Holibaugh v. Cox

• Decision Date: 12 March 1958
• Docket Number: No. 35128,35128
• Citation: 148 N.E.2d 677,167 Ohio St. 340
• Parties: , 4 O.O.2d 461 HOLIBAUGH et al., Appellees, v. COX, Appellant.
• Court: Ohio Supreme Court

Page 340

167 Ohio St. 340

148 N.E.2d 677, 4 O.O.2d 461

HOLIBAUGH et al., Appellees, v. COX, Appellant.

No. 35128.

Supreme Court of Ohio.

March 12, 1958.

Syllabus by the Court

1. Where an insured is injured by a tort-feasor, is reimbursed for a part of his damages by the insurer and, accordingly, assigns a part of his interest in the claim against the tort-feasor to such insurer, the insured may timely commence an action against the tort-feasor for the full amount of damages resulting from the tort and thereby effect a compliance with the statute of limitations pertaining to such indivisible chose in action as to parties united in interest with him, but the insurer must be joined as a party united in interest at any stage of the action, where he or the plaintiff so moves or where such issue is raised by the defendant tort-feasor. Paragraph two of the syllabus of Cleveland Paint & Color Co. v. Bauer Mfg. Co., 155 Ohio St. 17, 97 N.E.2d 545, paragraph one of the syllabus of National Retailers Mutual Ins. Co. v. Gross, 142 Ohio St. 132, 50 N.E.2d 258, and paragraph four of the syllabus of Lake Erie & Western Rd. Co. v. Falk, 62 Ohio St. 297, 56 N.E. 1020, approved and followed.

2. Where the total damages to an insured, resulting from the commission of a tort, exceed the amount for which he has been reimbursed by his insurer, such insured may recover such excess of loss from the tort-feasor. Newcomb v. Cincinnati Ins. Co., 22 Ohio St. 382, approved and followed.

This action was commenced on June 20, 1950, in the Court of Common Pleas of Stark County, by Margaret H. Holibaugh, a plaintiff and appellee herein, hereinafter called plaintiff, to recover from Clarence S. Cox, defendant and appellant herein, the full amount of damages alleged to have been suffered by her as the result of a collision of her automobile with that of defendant on July 18, 1948.

The cause came on for hearing on May 23, 1955, and at the beginning of the trial the plaintiff, upon a motion sustained by the court over the objection of the defendant, was permitted to amend her petition by adding to the caption thereof, after her name, the words, 'and Newark Fire Insurance Company,' and to add to her amended petition the following language 'Plaintiff says that the Newark Fire Insurance Company is subrogated to her interest in the amount of $349.26 by virtue of an insurance contract with said company.'

Defendant's objections to the addition of the insurance company as a party plaintiff were based upon his contentions that the company was barred from asserting its claim by the statute of limitations, and that it was guilty of laches; and he was allowed by the court to incorporate these objections into his answer, by amendment thereof.

The prayer of the petition is for $967.86, and the amount paid the plaintiff by the insurance company is $349.26. During the trial the court found that as a matter of law plaintiff's claim for loss of use of her automobile was not sustained by the evidence she presented and directed the jury to disregard such claim, which is in the amount of $150. The jury returned a verdict for plaintiff in the amount of $650, upon which judgment was rendered by the trial court.

The judgment was affirmed by the Court of Appeals for Stark County.

The cause is before this court pursuant to the allowance of defendant's motion to certify the record.

Day, Cope, Ketterer, Raley & Wright, Canton, for appellant.

Carson, Vogelgesang & Sheehan, Canton, for appellees.

MATTHIAS, Judge.

Defendant's assigned errors raise two issues for our consideration and determination:

I. Whether a subrogee insurer is barred by the two-year statute of limitations from joining in an action against a tort-feasor, where the insured commenced the action before the expiration of the two-year period for the full amount of the loss, including that for which he was reimbursed by the insurer.

II. Whether the amount of the verdict is excessive as a matter of law.

In order to determine the first issue, we must initially consider whether the assignor of a part of a tort claim to an assignee (such assignee being referred to herein as partial assignee) by virtue of a prior contract of insurance, retains the right and ability to maintain an action in his own name for the full amount of the damages resulting from the tort, or whether by such partial assignment the assignor foregoes the right to recover, in his own name, from the tort-feasor more than the full amount of damages less the amount of the partial assignment.

