Browne v. Franklin Fire Ins. Co.

• Decision Date: 16 February 1931
• Citation: 37 S.W.2d 977,225 Mo.App. 665
• Parties: ALLAN R. BROWNE ET AL., DEFENDANT IN ERROR, v. THE FRANKLIN FIRE INSURANCE CO. ET AL., DEFENDANTS; JOHN A. HILL, PLAINTIFF IN ERROR
• Court: Kansas Court of Appeals

37 S.W.2d 977

225 Mo.App. 665

ALLAN R. BROWNE ET AL., DEFENDANT IN ERROR, v. THE FRANKLIN FIRE INSURANCE CO. ET AL., DEFENDANTS; JOHN A. HILL, PLAINTIFF IN ERROR

Court of Appeals of Missouri, Kansas City

February 16, 1931

Error to the Circuit Court of Jackson County.--Hon. Martin J O'Donnell, Special Judge.

AFFIRMED.

Judgment affirmed.

Allan R. Browne, Bryan Allen and Wilbur R. Ennis for defendant in error.

L. A Laughlin for plaintiff in error.

ARNOLD J. Bland, J., concurs. Trimble, P. J., absent.

OPINION

ARNOLD, J.

This is an action in equity seeking to adjudge conflicting claims and distribute the proceeds of a certain fire insurance policy.

The facts show defendant, the Franklin Fire Insurance Company, is a corporation duly authorized to transact business in the State of Missouri, and John A. Hill defendant and appellant is a resident of Kansas City, Missouri. The plaintiffs, Salvatori (Sam) Agrusa and Anna Agrusa are husband and wife, and plaintiff, Allan R. Browne, is a practicing attorney of said city. On November 2, 1925, the Agrusas were owners of lot 13, block 5, Matthews & Hill's addition in Kansas City, upon which was a frame dwelling known as number 411 Brooklyn Avenue. On that day they borrowed the sum of $ 1900, and gave one J. L. Jones their promissory note for this amount, payable in monthly installments, secured by a first deed of trust on the property. Shortly thereafter, or at that date, the note was sold and assigned with the deed of trust to John A. Hill. The deed of trust contained a covenant whereby the Agrusas agreed:

". . . to keep the improvements upon said land constantly and satisfactorily insured until said note be paid, against loss by fire, in the sum of at least twenty-five hundred dollars and against loss by tornado and windstorm in the sum of at least twenty-five hundred dollars, and the policy or policies constantly assigned or pledged and delivered to said third party or assigned for further securing the payment of said note, with power to demand, receive and collect any and all moneys becoming payable thereunder, and the same to apply toward the payment of said note, unless otherwise paid," etc.

It is in evidence that at the time the deed of trust was executed there was some insurance on the property, which expired soon thereafter, and that Hill took out two policies of insurance on the property, the first on Dec. 16, 1925, in the sum of $ 500 and the second on May 21, 1926, in the sum of $ 2000, both in the name of the Agrusas, and for which the latter paid the premiums. Both policies were written by the Metropolitan Fire Insurance Company of Kansas City, Mo., and both have a mortgage clause making the loss, if any, payable to the mortgagee or assigns. These policies were retained by Hill and ever since have been in his possession.

On Feb. 2, 1927, the Agrusas took out a policy on the house for $ 3000 in the Franklin Fire Insurance Company, and this one had no mortgage clause. This policy always has been in possession of the Agrusas and Hill was not aware of its existence until after the loss occurred. On July 5, 1928, the house was totally destroyed by fire. The value of the lot after the fire is variously estimated at $ 300 to $ 500.

On July 10, 1928, the Agrusas entered into a written contract with Allan R. Browne, attorney at law, agreeing to give Browne one-third of any amount collected on the Franklin policy for his services in collecting it. Browne entered into negotiations with the Franklin Insurance Company and the loss was adjusted for the sum of $ 2600, and a draft for that amount, payable to Sam Agrusa and Anna Agrusa, John A. Hill and Allan R. Browne, was sent by the home office of said company to its local agent at Kansas City, but Hill refused to indorse the draft unless his note was paid out of the proceeds. This action was then instituted as a suit in equity to adjust and distribute the said money, and is brought by Allan R. Browne, Sam Agrusa and Anna Agrusa, as plaintiffs, against the Franklin Fire Insurance Agency and John A. Hill, as defendants.

