Morthland v. Lincoln Nat. Life Ins. Co.
| Decision Date | 09 June 1942 |
| Docket Number | 27699. |
| Citation | 42 N.E.2d 41,220 Ind. 692 |
| Parties | MORTHLAND v. LINCOLN NAT. LIFE INS. CO. |
| Court | Indiana Supreme Court |
[Copyrighted Material Omitted] [Copyrighted Material Omitted] [Copyrighted Material Omitted]
Appeal from Superior Court, Lake County; Harry L. Crumpacker, Special judge.
Earl B. Stroup, of Hammond, for appellant.
Gavit & Richardson, of Gary, for appellee.
In 1932 the Northern States Life Insurance Company, hereinafter referred to as the Northern States, was found to be insolvent and one John W. Morthland was appointed receiver therefor. With the approval of the insurance commissioners of the states of Indiana and Iowa and of the receivership court, the receiver entered into a reinsurance contract with the appellee Lincoln National Life Insurance Company, hereinafter referred to as the Lincoln.
By the terms of this contract a trustee was to be appointed by the court to act on behalf of all of the policyholders and beneficiaries of policies of the Northern States and the Lincoln was required to render an accounting annually to the trustee, the insurance commissioner and the receivership court, of all transactions pertaining to the assets and business of the Northern States.
The said Morthland was appointed and qualified as such trustee and as such filed exceptions to the 1937 annual report filed by the Lincoln, to which exceptions the Lincoln filed a reply. On a trial of the issues thus made the court found the facts specially and stated its conclusions of law. The court entered judgment approving said annual report and approving a lien increase of 35% as of December 31, 1937, on all Northern States policies in force December 24, 1938.
Appellant's motion for a new trial, asserting as grounds therefor that the decision of the court was not sustained by sufficient evidence and was contrary to law, was overruled and this appeal, prosecuted as a term time appeal from a final judgment, followed.
The appellee contends that the judgment approving the annual report was only an interlocutory order and must be appealed from as such. The judgment approved the annual report filed by the Lincoln for the year 1937 and a 35% increase of the lien established by the reinsurance contract. The increase of the lien resulted in a definite decrease in the value of the outstanding Northern States policies. On many such policies the increase of the lien entirely wiped out the equity and the policies were then terminated pursuant to the terms of the reinsurance contract. The fact that the amount of the lien might be later changed by a subsequent annual report did not prevent the order, approving the 1937 report and the increase of the lien, from being a final judgment from which an appeal would lie under the provisions of § 2-3201, Burns' 1933, § 471, Baldwin's 1934. The judgment was a final determination between all the parties that the amount of the lien as revealed and established by the 1937 report should govern in all transactions concerning Northern States policies from the effective date fixed by the judgment to the effective date fixed by a subsequent order, if any, approving a change in the amount of the lien to correspond to the then deficiency in Northern States assets. The judgment approving the report constituted a final judgment from which an appeal would lie. Hamrick, Trustee, v. Loring et al., 1896, 147 Ind. 229, 45 N.E. 107; Indiana National Bank of Indianapolis v. Danner, Rec., 1930, 204 Ind. 709, 170 N.E. 327.
The appellee also contends that the appellant's motion for a new trial was not properly filed, therefore raises no question, and that since the appeal was not taken within ninety days after the judgment, this court cannot consider the appeal on the merits.
The record includes a certificate of the clerk of the trial court which states that the attorneys for the appellant delivered the motion for a new trial to the clerk with specific instructions as to the record to be made thereon; that pursuant to said instructions the clerk placed his file mark on said motion, made and initialed an entry of the filing thereof in the court's bench docket, and also made an entry of the filing thereof in the Vacation Order Book; but that no entry of said filing was made in the entry docket. The appellee contends that the failure of the clerk to 'make a minute of the filing of such motion on the entry docket, showing the date of such filing and fixing his initials thereto,' pursuant to the provisions of § 2-2403, Burns' 1933, § 370, Baldwin's 1934, relating to the filing of a motion for a new trial after the adjournment of the term of court at which the decision was rendered, does not constitute a proper filing of the motion.
