Carter v. Bankers' Insurance

MR. CHIEF JUSTICE BRANTLY delivered the opinion of the court. This is an appeal from an order made by the district court of Lewis and Clark county dissolving an - attachment. The complaint contains five causes of action, each of which alleges a breach by defendant of a contract of insurance against damage or destruction of growing crops due to hail, drought, hot winds or any other cause, except fire or flood. One of the [325] several policies was issued by defendant to plaintiff and a co-owner, the interest of the latter having been assigned to the plaintiff after the loss is alleged to have occurred. The others were issued to four other persons, who also assigned their several interests to the plaintiff. All of the causes of action are substantially the same, except that the first is for a total loss, while the others are for partial losses. The complaint alleges compliance by the original holders of the policies with all the terms thereof, and that the crops covered by them were either damaged or wholly destroyed by drought and hot winds during the term for which they were issued. It alleges, - further, that the defendant’s adjuster investigated the losses and accepted the proof of them as .sufficient under the requirements of the policies in this behalf. The policies are identical, except as to the amounts claimed and the areas and descriptions of the lands upon which the crops were growing. Each of the policies designates the number of acres in crops covered by it, and fixes the maximum amount which the defendant binds itself to pay for a total loss at $7 per acre. It contains a provision that in case of a partial loss the quantities of any grain harvested must be valued at the rates therein specified, and the amounts deducted from the maximum amounts fixed for a total loss. This provision is as follows: “That in the event of a partial loss of said crop the amount of damage shall be determined by computing the value of the crop remaining by the following values of each grain, viz.: Wheat, one dollar per bushel; flax, one and 75/100 dollars per bushel; rye, seventy cents per bushel; oats, barley and speltz, fifty cents per bushel; and the damage thereto shall be the difference between the amount for which said crop is insured and the value obtained as herein provided.” Aside from this provision, the policies are of the same general form as other insurance policies. The attachment was issued by the clerk after the commencement of the action, upon plaintiff’s filing the affidavit and [1] undertaking required by the statute. The district court [326] sustained the motion for dissolution of it, on the ground that an insurance policy is not a contract for the “direct payment of money,” within the meaning of section 6656 of our Revised Codes. Whether it reached the correct conclusion is the only question presented to this court. Counsel for the plaintiff contend that the contracts in question come clearly within the statute as interpreted by this court in Ancient Order of Hibernians v. Sparrow, 29 Mont. 132, 101 Am. St. Rep. 563, 1 Ann. Cas. 144, 64 L. R. A. 128, 74 Pac. 197, and hence that the order must be reversed. This contention cannot be maintained. As we understand counsel, they proceed upon the idea that, though the obligation assumed by the defendant under the terms of each policy was contingent at the time it was issued, since, at the commencement of the action, the contingency had happened—that is, the loss had occurred—and all the conditions to’be performed by the plaintiff had been met, as alleged in the complaint, the obligation assumed by defendant had become absolute and unconditional. In other words, the right of the plaintiff to the writ in any case is to be determined, not by the character of the obligation as expressed in the contract, but by what the plaintiff alleges has occurred thereafter, without reference to the issues presented by the pleadings. In the case stated, this court, speaking through Mr. Justice Holloway, after assigning to the term “direct” the meaning “immediate; express, unambiguous; confessed; absolute”—as it is defined in Webster’s Dictionary, pointed out that it must have been inserted in the statute by the legislature to distinguish a particular class of contracts for the payment of money from all other contracts for the payment of money, thus limiting the scope of the statute to the particular class. The court said: “Before 1895 an attachment could be had in every action upon a contract, express or implied, for the payment of money, where the debt was not secured Since then the writ can only issue in those cases arising on contracts, express or implied, for the direct payment of money, and, applying the definitions of the term [327] ‘direct’ as given above, the obvious intention of the legislature can be made plain. The contracts now contemplated by section 890 [Rev. Codes, sec. 6656] above, are such only as require the payment unconditionally and absolutely of a definite sum.” The contract considered in that case was a bond executed by the defendants as sureties of one White conditioned that they would indemnify the plaintiff against any loss which it might suffer by reason of the failure of White to erect a building for it according to certain plans and specifications. The obligation assumed by the sureties, besides being conditional, was to pay, not an ascertained, liquidated amount, but an amount to be measured by the extent of the loss the plaintiff had suffered, which could be determined only by a trial. It is true that the contract considered in the Sparrow Case was collateral to the main or building contract, which did not call for the payment of money to effect its discharge, but for the erection of the building. Nevertheless the obligation assumed by the sureties was to compensate the plaintiff for the damage suffered by it by reason of the default of White, not to exceed the amount of the penalty mentioned in the bond. The amount of the penalty served' only to fix a limit beyond which the sureties could not be held liable, and, though the complaint charged that plaintiff had suffered a loss amounting to a definite sum, the amount for which the sureties could finally be held was to be determined by a judicial solution of the questions: “Did White in fact violate the principal contract?” and “What damage, if any, did plaintiff suffer?” The action was, therefore, not for a sum fixed or ascertainable from the terms of the contract and to be paid in any event, but for an unliquidated sum. So here the amount stated in each of the several policies to cover a total loss merely served to limit the amount for which the defendant could be held liable in any event, leaving the amount to be paid by it to be fixed by the court or jury under the issues presented to the pleadings. Assuming that the defendant puts in issue the allegations of the complaint, whether the loss is alleged to be total or partial, it is incumbent upon the [328] plaintiff to establish by his evidence that each of his several' assignors was the owner of the crops covered by his policy,that they were growing on the lands described in the policy held by him, that a loss had occurred, that the cause of the loss was one or more of the causes named in the policy, that the insured had performed the conditions on his part to be performed, and that he had assigned his interest to the plaintiff. Thus it appears that the policies fall into the class of those contracts which are excluded by the statute as interpreted in the Sparrow Case. The causes of action predicated upon them are for unliquidated damages, to be ascertained by the court or jury, and therefore they do not arise upon contracts for the direct payment of money. .In this respect the policies are not distinguishable from the bond considered in the Sparrow Case. Counsel argue that, if the conclusion announced in the Sparrow Case excludes these contracts from the class designated in the statute, it should be modified, or the result is that implied contracts such as merchants’ accounts, expressly included by the statute, are to be deemed excluded. It may be that the rule as therein stated is open to the criticism of it made by counsel. It is a sufficient answer to this contention, however, to say that, if the rule is to be modified, this may be properly done in a case when the necessity arises. It does not arise in this case. However it may hereafter be modified, it seems clear that the legislature, in enacting the statute, did not intend to authorize an attachment in actions such as this, to recover unliquidated damages arising out of breaches of contract. This was expressly held in the case of Beartooth Stock Co. v. Grosscup, 57 Mont. 595, 189 Pac. 773, and we see no reason to recede from the conclusion there stated. The order is affirmed. Affirmed. Associate Justices Hodloway, Hurly, Matthews and Cooper concur.