Travelers Ins. Co. v. Thompson

• Decision Date: 25 October 1968
• Docket Number: Nos. 40903--4--5,40906,40907--8,s. 40903--4--5
• Citation: 281 Minn. 547,163 N.W.2d 289
• Court: Minnesota Supreme Court
• Parties: TRAVELERS INSURANCE COMPANY, Continental Casualty Company, Time Insurance Company, Edward Ernest Nelson, an underwriter at Lloyd's, London, and Zurich Insurance Company, Appellants, v. T. Eugene THOMPSON, Respondent, Otto Swoboda, Spec. Admr. of Estate of Carol S. Thompson, deceased, et al., Respondents. Otto SWOBODA, Spec. Admr. of Estate of Carol S. Thompson, deceased, and T. Eugene Thompson, Respondents, v. GENERAL ACCIDENT FIRE & LIFE ASSURANCE CORPORATION, Ltd., Appellant.

Page 289

163 N.W.2d 289

281 Minn. 547

TRAVELERS INSURANCE COMPANY, Continental Casualty Company, Time Insurance Company, Edward Ernest Nelson, an underwriter at Lloyd's, London, and Zurich Insurance Company, Appellants, v. T. Eugene THOMPSON, Respondent, Otto Swoboda, Spec. Admr. of Estate of Carol S. Thompson, deceased, et al., Respondents.

Otto SWOBODA, Spec. Admr. of Estate of Carol S. Thompson, deceased, and T. Eugene Thompson, Respondents, v. GENERAL ACCIDENT FIRE & LIFE ASSURANCE CORPORATION, Ltd., Appellant.

Nos. 40903--4--5, 40907--8, 40906.

Supreme Court of Minnesota.

Oct. 25, 1968.

Rehearing Denied Jan. 14, 1969.

Syllabus by the Court

1. The general common-law rule that a conviction precludes neither the bringing of a civil action by a convicted person nor an attempt to prove that he is innocent of the offense is subject to the exception that where a convicted defendant attempts by subsequent civil litigation to profit from his own crime the judgment of conviction in the criminal case is conclusive as to the result of the civil action where the facts and issues in both are identical.

2. Minn. St. 525.87, which provides that one who 'feloniously' takes the life of another shall not profit from his own wrong, declares and establishes the policy which prohibits a murderer from profiting from the death that he has feloniously caused and, as applied to the facts herein recited, comprehends one who has been convicted of an intentional killing.

3. The fact that the conviction in a criminal action is not 'final' in the true sense because one who is wrongfully deprived of his liberty in a criminal action may at any time have review of an error growing out of denial of a basic constitutional right does not apply to an attempt by such convicted person to recover in a civil action any part of the estate of one whose death he has feloniously caused or to recover the proceeds of insurance policies issued to that person. Once it is decided that a conviction in a criminal case is conclusive as to facts and issues determined by the conviction, principles of public policy and the interests of litigants require that parties who had a full opportunity to litigate the issues should not be permitted to reopen and review such facts and issues in subsequent civil litigation.

Michael J. Baglio, Richard E. Kyle, J. Neil Morton, David W. Raudenbush and Samuel L. Hanson, St. Paul, for Travelers Ins. Co.

Altman, Geraghty, Leonard & Mulally, St. Paul, for Continental Cas Co., Time Ins. Co., and Gen. Acc. Fire & Life.

Meagher, Geer, Markham & Anderson, and O. C. Adamson, II, Minneapolis, for Nelson, Lloyds, London.

Mordaunt, Walstad, Cousineau & McGuire, Minneapolis, for Zurich Ins. Co.

Benedict Deinard and Allen I. Saeks, Minneapolis, for Thompson.

O'Connor, Green, Thomas, Walters & Kelly, Minneapolis, for Swoboda.

OPINION

MURPHY, Justice.

This is an appeal from a denial by the Ramsey County District Court of appellant insurance companies' motion for summary judgment. Appellants sought declaratory relief with regard to their liabilities on a number of insurance policies purchased by respondent, T. Eugene Thompson, on the life of his deceased wife, whom he was convicted of murdering. The district court certified as important and doubtful the question of whether Thompson's 1963 conviction of first-degree murder of his wife is conclusive so as to bar his claim as a beneficiary of the insurance policies. ¹ The facts in the prior criminal case are set out in detail in our opinion affirming Thompson's conviction. ² Only those facts which are germane to a determination of the present civil action will be related here.

