Creem v. Northwestern Mutual Fire Association of Seattle, Washington

• Decision Date: 19 November 1937
• Docket Number: 6433
• Citation: 58 Idaho 349,74 P.2d 702
• Parties: SAMUEL CREEM, Trustee for the Creditors of CHARLES A. RAMBO and CHARLES A. RAMBO, Respondents, v. NORTHWESTERN MUTUAL FIRE ASSOCIATION OF SEATTLE, WASHINGTON, a Corporation, Appellant
• Court: Idaho Supreme Court

74 P.2d 702

58 Idaho 349

SAMUEL CREEM, Trustee for the Creditors of CHARLES A. RAMBO and CHARLES A. RAMBO, Respondents, v. NORTHWESTERN MUTUAL FIRE ASSOCIATION OF SEATTLE, WASHINGTON, a Corporation, Appellant

No. 6433

Supreme Court of Idaho

November 19, 1937

APPEAL AND ERROR-NEW TRIAL-ISSUES-SUBSEQUENT APPEAL-LAW OF THE CASE-INSURANCE-ACTION ON POLICY-MUTUAL MISTAKE-EVIDENCE.

1. The sufficiency of evidence to prove that merchandise insured under fire policy providing for forfeiture upon encumbrance of merchandise by chattel mortgage was included in chattel mortgage by mutual mistake could be considered on a new trial, notwith- standing holding on former appeal that evidence was insufficient to prove that merchandise was included in chattel mortgage by mutual mistake, where new trial on the whole case had been ordered on former appeal.

2. If proofs on second trial are the same as upon first at which evidence was held insufficient to support judgment, appellate court is bound on second appeal to follow ruling on first appeal, but, if different proofs are presented on second trial, appellate court will make an independent examination as on an original appeal.

3. "The law of the case" means that, on reversal of judgment and remand of case to trial court for a new trial the case comes on for trial the same in all respects as if it had never been tried, subject to the condition that it must be tried in the light of and in consonance with rules of law as announced by appellate court in the particular case.

4. The holding on former appeal that question whether giving of chattel mortgage on insured property increased hazard, so as to avoid fire policy under forfeiture provision thereof, was for jury, was the "law of the case" on subsequent appeal.

5. Evidence of mortgagor and mortgagee that it was their intention and understanding that chattel mortgage was not to cover stock of goods and merchandise warranted recovery on fire policy providing for forfeiture thereof upon encumbrance of merchandise by chattel mortgage.

APPEAL from the District Court of the Seventh Judicial District, for Washington County. Hon. A. O. Sutton, Judge.

Action on insurance policy. Judgment for plaintiff. Affirmed.

Judgment affirmed with costs to respondent.

J. F Martin, for Appellant.

The decision of the supreme court formed the law of the case and questions determined on the prior appeal should not have been relitigated. (4 C. J. 1240; Hall v. Blackman, 9 Idaho 555, 75 P. 608; Gerber v. Nampa etc. Irr Dist., 19 Idaho 765, 116 P. 104; Kerns v. Morgan, 11 Idaho 572, 83 P. 954; Richards v. Jarvis, 44 Idaho 403, 258 P. 370.)

The rule "Law of the Case" applies to questions as to the sufficiency or insufficiency of the evidence to prove a fact in issue. (2 R. C. L. 227; Beymer v. Monarch, 23 Idaho 292, 129 P. 919; Noyes v. Des Moines Club, 186 Iowa 378, 170 N.W. 461.)

Where an appellate court holds and determines the evidence insufficient to sustain the verdict, the cause should not be resubmitted to a jury upon a retrial of the case, where the evidence is merely cumulative or of the same class and character. (2 R. C. L. 227; Sorensen v. Larue, 47 Idaho 772, 278 P. 1016; Beymer v. Monarch, supra; Westfall v. Wait, 165 Ind. 353, 73 N.E. 1089, 6 Ann. Cas. 788; Noyes v. Des Moines Club, 186 Iowa 378, 170 N.W. 461.)

Geo. Donart and Ed. R. Coulter, for Respondents.

Unless the mandate of the appellate court contains express directions as to the issues to be retried, a remand for a new trial opens the whole case for a new trial as to all issues and the cause should be tried de novo. (American Surety Co. of New York v. Jackson, 26 F.2d 248, 24 P.2d 768; Hidden v. Jordan, 28 Cal. 301; Jacobs v. Walker, 3 Cal. Unrep. Cas. 865, 33 P. 91; Mattock v. Goughnour, 13 Mont. 300, 34 P. 36; Corporation of Members of Church, etc., v. Watson, 27 Utah 538, 76 P. 706.

Where the inclusion of the stock of merchandise in the mortgage was due to a mutual mistake of mortgagor and mortgagees at the time of the execution of the mortgage, and neither party intended to so include same, then the mortgage was void as to said merchandise. (11 C. J., p. 490, sec. 146.)

