Wolverine Ins. Co. v. Klomparens

• Decision Date: 10 December 1935
• Docket Number: No. 113,June term, 1935.,113
• Citation: 263 N.W. 724,273 Mich. 493
• Parties: WOLVERINE INS. CO. v. KLOMPARENS et al.
• Court: Michigan Supreme Court

273 Mich. 493

263 N.W. 724

WOLVERINE INS. CO.

v.KLOMPARENS et al.

No. 113, June term, 1935.

Supreme Court of Michigan.

Dec. 10, 1935.

Action by the Wolverine Insurance Company against James T. Klomparens, doing business as the Klomparens Coal Company, and another. Judgment for plaintiff, and defendants appeal.

Affirmed.

Appeal from Circuit Court, Ottawa County; Fred T. Miles, judge.

Argued before the Entire Bench.

Mason, Alexander, McCaslin & Cholette, of Grand Rapids (G. F. Classon, of Detroit, of counsel), for appellants.

Diekema, Cross & Ten Cate, of Holland, for appellee.

FEAD, Justice.

Plaintiff, as assignee of J. J. Lanting, had judgment on trial before the court without a jury.

Mr. Lanting had an automobile collision insurance policy issued by plaintiff. The policy contained the usual subrogation clause. As a result of a collision between his car and a vehicle negligently operated by defendants, Mr. Lanting sustained both personal and property damages. In negotiations and adjustment arising out of the collision, defendants were represented by their own insurer and both insurance companies were represent by attorneys and their agents.

The collision occurred February 12, 1934. March 7th, plaintiff paid Mr. Lanting an adjusted sum for property damage and took an assignment of his claim against defendants therefor. No formal or written notice of the assignment was given defendants until July 13th.

Mr. Lanting put his claim against defendants in the hands of an attorney. June 2d, a settlement agreement was executed, releasing defendants from all claims on account of the collision, including injuries to the car and personal property.

Defendants contend the settlement with Mr. Lanting was a bar to this action because they had had no notice of the assignment to plaintiff prior thereto and the settlement contract, which purports to cover all damage, cannot be explained or varied by parol testimony. The items entering into a settlement may be shown by parol. Pawlicki v. Hollenbeck, 250 Mich. 38, 229 N.W. 626. The facts are that defendants, through their investigators and attorneys, were fully informed before the settlement that plaintiff had made payment of property damage on its policy; and, on Mr. Lanting's claim that plaintiff had not paid his full loss therefor, an additional amount for property damage was allowed by defendants in the settlement with him. The rule is applicable.

‘It is too sell settled to render the citation of authorities necessary that, as between an insurer and a tort feasor who has caused a loss of the insured property, the latter is ultimately liable for the loss, and that upon payment to the insured by the insurer the latter is entitled to be subrogated pro tanto to the insured's right against the tort feasor. With this right in view the authorities are agreed that where, with knowledge of a previous settlement by the insurer with the insured, a tort feasor who is responsible for the loss procures a release by making a settlement with the insured, the release amounts to a fraud upon the insurer's right, and therefore constitutes no defense as against the insurer in an action to enforce its right of subrogation against the tort feasor.

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