Collison v. International Insurance Co.

• Decision Date: 03 November 1941
• Docket Number: Civil 4367
• Citation: 118 P.2d 445,58 Ariz. 156
• Parties: R. G. COLLISON and M. A. OHLSON, Appellants, v. INTERNATIONAL INSURANCE COMPANY, a Corporation, Appellee
• Court: Arizona Supreme Court

118 P.2d 445

58 Ariz. 156

R. G. COLLISON and M. A. OHLSON, Appellants, v. INTERNATIONAL INSURANCE COMPANY, a Corporation, Appellee

Civil No. 4367

Supreme Court of Arizona

November 3, 1941

APPEAL from a judgment of the Superior Court of the County of Maricopa. G. A. Rodgers, Judge. Judgment affirmed.

Mr John W. Ray, of Phoenix, Arizona; Mr. Clifford A. Jones and Mr. A.P.G. Steffes, of Las Vegas, Nevada, for Appellants.

Messrs Perry, Silverthorn & Johnson, for Appellee.

OPINION

LOCKWOOD, C.J.

International Insurance Company, a corporation, called plaintiff, brought suit against R. G. Collison and M. A. Ohlson, called defendants. Raul Ohlson was also a nominal defendant. The charging part of the complaint reads as follows:

"2. During the period from July 1, 1938, to April 28, 1939 defendants, R. G. Collison and M. A Ohlson, had and received the sum of Two Thousand Fifty-two and 89/100 Dollars, the property of the plaintiff, which said sum said defendants promised to pay plaintiff, but have failed so to do, although payment thereof has been duly demanded."

Defendants answered with a general denial. The case came for trial before the court sitting w ithout a jury, the principal witness for plaintiff being Joe L. Schmitt, Jr., the insurance examiner for the Arizona Corporation Commission and a graduate examiner of the National Association of Insurance Commissioners. A duplicate of a report made by him to the corporation commission of the result of his examination, during May, 1939, of the affairs of the plaintiff was put in evidence, as were the records on which the report was based, and they were explained to a great extent by the oral testimony of the witnesses.

Defendants were respectively vice president and secretary-treasurer of plaintiff during all the times involved in this action. The evidence of Schmitt, together with the records and his report to the corporation commission reasonably sustained the conclusion reached by the trial court that defendants had improperly applied $2,027.89 belonging to plaintiff, which had come into their hands as such officers, and judgment was rendered against them for that amount, whereupon this appeal was taken.

There are seven assignments of error which raise, in substance, three questions of law for our consideration. The first is whether it was error to receive in evidence the written report of Schmitt above referred to. It was objected to on the ground that it contained argumentative matter, opinions and conclusions of law of the witness. There can be no question that generally speaking the testimony of qualified accountants as to facts shown by their examination of the records of a party to an action is competent evidence. Cornes v. United States, (9 Cir.) 119 F.2d 127; 22 C.J. 537, and cases cited.

The original records, upon which the report of Schmitt was based were introduced in evidence and were available to defendants. The witness was cross - examined by their counsel most thoroughly. It is true that those portions of the report which contained conclusions of law and argumentative matter were not properly admissible as evidence, and had the case been tried to a jury there might have been a serious question raised. When, however, a case is tried to the court without a jury, even though improper evidence is offered and received, if there is competent evidence sufficient to support the judgment, it will be sustained regardless of the error, for we must assume that the court considered only the competent evidence. Home Owners' Loan Corp. v. Bank of Arizona, 54 Ariz. 146, 94 P.2d 437; In re Guardianship of Sorrells (Sorrells v. Bergier), ante, p. 25, 117 P.2d 96. We think there was no reversible error under the circumstances in admitting the report of Schmitt, and further that on the case as a whole there was sufficient evidence before the trial court to sustain the judgment.

It is true there was evidence offered by the defense which might have permitted a contrary conclusion on some, at least, of the items involved, but this was a matter for the trial court to decide, and we do not consider the weight of the evidence. Dunseath v. Tucson Golf & Country Club, 51 Ariz. 14, 74 P.2d 43; Thornburg v. Frye, 44 Ariz. 282, 36 P.2d 548.

There is, however, one question raised which is worthy of serious consideration. Plaintiff alleged in its complaint that the period during which defendants had received the money involved herein began with July 1, 1938, and ended with April 28, 1939, and the evidence is of such a nature that it cannot be determined definitely that something over one thousand dollars of that amount was not received and misapplied prior to July 1, 1938. It is urged that so far as this amount at least is concerned, the issue is not within the pleadings, and that since there is nothing in the record to show that there was an effort to amend the pleadings to conform to the evidence, the judgment rendered thereon cannot be sustained.

Plaintiff admits this to be the general rule but appeals to section 21-449, Arizona Code 1939, which reads so far as material as follows:

"Amendments to conform to the evidence. -- When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Such amendment of the...