Dunbrack v. Neall
| Decision Date | 01 April 1904 |
| Citation | 47 S.E. 303,55 W.Va. 565 |
| Parties | DUNBRACK v. NEALL et al. |
| Court | West Virginia Supreme Court |
Submitted September 9, 1901.
Syllabus by the Court.
1. By verbal agreement, N. sold to D. certain real estate on March 28, 1896, for $2,500, but the contract was not completed by the payment of $625, cash payment, and execution and delivery of the deed from N. to D., and deed of trust by D. to J. S N., trustee, to secure the deferred payments, aggregating $1,875, until June 29, 1896; the deeds bearing the first-named date. On the 4th day of June, 1896, N. took an insurance policy on the buildings in her own name for $2,000 and paid the premium thereon. After the completion of the contract, N. offered to assign to D. the insurance policy upon repayment to her by D. of the premium, which D. refused to do. N. then assigned the same, with the assent of the insuring company, to D., and the said company indorsed on the policy, "This policy is hereby transferred and assigned to A. C. Dunbrack with loss, if any, payable to J. S. Neall trustee for Mary A. Neall, as his interest may appear," which policy was held by J. S. N., trustee. Held said insurance was for the sole benefit of N., and D. had no interest in said policy.
2. Where a creditor secured by trust deed procured insurance on the trust property for his own benefit, and the premium was paid out of his own money, the trust debtor cannot require the creditor to account to him for money received on account of such insurance.
Appeal from Circuit Court, Tucker County; John Homer Holt, Judge.
Bill by A. C. Dunbrack against Mary A. Neall and others. Decree for plaintiff. Defendants appeal. Reversed.
W. B. Maxwell, for appellants.
W. G. Worley, for appellee.
By deed dated the 28th day of March, 1896, Mary A. Neall and James A. Neall, her husband, of Philadelphia, Pa., by J. S. Neall, their attorney in fact, conveyed to A. C. Dunbrack certain parcels of land therein described, being in the town of Parsons, in Tucker county, in consideration of $2,500, of which $625 was paid in cash, and three notes signed by A. C. Dunbrack, bearing even date with the deed, for $625, payable, respectively, on or before the 28th days of March, 1897, 1898, and 1899, and being the deferred installments of purchase money on said property. On the same day said Dunbrack executed a deed of trust to J. S. Neall, trustee, on the same property, to secure the payment of said notes. While the deeds bear date on the 28th of March, the transaction was not really consummated and the deeds delivered until the 29th day of June, 1896. On the 4th day of June, 1896, before the transaction had been completed in writing, Mary A. Neall insured the building on the property so conveyed in the Scottish Union & National Insurance Company for $2,000. After the execution of said deed of conveyance and trust deed, on the 27th of July, 1896, she indorsed on said policy an assignment of the same to A. C. Dunbrack, subject to the consent of the insurance company; and, on the 7th of August following, the insurance company, by its agent, indorsed its consent to said assignment, and at the same time entered thereon the further indorsement: "This policy is hereby transferred and assigned to A. C. Dunbrack with loss, if any, payable to J. S. Neall, trustee for Mary A. Neall, as his interest may appear." On the 18th of May, 1897, the insured building was burned. The trustee, Neall, gave notice to sell the property conveyed by said deed of trust, to be sold on the 18th day of August, 1897. On the 12th day of August, 1897, Dunbrack presented his bill of complaint against Mary A. Neall, J. S. Neall, trustee, and the Scottish Union & National Insurance Company, to the judge of the circuit court of Tucker county, praying an injunction to restrain the trustee from selling the said property on the 18th of August, or any other day, until the further order of the court, and that the trustee be required to give bond as required by law, and that he be required to produce said insurance policy, with a full statement of all steps taken by him to collect the same, and that said insurance company be required, on its part, to answer and set up in said suit why said insurance policy had not been paid by it, and any defense, if any it had, against such payment, and that said company be required to pay the face of said policy, $2,000, and interest thereon, into court, to be paid by it to the said Neall direct upon her said trust deed, and that plaintiff, after being permitted to retain the cost of the suit, might be permitted to pay to said Mary Neall the balance due on said trust deed, if there be any balance then due, and that she then be required to release said trust deed and relieve the said land from the lien thereon, and for general relief.
