Standard Oil Co. v. Dye

• Decision Date: 23 September 1929
• Citation: 20 S.W.2d 946,223 Mo.App. 926
• Parties: STANDARD OIL COMPANY, APPELLANT, v. A. E. DYE AND CORA DYE, RESPONDENTS. [*]
• Court: Missouri Court of Appeals

20 S.W.2d 946

223 Mo.App. 926

STANDARD OIL COMPANY, APPELLANT, v. A. E. DYE AND CORA DYE, RESPONDENTS. ^[*]

Court of Appeals of Missouri, Springfield

September 23, 1929

Appeal from Circuit Court of Reynolds County.--Hon. E. M. Dearing Judge.

REVERSED AND REMANDED (with directions).

Judgment reversed and remanded.

Lorts & Breuer for appellant.

(1) The court erred in refusing to give declaration of law offered by plaintiff at close of the evidence, because the loss occurred between the time of contract of sale and delivery of the deed. Manning v. Insurance Co., 123 Mo.App. 456; Mahan v. Home Insurance Co., 205 Mo.App. 592. The greater weight of authority in this country is that the purchaser is deemed, in equity to be the owner, the vendor merely retaining the legal title as security for the unpaid purchase price. The purchaser must stand loss of buildings by fire, and in equity is entitled to the insurance money collected by the vendor. Smith v. Phoenix Insurance Co., 25 Am. St. Rep. 191; Williams v. Lilley, 37 L.R.A. 150; Breuer v. Herbert, 96 Am. Dec. 582; Reed v. Lukens, 84 Am. St. 425; 27 R. C. L., pp 559-560, sec. 298. The fact that the contract is carried out without an abatement of the purchase price does not affect the right of the purchaser in this respect. Skinner et al. v. Houghton, 84 Am. St. Rep. 485. This is the rule even though the purchaser may have contemplated tearing the buildings down. (2) Where a contract of insurance is fully performed after injury to premises by fire, the purchaser is entitled to proceeds of insurance policies placed on property prior to date of the contract, even though he had announced his intention to tear buildings down. 26 C. J., note 29, p 437; Insurance Co. v. Updegraff, 21 Pa. St. 513; Hill v. Insurance Co., 59 Pa. St. 474; Purcell v. Grover, 109 Pa. St. 617; Gilbert v. Port, 28 Ohio St. 276; Williams v. Lilly, 67 Conn. 50. Such is the general rule in the United States. 1 Warvelle on Vendors (2 Ed.), Sec. 193, p. 241; Reed v. Lukens, 44 Pa. St. 200; Hill v. Cumberland & Co., 59 Pa. St. 474. (3) This case being in nature of an equity case the appellate court will review the evidence and make its own finding of facts.

Wm. P. Elmer for respondent.

Unless the policy of insurance has been assigned to the purchaser, the right to the proceeds of insurance taken out by the vendor for his benefit is in the vendor and not the purchaser. 26 C. J. 437, par. 586. Each is entitled to the proceeds of his own insurance. There was no contractual relation between purchaser and the insurance company. Hubbard v. Home Insurance Co., 222 S.W. 886; Russell v. Home Insurance Co., 262 S.W. 385.

SMITH, J. Cox, P. J., and Bailey, J., concur.

OPINION

SMITH, J.

This is an action filed in the circuit court of Dent county, Missouri, on the 16th of October, 1926, and at the April Term, 1927, of said court, on application of the plaintiff a change of venue was awarded to the circuit court of Reynolds county, and a trial was had there before the court on the 31st day of May, 1928.

This suit was based upon a petition in which the plaintiff alleged that on the 10th day of November 1925, it entered into a contract in writing with the defendants, giving the plaintiff an option of purchase from the defendants of the following described real estate, located in Dent county, Missouri, to-wit: The west half of lot 3 of block 23 in West Salem, in the city of Salem, at an agreed purchase price of $ 6200 a copy of which said written option of purchase was attached to said petition; that thereafter, and within the time limit of said contract, the plaintiff accepted said option by informing the defendants that it would take said property as provided in said contract. The plaintiff alleged that at the time of the written contract for the purchase of said real estate, there was a valuable frame building on said real estate worth more than $ 1000 and upon which the defendants carried insurance against loss by fire. That after the plaintiff had accepted the option of purchase and before the defendants had executed to plaintiff their deed of conveyance, the building was destroyed by fire and the defendants had collected from the insurance company the sum of $ 1000 for the loss thereon.

