Hartford Ins. Co. of the Midwest v. Brewer

• Decision Date: 29 May 1996
• Docket Number: No. CA,CA
• Citation: 922 S.W.2d 360,54 Ark.App. 1
• Parties: HARTFORD INSURANCE COMPANY OF THE MIDWEST, Appellant, v. Damon BREWER and Carolyn Brewer, Appellees. 95-237.
• Court: Arkansas Court of Appeals

Page 360

922 S.W.2d 360

54 Ark.App. 1

HARTFORD INSURANCE COMPANY OF THE MIDWEST, Appellant, v. Damon BREWER and Carolyn Brewer, Appellees.

No. CA 95-237.

Court of Appeals of Arkansas En Banc.

May 29, 1996.

Michael E. Aud, Little Rock, for appellant.

Helen Rice Grinder, Conway, for appellees.

PITTMAN, Judge.

The appellant, Hartford Insurance Company, appeals from an order granting summary judgment in favor of appellees, Damon and Carolyn Brewer, on their claim to entitlement to the proceeds of an insurance policy issued by appellant. Appellant contends that the trial court erred in granting appellees' motion for summary judgment and instead should have awarded summary judgment to appellant. For the reasons that follow, we affirm.

Although the record in this case is sketchy at best, the parties seem to agree upon certain facts. In December 1990, appellee Damon Brewer's mother, Ethel Brewer, died intestate, leaving a residence in Conway to vest in her heirs by operation of law. See Ark.Code Ann. § 28-9-203(c) (1987). In July 1991, appellant issued a homeowner's insurance policy covering the property through June 1992. Apparently, the named insured was the "Estate of Ethel Brewer." On February 3, 1992, the other heirs of the decedent transferred all their interest in the property to appellees, who are husband and wife. Twelve days later, the property burned. Appellees then sought to collect under the policy issued by appellant. The claim was denied, and appellees filed this action, in their individual capacities only, in circuit court. After initial pleadings were filed, both appellant and appellees filed motions for summary judgment. The court granted appellees' motion and awarded them judgment for $38,500.00 under the policy, attorney's fees, and a twelve-percent penalty.

On appeal, appellant argues that the trial court erred because the named insured, the "Estate of Ethel Brewer," had no insurable interest at the time of the loss as required by Ark.Code Ann. § 23-79-104 (Repl.1992). While appellant seems to concede that the estate had an insurable interest at the time that the policy was issued and that the appellees had an insurable interest at the time of the loss, appellant specifically argues that an estate is a legal entity separate and distinct from a decedent's individual heirs and that "it is not enough to have an insurable interest in property unless the person or persons having such interest also are specifically named as insureds." In other words, it is appellant's argument that appellees had no contract of insurance with appellant, and that appellant was entitled to judgment as a matter of law. Appellees respond that, "[s]ince the heirs of Ethel Brewer already had whatever interest they were to obtain from her estate when the estate became the named beneficiary, it is clear that the policy must be read to cover the heirs of the estate and, by conveyance, to [cover] Damon and Carolyn Brewer."

Summary judgment is an extreme remedy and should be granted only when there are no genuine issues of material fact left to be determined and when the case can be decided as a matter of law. Cherepski v. Walker, 323 Ark. 43, 913 S.W.2d 761 (1996). In light of the record with which we have been presented, however, we are unable to reach the merits of appellant's argument. Although we are essentially being asked to construe a written contract of insurance so as to reverse a circuit court's solemn judgment thereon, the contract appears neither in the abstract nor even in the record. ¹ It is axiomatic that, to determine rights and duties under a contract, we must determine the intent of the parties. This is not to be accomplished through the establishment of a judicial inquisition, but instead by examining the written agreement to construe it and declare its legal effect. Duvall v. Massachusetts Indemnity and Life Insurance Co., 295 Ark. 412, 748 S.W.2d 650 (1988); Floyd v. Otter Creek Homeowners Association, 23 Ark.App. 31, 742 S.W.2d 120 (1988). It is well settled that the intent of the parties is to be determined from the whole context of the agreement; the court must consider the instrument in its entirety. Continental Casualty Co. v. Davidson, 250 Ark. 35, 463 S.W.2d 652 (1971); Fowler v. Unionaid Life Insurance Co., 180 Ark. 140, 20 S.W.2d 611 (1929); Floyd v. Otter Creek Homeowners Association, supra. Clearly, it is an appellant's burden to bring up a record sufficient to demonstrate error. McAdams v. Automotive Rentals, Inc., 324 Ark. 332, 921 S.W.2d 592 (1996); May Construction Co., Inc. v. Benton School District No. 8, 320 Ark. 147, 895 S.W.2d 521 (1995); Young v. Young, 316 Ark. 456, 872 S.W.2d 856 (1994). Without the contract in question, which may have spoken in any number of ways to the issue of the person or persons entitled to the policy proceeds, we cannot determine whether the trial court erred. Therefore, we conclude that appellant has failed in its burden, and we affirm. ²

Affirmed.

