Pierson v. Allen, 51677

• Decision Date: 14 November 1966
• Docket Number: No. 1,No. 51677,51677,1
• Citation: 409 S.W.2d 127
• Parties: Louis Ernest PIERSON, Respondent, v. Marvin Hollis ALLEN, Appellant
• Court: Missouri Supreme Court

Page 127

409 S.W.2d 127

Louis Ernest PIERSON, Respondent, v. Marvin Hollis ALLEN, Appellant.

No. 51677.

Supreme Court of Missouri, Division No. 1.

Nov. 14, 1966.

Motion for Rehearing or to Transfer to Court En Banc Denied

Dec. 12, 1966.

Adolph K. Schwartz, St. Louis, for respondent.

Robert W. Wilson and Robert E. Keaney, Moser, Marsalek, Carpenter, Cleary & Jaeckel, St. Louis, for appellant.

HIGGINS, Commissioner.

Action by respondent for $16,000 damages for personal injuries; counterclaim by appellant for $16,128.01 damages for personal injuries and property damage, and appeal from dismissal of the counterclaim with prejudice.

Respondent's petition was filed on or about May 16, 1958; appellant's answer was filed June 19, 1958, and his counter-claim July 3, 1958; respondent's answer to counterclaim and reply to answer were filed July 14, 1958. Respondent amended his petition August 12, 1958, and appellant refiled his answer August 26, 1958. 'Stipulation For Dismissal Of Plaintiff's Cause of Action (Counterclaim Remains Pending),' executed by attorneys for the parties, was filed November 21, 1958, as follows:

'It is hereby stipulated and agreed, by and between plaintiff and defendant, that plaintiff's cause of action shall be dismissed with prejudice to any other or future action on account of the matters and things contained and set forth in plaintiff's petition, and that court costs relative to this dismissal shall be paid by defendant.

'It is further stipulated and agreed, by and between plaintiff and defendant, that defendant's counterclaim which is pending in this cause shall not be affected by the dismissal of plaintiff's cause of action, and that said counterclaim shall remain alive and active; and that the caption of said cause and the designation of parties shall be amended to show Marvin Hollis Allen as plaintiff, and Louis Ernest Pierson as defendant.'

Throughout all the foregoing, respondent was represented by the law offices of Limbaugh & Limbaugh, by either Rush H. Limbaugh or Stephen N. Limbaugh. Respondent's present counsel, Adolph K. Schwartz, entered his appearance in defense of the counterclaim on behalf of respondent and his insurer, MFA Insurance Company, December 16, 1958, and he filed an amended answer to appellant's counterclaim as of March 12, 1959, which pleaded estoppel as a result of compromise settlement as a further defense to the counterclaim which came on for trial March 17, 1959.

On the day of trial, March 17, 1959, appellant moved to redesignate himself as plaintiff and respondent as defendant in line with the stipulation which disposed of respondent's petition. Mr. Schwartz objected on the theory that neither respondent nor his insurer consented to the stipulation. A lengthy colloquy ensued as to the difficulties presented by respondent's motion and the cause was laid over until March 18, 1959, with the motion unresolved.

On March 18, 1959, respondent filed motions to set aside an order striking the defense of estoppel from his answer to the counterclaim, to strike the second paragraph of the stipulation for dismissal of plaintiff's petition, and to dismiss, or for judgment on, the counterclaim. These matters were taken up in chambers and respondent testified in support of them. He testified that he hired Rush Limbaugh of Cape Girardeau to file his suit; that he agreed to a settlement of his case for $9,500; that he and his wife signed a release and received their money. He said that he did not see the stipulation; that he did know he still had a lawsuit to defend; that he did not authorize Stephen N. Limbaugh to make it, and that 'they' did not ask his permission to let the counterclaim remain alive. On cross-examination he admitted that he authorized Mr. Limbaugh to file a petition for him without reading or signing it; that he did not know of his amended petition; that he never saw the counterclaim or the answer filed to it; that he placed no restrictions on his attorneys' actions; that he did not read the release but signed where his attorney told him to sign; that he notified his insurance company about the accident. 'At the time we signed the release, when he told us how much they were going to make this, he said that this man might come back with a counterclaim.' The release executed by appellant and his wife provided: 'It is understood and acknowledged that said payment is made in consequence of a claim for damages having been asserted by us, and any compromise thereof, and said payment is not to be construed as an admission of liability on the part of any party hereby released for the accidental injuries and damages above described and referred to.'

In order to procure testimony from Mr. Stephen N. Limbaugh the case was laid over until March 23, 1959, and it was continued from time to time thereafter until May 5, 1965, at which time Mr. Limbaugh testified that in the course of handling respondent's lawsuit he filed an answer to appellant's counterclaim, told respondent about the counterclaim and discussed it with him. 'I discussed with him the various facets of the litigation; that would include the claim and counterclaim, and I advised him as to what I thought would be the procedure he should follow, and as I recall it, he accepted my advice.' In negotiating the settlement he consulted respondent about leaving the counterclaim outstanding 'and it was agreeable with him to go ahead with it on that basis.' He identified the stipulation in evidence as the stipulation he executed on behalf of respondent for the settlement of respondent's claim leaving appellant's counterclaim outstanding. He was never employed by MFA in connection with the suit.

On June 21, 1965, the court entered an order dismissing respondent's counterclaim with prejudice; no reason was given.

Except for reversal of the parties' relation to each other, this case is akin to Portell v. Pevely Dairy Co., Mo., 388 S.W.2d 790, and is governed, as that case was, by the rule of Kirtley v. Irey, Mo., 375 S.W.2d 129, 134: "(A) liability insurer's settlement of a claim against the insured, made without the insured's consent or against his protests of nonliability, and not thereafter ratified by him, will not ordinarily bar an action by the insured against the person receiving the settlement, on a claim arising out of the same state of facts." Annotation 32 A.L.R.2d 937, 938. Myrtie Portell sued Pevely and one Bannon for damages arising from a collision between her automobile and Pevely's truck driven by Bannon, and Bannon counterclaimed for damages. Jury trial resulted in a verdict against plaintiff on her action and for Bannon on his counterclaim. While Mrs. Portell's appeal from the judgment in favor of Bannon on his counterclaim was pending, a stipulation, signed by attorneys for Portell and Bannon was filed for the dismissal of Bannon's counterclaim, which read: 'By consent of the parties, judgment for defendant Bannon on his counterclaim set aside and for naught held. All matters in controversy in regard to said counterclaim having been settled said...