Gibson v. American Ins. Co.

• Decision Date: 14 February 1941
• Citation: 146 Fla. 171,200 So. 357
• Parties: GIBSON v. AMERICAN INS. CO., et al.
• Court: Florida Supreme Court

200 So. 357

146 Fla. 171

GIBSON v. AMERICAN INS. CO., et al.

Florida Supreme Court, Division A.

February 14, 1941

Suit in equity by C. E. Gibson against the American Insurance Company, C. R. Dorsey, Inc., C. R. Dorsey, individually, and others for reformation of a fire insurance policy. From decrees dismissing the bill of complaint as to named defendants, plaintiff appeals.

Affirmed as to defendants C. R. Dorsey, Inc., and Dorsey individually and reversed and remanded as to defendant insurance company. Appeal from Circuit Court, Palm Beach County C. E. Chillingworth, judge.

COUNSEL

E. M Baynes, of West Palm Beach, for appellants.

Stapp Ward & Ward, of Miami, for appellee American Ins. Co. of Newark, N. J.

O. S. Miller, of West Palm Beach, for appellees Lucretia Meerdink, as adm'x of Estate of C.J. Meerdink, and O. S. Miller.

Earnest, Lewis & Smith, of West Palm Beach, for appellees C. R. Dorsey, Inc., and C. R. Dorsey.

OPINION

BUFORD Justice.

Appeal brings for review two decrees, one dismissing the bill of complaint as to the American Insurance Company, and the other dismissing the bill as to the defendants C. R. Dorsey, Inc., a corporation, and C. R. Dorsey, individually.

There was no error in the entry of the latter order because the bill alleged no grounds for equitable relief against those defendants.

The bill sought as to the American Insurance Company the reformation of an insurance policy issued by that company to one O. S. Miller with loss payable to one C.J. Meerdink. It was, in effect, alleged in the bill that Miller applied for a policy of fire insurance on certain property, the equitable title to which was in Miller but the legal title to which was in Meerdink; that the true status of the title was fully developed and explained to the authorized agent of the Insurance Company by Miller; that Miller paid the required premium and the agent agreed on behalf of the Insurance Company that a policy of insurance would be issued by the Company and delivered to Miller which would protect Miller against fire loss of the property; that in due course the agent delivered an insurance policy to Miller and Miller, assuming that the policy was so framed as to protect Miller against fire loss, did not read the policy but, relying on his agreement with the agent, placed the policy in his safe and did not read it until after the fire loss occurred, shortly after the issuance of the policy; that upon examination of the policy he found that it provided for loss payable to Meerdink, the holder of the naked legal title. Reformation was prayed to reform the policy so as to make loss payable to Miller to conform to the agreement, supra.

The suit is by the assignee of Miller and also of Meerdink, but we hold the assignment of Meerdink of no efficacy as he had no interest in the claim and, therefore, had nothing to assign.

The American Insurance Company filed motion to dismiss stating five grounds, as follows:

'I. The bill of complaint is without equity as to this defendant.

'II. All rights under the contract sought to be reformed herein have heretofore been completely adjudicated in that certain common-law action heretofore filed in the Fifteenth Judicial Circuit in and for Palm Beach County, Florida, under common-law action No. 8029, wherein final judgment was entered for this defendant and wherein said final judgment was affirmed by the Supreme Court of Florida, and, therefore, further action under said policy as against this defendant is barred under the doctrine of res adjudicata.

'III. The plaintiff herein, as assignee of the original assured under said policy, acquired only such interest in the policy or the proceeds therefrom as was owned by the assured at the time of the assignment and took such assignment subject to all defenses which would be available to this defendant against any action brought by the original assured and, therefore, as the original assured is barred from any further action against the defendant herein his assignee, the plaintiff herein, is likewise barred and estopped from maintaining this action.

'IV. The original assured in the policy sought to be reformed herein filed his common-law action against this defendant as hereinabove set forth seeking to enforce the contract as written, and said action was prosecuted to final judgment in the Fifteenth Judicial Circuit of the State of Florida, and said final judgment was affirmed by the Supreme Court of the State of Florida, and, therefore, under the doctrine of the election of remedies the assured and his assignee, the plaintiff herein, are barred from maintaining any additional action on said policy.

'V. The plaintiff herein was not in any respect a party to the original contract of insurance herein sought to be reformed and, therefore, without making the original assured a party plaintiff to this action cannot maintain this action for reformation of the contract involved in this cause, to which contract he was not an original party.'

The decree from which the appeal is taken, inter alia, is:

'The principal question is whether or not the predecessor in interest of this plaintiff, by pursuing the common-law action to a final judgment, has created a bar to this equity suit for the purpose of reforming and enforcing the insurance policy.

'Both parties cite the case of American Process Co. v. Florida White Pressed Brick Company, 56 Fla. 116, 47 So. 942, 16 Ann. Gas. 1054. Apparently, the essential inquiry under that case is whether the allegations of facts necessary to...