Phenix Ins. Co. of Brooklyn, N.Y. v. Ceaphus

There are two controlling questions in this case: (1) Did the court err in permitting the amendment to the petition, allowed after remand of this case by this court? (2) Did the court err in decreeing a reformation of the policy of insurance? These questions will be considered in their order.

In Wynnewood Cotton Oil Co. v. Moore, post, p. _____, 153 P. 633, it is held:

"The statutes and also the decisions of the courts of this state are extremely liberal in permitting amendments to pleadings, so long as such amendments are in furtherance of justice; and amendments which even change the cause of action may be permitted, provided they do not substantially change the plaintiff's claim."

Section 4790, Rev. Laws 1910, reads:

"The court may, before or after judgment, in furtherance of justice, and on such terms as may be proper, amend any pleading, process or proceeding by adding or striking out the name of any party, or correcting a mistake in the name of a party, or a mistake in any other respect, or by inserting other allegations material to the case, or conform the pleading or proceedings to the facts proved, when such amendment does not change substantially the claim or defense; and when any proceeding fails to conform, in any respect, to the provisions of this Code, the court may permit the same to be made conformable thereto by amendment."

"It has been declared to be a fair test, in determining whether a new cause of action is alleged in an amendment, to inquire if a recovery had upon the original complaint would be a bar to any recovery under the amended complaint, or if the same evidence would support both, or if the same measure of damages is applicable. * * * (1 Encyc. of Pl. Pr. 556, and authorities cited.)

Had the case not been appealed, and another suit brought under the petition as amended in this case, there can be no question that the recovery had under the original petition could be successfully pleaded in bar against a suit under the amended petition.

By agreement, the identical evidence given under the original petition was admitted in the trial of this case upon the petition as amended. Consequently there can be no question that the same evidence would support both the action under the original petition and under the petition as amended. The measure of damages was the same in the original petition as in the amended petition. Tested by the above-stated rule (1 Encyc. Pl. Pr. 556), it must be concluded that the amendment allowed "did not change substantially the claim or defense." The changes made by the amendment to the petition clearly were not of the essence of the cause of action, and in no wise could have prejudiced the plaintiff in error. Section 4790, Rev. Laws 1910, supra, virtually forbids "amendments only where the allegations of the claim or defense would be changed in its general scope and meaning." Atlantic Pac. Ry. Co. v. Laird,164 U.S. 393, 17 Sup. Ct. 120, 41 L.Ed. 485.

In Whalen v. Gordon et al., 95 Fed. 305, 37 C. C. A. 70, it is held:

"An amendment to a petition, which sets up no new cause of action or claim, and makes no new demand, but simply varies or expands the allegations in support of the cause of action already propounded, relates back to the commencement of the action, and the running of the statute against the claim so pleaded is arrested at that point."

In Motsenbocker et al. v. Shawnee Gas Electric Co. et al.,49 Okla. 304, 152 P. 82, Justice Hardy, speaking for the court, says:

"It appears to us that the Legislature has enjoined upon the courts of this state by positive enactment a liberal rule of procedure authorizing amendments in furtherance of justice, when same do not substantially change the claim or defense; and we do not think we ought to adopt a policy that would defeat substantial justice by indulging in fine-spun theories, woven around technical rules of procedure. * * *"

The amendment to the original petition simply amplifies the same and relates back to the commencement of the suit, against which the statute of limitations will not lie. As earnestly insisted upon by the learned counsel for plaintiff in error, we have carefully examined the opinion of Justice Sanborn inWhalen v. Gordon, supra, and are unable to agree with them "that the principle announced in that case is conclusive and directly applicable to the facts in the case at bar." On the contrary, we think that the quotations from the now Chief Justice White support the conclusion, reached by us, that the amendment did not state a new cause of action, and that the demurrer to said amended petition, on the ground that the action was barred by the statute of limitations, was properly overruled by the court.

The court decreed a reformation of the policy of insurance, and this was done in accordance with undenied agreed evidence; hence, did the court err in so decreeing? In the case of Williams v. North German Ins. Co. (C. C.) 24 Fed. 625, Justice Miller announces the rule to be:

"Where a policy of insurance, which has been drawn up by the agent of the insurer and merely accepted by the insured, does not represent the intention of both parties because of the fault or negligence of the agent, it may be reformed, so as to express the contract as it was intended to be made."

There is no question that the agreed evidence in this case shows that insured contracted for insurance upon the house, stating at the time to the agent that he did not own, but his wife did own, the land upon which the building was situated; that he had erected the building with the consent of his wife, and he showed the soliciting agent the patent to his wife for the land, and thereupon the said agent said:

"That did not make any difference; it will be insured after 12 o'clock tomorrow."

If the agent fails to do that which was intended, it would be harsh to say that the instrument should not be reformed, and that equity will give no relief. It is clear to us that the right to have said reformation decreed cannot be questioned, and we do not deem it necessary to cite the many authorities that may be cited in support thereof.

It follows that the court did not commit prejudicial error in overruling the demurrer to the evidence, or in overruling the motion for a new trial; and the cause should be affirmed.

By the Court: It is so ordered.