The plaintiff alleged that said building was a valuable appurtenance on said real estate and that its destruction reduced the value of said real estate in the sum of $ 1000; that after the destruction of said building and after defendants had collected the insurance, they refused to turn over said money or any part thereof to the plaintiff and refused to execute and deliver to plaintiff their deed unless the plaintiff paid the price of $ 6200 as stipulated in the option of purchase, notwithstanding the loss and destruction of said building; that the plaintiff paid the defendants $ 6200 with the understanding and agreement that the plaintiff reserved the right to force its claim against the defendants for the $ 1000 received by the defendants as fire insurance on the building, and received a deed from the defendants conveying title to the plaintiff for said real estate. Plaintiff further alleged that the defendants were entitled to collect the amount of insurance, but as a matter of law they were compelled to hold the same for the benefit of plaintiff as their vendee. Closing with a prayer for an order of court, declaring the defendants the holder and trustee of said money, to-wit, $ 1000 for the benefit of plaintiff and that they be required to pay all of the same to plaintiff.

A demurrer to said petition was filed but overruled, whereupon the defendants filed an answer admitting the execution of the option contract and admitting that the plaintiff agreed to pay the purchase price of $ 6200 for the property described and admitting the execution to the plaintiff of a general warranty deed to said real estate, and admitting that the defendants collected the sum of $ 1000 from said insurance company after the acceptance of the option of purchase by plaintiff and before the deed was executed.

Defendants in said answer averred that the building located on said premises was regarded as of no value by the plaintiff and averred that the plaintiff repeatedly offered to sell it at $ 50 to anyone who would remove it from said premises and that the loss of said building by fire would not reduce the value of the premises to plaintiff. That after the destruction of said building by fire the defendants offered to rescind the contract with the plaintiff and to relieve the plaintiff from the obligation of purchasing the property under its contract, and offered to return to plaintiff all earnest money paid under said option, but that the plaintiff refused to accept defendants offer to rescind the contract and be released from said contract, but held to carry the same out and pay the sum of $ 6200 to the defendants, at which time plaintiff's agents were informed by the defendants that no change would be made in the contract of purchase and that the plaintiff must stand upon the contract as written, or refuse to accept and carry out the same.

Defendants averred that when the plaintiff paid the sum of $ 6200 that plaintiff attempted to reserve the right to enforce a claim against the defendant for $ 1000 but that such attempt was merely an act upon part of plaintiff to which at no time did the defendants agree, and that the defendants did not at any time become the trustee either by agreement or in law, for the use and benefit of the plaintiff, for the amount of insurance so collected by them. That the insurance policy was drawn in the name of A. E. Dye, one of the defendants and that the same was never assigned to the plaintiff nor contracted to be assigned to the plaintiff, and that the plaintiff had no right to the same.

The plaintiff filed its replication in which it says that it is not true as alleged in defendants' answer that the building destroyed by fire was worthless, but that same was a valuable and useful building and worth the amount of insurance recovered by defendants for its loss. That it is not true that the defendants did not consent to or agree that the plaintiff should reserve its right to institute legal proceedings for the recovery of the $ 1000 held by the defendants as insurance money for the destruction of said building, but that said reservation was made in writing on the back of checks delivered to the defendants by plaintiff as the purchase price of said lots and that the same was so understood an accepted at the time by the defendants. And with a general denial of each and every allegation of new matters set up in the answer of defendants.

The cause was taken under advisement by the court until November 28, 1928, and judgment rendered for the defendants. In due time, motion for new trial was filed and overruled and proper steps taken for appeal.

We have examined the abstract of the record and find that the attorney for the appellant has made a fair statement of the case and the facts as shown by the testimony and we adopt his statement which is as follows:

"The appellant has appealed from a finding and judgment of the circuit court of Reynolds county, Missouri, rendered at the November Term, 1928, of said court, the appellant here being the plaintiff, and the respondents the defendants in said cause. The respondents are now and for many years prior to the institution of this suit, have been residents of Salem, in Dent county, and were the owners of the real estate hereinbefore described, upon which there was situated a frame building, a part of which being two stories and the remainder a story and a half. The building was seventy feet long and forty feet wide, which the respondents were using for storage of...