Ex parte Metropolitan Life Ins. Co.

• Citation: 266 Ala. 551,98 So.2d 20
• Decision Date: 31 October 1957
• Docket Number: 6 Div. 837
• Parties: Ex parte METROPOLITAN LIFE INSURANCE COMPANY.
• Court: Supreme Court of Alabama

Page 20

98 So.2d 20

266 Ala. 551

Ex parte METROPOLITAN LIFE INSURANCE COMPANY.

6 Div. 837.

Supreme Court of Alabama.

Oct. 31, 1957.

Meade Whitaker and Cabiniss & Johnston, Birmingham, for petitioner.

H. M. Abercrombie and Jos. S. Mead, Birmingham, for respondent.

GOODWYN, Justice.

The Metropolitan Life Insurance Company petitioned this court for an alternative writ of mandamus to be directed to Honorable J. Edgar Bowron, as Judge of the Tenth Judicial Circuit of Alabama. We ordered issuance of a rule nisi as prayed for and Judge Bowron has made answer thereto.

The question presented is whether the insurance company's motion to transfer the case of Evelyn E. R. Booker, plaintiff v. Metropolitan Life Insurance Company, a corporation, defendant, from the law side to the equity side of the court is sufficient as against plaintiff's demurrer interposed thereto. The demurrer being sustained, the defendant insurance company filed its petition here for mandamus to review said ruling. That is the proper method of review. Ex parte Stember, 262 Ala. 56, 57, 77 So.2d 351; Cannady v. Jinright, 253 Ala. 341, 343, 44 So.2d 737; Ex parte R. A. Brown & Co., 240 Ala. 157, 160, 198 So. 138; Esslinger v. Spragins, 236 Ala. 508, 512, 183 So. 401; Jones v. Wright, 220 Ala. 406, 407, 125 So. 645; Ex parte Louisville & N. R. Co., 211 Ala. 531, 532, 100 So. 843.

The suit at law is on a policy of life insurance issued by the defendant company insuring the life of Luther Booker, now deceased, in the sum of $7,000, the plaintiff being the beneficiary under the policy. The policy was issued in Mississippi in 1948, where the insured resided at the time.

Petitioner-defendant, by its motion, seeks to transfer the suit to equity in order to reform the policy on the ground of mutual mistake or, in the alternative, that the policy 'was issued on and pursuant to a unilateral mistake on the part of defendant and fraud or inequitable conduct on the part of said Luther Booker or plaintiff.' The motion was filed pursuant to Code 1940, Tit. 13, § 153, which provides as follows:

' § 153. Equitable defense; how interposed; proceedings on.--If an equitable question, the decision of which should dispose of the cause and which cannot be disposed of in the law side of the court, depends upon the assertion of an equitable right or defense by a party who is defendant or an intervening claimant in such suit at law, such party may assert such right or defense by a written motion filed in the cause, which shall state the substance of the equitable right or defense, and be verified by the affidavit of some person having knowledge of the facts, and the legal sufficiency of such motion may be tested by demurrer and the facts therein may be controverted by affidavit. If it satisfactorily appears to the judge hearing the same that such motion and proof sufficiently assert and show an equitable right or defense, the decision of which should dispose of the cause and which cannot be disposed of in the law side of the court, he shall so state in his judgment or decree and shall direct therein that the cause be transferred from the law side of the court to the equity side of the court, and the same shall thereupon be docketed and proceed in the equity side of the court.'

The single question for decision is whether the motion, as last amended, states the substance of an equitable right or defense available to the defendant which should dispose of the cause and which cannot be disposed of in the law side of the court. Plaintiff's demurrer was the appropriate method of testing the sufficiency of the motion. Code 1940, Tit. 13, § 153, supra; Ex parte R. A. Brown & Co., 240 Ala. 157, 160, 198 So. 138, supra. The facts alleged in the motion were not controverted by affidavit, as authorized by § 153, Tit. 13, supra. In this connection, see Ex parte R. A. Brown & Co., supra.

We have held that 'in order to require a judge at law to transfer a cause to equity under authority of Title 13, section 153, Code, the motion must not only withstand such test as if it were an original bill seeking equity (Ex parte Griffin, 243 Ala. 672, 11 So.2d 738; Ex parte R. A. Brown & Co., 240 Ala. 157, 198 So. 138), but two other conditions must appear as required by the statute: (1) The equitable right or defense must be sufficient to dispose of the cause; and (2) it cannot have that effect on the law side of the court.' Ex parte Adams Const. Co., 251 Ala. 347, 348, 37 So.2d 497, 498. However, a decision on the motion is not res judicata on the issue of the claimed equitable right of defense. Ex parte Perusini Const. Co., 242 Ala. 632, 636 7 So.2d 576; Whitten v. Sheffield Land Co., 233 Ala. 580, 581, 173 So. 48.