ROGERS, J., agrees.

JENNINGS, C.J., concurs.

MAYFIELD, NEAL, and GRIFFEN, JJ., dissent.

GRIFFEN, Judge, dissenting.

"A blind man should not judge of colors." Proverb

The majority would affirm this patently wrong result due to an abstracting error. The Arkansas Supreme Court has repeatedly held that even an abstract that falls considerably short of the requirements of Rule 4-2 may not be "flagrantly" deficient. Linder v. Howard, 296 Ark. 414, 757 S.W.2d 549 (1988); Ark.Sup.Ct.R. 4-2(b)(2); see also Haynes v. State, 309 Ark. 583, 832 S.W.2d 479 (1992); Goodloe v. Goodloe, 253 Ark. 550, 487 S.W.2d 593 (1972). The balance of the parties' briefs may overcome the deficiency and provide the court with the matters "necessary to an understanding of all questions presented to the court for decision." Ark.Sup.Ct.R. 4-2(a)(6); Fight v. State, 314 Ark. 438, 863 S.W.2d 800 (1993); Haynes v. State, 309 Ark. 583, 832 S.W.2d 479 (1992).

Here, the homeowner's insurance policy at issue was not included in the record or abstracted. However, the issue on appeal has nothing to do with the existence or the basic terms of the contract. Indeed, the parties agree to all the material issues surrounding the contract. The narrow question on appeal is whether the named insured ("The Estate of Ethel Brewer") continued to have an insurable interest or, more specifically, whether summary judgment on this question was proper given the factual state of the record. I contend that the absence of the contract in the record was not fatal, given the parties' apparent stipulations regarding the contract, and that we should have properly proceeded to the issue of summary judgment.

With regard to summary judgment, I disagree with the result reached in this case and the reasoning announced in the prevailing opinion because it is clear that genuine issues of material fact exist that preclude entry of summary judgment. It is equally clear that no accurate determination can be made that either party is entitled to judgment, as a matter of law or otherwise, until those factual issues are resolved. Therefore, the trial court should not have entered summary judgment in favor of appellees in the face of the clear and time-honored principle affirmed by Rule 56 of the Arkansas Rules of Civil Procedure. The same logic compelled denial of the appellant's summary judgment motion.

We must remember that the object of summary judgment proceedings is not to try the issues, but to determine if there are any issues to be tried, and if there is any doubt whatsoever, the motion for summary judgment should be denied. Rowland v. Gastroenterology Assocs., 280 Ark. 278, 657 S.W.2d 536 (1983); Walker v. Stephens, 3 Ark.App. 205, 626 S.W.2d 200 (1981). That is why courts have consistently stated that summary judgment is an extreme remedy which should only be allowed when it is clear that there is no issue of fact to be litigated. Lee v. John Doe, 274 Ark. 467, 626 S.W.2d 353 (1981); McCaleb v. National Bank of Commerce, 25 Ark.App. 53, 752 S.W.2d 54 (1988). This case demonstrates what can happen when parties and courts forget or ignore this fundamental rationale.

The parties agree that appellant issued its policy covering the residence in question to an insured known as the "Estate of Ethel Brewer." Appellant claims that its insured lost any insurable interest in the property once the heirs at law sold their respective interests to Damon Brewer and his wife. Neither party before us is the Estate of Ethel Brewer. The record contains nothing that suggests the status of the Estate of Ethel Brewer. Neither the trial judge nor this court knows the status of the Estate of Ethel Brewer. Especially important is whether the Estate of Ethel Brewer has claims pending against it that might be satisfied by the proceeds of the insurance policy. Whether the Estate is open or closed, whether claims are pending against it and, if so, in what amounts, whether the Estate has somehow transferred any interest that it may have in the policy proceeds to appellees, and whether Damon Brewer is entitled to recover, personally, from appellant based upon an insurance policy issued to somebody else known as the Estate of Ethel Brewer, are questions that should be resolved before a court of law orders appellant to give insurance proceeds payable on a policy in the name of the Estate to anybody else. But instead of joining the Estate in this litigation and developing the evidence on these issues, the parties have presented this case for summary adjudication with nothing in the record concerning any of them. The trial court improperly gave the imprimatur of legitimacy to their efforts by granting appellees' summary judgment motion, and now the result announced in the prevailing opinion compounds the error.

None of the aforementioned basic questions were raised by either party at the trial level or on this appeal. Of course, appellant has an interest in paying nothing to anybody, so it...