Little v. Brown

• Decision Date: 16 May 1932
• Docket Number: Civil 3133
• Citation: 11 P.2d 610,40 Ariz. 206
• Parties: O. W. LITTLE, Appellant, v. EUGENE J. BROWN, Appellee
• Court: Arizona Supreme Court

11 P.2d 610

40 Ariz. 206

O. W. LITTLE, Appellant, v. EUGENE J. BROWN, Appellee

Civil No. 3133

Supreme Court of Arizona

May 16, 1932

APPEAL from a judgment of the Superior Court of the County of Mohave. D. A. Bridges, Judge. Affirmed.

For former opinion in same case, see 36 Ariz. 194, 283 P. 924.

Mr Louis L. Wallace and Mr. David P. Hatch, for Appellant.

Mr Phil Jacobson and Mr. Carl G. Krook, for Appellee.

OPINION

ROSS, J.

This is the second time this case has come to this court. On the previous appeal the question involved was the power of the court after the plaintiff had introduced his evidence, to direct an involuntary nonsuit, and we held that no such power existed. We also held that plaintiff had made out a prima facie case and for that reason it was error to dismiss him. We refused, although urged by appellant to do so, to enter judgment or to remand with directions to the trial court to enter judgment for plaintiff on his prima facie case. In the order remanding the case we said:

" . . The court's error was made at the instance of defendant, but we think the ends of justice demand that he be permitted to submit evidence in support of his defenses. The cause is remanded, therefore, with directions that a new trial be granted, on condition that defendant first pay the costs of this appeal; otherwise that the judgment be entered for plaintiff."

Upon the case being returned to the trial court, defendant Brown performed the condition upon which a new trial was granted by paying the costs of appeal, amounting to the sum of $579.45, and thereafter filed a supplemental answer alleging that W. E. Little was the real and actual party plaintiff in interest and that on or about February 15, 1930, he and defendant Brown settled and compromised the litigation by defendant Brown paying him $300. That thereafter the following instrument was filed in the superior court of Mohave county, the county in which the action of O. W. Little versus Eugene J. Brown was pending, to wit: To the Clerk of said Court:

"You will enter a dismissal of the above entitled action with prejudice.

"Los Angeles, Calif., March 5, 1930.

"[Signed] O. W. LITTLE, Plaintiff."

Otherwise the pleadings as they stood in the former trial, the substance of which is stated in our former opinion, found in 36 Ariz. 194, 283 P. 924, remain the same.

The trial court, without objection, proceeded to try the question raised by the supplemental answer, that is, as to whether the settlement and compromise therein pleaded was in fact effectual and binding upon the plaintiff O. W. Little, it having been effected by and through his assignor, W. E. Little, after assignment and after suit brought. Upon this issue the court found that W. E. Little was the real party in interest and that plaintiff knew he was negotiating a settlement and made no effort to prevent it, and he was therefore authorized to enter into a settlement, and ordered judgment in favor of the defendant.

The plaintiff, O. W. Little, has appealed and assigned so many reasons therefor that we will not undertake the labor of separately stating them, but will consider them in the several propositions hereinafter stated.

It is first claimed the judgment on the former appeal was one for a new trial of certain issues and that defendant had no right to amend his answer or to supplement it with a plea of settlement and compromise as was done, and that the court was without jurisdiction to hear or determine such issue. It is also contended that in entertaining the defendant's plea of compromise the court disregarded the law of the case as announced in the opinion on the former appeal.

Answering these contentions we will say we know of no rule of law that forbids parties to litigation compromising such litigation at any stage, even after judgment in favor of one of them. If such compromise is free from fraud and by competent parties it would be the duty of the court to recognize it and refuse to proceed with the trial of the controversy, even though the Supreme Court has directed it. This is so because the compromise and settlement makes the question involved a moot one.

However, we do not agree with plaintiff as to the effect of our former judgment. The order was for a new trial generally and not of any particular issue or isues. This, we understand, sent the case back to be tried de novo and as though it had never been tried before, with this limitation: That the trial must proceed in accordance with the principles of law as laid down in the first case. If the issues and facts are the same, the rules announced in our former opinion would control; but if the issues and facts are different, such opinion would not control. The rule is stated in Standard Accident Ins. Co. v. Allen, 38 Ariz. 173, 298 P. 406, as follows:

"The right to amend under the remand may be left open, or it may be foreclosed. If left open and new pleadings and new evidence are offered, necessarily what was decided upon different issues and facts would not be 'the law of the case' in a retrial."

Another reason why these two assignments are not good is that the issue of compromise was actually tried without any objection whatever from plaintiff. He filed no motion to strike the supplemental answer, did not demur to it, or in any way question the defendant's right to plead settlement when and as he did. It seemed to be agreed among counsel and the court that if the plea was established by competent evidence it would dispose of the case. Accordingly, without objection, the trial was confined to that issue. If the questions now raised were ever available to the plaintiff, we think he waived them by his conduct in proceeding to trial without objection.

The next assignments involve the right of an assignor of a chose in action, assigned for the purposes of collection, to ignore such assignment and the assignee and settle or compromise the debt with the debtor, and its effect upon the suit then pending by the assignee for its collection. Without reciting the evidence bearing on the assignments, it is to the following effect: W. E. Little, a resident of Los Angeles, had a claim for $20,000 against defendant Brown for 20,000 shares of stock in the Kaaba Mining & Milling Corporation, an Arizona corporation doing business in Mohave county. He assigned in writing his claim and demand for such $20,000 to his son O. W. Little for the purposes of collection only. The residence or business of O. W. Little in Arizona made it covenient for him to prosecute the claim.

It is insisted by plaintiff that he was, under the assignment, the legal owner and holder of the claim or demand; that only he had the right to compromise and settle it with the debtor and that the settlement with the debtor by the assignor, even though the latter was the sole beneficiary, was ineffectual and void. He cites many authorities to the effect that the debtor cannot defeat the action by an assignee by showing that the assignment was for the purposes of collection only, among them the case of Sroufe v. Soto Brothers & Co., 5 Ariz. 10, 43 P. 221. In that case the court, after stating, "The right of a party to maintain an action on an account which has been assigned to him for the purpose of collection, only, is the question presented by the record in this case," proceeded to hold that the assignee was the real party in interest and that, "Though it was in fact understood by the parties that the beneficial interests to pass by the assignments were limited, still the plaintiffs, as holders of the legal title of said accounts, could sue...