John A. Boyd Motor Company v. Claffey

• Decision Date: 19 February 1929
• Docket Number: 13,253
• Parties: JOHN A. BOYD MOTOR COMPANY v. CLAFFEY
• Court: Indiana Appellate Court

165 N.E. 255

94 Ind.App. 492

JOHN A. BOYD MOTOR COMPANY v. CLAFFEY

No. 13,253

Court of Appeals of Indiana

February 19, 1929

Rehearing denied July 5, 1929. Transfer denied June 10, 1932.

From Marion Municipal Court (5,533) ; Asa J. Smith, Judge Pro Tempore.

Action by John W. Claffey against the John A. Boyd Motor Company. From a judgment for plaintiff, the defendant appealed.

Reversed.

James W. Noel, Hubert Hickam, Alan W. Boyd and Robert D. Armstrong for appellant.

Fae W Patrick, Bachelder & Bachelder, Fenton, Steers, Beasley & Klee and James C. Jay, for appellee.

OPINION

NEAL, J.

The appellee, in his complaint against appellant, in substance alleges: That the appellant was a corporation, engaged in the general business of selling, buying and repairing automobiles; that appellee was the owner of a Buick touring car and that on July 8, 1927, appellee delivered his car to appellant for the purpose of having it repaired; that the appellant accepted and received said car and promised to re-deliver the same on or about July 10, 1927; that appellant failed to use proper care to protect said automobile while in its possession in that said car was stolen from appellant's garage about July 10, 1927, and one day thereafter was found on a public road in Indiana in a damaged and wrecked condition; that it was necessary to repair the car and the cost of repair was $ 219.15; that appellee lost the use of his car for 30 days and that a reasonable compensation for the loss of the use of his automobile was $ 60; that the "repair of said damage was made necessary by reason of the carelessness and negligence on the part of defendant (appellant) to properly look after, protect and care for said automobile while in its possession."

Appellant by his amended second paragraph of answer alleges that prior to July 10, 1927, the American Auto Indemnity Association, an organization of persons, firms and individuals doing business in the State of Indiana, with its principal office in the city of Indianapolis, as a reciprocal insurance association had issued its policy of insurance to appellee, whereby said association and the various subscribers thereof undertook and agreed to insure and indemnify appellee against all loss or damage of every kind and character which might arise by reason of the theft of the automobile described in the complaint; that said policy of insurance further contained a provision whereby appellee agreed that said association should be subrogated, under the terms of said policy, upon payment of any loss or damage to said automobile occurring by reason of theft, to any and all causes of action of any description appellee might have as against any third person growing out of or in any manner connected with or arising by reason of the theft of said automobile; that said policy further provided that, upon payment of such loss or damage to appellee occurring by reason of the theft of said automobile, appellee would assign to said association and members thereof any and all claims or causes of action he might have as against any third person growing out of or connected with or arising from the theft of said automobile; that appellant did not have in its possession a copy of said policy of insurance and was, therefore, unable to attach a copy thereof as an exhibit, but that appellee had in his possession a copy thereof and that the terms and conditions thereof were fully and completely known to him; that said automobile was left with appellant for repair, as alleged in the complaint, but was stolen by third persons unknown to appellant prior to its re-delivery to appellee; that said loss and all the items thereof described in the complaint were covered by said policy of insurance and that said association had fully paid appellee all the items of loss alleged in the complaint; that appellee, pursuant to the provisions of his policy and in consideration of said payments, thereafter, and before the commencement of this action, assigned to said association and the subscribers thereof all causes of action appellee then had or asserted against any third persons arising out of or connected with the said theft, including the cause of action sued upon against appellant, and that said association had been subrogated to any and all rights that appellee had ever had as against appellant by reason of the matters and things alleged in the complaint; that said association and the subscribers thereof were the only owners entitled to the proceeds of any judgment which might be rendered in the action and that appellee was not entitled to any of the proceeds of any judgment so rendered and had no interest therein; that by reason of the terms appellee was not the real party in interest in the cause and could not maintain this action against appellant.

The appellee's demurrer to said answer was sustained. Appellant refused to plead further and the court rendered judgment in favor of appellee in the sum of $ 220.15 and costs. The error assigned is the sustaining of appellee's demurrer to appellant's amended second paragraph of answer.

It is provided by § 258 Burns 1926, that every action must be prosecuted in the name of the real party in interest; with certain exceptions not material to this case.

