Royal Ins. Co. v. Stewart, 23903.

• Decision Date: 10 February 1921
• Docket Number: No. 23903.,23903.
• Parties: ROYAL INSURANCE CO., LIMITED, OF LIVERPOOL, v. STEWART.
• Court: Indiana Supreme Court

190 Ind. 444

129 N.E. 853

ROYAL INSURANCE CO., LIMITED, OF LIVERPOOL,

v.STEWART.

No. 23903.

Supreme Court of Indiana.

Feb. 10, 1921.

Appeal from Circuit Court, Decatur County.

Action by William F. Stewart against the Royal Insurance Company, Limited, of Liverpool. Judgment for plaintiff. Transferred from Appellate Court under Acts 1901, c. 247, p. 567, § 10. Judgment of circuit court reversed. Superseding opinion of Appellate Court (121 N. E. 307).Burke G. Slaymaker, of Indianapolis, for appellant.

Hacker & Jones, of Columbus, for appellee.

EWBANK, J.

This was an action by the appellee on an insurance policy issued by the appellant, seeking to recover for a loss by fire. The complaint was in three paragraphs. The trial court found for the appellant on the issues joined on the first paragraph of the complaint, and it need not be further considered, except to say that it sought to reform the policy as not stating the real contract. The second paragraph of the complaint alleged that the appellant issued to appellee a fire insurance policy covering certain property owned by the appellee, and exhibited the policy as written, in the New York Standard form, with the allegation that the “iron-safe clause” therein (as hereinafter set out) was incorporated in the policy by mistake; that the insured property had been consumed by fire, and that appellee had complied with all the provisions of the policy contract, except certain other provisions which were waived, as was alleged, by reason of facts stated; and asked that the policy be reformed so as to express the contract really entered into, by striking out the “iron-safe clause,” and that appellee be given judgment for the damage caused by the fire. And the third paragraph of complaint alleged the execution of the policy, setting it out as written, that the property insured was destroyed by fire; that appellant did certain acts by which some of the conditions of the policy other than the “iron-safe clause” were waived, and that appellee performed all conditions not so waived, and demanded a judgment at law for the face of the policy. Demurrers to each paragraph of the complaint were overruled, and appellant excepted.

Many paragraphs of answer were filed, of which the first paragraph was a general denial, and the second and sixth pleaded former adjudication, the sixth paragraph setting out the facts relied on more in detail, and alleging that appellee, as sole plaintiff, had previously filed, in the same circuit court in which this action was begun, a complaint setting out the same policy exhibited with each paragraph of this complaint, and averring the same facts as to the destruction of the insured property by fire, and as to appellants' waiver of certain conditions of the policy, and appellees' performance of all other conditions; that the case was taken by change of venue to the Jennings circuit court, by which a demurrer filed by appellant for want of sufficient facts was sustained to said complaint, and upon the refusal of appellee to amend or plead over, a judgment was rendered thereon, against appellee and in favor of appellant, for the costs of the action; that appellee sued and appellant was sued in that action in the same capacity as in this, and they were, respectively, the sole plaintiff and sole defendant therein, and that the subject-matter was the same; that said judgment in the former action had not been reversed, modified, set aside or appealed from, but was in full force and effect; and that appellee was suing in this action for the same identical claim and demand which was so sued for and adjudicated in the former action.

Demurrers were sustained to each of seven paragraphs of the answer, and appellant excepted, but others, including the second and sixth paragraphs, were held sufficient. A reply of general denial was filed. The cause was submitted for trial on the issues joined on each of the three paragraphs of complaint and numerous paragraphs of answer, including the general denial, and the pleas of former adjudication. The issues joined on the first and second paragraphs of the complaint, which sought a reformation of the policy, were tried by the court, and the issues joined on the third paragraph were submitted to a jury, upon the same evidence.

At the trial the plaintiff testified that:

“I never had any other fire in 1912 than the fire mentioned in this complaint. The only property I ever had damaged by fire was the property mentioned in my complaint in this action. I filed a complaint against the defendant in the Ripley circuit court on September 11, 1913, *** some time in September, 1913. I was the plaintiff in that action, and the loss I sued for in that action is the loss I am suing for in this action, and upon the same policy and against the same defendant.”

