Phoenix Savings Bank and Trust Co. v. Ellis, Civil 3827

• Decision Date: 29 June 1937
• Docket Number: Civil 3827
• Citation: 69 P.2d 796,50 Ariz. 116
• Parties: THE PHOENIX SAVINGS BANK AND TRUST COMPANY, a Corporation, Administrator of the Estate of ALTIEMOND MONTGOMERY WARD, Also Known as ARTHUR MONTGOMERY WARD, Also Known as AL MONTGOMERY WARD, Deceased, Appellant, v. PEGGY ELLIS and EUGENE G. ELLIS, Appellees
• Court: Arizona Supreme Court

69 P.2d 796

50 Ariz. 116

THE PHOENIX SAVINGS BANK AND TRUST COMPANY, a Corporation, Administrator of the Estate of ALTIEMOND MONTGOMERY WARD, Also Known as ARTHUR MONTGOMERY WARD, Also Known as AL MONTGOMERY WARD, Deceased, Appellant, v. PEGGY ELLIS and EUGENE G. ELLIS, Appellees

Civil No. 3827

Supreme Court of Arizona

June 29, 1937

APPEAL from an order of the Superior Court of the County of Maricopa. M. T. Phelps, Judge. Order reversed and cause remanded with instructions.

Miss Alice M. Birdsall, and Mr. Herman Lewkowitz, for Appellant.

Mr. E O. Phlegar, and Mr. Russell A. Johnson, for Appellees.

OPINION

LOCKWOOD, J.

This an appeal from an order of the superior court, to the effect that counts I, II, and III of defendant's amended counterclaim should be stricken from defendant's third amended answer and amended counterclaim, and denying the right to amend them.

The question involved in the appeal is one of law alone, and the facts necessary for its determination may be stated as follows. Altiemond Montgomery Ward, hereinafter called decedent, a resident of California, died intestate in that state on or about the 28th day of October, 1933, leaving a substantial estate in both California and Arizona. On the 30th day of March, 1934, letters of administration of the estate of decedent were issued by the superior court of Los Angeles County, California, to Mary C. Ward. Thereafter, and on the 9th of February, 1935, the superior court of Maricopa county issued letters of administration of said estate to the Phoenix Savings Bank & Trust Company, a corporation hereinafter called defendant. On November 7, 1935, Peggy Ellis, hereinafter called plaintiff, and Eugene G. Ellis commenced this action in the superior court of Maricopa county, alleging, in substance, that plaintiff had acted as practical nurse, housekeeper, and attendant for decedent in California during a period of twenty-three months, for which he agreed to pay her the reasonable value of such services amounting to a total sum of $1,725, and that on the 5th day of September, 1935, she had filed with the administrator a claim for such amount which the latter had failed either to approve or reject, and therefore she brought this suit. The defendant answered, admitting the presentation of the claim, but denying both specifically and generally all of the other allegations of the complaint regarding the services. It then set up a counterclaim containing some seven items, only three of which need be considered in the present action. These items were $1,150 for board of plaintiff and her children, and $153 for money expended by decedent at the request of plaintiff and for her benefit. From there on matters proceeded with various motions, demurrers, and amended pleadings of many natures until a third amended answer and counterclaim was filed on May 25, 1936. The only allegation of the counterclaim which we need consider is that contained in paragraph VI, which reads as follows:

"That on the 7th day of November, 1935, Mary C. Ward, acting as administratrix of the estate of said Altiemond Montgomery Ward, deceased, under the appointment made by the superior court of Los Angeles County, California, and also individually, for and in consideration of the prosecution of said claims for and on behalf of the estate of said decedent and the heirs at law of said estate by this defendant as administrator aforesaid, made to this defendant as such administrator an oral assignment of all her right, title and interest as administratrix of said estate under letters issued to her by the superior court of Los Angeles County, California; and also as an heir at law of said estate in and to all claims, demands and rights of action accruing against plaintiffs or either of them on account of the matters and things hereinabove set forth, and authorized and directed this defendant to prosecute the cause of action hereinabove set forth against these plaintiffs; that thereafter and in the early part of 1936, the exact date thereof being unknown to this defendant, said Mary C. Ward, acting individually and as administratrix aforesaid, by an instrument in writing, confirmed said oral assignment theretofore made by her; that thereafter and on the 24th day of April, 1936, said Mary C. Ward as administratrix aforesaid of the estate of said Altiemond Montgomery Ward, deceased, in the county of Los Angeles, state of California, made, executed and delivered to this defendant an assignment in writing confirming and ratifying said oral assignment theretofore made by her of the claim hereinabove set forth and described, and duly transferring all rights of action thereon; that thereafter and on the 18th day of May, 1936, an order was duly made and entered by the superior court of Los Angeles County, California, in proceedings pending therein, in the administration of the estate of said Altiemond Montgomery Ward, deceased ratifying and confirming the assignment of said claim theretofore made by said Mary C. Ward as administratrix aforesaid, and decreeing this defendant as administrator of the estate of Altiemond Montgomery Ward, deceased, in Maricopa County, Arizona to be entitled to the distribution of the claims so assigned;"

Plaintiff thereupon moved to strike the counterclaims, assigning the following reason:

"... that it affirmatively appears from the allegations of said counts, and each of them, that the said defendant was not the owner of the claims set forth in said counts, nor any of them; nor did said claims exist in favor of said defendant at the date of the institution of this suit."

The same point was raised by demurrer. The court thereupon made the following order:

"It is ordered by the court that the motion of plaintiffs to strike from defendant's third amended answer and amended counterclaim, Counts, I, II and III of defendant's said amended counterclaim is hereby granted, and said Counts, I, II and III of said amended counterclaim are hereby ordered stricken from defendant's third amended answer and amended counterclaim, and said defendant is denied the right to amend said Counts I, II and III thereof,"

which was the order from which this appeal was taken.

There is, in effect, but one question before us, and that is whether it appears on the face of the counterclaims that they were not claims of the class permitted by our statutes to be pleaded as counterclaims in this action. The situation is governed by section 3785, Revised Code of 1928, which reads as follows:

"Filing of counterclaim not admission; subject of counterclaim. The pleading of a counterclaim is not an admission of the cause of action alleged in the complaint. The counterclaim must be an existing one in favor of a defendant and against a plaintiff, between whom a several judgment might be had in the action, and must be: A cause of action arising out of the contract or transaction pleaded in the complaint, or connected with the subject of the action; or, in an action arising on a contract, another cause of action arising also on a contract, and existing when the...