When a motion for a new trial is filed in the office of the clerk after the court is adjourned, the above statute makes it the duty of the clerk to make a minute of the filing in the entry docket, showing the date of the filing, and also to make a vacation order book entry showing such filing and the date thereof. These steps are for the purpose of furnishing evidence of the filing within the time and of calling the motion to the attention of the court. A failure of the clerk to properly record the evidence of the filing should not be permitted to deprive a party who has filed a timely and proper motion of his right to appeal. A paper is filed with the clerk when it is delivered to him for that purpose. In the instant case the record made was sufficient to furnish evidence of the filing and to call the motion to the attention of the court. The filing was sufficient. Gfroerer v. Gfroerer, 1910, 173 Ind. 424, 90 N.E. 757; Powers v. State, 1882, 87 Ind. 144, 148.
The appellant's brief first presents propositions relating to the action of the trial court in striking out the exceptions and objections to the 1937 report filed by Grace M. Donnell, a policyholder of the Northern States who filed said exceptions on behalf of herself and all other such policyholders. Grace M. Donnell did not appeal and the appellant has failed to show how he could have been harmed by this action of the court. One cannot secure the reversal of a judgment because of errors prejudicial to another party who has not appealed. In re Gilbert et al., 1924, 195 Ind. 278, 114 N.E. 551.
Appellant tendered for filing supplemental exceptions to the 1937 report by which he attempted to present questions concerning transactions which occurred subsequent to the period covered by the report and to enlarge on the exceptions already filed. The report was for the purpose of showing the condition of the Northern States business as of December 31, 1937, by showing the transactions occurring during that year and the assets and liabilities as of that date. The appellant agreed in writing as to the valuation of the assets as of that date and the report was made on the basis of that agreement. A sale of the assets made subsequent to that date, at a higher price than the agreed value, would be reflected in the next annual report but could not be pleaded and shown to change the agreed value as of the effective date of the report. At most, such a sale would only be evidence of the value of such assets. The statute provides that 'the court may, on motion, allow supplemental pleadings, showing facts which occurred after the former pleadings were filed.' Burns' 1933, § 2-1072, Baldwin's 1934, § 176. The statute makes permission to file such pleadings discretionary with the court, when such pleadings include facts which occurred after the filing of the original pleadings and which would be pertinent to the issues raised by the original pleadings. The supplemental exceptions tendered by the appellant failed to show such facts. The court did not abuse its discretion by refusing to permit the filing of the supplemental exceptions.
The exceptions filed to the 1937 report by the appellant, on February 16, 1939, made the following principal objections to said report:
1. That the reinsurance contract by its terms requires that any adjustment of the lien be made not later than April 1st, of each year on the basis of the facts shown by the annual report covering the preceding year; that the 1937 report was not filed until January 5, 1939, and attempted to increase the lien 35% on the policies in force December 24, 1938.
2. That while the amount of the aggregate lien was reduced in the year 1937, this reduction was not reflected in a decrease of the lien upon Northern States policies which were unrewritten; that the Lincoln has, in violation of paragraph 15 of the reinsurance contract, and fraudulently, attempted to rewrite most of the Northern States policies and has rewritten thousands of said policies; that by reason of the delay in making and filing the 1937 report and by reason of its fraud and breach of said contract the Lincoln is estopped to assert and obtain an increase of lien for the year 1937 and should: (a) Be required to assume any loss on the Northern States business for that year; (b) forfeit its rights to be paid for administration expenses incurred in handling policies rewritten by the Lincoln amounting to approximately $15,000; and (c) be required to return to the Northern States' fund $11,755.33 disbursed for renewal commissions on the rewriting of Northern States policies.
3. That the Lincoln in its 1937 report does not correctly account for interest pursuant to the reinsurance contract as amended in June, 1938.
4. That the Lincoln did not, in its 1937 report, account for a surplus of $20,421.32 shown by its 1936 report.
5. That the 1937 report contained no accounting for profits and losses but attempted to charge out as losses current items of unpaid expenses, such as accrued death losses and estimated...
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