After stating the foregoing facts and making the further allegation that Hill had orally agreed he would have no interest in the Franklin policy, the petition prayed the insurance company be ordered to pay the $ 2600 into court, and the court adjudge plaintiffs entitled to said fund to the exclusion of defendant Hill, and for the enforcement of Browne's attorney's lien. On motion of the Franklin Insurance Company and agreement of parties, the insurance company paid the $ 2600 into court and was released from all further liability.

Hill filed answer and cross petition asking judgment on the note against the Agrusas, and that it be adjudged an equitable as well as contractual lien upon the money paid into court. The reply was a general denial. Upon the issues so pleaded the cause went to trial at the November term, 1928, of the circuit court of Jackson County, before a special judge, resulting in a decree that defendant Hill had no interest in the fund, and ordering the clerk to pay the Agrusas $ 1733.33, and Allan R. Browne $ 866.67. The decree also gave Hill judgment on his note and adjudged that Hill pay the costs of the suit. At the January term, 1929, the judgment was amended nunc pro tunc by striking out that part of the decree giving judgment in favor of Hill on his note, and in lieu thereof, specified that said judgment in favor of Hill "was outside the issue so tried and submitted and said finding and judgment . . . should be stricken out."

Motions for a new trial and in arrest of judgment, on behalf of defendant Hill were overruled and Hill appealed. Later the appeal was dismissed and the cause is before us for consideration on a writ of error sued out by Hill.

In his brief defendant states the Metropolitan Fire Insurance Co. refused to pay the loss under the two policies first named, and said company is now insolvent and in the hands of the Insurance Department of the State of Missouri, as receiver. However, we find no proof of such receivership in the record.

The first point urged is that defendant Hill is entitled to all the money paid into court by the Franklin Fire Insurance Company. In his argument, defendant first undertakes to state the position of each of the parties hereto and declares a petition in equity should be referable to some recognized ground of equitable jurisdiction in order to be sustained; that the ground of equitable jurisdiction sought to be invoked by plaintiffs can only be that of interpleader; that plaintiffs are one of two parties claiming a fund in the hands of a third party, and bring this suit in equity against the other claimant and holder of the fund to have the rights of the parties determined, as upon a bill of interpleader. And it is argued this may not be done.

It is urged the bill was demurrable for want of equity and that defendant Hill did demur to it on that ground; that the Franklin Insurance Company could not file a bill of interpleader because they were not willing to pay the full amount of the policy into court, and they could not litigate the question whether they should pay less. [Citing cases.] It is argued in this condition of the case the Franklin Insurance Company filed a motion offering to pay $ 2600 into court, for a release from all liability; that this offer was accepted and the money paid in; that as the case now stands, it is as though the Franklin Company had filed a bill of interpleader in the first place, and plaintiffs by their petition, and defendant Hill by his answer were interpleading for the fund.

We have carefully scanned the record and fail to find defendant Hill, at any time, demurred to the petition. The only place in the record where there is any mention of the sufficiency or inadequacy of the petition is in the motion in arrest of judgment wherein it is stated as one of the grounds for arrest: "The petition does not state facts sufficient to constitute a cause of action." We must hold this charge is not sufficient to support defendant's contention that there was a demurrer to the petition, or his charge that the cause is not one in equity. In the first place, the record shows the amount of $ 2600 was fixed by adjustment and a draft for that amount forwarded. It is true defendant Hill had nothing to do with said adjustment. The fact is outstanding that Hill, by means of his cross-bill, sought the same remedy plaintiffs were seeking by their petition. Defendant Hill is in no position to complain in this respect. Moreover the cause was tried as one in equity and we shall so treat it here. Defendant cites Boyer v. Hamilton, 21 Mo.App. 520; Arn v. Arn, 81 Mo.App. 133, and Hathaway v. Foy, 40 Mo. 540, as supporting his theory on this point.

Plaintiffs properly make the distinction between the cases just cited and the one at bar in that in the cited cases the funds had not been placed in the court for proper distribution by the chancellor. Here the insurance company came into court and by motion, offered to pay the sum of $ 2600 which had been agreed upon, as the liquidated amount due from the insurance company; said offer was accepted by Hill, the Agrusas and Browne and the motion was sustained. We, therefore, hold defendant Hill, having waived objection to the form of the action may not raise the question for the first time on appeal. It is of record there is no dispute among the parties as to the amount the Franklin Company should pay on the policy. This takes the case out of the rule stated in 33 C. J. 440, to the effect that an interpleader fails only if the amount which is the subject of the interplea is in controversy. As we view the case (and this seems to be agreed upon between the parties), the...