Renner v. Progressive Life Insurance Co.

• Decision Date: 25 January 1937
• Docket Number: 4-4493
• Citation: 101 S.W.2d 426,193 Ark. 504
• Parties: RENNER v. PROGRESSIVE LIFE INSURANCE COMPANY
• Court: Arkansas Supreme Court

101 S.W.2d 426

193 Ark. 504

RENNER v. PROGRESSIVE LIFE INSURANCE COMPANY

4-4493

Supreme Court of Arkansas

January 25, 1937

Appeal from Benton Circuit Court; John S. Combs, Judge; reversed.

Judgment reversed and cause remanded.

John W Nance, for appellant.

E. M Arnold and Duty & Duty, for appellees.

BUTLER J. MCHANEY, J., dissents.

OPINION

BUTLER, J.

This appeal is from an order of the Benton circuit court striking from the files appellant's amended complaint and the second appeal prosecuted in this action. The first was from a judgment of the trial court sustaining in part a demurrer to the complaint and a motion to dismiss. This court dismissed the appeal for the reason that it was prematurely taken. Renner v. Progressive Life Ins. Co., 191 Ark. 836, 88 S.W.2d 57. The history of this litigation is stated in that opinion, reference to which is hereby made. The order appealed from, considered by the court in the case, supra, recites that the demurrer to plaintiff's complaint was sustained and "that defendant's motion to dismiss the complaint is sustained as to that part of same which seeks to recover balance due on the contract sued upon, and leave is granted to the plaintiff to amend that part of his complaint which seeks recovery for wrongful conversion of the property." Our opinion dismissing appellant's appeal was rendered on December 2, 1935. Within apt time the mandate of this court was filed in the court below and also an amended complaint to which was attached the contract and escrow agreements which were the basis of the action originally brought.

Summarized, the material allegations may be thus stated: Renner, the appellant, and one, J. F. Catlett, were the owners of the capital stock of the Springfield Life Insurance Company of Springfield, Missouri, a corporation organized and transacting business as a legal reserve life insurance corporation under the laws of the state of Missouri, maintaining its principal office and place of business in the city of Springfield in that state. The corporation had a paid-up capital stock of $ 50,000, represented by one thousand shares of which, on the 23d day of May, 1930, appellant Renner was the owner of 504 shares and R. W. Catlett the owner of 496 shares. One hundred and twenty-five shares of appellant's stock were held in escrow by a bank in Springdale, Arkansas, to secure the balance of purchase price of same due the estate of C. G. Dodson, deceased, and one hundred and twenty-five shares were held in escrow by a trust company of Springfield, Missouri, to secure payment of part of the purchase price in the sum of $ 27,500 due to one Keltner. It was alleged that, on the date above named, the Springfield Life Insurance Company was solvent, having a large amount of insurance contracts in force, with a legal reserve maintained as required by law, to secure which there was on deposit with the Superintendent of Insurance of the state of Missouri securities of the value of $ 45,000. There was cash on hand in the sum of $ 50,000 and office equipment and other assets of the fair market value of $ 10,000, and the shares of the insurance company had a fair market value of $ 200 per share. It was further alleged that the appellee, Progressive Life Insurance Company, acting by and through J. W. Walker and J. E. Felker, proposed to purchase the capital stock of the Springfield Life Insurance Company owned by Renner and Catlett and promised them that the Springfield Life Insurance Company should be maintained as a going concern in the city of Springfield until the Progressive Life Insurance Company had fully performed its contract for the purchase of the shares of capital stock; that on said date a contract of sale was entered into between the appellant and Catlett on the one hand and the Progressive Life Insurance Company on the other, whereby it was agreed that the Progressive Life should purchase the capital stock of the Springfield Life owned by Renner and Catlett and that the appellant Renner should be paid $ 10,000 in cash and the Dodson estate and Keltner the balance of the purchase due by Renner; that in addition, appellant Renner should be paid a certain sum in deferred monthly payments of $ 2,000 each until fully paid. It was further alleged that article VII of the contract provided that in default of deferred payments the Progressive Life was to forfeit all payments previously made as liquidated damages for breach of contract, and also to forfeit all further rights and benefits thereunder; that contemporaneous with the execution of the contract of sale, an escrow agreement was executed by which the Southern Missouri Trust Company was named as the depository and the shares of stock of the Springfield Life Insurance Company deposited with it, 246 shares being deposited by appellant Renner and 246 by R. W. Catlett. The deferred payments were to be made to the depository for the benefit of Catlett and Renner and upon payment of the entire purchase price the shares were to be delivered by the depository to the Progressive Life Insurance Company. It was further alleged that by the terms of the contract and escrow agreement, if default of deferred payments was made for a period of not less than ninety days the depository was directed to restore to Renner and Catlett their respective shares of stock and that all payments which had been made by the Progressive Life Insurance Company should be retained by Renner and Catlett as liquidated damages.

It was further alleged that after the execution of the contract and the payment of the $ 10,000 in cash to Renner the Progressive Life Ins. Co. took possession of all of the assets of the Springfield Life Ins. Company, paid certain of the deferred monthly payments due Renner, and a part of the sums due Keltner and Dodson estate, managed and controlled its property and business affairs, and continued to operate said company as a going concern until November 9, 1931, at which time appellees, for the purpose of defrauding appellant, repudiated the contract to pay appellant the sums due him, balance purchase price of his shares of stock, and without his knowledge or consent converted all of the assets and business of the Springfield Life to their own use, transferred the policy contracts issued by the Springfield Life to the Progressive Life and ceased to carry on the life insurance business of said Springfield Life thereby rendering its shares of stock valueless.

The appellees filed a plea to the amended complaint designated "Motion to strike amended complaint." In that motion a history of the case was recited and the order made by the trial court from which the appeal in Renner v. Progressive Life Ins. Co., supra, was considered. It was then alleged that after the granting by the court of permission to amend, the plaintiff, by prosecuting an appeal to the Supreme Court, waived his right to amend and that his attempt now to do so--more than eleven months after permission was granted--is unreasonable in that no application for leave to amend has been made and no showing made as to why the amended complaint was not filed within a reasonable time after the term of the court in which permission was granted. It was further alleged that the purported amended complaint contained no new or different facts from those contained in the former complaint. There were other allegations relating to proceedings had prior to the order of the court made March 9, 1935, from which the appeal was taken in the case of Renner v. Progressive Life Insurance Co., supra. We do not set out these allegations as they have no bearing on the present question.

On March 28, 1936, the court below made the order involved in the present appeal, which is as follows: "On this 28th day of March, 1936, the same being a day of the regular March, 1936, Term of this court, comes on for hearing the motion of the defendants in the above entitled cause to strike the amended complaint of the plaintiff herein filed on the 2d day of March, 1936, and after...