subsequently occurred.

Lindy L. Barnett, traveling on the same highway, approached the Wolfolk truck from its rear. He was then the owner of and was operating a tractor which was hauling a trailer owned by Point Express, Inc. Barnett undertook to pass the standing Wolfolk truck on its left side. At or about the time Barnett was in the act of doing so, McDonald alighted from the cab of the Wolfolk truck on its left side. In these circumstances, according to Barnett's contention, he drove his vehicle to his right in an effort to avoid striking McDonald and, as a consequence, his vehicle collided with the Wolfolk vehicle. Severe damage resulted to the Wolfolk tractor and trailer; to the trailer owned by Point Express Inc.; and to the Barnett tractor which was hauling the Point Express trailer. In addition, Barnett sustained serious bodily injuries. No effort is made here to state accurately the facts which caused the accident. We are not concerned on this appeal with questions pertaining to negligence or due care.

Three civil actions resulted from the accident: (1) Barnett instituted an action against Wolfolk and his employee- driver, McDonald, to recover for his bodily injuries and for the property damage caused to his tractor; (2) Point Express, Inc., owner of the trailer which Barnett was hauling, instituted an action against Wolfolk and his employee-driver, McDonald, to recover for damages caused to its trailer; and (3) Wolfolk instituted an action against Point Express, Inc., to recover for damage caused to his tractor and trailer.

Barnett carried collision insurance on his tractor with American Hardware Mutual Insurance Company. This insurance company made settlement with Barnett in the sum of $4,498.19 for damage caused to his tractor and took from Barnett an assignment of his claim. This settlement and assignment form the basis of the insurance subrogation action which is involved on this appeal. It was in this action that the trial court sustained the plea of res judicata and rendered the judgment in favor of the defendants from which this appeal is prosecuted.

The case of Point Express, Inc. v. Wolfolk and McDonald and the case of Wolfolk v. Point Express, Inc., were consolidated for trial. A jury trial of the consolidated actions in May, 1959, resulted in a verdict by which the jury found that none of the parties was entitled to recover. Judgment was entered on that verdict. In connection with the plea of res judicata, we note at this point that Lindy L. Barnett was not a party to either of the consolidated actions, though he testified as a witness at the trial.

Attorney Robert E. Douglas, of Charleston, was employed by American Hardware Mutual Insurance Company in relation to the claim for property damage caused to Barnett's tractor. Attorney Carroll W. Casto, of Point Pleasant, represented Barnett in relation to his personal injury claim. The two attorneys conferred and collaborated in the institution of the original action in behalf of Barnett.

Attorney Robert H. C. Kay, of Charleston, was one of counsel employed by Carolina Casualty Company with which Wolfolk carried a public liability and property damage policy of insurance covering his tractor-trailer truck.

In the original case of Lindy L. Barnett v. Wolfolk and McDonald, a settlement was made of Barnett's personal injury claim and an order was entered on September 14, 1959, which dismissed the action in its entirety. Present at the time of the dismissal were Attorney Kay in behalf of Wolfolk's insurer and Attorney Casto, who represented Barnett in relation to his personal injury claim. Attorney Douglas, who represented Barnett's insurer in relation to Barnett's property damage claim, was at that time away from his home and office on vacation and, therefore, he was not present when the dismissal order was entered.

When Attorney Douglas returned from his vacation and learned of the dismissal order, he moved the trial court to vacate the order. This motion was overruled by the court on October 30, 1959.

During the course of the argument of the motion to vacate the dismissal order, there was a discussion among the trial judge and counsel concerning the possibility of the institution of an insurance subrogation action such as that involved on this appeal. In that connection, Attorney Kay, in behalf of Carolina Casualty Company, agreed not to plead the statute of limitations if a subrogation action were subsequently instituted. An order was entered by the court which contained the following language:

'* * * that an agreement, reduced to writing, was entered into between Lindy Barnett, Carroll Casto and Robert H. C. Kay that the defendants would not plead as a defense the statute of limitations in any suit hereafter brought by the American Hardware Mutual Insurance Company or by Lindy Barnett to collect the subrogation claim of American Hardware Mutual Insurance Company against the defendants which understanding counsel for the defendants reiterate and ask that such agreement and understanding be and the same is made a part of the record in this case * * *.'

Wolfolk and McDonald filed an answer to the complaint in the subrogation action in which, among other defenses, they relied on the doctrine of res judicata. Subsequently, they filed an amended answer in which they alleged that the order which recorded the agreement not to plead the statute of limitations was entered in November, 1959; that the plaintiff thereafter delayed the institution of the subrogation action until May 16, 1963; and that the plaintiff was guilty of laches in delaying the institution of the subrogation action 'until it felt that the attorneys representing Wolfolk and McDonald would have destroyed their files showing the results of their investigation and their notes and information' in relation to the trial of the consolidated actions.

In support of the defense of laches, Attorney Kay filed an affidavit in which he stated that Attorney Douglas advised him that he was not going to institute a subrogation action but that he intended to appeal to this Court from the action of the trial court in entering and refusing to vacate the dismissal order of September 14, 1959; and that after the lapse of one year from the date of the entry of the dismissal order, all of the affiant's files, data, information and notes in connection with the case were destroyed. A similar affidavit by the legal examiner for the Carolina Casualty Company was filed in relation to the destruction of his files. A counter-affidavit executed on March 31, 1964, by Robert E. Douglas was filed. The three affidavits were, by orders of the trial court, made a part of the record.

The Douglas affidavit contains the following statement: 'This affiant told Mr. Kay he was leaving on a two-week vacation, and Mr. Kay assured this affiant that nothing would be done until he had gotten back in touch with this affiant.' The Douglas affidavit states further that Attorney Kay called the affiant's office approximately six months following the entry of the final order and that the two attorneys discussed 'the future course of action to be taken'; that the affiant considered the merits of an effort to appeal from the action of the trial court; that he later concluded that the most...