Plaintiff in his bill, alleges the assignment by Mrs. Neall to plaintiff with the knowledge and assent of said company, and his own assignment thereof to Trustee Neall as security for said purchase money; that the said policy was delivered by plaintiff to the trustee, who was a nonresident of the state of West Virginia, and a resident of Colorado; and alleged that said insurance policy was necessarily a primary security for said trust debt, and, by every construction of law and equity, and the understanding of parties, in case of destruction of property by fire the same was to be immediately collected and paid upon said debt, and to the relief of the land, and there was no good reason why such collection and application should not be made by the trustee, and that no just defense could be made by the company to making such payment; that, by reason of said $2,000 insurance, plaintiff "was estopped from taking further insurance on said building"; that said trustee, acting through his local attorney, had not collected said policy, nor taken any steps to do so, nor produced the policy, nor allowed plaintiff, in his behalf, to take legal steps for its collection, but, on the contrary, had advertised said land for sale under said trust deed, and that, unless this court of equity would intervene to prevent, the property would be sold at great loss and detriment to plaintiff; that plaintiff was advised that, under the circumstances, a court of equity would intervene and lend its assistance to stop the highhanded outrage, by staying and enjoining the trustee from making sale until he had collected said insurance and applied the proceeds to said debt, or demonstrated by proper legal proceedings that the same was uncollectible, and further he had submitted himself to the jurisdiction of the court by executing a proper bond, so that plaintiff might have some assurance that the trust debt would be properly paid to the beneficiary and any balance to plaintiff; and the court, having and taken jurisdiction for this purpose should take such jurisdiction for all purposes, and should in this proceeding require said trustee to produce and file his insurance policy, and require said insurance company to at once make any and all defense it might have to the payment of its liability thereunder, and, if it should appear that no just defense existed, require it to pay the amount at once into court, to be applied to payment of said trust debt, and the plaintiff be permitted to pay the balance to the entire discharge of said debt and relief of said land. The defendants, Mary A. Neall and J. S. Neall, trustee, filed their joint and separate answers, showing that the deed of conveyance and trust deed were delivered on the 29th day of June, 1896, the acknowledgment of the trust deed by Dunbrack bearing that date, and the cash payment of $625 being made on that day; that the policy of insurance was taken by Mary A. Neall on the 4th day of June, while she was uncertain as to whether the sale to Dunbrack would be consummated; that she paid the whole of the premium thereon, and that, when plaintiff complied with the terms of the sale, she, by her agent, offered to assign said insurance policy to plaintiff if he would pay her the premium which she had paid thereon, which plaintiff refused to do; she then set about to get the policy so transferred that, in case of loss of the building, she would be able to receive some of the benefit from her said insurance, and accordingly, by the consent of the company, had the indorsement made and indorsed on said policy, in which condition it was at the time of the fire which destroyed the building; that, after the destruction of the building, respondents made proof of loss, and demanded payment of the insurance company, but the company refused to pay until the trustee should exhaust his remedy under the trust deed by sale of the land, establishing the amount of his loss, if any, as provided in the indorsement on said policy, save and except the sum of $1,000, which the said trustee received and accepted in full settlement of his claim against the said insurance company. The trustee then advertised the land to be sold on the 18th of August, 1897. Respondents denied that it was ever agreed between them and plaintiff that the policy should be taken and held by them as a primary or any other kind of security; that plaintiff refused to pay the premium, and he had no legal or equitable right to have the benefit of the policy, or of any part of it; and denied that they had a contract of understanding with the plaintiff that in case of fire they should collect the amount of the policy and apply it on the purchase money, or that there was any understanding or agreement to that effect, or any other effect, which would relieve plaintiff from the payment of the purchase money due by him; and that the allegations of plaintiff's bill that such an agreement and understanding were entered...
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