The question of the right of a plaintiff to maintain an action as the real party in interest must be raised by a special answer, unless the complaint on its face discloses that the plaintiff is not the real party in interest, when it may be raised by demurrer. Such answer, if the facts are sufficiently alleged and are true, is in bar of the action.

Felton v. Smith (1882), 84 Ind. 485;

Board, etc., v. Jameson (1882), 86 Ind. 154;

Curtis v. Gooding (1884), 99 Ind. 45, 52;

Morningstar v. Cunningham (1887), 110 Ind. 328, 11 N.E. 593, 59 Am. Rep. 211;

State v. Ruhlman (1887), 111 Ind. 17, 11 N.E. 793;

Bostwick v. Bryant (1888), 113 Ind. 448, 16 N.E. 378;

Bowser v. Mattler (1894), 137 Ind. 649, 35 N.E. 701, 36 N.E. 714.

What constitutes the real party in interest under our code? Under the decisions of our state, as appears by a long line of cases, the party entitled to the fruits of the action has been held to be the real party in interest, unless the party comes within an exception provided for by the statutes.

Swift v. Ellsworth (1856), 10 Ind. 205, 71 Am. Dec. 316;

Mewherter v. Price (1858), 11 Ind. 199;

Wilson v. Clark (1858), 11 Ind. 385;

Gillispie v. Ft. Wayne, etc., R. Co. (1859), 12 Ind. 398;

Treadway v. Cobb (1862), 18 Ind. 36;

Kelley v. Love, Exr. (1871), 35 Ind. 106;

Deuel v. Newlin (1891), 131 Ind. 40, 30 N.E. 795;

Sinker v. Floyd (1885), 104 Ind. 291, 4 N.E. 10;

Bostwick v. Bryant, supra;

Tyler v. Davis (1905), 37 Ind.App. 557, 75 N.E. 3;

Roane Iron Co. v. Bell-Armstead Mfg. Co. (1900), 24 Ind.App. 250, 56 N.E. 696;

In re Burk (1918), 66 Ind.App. 435, 118 N.E. 540.

It has also been held that, unless otherwise provided for by our code, the bare legal title is not sufficient to constitute a plaintiff as the real party in interest.

Bostwick v. Bryant, supra;

Deuel v. Newlin, supra;

Board, etc., v. Jameson, supra.

Under the provisions of the civil code, where a claim has been assigned prior to the commencement of the action, the assignee is the only proper plaintiff and the action cannot be maintained by the assignor.

Louisville, etc., R. Co. v. Goodbar (1882), 88 Ind. 213, 215;

Reynolds v. Louisville, etc., R. Co. (1875), 143 Ind. 579, 40 N.E. 410.

The answer alleged that the appellee, under and pursuant to the terms of the insurance policy, would assign to the American Auto Indemnity Association and the members thereof, any and all claims or causes of action he might have as against any third person growing out of or connected with or arising from the theft of the appellee's automobile upon the payment to appellee the amount of such loss; also that such loss was paid to appellee and said assignment was made pursuant to the provisions of the policy. The answer does not allege that the assignment was made in writing and no copy of such assignment is found in the answer or made a part of the same as an exhibit. Appellee's contention that we should regard the assignment as in parol is probably correct. It has been repeatedly held, however, that an assignment may be made by parol.

Slaughter, Assignee, v. Foust (1837), 4 Blackf. (Ind.) 379;

Groves v. Ruby (1865), 24 Ind. 418;

Fordyce v. Nelson (1883), 91 Ind. 447.

The appellee agreed to make an assignment of all causes of action, etc., and payment to him by the insurer of the whole of his loss had the effect of creating an equitable assignment of the insured cause of action against the person causing the loss, for equity regards that as done which the parties have agreed should be done.

The cause of action was assignable. In the case of Employers' Fire Ins. Co. v. Consolidated Garage and Sales Co. (1927), 85 Ind.App. 674, 155 N.E. 533, this court, by Judge McMahan, said: "Any and all rights of action possessed by Martindale against the sales company or its employees arising out of or in any way connected with the act of the employee... was assignable, and was assigned to appellant, and this included the right to sue for the damage occasioned by the wrecking of the car."

The answer also alleges that the policy contained a provision whereby appellee agreed that said association should be subrogated upon the payment of any loss or damage to said automobile occurring by reason of the theft, to any and all causes of action of any description appellee might have as against any third person growing out of or in any manner connected with or arising by reason of the theft of the automobile. The agreement of the insured...