On the morning of March 6, 1963, Carol Thompson was beaten and stabbed to death in her St. Paul home. Evidence collected at the scene of the crime led to the arrest in Arizona of one Dick W. C. Anderson. Anderson confessed to the murder and implicated several other parties, among whom were Norman Mastrian and respondent. Anderson's testimony at the trial was that he was approached by Mastrian on March 3, 1963, and asked 'if he was interested in killing a woman'; Anderson also testified that when questioned Mastrian admitted that 'insurance was involved.' ³ Richard Sharp, one of the men implicated in the conspiracy, testified that Mastrian had earlier offered the job to him, describing the victim as 'a churchgoing woman with four children' and 'heavily insured.' ⁴

The facts disclosed are that between February 1962 and January 1963 Thompson purchased nine term policies, totaling $1,055,000, on his wife's life. The policies were to expire on dates ranging from March 15, 1963, to April 9, 1967. ⁵ In each of the policies Thompson was the named beneficiary. His explanations for acquiring this unusual amount of term insurance were (1) that since his wife would acquire in the event of his death $460,000 of insurance on his life and could expect to inherit $500,000 should her father die, he (Thompson) should be able to anticipate an equal amount in the event of his wife's death; ⁶ and (2) that 'he had a premonition that his wife was going to have a tragic accident on February 8 or 9, 1963.' ⁷

There was testimony at the criminal trial to the effect that Thompson had been intimate with his secretary over a 2-year period from 1960 and that he had offered to marry her. The testimony showed, however, that his offers were rejected and that his secretary married another man in 1962. It appears that she last heard from Thompson at Christmas time in 1962, more than 3 months before the murder of Thompson's wife. The record fairly establishes that the overriding motive for the murder was to secure the proceeds of the insurance policies rather than the affair with the secretary.

1. It is agreed that Minn. St. 525.87 prevents one who has 'feloniously' taken or caused the death of another from profiting from such wrongful act by inheriting from such person's estate or being a veneficiary of an insurance policy on the victim's life. ⁸ The core question here is whether a criminal conviction may be considered in a subsequent civil proceeding for the purpose of establishing the truth of the facts upon which the conviction was based. This question must be considered in the light of our prior decision which reviewed at length the issues and procedures involved in the criminal prosecution which resulted in respondent's conviction. It must be recognized that the facts set forth in that decision gave rise to both the criminal and the civil actions with which we are here concerned. The facts and issues in both actions are identical. The issues in the criminal case have been decided, reviewed, and affirmed on appeal. Appellant insurance companies contend that in the posture of these proceedings principles of 'estoppel by judgment' or 'collateral estoppel' require that the judgment in the criminal case be conclusive as to the issues raised in the civil case. Respondent contends, on the other hand, that because of the absence of the essential element of mutuality 'the parties in the criminal proceedings not being the same as those in the civil proceedings) principles of estoppel may not be applied.

Collateral estoppel is a limited form of res judicata whereby a former judgment is conclusive in a later suit between the same parties or their privies as to determinative issues finally decided in the former suit. In Gollner v. Cram, 258 Minn. 8, 10, 102 N.W.2d 521, 523, 83 A.L.R.2d 971, 974. we said:

'The doctrine of collateral estoppel (also referred to as estoppel by verdict) applies where it affirmatively appears that the issue presented has already been litigated in a prior suit between the same parties even though based upon a different cause of action. Unlike the situation where a former judgment acts as an absolute bar, it is an indispensable prerequisite to collateral estoppel that the issue involved be actually litigated and determined in the former suit.'

The principle of collateral estoppel has been expressed in varying terms in Brooks Realty, Inc. v. Aetna Ins. Co., 268 Minn. 122, 128 N.W.2d 151; Anderson v. Mikel Drilling Co., 257 Minn. 487, 102 N.W.2d 293; Lustik v. Rankila, 269 Minn. 515, 131 N.W.2d 741. See, Annotation, 83 A.L.R.2d 977, 986; 10 Dunnell, Dig. (3 ed.) §§ 5161, 5162.

The general common-law rule has been that a criminal judgment is not admissible as evidence in a civil action to establish a fact determined in the criminal action nor does it constitute a bar to a subsequent civil action based upon the offense of which the party stands convicted and that the judgment of conviction is not admissible in evidence for that purpose. Wahl v. Walton, 30 Minn. 506, 16 N.W. 397; Annotations, 31 A.L.R. 261, 18 A.L.R.2d 1287, and 42 A.L.R.2d 634. It has been held that a conviction precludes neither the bringing of a civil action by a convicted person nor an attempt to prove that he is innocent of the offense. 30A Am.Jur., Judgments, § 474; 50 C.J.S. Judgments § 754. In addition to the absence of mutuality in the second suit, other considerations which have influenced courts in so holding are that the judgment may not be conclusive of issues which might have been litigated and determined in the initial action but which were not; failure or inadequacy of legal representation; the drawing of a wrong inference or misapplication of law which might give rise to an erroneous result; and the rule of evidence that the judgment in a criminal case is nothing more than the opinion of 12 jurors and, consequently, hearsay.

It is important to note that an exception to this rule has developed in situations where the convicted defendant attempts by subsequent civil litigation to profit from his own crime, as where an arsonist seeks to recover insurance proceeds for damage caused by the fire which he was convicted of setting, or where a beneficiary convicted of homicide seeks to recover under the victim's life insurance policy....