When a motion to transfer to equity is granted, the movant becomes the complainant and it is incumbent on him to file in the equity court a bill of complaint seeking relief on the basis of the equitable right or defense asserted in the motion. Cornelius v. Moore, 208 Ala. 237, 238, 94 So. 57. But this does not mean that relief in equity may not also be sought on other equitable grounds nor that all of the grounds made the basis of the motion must be substantisted in the equity court. Ballentine v. Bradley, 238 Ala. 446, 451, 191 So. 618; Ex parte Perusini Const. Co., 242 Ala. 632, 7 So.2d 576, supra. So long as there is one equitable right or defense which is dispositive of the cause but which cannot be availed of in the law side of the court, that is sufficient. Of course, the proceedings in equity follow the same course as if the cause had originated there.

We come, then, to consider whether the motion, on demurrer, sufficiently states at least one equitable right or defense entitling defendant to have the cause transferred to equity. We are persuaded that it does.

Code 1940, Tit. 9, § 59, provides as follows:

' § 59. When contract may be revised.--When, through fraud, or a mutual mistake of the parties, or a mistake of one party, which the other at the time knew or suspected, a written contract does not truly express the intention of the parties, it may be revised by a court of equity on the application of the party aggrieved, so as to express that intention, so far as it can be done without prejudice to the rights acquired by third persons, in good faith and for value.'

There appears to be no doubt that one of the 'equitable right or defense' relied on for transfer is that the insurance contract, 'through * * * a mutual mistake of the parties, * * * does not truly express the intention of the parties.' The question is whether the motion sufficiently alleges such mutual mistake.

The motion, as last amended, contains the following allegations:

'1. Defendant avers that this suit is brought by plaintiff as beneficiary upon a policy of life insurance issued by this defendant, numbered 17 330 032 A, under which plaintiff claims that defendant agreed to insure the life of Luther Booker, now deceased in the sum of $7,000; that said policy sued on was issued by defendant pursuant to a written application signed and dated by said Luther Booker on, to-wit, July 6, 1948, and a written amendment thereto dated September 2, 1948, and signed by said Luther Booker on, to-wit, September 10, 1948, and under and by reason of facts and circumstances hereinafter set forth; that said Luther Booker applied for said insurance in the exercise of conversion rights to which he was entitled under Group Policy No. 6770-GLHD issued to St. Louis-San Francisco Railway Company under which group policy said Luther Booker had formerly been insured as an employee of said railroad company in the amount of $7,000; that said Exhibit 2 is a true and correct copy of the policy sued on, which exhibit is made a part of this motion, and which exhibit also contains a true and correct copy of said written application and said written amendment thereto.

'2. Defendant further avers that in said original written application said Luther Booker applied for issuance of a policy of life insurance in the amount of $7,000 under an insurance plan described as 'whole life paid up at age 65', with premiums payable monthly and with plaintiff as the primary beneficiary of said insurance; that one George W. Nethery as the soliciting agent for defendant received said original application from said Luther Booker and at the same time collected for defendant from said Luther Booker the sum of $57.19 as a payment in advance on account of the first monthly premium on the policy of insurance applied for; that thereafter, during the month of August, 1948, defendant informed said Luther Booker through said Nethery that the plan of insurance applied for, viz., whole life paid up at age 65, court not be issued by defendant, but that defendant would issue in lieu thereof a policy of insurance on its usual and customary form for any one of the following described plans at the monthly premium indicated:

a) whole life paid-up at age 85--$66.18

b) 20 payment life 66.22

c) 30 payment life 66.50

d) 30 year endowment 65.10;

that during said month and on or before August 17, 1948 said Luther Booker or plaintiff, acting for and in his behalf, thereupon requested defendant to issue a policy of life insurance on said plan known as '30 year endowment'; and that on, to-wit, August 7, 1948, said Luther Booker or plaintiff paid to defendant the additional sum of $10.00 to be applied on account of the first monthly premium on said policy of insurance, all in accordance with the provisions of said original application dated July 6, 1948, which specified that the first premium on an individual policy issued under the conversion rights set out in said group policy was required to be paid to and accepted by the Company during the lifetime of the applicant as a condition precedent to the issuance of such a policy, and further in accordance with the provisions of said group policy as hereinbelow more particularly averred.

'3. Defendant further...