Smiley v. National Fire Ins. Co. of Hartford

• Decision Date: 02 February 1960
• Docket Number: No. 9776-,9776-
• Citation: 78 S.D. 277,100 N.W.2d 827
• Court: South Dakota Supreme Court
• Parties: J. C. SMILEY and Henrietta K. Smiley, Plaintiffs and Respondents, v. NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, a Corporation, Defendant, and Alex W. Findlay, an individual doing business as Findlay Construction Company, Defendant and Appellant. r.

Page 827

100 N.W.2d 827

78 S.D. 277

J. C. SMILEY and Henrietta K. Smiley, Plaintiffs and Respondents, v. NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, a Corporation Defendant, and Alex W. Findlay, an individual doing business as Findlay Construction Company, Defendant and Appellant.

No. 9776-r.

Supreme Court of South Dakota.

Feb. 2, 1960.

Morrill & Morrill, Sturgis, for defendant and appellant.

H. F. Fellows, Rapid City, R. A. Smiley, William E. Anderson, Belle Fourche, for plaintiffs and respondents.

ROBERTS, Presiding Judge.

This is an appeal by permission from an order of compulsory reference.

SDC 33.1502(1) provides that the court, of its own motion, or upon application of either party, without the consent of the other, may direct a reference 'when the trial of an issue of fact requires the examination of a long account on either side'.

Plaintiffs brought this action to recover damages for the breach of a contract for the construction of an addition to their residence. The breach alleged in the complaint is that defendant Alex W. Findlay failed to perform the contract in accordance with its terms and specifications and that plaintiffs expended the amount specified in an exhibit attached to and made a part of the complaint for labor and materials in completing the contract. There are 76 such items totaling $7,584.72. It is further alleged that defendant National Fire Insurance Company is the surety on the bond furnished by defendant Findlay conditioned for the performance of the contract.

Defendant Findlay by an amended answer denies the claimed breach and by way of counterclaim alleges that plaintiffs are indebted to him for extra work and materials. When the action was called for trial, plaintiffs made application for reference. The court over objection of defendant Findlay made an order referring all issues to a referee for hearing and determination.

Counsel for appellant contend that this is not an action involving the examination of a long account upon either side within the meaning of the statute and that the issues are such that in the absence of an express waiver defendant has a right to a trial by jury under Section 6, Article VI, of the Constitution of this state, which provides that the right of trial by jury shall remain inviolate.

The practice of referring actions at law involving the examination of long accounts has prevailed in some jurisdictions from an early period. The history of this statute providing for reference with or without the consent of the parties may be traced back to an enactment in the Colony of New York in 1768 of a statute authorizing such reference of an action when a trial required 'the examination of a long account either on the one side or the other'. Steck v. Colorado Fuel & Iron Co., 142 N.Y. 236, 37 N.E. 1, 7, 25 L.R.A. 67; Snell v. Niagara Paper Mills, 193 N.Y. 433, 86 N.E. 460, 25 L.R.A.,N.S., 264. The constitution adopted in New York provided that trial by jury was retained in all cases in which it had been theretofore used. The courts of that state held that since cases involving long accounts were referable without consent of the parties before the adoption of the constitution they continued to be so after adoption. Lee v. Tillotson, 24 Wend. 337, 35 Am.Dec. 624.

Section 2, Chapter 112, Laws of 1889, authorizing compulsory reference 'when the trial of an issue of fact shall require the examination of a long account on either side' was in force prior to and at the time of the adoption of the Constitution of this state. The act referred to repealed Section 272, Code of Civil Procedure of 1877, which authorized references, without consent, 'in all cases formerly cognizable in chancery'. Language similar or identical to that of the 1889 enactment has been construed in New York and elsewhere to apply to actions at law or in equity where the examination of a long account is involved. Doyle v. Metropolitan El. Ry. Co., 136 N.Y. 505, 32 N.E. 1008; Craig v. California Vineyard Co., 30 Or. 43, 46 P. 421; Smith v. Kunert, 17 N.D. 120, 115 N.W. 76; Winnebago County v. Dodge County, 125 Wis. 42, 103 N.W. 255. In other jurisdictions, however, it is held that the statutory provision, because of the right of a trial by jury, applies only to proceedings formerly cognizable in equity. Joshua Hendy Machine Works v. Pacific Cable Construction Co., 99 Cal. 421, 33 P. 1084; Benson v. Charles Weitz' Sons, 211 Iowa 489, 231 N.W. 431; Farmers' & Merchants' Nat. Bank of Lake City v. Foster, 132 S.C. 410, 129 S.E. 629; see also Annotations in 79 Am.Dec. 207; 3 L.R.A. 271; 25 L.R.A. 68; 126 A.L.R. 314. The history of the statute in this jurisdiction clearly indicates that it was not intended to have such limited application.

A cause is not referable under the statute, without the consent of the parties, unless it shall...