H. H. Cope and P. E. Bear testified that they were employed by appellee as attorneys in cause No. 6522 in the Ripley circuit court, which became No. 6283 in the Jennings circuit court, and that appellee gave them a statement of facts on which the complaint in that case was written, and that two conferences with appellee upon the facts were had before the complaint was filed; that the complaint was read to appellee, including all that it said about the iron-safe clause, in the policy; that the facts alleged in that complaint were gotten solely from appellee.

Mr. Cope testified that after the Jennings circuit court sustained the demurrer to the complaint he told the court that the complaint stated all of the facts as they were, and then prepared the entry of judgment, which was approved by counsel for both sides and was entered of record, and that in sustaining the demurrer to the complaint in the former case in the Jennings circuit court the court stated that it was sustained on the ground that the allegations therein relative to the waiver of the “iron-safe clause” were not sufficient to constitute a waiver. Robert E. Greighile testified that he was the judge of the Jennings circuit court by whom said demurrer was sustained, and that it was sustained on the ground that the “iron-safe clause” in the policy constituted a promissory warranty, and that the complaint admitted a breach of this warranty, and alleged facts intended to show a waiver of such breach, but that it was the judgment of the court that the facts pleaded did not constitute such waiver, and that, having so decided, the demurrer was sustained without much consideration of the other grounds of demurrer assigned; that appellee was present on one occasion when the demurrer was argued orally, and that when the ruling was announced appellee's attorney asked that the matter be passed until afternoon, so that he could reach his client by telephone, and in the afternoon refused to plead further. There was other testimony also to the same effect.

The record of the proceedings and judgment in cause No. 6283 in the Jennings circuit court were read in evidence, reciting that the appellee, on September 12, 1913, by Van Osdol and Cope, his attorneys, filed his complaint against the appellant as cause No. 6522, in the Ripley circuit court; that on change of venue the case was taken to the Jennings circuit court; that the appellant filed a demurrer to the complaint for the alleged reason that the complaint did not state facts sufficient to constitute a cause of action, specifying that the admitted breach of the warranties, terms, and conditions of the policy sued on were not shown by the facts alleged to have been waived (with other reasons), and that thereupon the court entered the following judgment:

“Come the parties in the above-entitled cause, the plaintiff [appellee] by Van Osdol & Cope, his attorneys, and the defendant [appellant] by Burke G. Slaymaker, its attorney, and the court now sustains the demurrer of the defendant to the complaint of the plaintiff. And the plaintiff now abides the said ruling on said demurrer to said complaint, and refuses to plead over; and, upon the defendants' motion, and because of the refusal of said plaintiff to plead over, the court gives and renders judgment herein in favor of the defendant and against the plaintiff; and it is adjudged and ordered by the court that the defendant have and recover of and from the plaintiff its costs herein laid out and expended taxed at the sum of $-, all of which is ordered and adjudged by the court.”

And the clerk certified that said judgment had not been appealed from, reversed, modified, or set aside, but was in full force and effect.

As a part of the record so read in evidence, the complaint and demurrer thereto in the said former action were introduced and read. The demurrer stated that “said complaint does not state facts sufficient to constitute a cause of action.” The complaint so demurred to alleged exactly the same facts as to appellee's ownership of the same property as the complaint in the case at bar, that it was insured against fire by a policy in the appellant company, its destruction by fire, its value, and what appellee and appellant thereafter did and failed to do, all as alleged in the complaint in this case. But it counted upon the insurance policy, just as it was written, and, instead of alleging, as does the second paragraph of complaint in this (the second) action, that the parties agreed upon the issuance of a policy which should not contain the “iron-safe clause,” and that it was written into the policy by mutual mistake of the parties, the complaint in such former action expressly alleged that the “iron-safe clause” was part of the policy contract, in the following language, quoted from such former complaint:

“Plaintiff further avers that as to one of the conditions mentioned and set forth in said policy of insurance, as a stipulation and condition, known as the inventory and iron-safe clause, which provided that as a ‘part of the consideration, and it is expressly warranted by the assured under this policy, that a...