GIVENS, J. Morgan, C. J., Holden, J., and Budge, J., concurring. AILSHIE. J., Dissenting in part.

OPINION

GIVENS, J.

This case was here on the merits on a previous appeal and we reversed the judgment and remanded the cause "for a new trial." (Creem v. Northwestern Mut. Fire Assn., 56 Idaho 529, 56 P.2d 762.) The case was tried again de novo and judgment was rendered for the plaintiff and it is here again on appeal on the merits.

It is first contended that the trial court did not follow our former decision as to the law of the case. A very careful examination of the rulings of the court and the instructions given the jury satisfies us that appellant is in error in its contention in this respect; and that the trial court did in fact have a very clear understanding of our former opinion and followed it in all substantial respects throughout the trial and in the instructions as well. The facts of the case are set out in sufficient detail in our former opinion to serve our purposes here in dealing with all the issues tendered on this appeal.

In our opinion on the former appeal it is said:

"The evidence herein is insufficient to prove that the merchandise was included in the chattel mortgage by mutual mistake."

Appellant argues that by the foregoing holding, as to the insufficiency of the evidence, we adjudged that there was no sufficient evidence to support the charge that the merchandise, covered by the mortgage to the Nampa Weiser Company and Shellhaas, was described and included in the mortgage by "mutual mistake"; and that such holding became res judicata or the law of the case. The weakness of this contention lies in the fact that, instead of withholding that issue from consideration on a new trial, we ordered a new trial on the whole case. In that state of the case this issue as well as all others was open for trial anew as if it had never been tried. (Little v. Brown, 40 Ariz. 206, 11 P.2d 610; 5 C. J. S. 1549, sec. 1989.)

Of course if the proofs on a second trial should be the same as upon the first trial, on which the evidence was held insufficient to support the judgment, the appellate court would feel bound on the second appeal to follow the ruling on the first appeal. But if other or different proofs are presented on the second trial, the appellate court will give it an independent examination as on an original appeal. Where a judgment is reversed and the case is remanded to the trial court "for a new trial," the case comes on for trial the same, in all respects, as if it had never been tried, subject to this condition, however, that it must be tried in the light of and in consonance with the rules of law as announced by the appellate court in that particular case. This is what we call "the law of the case." (Ryan Gulch Reservoir Co. v. Swartz, 83 Colo. 225, 263 P. 728; Rebold v. National Supply Co., 133 Okla. 140, 271 P. 852; Little v. Brown, 40 Ariz. 206, 11 P.2d 610; Colby v. Daniels, 151 Okla. 89, 1 P.2d 693; Godefroy v. Reilly, 140 Wash. 650, 250 P. 59, at 62; Adams v. Kennard, (Or.) 122 Ore. 84, 222 P. 1092, at 1094; Corporation of Members of Church, etc., v. Watson, 27 Utah 538, 76 P. 706; Mattock v. Goughnour, 13 Mont. 300, 34 P. 36.) The decisions of this court cited and relied on by appellant are in entire harmony with the rule here stated. (Hall v. Blackman, 9 Idaho 555, 75 P. 608; Gerber v. Nampa & Meridian Irr. Dist., 19 Idaho 765, 116 P. 104; Richards v. Jarvis, 44 Idaho 403, 258 P. 370; Phy v. Edgerton, 44 Idaho 530, 258 P. 545; Vinyard v. North Side Canal Co., Ltd., 47 Idaho 272, 274 P. 1069.)

As to respondent's argument that the clause in the policy reading:

". . . . if the hazard be increased by any means within the control or knowledge of the insured . . . ." has no reference to the giving of a chattel mortgage on insured property, our former decision, 56 Idaho 529, 56 P.2d 762, is the law of the case which the trial court followed.

Appellant contends the evidence is insufficient to prove that the merchandise was included in the chattel mortgage by mutual mistake and that the evidence of mistake was not as strong on the second trial as at the first. The same witnesses testified as to this feature of the case except Mr. Shellhaas who was one of the mortgagees and did not testify at the former trial, did at the second trial, and Mrs. Shellhaas who acted as his agent in connection with the taking of the mortgage testified at the first trial but not at the second. In the second trial therefore, there was the testimony of both mortgagees and the mortgagor that it was their intention and understanding that the mortgage was not to cover the stock of goods and merchandise. This court has laid down the following test for determination of the sufficiency of the evidence under these circumstances:

"It is next contended by appellant 'that plaintiff did not establish beyond a reasonable doubt by clear, satisfactory and convincing evidence that there was a mutual mistake in reducing the contract to writing' and that, therefore the court erred in finding that a mistake had been made and in entering judgment for a reformation of the contract. Appellant contends that in such cases the rule is that before a reformation can be had on the ground of mutual mistake that the 'mistake must appear beyond a reasonable doubt.'

"Counsel cites something like a hundred authorities in support of this contention. We are not going to review these authorities or again enter into any extended discussion of this question. This court has adopted and followed a different rule in such cases. This...