Critchlow v. Reliance Mut. Ins. Ass'n of Des Moines

• Decision Date: 04 March 1924
• Docket Number: No. 35731.,35731.
• Citation: 198 Iowa 1086,197 N.W. 318
• Parties: CRITCHLOW v. RELIANCE MUT. INS. ASS'N OF DES MOINES.
• Court: Iowa Supreme Court

198 Iowa 1086

197 N.W. 318

CRITCHLOW

v.RELIANCE MUT. INS. ASS'N OF DES MOINES.

No. 35731.

Supreme Court of Iowa.

March 4, 1924.

Appeal from District Court, Mahaska County; D. W. Hamilton, Judge.

Plaintiff brings this action as assignee and mortgagee to recover the amount of a mortgage on account of the loss and destruction of the insured property while in the possession of a trustee in bankruptcy. A verdict was directed in favor of the defendant insurance company, and the plaintiff appeals. Reversed.Irving C. Johnson and McCoy & McCoy, all of Oskaloosa, for appellant.

Devitt & Eichhorn, of Oskaloosa, for appellee.

STEVENS, J.

This is an action in the name of W. C. Critchlow plaintiff, appellant herein, against the Reliance Mutual Insurance Association of Des Moines, to recover, as assignee and mortgagee of the insured, the amount of a mortgage on a stock of hardware, on account of the destruction of the property insured by fire. The insured went into voluntary bankruptcy shortly before the fire, and the loss occurred after a trustee had been appointed and while the property was in his possession. Appellee is a mutual insurance association. On November 10, 1920, it executed its policy to Dick Van Rees on a stock of hardware which he had purchased of appellant, in the sum of $3,500, making the loss, if any, payable to appellant, mortgagee, as his interest should appear. On December 23, 1920, appellant secured possession of the stock of hardware by replevin. Four days later, Van Rees, the insured, filed a petition in voluntary bankruptcy, and on December 30th a supplemental petition setting up the replevin proceedings. On December 28th the insured was adjudged a bankrupt. After the appointment of a trustee in bankruptcy had been made and possession taken by him of the property, it was on February 28, 1921, totally destroyed by fire. This action was commenced on or about September 17th following. The case was tried to a jury, resulting in a directed verdict for appellee.

Appellant alleged in his petition that on January 3, 1921, the insured assigned the policy to him as mortgagee, and that said assignment was duly approved in writing by the company. Numerous defenses were pleaded: First, it is claimed by appellee that the title to the property insured passed, by operation of law, to the trustee in bankruptcy, and that at the time of the alleged assignment of the policy by insured he did not have an insurable interest therein; that the assignment was without the authority of the insured, and that his name was forged thereto by one W. C. Boatman, a soliciting agent of the company; and that the policy was in fact delivered by the insured to Boatman, to be sent to the company for cancellation, and not for the assignment to appellant.

[1] During the trial, appellant amended his petition fully setting up his interest as mortgagee, and demanding recovery as such. To this amendment appellee set up a provision of the policy requiring action to be commenced thereon within 12 months after a right of action has accrued.

The original petition, to which a copy of the policy was attached, contained the allegations that the insured had assigned his interest in the policy to appellant as mortgagee, and that “at the time of said loss this plaintiff was the mortgagee of said property.” The prayer of the petition was for judgment and did not refer to appellant as assignee or mortgagee. The petition was not assailed by motion for some specific statements, nor was it otherwise challenged by appellee. That the petition is defective and violates several well-known rules of pleading must be conceded, and, but for the extreme liberality in favor of amendments, we should be compelled to hold that it does not, although not assailed, state a cause of action in appellant's favor as mortgagee. Nonconformity to the well-established rules of pleading is seldom excusable, and always results in confusion, and frequently in the loss of valuable rights of litigants. If the amendment, setting up a cause of action in plaintiff's favor as mortgagee, which was filed during the trial, is to be construed as the statement of a new and independent cause of action, then, upon the theory of appellee, it was, when filed, barred by the statute of limitations. If, however, it is to be construed as a mere amendment to the original cause of action, and intended simply to amplify and enlarge the allegations thereof, then it relates back to the filing of such original petition, and clearly the plea of the statute of limitations is not available to appellee.

We are inclined to give liberal effect to the rule relating to amendments, and to hold that the original petition stated a cause of action in favor of appellant as mortgagee. It is true the petition contains but one count; but this is not controlling. The allegations of the petition are that the assignment to appellant was as mortgagee. As we have so recently reviewed the authorities on the subject of amendments as affected by the statute of limitations, we shall not undertake to go over them again. The rule is familiar and fully stated in the cases cited below. This action was brought to recover for the loss sustained, and the interest of appellant is described in the original petition to be that of an assignee and mortgagee. The pleading is not to be commended as a model, but we think the amendment germane thereto, and that it should be treated as amplifying the allegations of the original petition, rather than as the statement of a new and independent cause of action. In saying this, we, of course, recognize the distinction between the right of an assignee of the policy to recover for a loss thereunder and the right of a mortgagee to recover as his interest may appear. Our conclusion on this point is well sustained by our prior decisions: Basham v. C. G. W. Ry. Co., 178 Iowa, 998, 154 N. W. 1019, 157 N. W. 192;Lammars v. C. G. W. Ry. Co., 187 Iowa, 1277, 175 N. W. 311;Hobbs v. Railroad Co., 182 Iowa, 316, 165 N. W. 912;Hueston v. Preferred Acc. Ins. Co., 184 Iowa, 408, 168 N. W. 150.

What is here said disposes of appellee's plea of the statute of limitations. We need not, therefore, consider appellant's contention that the provision in the policy as to the time within which an action may be maintained thereon is not applicable to actions brought by a mortgagee to recover for the loss as his interest may appear.

II. We are not quite clear whether or not appellant intended to abandon his claim as assignee. We rather assume, from some of the language of his reply argument, that such was his intention. In any event, the assignment of this point is too general to permit the proposition to be reviewed on appeal.

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