Defendant relies heavily upon the case of Cleveland Paint & Color Co. v. Bauer Mfg. Co., 155 Ohio St. 17, 97 N.E.2d 545, to support his argument that the insurance company herein is a party so united in interest with the insured that, by not joining with her as a party plaintiff in a suit against the tort-feasor for the full amount of damages sustained as a result of the tort, before the expiration of the two-year period limiting the time in which an action must be commenced to recover damages for property injured or destroyed by negligence, it forfeited its right to recover the amount to which it had been subrogated. As a corollary to that proposition, the defendant also contends that the insured in the instant case can recover, if anything, at least no more than the $50 which she was obligated to pay under the terms of the insurance contract, and at most no more than the full amount of her damages less whatever amount she accepted from the insurance company in settlement of her claim under the insurance contract.

With respect to the instant question, however, the Bauer case is authority merely for the principle that, where an insured is in fact partially reimbursed, by virtue of a contract of insurance, for a loss suffered by the negligence of another, and where such insured, pursuant to such reimbursement under the contract, assigns a part of his claim for damages to the insurer, the insurer is a party united in interest with the insured in an action by the insured against the tort-feasor and must be joined as such party upon the raising of the issue by the defendant tort-feasor. In that case, the plaintiff (insured) elected not to plead further, upon the overruling of its demurrer to defendant's objection that it was not the real party in interest, and no attempt was made by either the plaintiff or the defendant to have the insurance company joined as a party to the action. Neither the possibility of joinder nor the statute of limitations was considered or discussed in the opinion in that case.

A case which is highly significant in connection with this problem is National Retailers Mutual Ins. Co. v. Gross, 142 Ohio St. 132, 50 N.E.2d 258, 259. In that case, the insured assigned to the insurance company that part of his claim against the tort-feasor in excess of $50. The insurance company then timely brought an action against the tort-feasor to recover the amount it had paid its insured, and, more than two years after the alleged tort had occurred, the defendant moved to have the insured joined as a party to the action and to be allowed to file a cross-petition against such new party.

In the complete sustaining of the defendant's position, Chief Justice Weygandt, in the course of his opinion, stated:

'The entire injury suffered by an individual as the result of a tortious act constitutes an indivisible chose in action. According to the petition Rothen retained an interest in the chose in action to the extent of $50, and the remainder was assigned to the plaintiff company. They became joint owners of the indivisible chose in action. Their unity of interest was such as to make it proper--even necessary, according to many authorities--for both to be included as parties, thereby avoiding a splitting of the cause of action and the harassing of the defendant tort-feasor by more than one suit.'

The first paragraph of the syllabus of that case reads as follows:

'In an action by the assignee of part of a tort claim against a tort-feasor the latter may have the assignor of the claim made a party to the action.'

We presume that, in all equity, this principle means also that the joined assignor can set up any claim over and above the partial assignment which he may have against the tort-feasor, since the insurer can recover, of course, no more than the amount to which he was subrogated.

The cases noted above, as well as most of the cases concerning the subject of joinder of assignors and assignees of tort claims, deal with the question of whether such an assignor or assignee may be compelled to join as a party to the action, rather than whether such party may be refused permission to join in a timely commenced suit, after the statute of limitations has run; and this particular question has not appeared in decisions of this court prior hereto.

Section 2307.18, Revised Code (Section 11254, General Code), provides that 'all persons having an interest in the subject of an action, and in obtaining the relief demanded, may be joined as plaintiffs,' and Section 2307.20 (Section 11256) provides that 'parties who are united in interest must be joined as plaintiffs or defendants.'

We found in the Gross case, supra, 142 Ohio St. 132, 50 N.E.2d 258, that an assignor and a partial assignee of a tort claim are parties united in interest, and that, upon suit by the partial assignee alone, for the amount of the assignment, the assignor must be joined upon motion of the defendant tort-feasor. In the Bauer case, supra, 155 Ohio St. 17, 97 N.E.2d 545, we found that an assignor and a partial assignee of a tort claim are parties united in interest, and that, upon suit by the assignor alone, for the full amount of damages, there is a defect of parties plaintiff which will result in the failure of the entire action if, upon attention being called thereto, such defect is not remedied. These findings do not, however, solve the problem of whether the...