Johnson v. Staple Cotton Co-Op. Ass'n

• Citation: 107 So. 2,142 Miss. 312
• Decision Date: 04 January 1926
• Docket Number: 25111
• Parties: JOHNSON v. STAPLE COTTON CO-OP. ASS'N et al. [*]
• Court: Mississippi Supreme Court

107 So. 2

142 Miss. 312

JOHNSON v. STAPLE COTTON CO-OP. ASS'N et al. ^[*]

No. 25111

Supreme Court of Mississippi

January 4, 1926

Division A

Suggestion of Error Overruled Feb. 15, 1926.

APPEAL from chancery court of Leflore county, HON. C. L. LOMAX Chancellor.

Suit by J. N. Johnson against the Staple Cotton Cooperative Association and another. Demurrer to bill sustained, and plaintiff appeals. Reversed and remanded.

Cause reversed and remanded.

Wells Stevens & Jones and Forrest G. Cooper, for appellant.

The subject-matter of this suit is the value of eighty-six bales of long staple cotton destroyed by fire. The cotton had been grown by the complainant, J. N. Johnson, under contract to be sold and delivered to the Staple Cotton Co-operative Association. Under the terms of the marketing agreement, made an exhibit to the bill, the cotton at all times was association cotton. From the moment it was planted in the fields until actual delivery should be made to the association, the cotton was its property. Brown v. Staple Cotton Ass'n, 132 Miss. 859, 96 So. 849.

The next important consideration is the allegation of the bill of complaint that the association insured this cotton not only for the benefit of the association itself but for the benefit of the grower members. A true copy of the policy of insurance is attached to the bill and speaks for itself. The policy is a so-called "open" policy. It attaches to cotton in gins and before it is even baled. It attaches to cotton located in gin yards. It attaches to cotton on gin platforms adjacent to gins. The bill shows, and the demurrer admits that the cotton here in question was ginned by him at his own ginnery, and placed on the platform in bales, and, therefore, expressly and beyond doubt, comes within the terms of the policy.

The bill is not multifarious. The best answer to the argument that the bill is multifarious or that disconnected claims or equities are sued for against different defendants, is the splendid brief of Gwin & Mounger in Jones v. Jones, 99 Miss. 600, 55 So. 361. In the joint brief on file by Gwin & Mounger and Judge Tim E. Cooper, 99 Miss. at 606, will be found collated the following authorities, which are directly applicable to the case at bar: Garrett v. Miss. & Ala. R. R. Co., Freeman's Ch. Rep. 70; Martin v. Pleasants, S. & M. Ch. Rep. 17; Wright v. Sheldon, S. & M. Ch. Rep. 339; Nevitt v. Gillespie, 1 How. 108; Delafield v. Anderson, 7 S. & M. 630; Butler v. Spann, 27 Miss. 234; Snodgrass v. Andrews, 30 Miss. 472; Forniquet v. Forstall, 34 Miss. 96; Thomas v. Thomas, 45 Miss. 263; McGowan v. McGowan, 48 Miss. 453; Jones v. Foster, 50 Miss. 52; Waller v. Shannon, 53 Miss. 500; Taylor v. Smith, 54 Miss. 84; Bishop v. Rosenbaum, 58 Miss. 84; State v. Brown, 58 Miss. 835; Barry v. Barry, 64 Miss. 712; Gardie v. Bulger, 66 Miss. 577; Georgia P. Ry. Co. v. Brooks, 66 Miss. 583; Henry v. Henderson, 79 Miss. 454; Mosely v. Larson, 86 Miss. 288; Thames v. Mangum, 87 Miss. 575; Columbus Ins. & Banking Co. v. Humphreys, 58 Miss. 258; Robert v. Starke, 47 Miss. 263; Darcey v. Lake, 46 Miss. 109. See also 21 C. J., p. 415; Neylans v. Burge, 14 S. & M. 201; 1 Pomeroy (4th Ed.), par. 113; Middleton v. Howell, 127 Miss. 880; Roberts v. Burwell, 117 Miss. 451, 78 So. 357. The last case holds that if two or more complainants assert interests which have a common origin, or radiate from the same center, or have a common connecting link, then equity may retain jurisdiction even though the court would be compelled to write separate decrees in favor of the several complaining parties; and by the same token under the same general rules of equity, if the defendants have interests, or any kind of liability which radiates from the same center or has a common connecting link, or if they are at all interested in the subject-matter of the suit, then equity has jurisdiction to adjudicate the liabilities of the defendants, although it requires the rendition of separable judgments; and it makes no difference in equity whether the parties interested in the same subject-matter appear as complainants or defendants.

