Cohen v. Standard Acc. Ins. Co.

• Decision Date: 04 November 1941
• Docket Number: 15321.
• Parties: COHEN v. STANDARD ACC. INS. CO.
• Court: South Carolina Supreme Court

17 S.E.2d 230

203 S.C. 263

COHEN v. STANDARD ACC. INS. CO.

No. 15321.

Supreme Court of South Carolina

November 4, 1941

Douglas McKay and John B. McCutcheon, Jr., both of Columbia, for appellant.

C T. Graydon and John Grimball, both of Columbia, for respondent.

L. D LIDE, Acting Associate Justice.

Murphy Cohen, plaintiff above named and respondent herein, was engaged in the business of operating a liquor store at Myrtle Beach, called the Carolina Liquor Store, for a period of time commencing on or about July 13, 1936. Cohen entered into a parol agreement with one Brooks Baldwin, formerly of Tabor N. C., for the purpose of the formation of a partnership for the conduct of this business, but he claims that Baldwin did not put up his share of the capital and did not comply with the agreement, and that hence the partnership was not consummated; while on the other hand, Baldwin claims that he was in fact a co-partner in the business. It appears that Baldwin did work in the store from its opening until on or about the 1st day of September, 1936, when he left to attend the North Carolina State College as a student, returning to Myrtle Beach during the Christmas holidays.

Thereafter there seems to have been considerable controversy between Baldwin and Cohen in regard to the business, which resulted in litigation between them commencing in July, 1937. Indeed there appears to have been a suit and a cross suit. And on July 29, 1937, an order was handed down by Honorable M. M. Mann, presiding Judge of the Court of Common Pleas for Horry County, appointing two receivers to take over and manage the Carolina Liquor Store at Myrtle Beach, and fixing the value of the property sought to be placed in the hands of the receivers at $6,000. Thereupon, Cohen, who was thus deprived of the possession of the business, applied to Standard Accident Insurance Company, the defendant above named and the appellant herein, for a bond in the sum of $12,000, pursuant to the provisions of Section 584 (9), Code 1932, which provides that no receiver of the property of any person or corporation shall be appointed before final judgment if the party claiming the property or the party in possession thereof shall offer a bond in the penalty of double the value of the property with sufficient security "to fully account for and deliver over, whenever thereafter required by any final adjudication in the cause, the property sought to be placed in the hands of a receiver, and to meet and satisfy any decree or judgment or order that may be made in the cause." This kind of bond is sometimes spoken of as a forthcoming bond.

Upon payment of the premium, to wit, $150, the Insurance Company as surety and Murphy Cohen as principal duly executed the bond applied for, the same being dated August 4, 1937. The execution on the part of the Company was made by its attorney-in-fact, his power of attorney being in regular form. Notwithstanding the due and complete execution of the bond, however, when Cohen presented it to the Clerk of Court at Conway for filing the Clerk declined to receive or file it for the reason that he was notified by the Standard Accident Insurance Company not to accept the bond, which was in effect a cancellation of the same. Hence Cohen contends that the bond having been cancelled, there was no other way for him to obtain possession of his property and business, and that he was thus forced to sell to Baldwin at a sacrifice; and it appears that on August 7, 1937, he entered into a "buy or sell" agreement with Baldwin, pursuant to which he sold out to him for $3,503.65.

Thereafter Cohen commenced the instant action alleging that the defendant by reason of its breach of the contract relating to the bond in question forced the plaintiff to sell his property at an amount far below the market price, whereby he sustained a loss of over $3,000 in the transaction, the complaint also alleging that the defendant collected from the plaintiff the premium on the bond and retained the same. Defendant answered denying liability, and the cause came on for trial in the Richland County Court before Judge Holman and a jury for the first time on January 27, 1939, resulting in a verdict in plaintiff's favor for $2,733, which upon a motion for a new trial was reduced by order nisi to the sum of $1,900, the reduction being accepted by the plaintiff; whereupon the cause was appealed by the defendant to this Court, the opinion of which was delivered on May 31, 1940, reversing the judgment below and remanding the case for a new trial on the sole ground of error in the admission of certain testimony relating to the issue as to whether or not the Standard Accident Insurance Company "had cancelled, or ordered the nonacceptance of the bond in question." The appeal also involved exceptions on the part of the Insurance Company to the refusal of the lower Court to direct a verdict upon the ground that the evidence was insufficient to show that the plaintiff, Cohen, sustained any loss or damage; but as to that issue this Court held that Judge Holman committed no error in submitting the same to the jury. The opinion is reported in 194 S.C. 533, 9 S.E.2d 222, 223.

After the remittitur to the Lower Court was filed the defendant tendered to the plaintiff the amount of the bond premium payment, to wit, $150, and for that purpose offered to allow judgment to be taken against it for this sum "with costs from the date of the remittitur and interest;" but this tender and offer was refused. The defendant was then permitted to amend its answer by adding to its general denial previously interposed an admission of the cancellation or recall of the bond, setting up the circumstances under which the same was issued and cancelled and the facts relating to the disposition of the premium. In this connection, it may be said that on the second trial of the case, counsel for the plaintiff withdrew the matter of the alleged failure to return the premium as an element of damages.

The case came on for trial before Judge Holman and a jury for a second time on July 22, 1940, and at the close of all the testimony both parties moved for a direction of verdict, the motion of defendant being based on the ground "that the plaintiff has failed to prove any damages that can be attributable to the Standard Accident Insurance Company on account of the cancellation of the bond." The Court refused to direct a verdict and submitted the cause to the jury. In this connection, it should be stated that on the second trial of the case there was no question whatever as to the competency of the testimony tending to prove that the defendant cancelled the bond by refusing to allow it to be accepted and filed by the Clerk, although it had previously been duly executed and the premium paid; and indeed there was no issue on this point. As Judge Holman says in his charge: "Defendant admits that it issued the bond and the defendant admits it cancelled the bond, but denies that Cohen suffered any loss as a result of any act or acts on the part of the defendant."

The jury returned a verdict in favor of the plaintiff for the sum of $2,500, and thereafter the defendant moved for a new trial on the ground that the verdict was excessive, and also on the ground that the evidence was insufficient to show that the plaintiff had sustained any damages. The Court overruled the motion except as to excessive damages and granted a new trial nisi, that is to say, unless $600 was remitted, but this was done in due course, thus reducing the verdict to the sum of $1,900. Thereupon the case was brought to this Court by the defendant upon four exceptions; but it will be observed that there is no exception whatever to the rulings of the County Judge upon the admissibility of testimony, or to his charge to the jury, or...