So we say in the case at bar that the defendant, the Cotton Association, could have joined with the complainant Johnson in asserting liability against the Globe & Rutgers Fire Insurance Company for the one value of the cotton involved in this suit. The court should not overlook the fact that the bill in this case prays for a discovery, and discovery alone is one of the legal grounds of equity jurisdiction. If the association has received anything from the fire insurance company for the cotton destroyed by fire, then Mr. Johnson has an equitable interest in these proceeds, and should be reimbursed. Furthermore, if the insurance has been paid to the association, this is an important inquiry and factor in determining the liability of the insurance company, for it cannot be successfully denied that if the insurance company has paid the loss either to the association or to Mr. Johnson, its liability is at an end. The bill alleges that the complainant has no knowledge and cannot obtain knowledge on this point except by discovery.

Again, if the association is liable to Johnson for this cotton regardless of whether it carried insurance or not, then it has a right to pay Johnson for his cotton and keep the insurance money in its own treasury for the benefit of all grower members and to recoup the loss sustained by the fires. In other words, Johnson is entitled to but one recovery and the defendants are liable for but one payment. It is a three-cornered controversy, therefore, in which every party to this suit is vitally interested, and beyond question equity has jurisdiction to adjudicate the respective claims and interests. It makes no difference whether we regard this as a suit for insurance money or a suit for the value of the cotton, it is all a suit for the same amount of money--call it what you will. Petree v. Lansing, 66 Barb. (N. Y.) 357; McIlvoy v. Alsop, 45 Miss. 365; Berry v. Bacon, 28 Miss. 318; Foster v. Jones, 19 So. 893; Comstock v. Rayford, 1 S. & M. 423, 40 Am. Dec. 102; Freeman v. Guyon, 11 S. &. M. 69; Richardson v. Brooks, 52 Miss. 123; 5 Pomeroy, par. 2314; 21 C. J. 315; Fidelity & Deposit Co. v. Wilkinson County, 106 Miss. 654; Wright v. Lauderdale County, 71 Miss. 800.

Applying the principle reflected by the foregoing authorities, we submit that all the parties here are interested in the one controversy as to whether the complainant is entitled to discovery and whether he is entitled to the insurance money, and if there is one common ground or issue, then the parties are properly joined, even though the interests of the defendant are separate and distinct.

The relationship of the association to every grower member. This relationship is contractual. We contend, first, that this cotton was bought outright by the association; and when it was grown, ginned, baled and put upon the gin platform ready for actual shipment, it was a constructive delivery which makes the cotton the property of the association. Under the allegations of the bill, the association took charge of the cotton that was salvaged; or, in other words, the association has treated this cotton as belonging to the association, first, by having samples of the cotton submitted after the fire and the loss investigated; second, by taking charge of the bales that were damaged and disposing of them as association cotton. The association, therefore, is estopped to deny that the cotton was not actually delivered. In the third place, the association had insured this cotton for its own benefit and is protected by the insurance, and should be held to the utmost good faith. Certainly the association is either a purchaser or a trustee or agent coupled with an interest. Oregon Growers' Co-operative Ass'n v. Lentz, 212 P. 811; Ex parte Baldwyn County v. Producers' Corp., 203 Ala. 345, 83 So. 69; Hood River Orchard Co. v. Stone, 97 Ore. 168, 191 P. 662; Phez Co. v. Salem Fruit Union, 201 P. 222, 25 A. L. R. 1090; 21 R. C. L. 823; 3 R. C. L. Supp. 1193.

Where the complainant has a right to discovery, equity has original jurisdiction and in doing so will administer full relief although purely legal questions may be involved. Woods v. Riley, 72 Miss. 73; 1 Pomeroy, Eq. Jurisprudence (4 Ed.), p. 190, et seq.; Millsaps v. Pfeiffer, 44 Miss. 805; Buckner v. Ferguson, 44 Miss. 667; Lumber Yard v. Railroad Co., 96 Miss. 116, 50 So. 445, Ann. Cas. 1912 A 801; Bomer Bros. v. Warren County, 103 Miss. 343.

The right of beneficiary under an insurance policy to recover by suit in his own name although not directly a party to the contract of insurance. The policy contract on which this suit is based is written by the Globe & Rutgers Fire Insurance Company and indemnifies the Staple Cotton Cooperative Association and legal representatives. The policy recites that it covers cotton of the assured association and its members. 14 R. C. L. 1366; Bradley v. Brown, 78 Neb. 836, 13 L. R. A. (N. S.) 152. The case at bar comes clearly within the rule showing that the policy sued on covers the cotton owned by the Staple Cotton Association and its members, thereby putting the insurance company on notice that others besides the association were interested in this cotton and thus this suit is rightfully brought by Mr. Johnson, who was at that time one of the members of the association and clearly within the policy.

In Joyce on the Law of Insurance, section 3610, the general rule is that action upon policies of insurance is generally brought in the name of the assured, unless others are also named in the policy as parties intended to be insured, citing Ward v. Wood, 13 Mass. 539. See also Ins. Co. of North America v. Forcheimer, 5...