When the decision of this appeal was reached and announced, I entered my dissent from the conclusion of the majority of the court that the judgment of the trial court should be reformed and affirmed in accordance with the views expressed in the opinion of Justice GRAVES filed on May 2, 1934.
It seems clear to me that the findings of fact set out in that opinion require an affirmance of the judgment rendered by the trial court; appellee not having complained of the amount of the judgment. *Page 681
The fact findings by this court, which are shown by the undisputed evidence, are:
"That before Robert Griffin sold the note to appellant he had foreclosed the deed of trust securing it and sold the lot on which the burned house had stood out against appellee Cawlfield for $1,200.00, which sum Cawlfield had become entitled to have credited on the aggregate then due on the note; the evidence shows the date of the assignment to have been February 1, 1931, at which time there was due on the note $6,000.00 for principal, $440.00 for interest, and $644.00 for attorney's fees, aggregating $7,084.00; deducting therefrom the $1,200.00 the lot had sold for under the prior foreclosure thereon by Griffin, there is left a balance of $5,884.00 due on the note in the hands of the Insurance Company on that date. The note carried an interest rate of 8% per annum, hence it was entitled to add thereto $470.72 for practically one year's interest at that rate from February 1, 1931, to January 28, 1932, the date of the judgment, making a total in its favor on the latter date of $6,354.72.
"Under the jury's verdict, however, there had been due Cawlfield since February 1st of 1931 the $700.00 balance due under the insurance policy over and above the $6,000.00 appellant had so paid to Griffin on that date for the note against him; this verdict of the jury that the house had been totally destroyed is not attacked, nor could it have been successfully so, since there is ample evidence to sustain it; in consequence Cawlfield, on his side, was entitled to the $700.00 balance due under the insurance policy, together with the 6% interest allowed by law thereon from the date of the assignment of his note to appellant on February 1st of 1931 to the date of the judgment herein on January 28th of 1932, or the additional sum of $42.00, which added to the $700.00 balance of insurance leaves a total due him at the latter date of $742.00; in other words, the separate accounts are to be considered as carrying $6,354.72 in favor of the Insurance Company as against $6,742.00 in favor of Cawlfield, the striking of a balance between which amounts leaves still due the latter on the date of this judgment the sum of $387.28, rather than the amount of the judgment rendered.
"It follows that the judgment in appellee's favor should be so reformed as to be reduced to the sum of $387.28 and affirmed for that amount."
The mathematical calculations contained in the opinion are, I am sure, accurate, but the application of the law fixing the rights of the parties under their contract to the facts stated in the opinion seems to me to be clearly erroneous.
The opinion correctly states that the $700 which appellant claimed appellee was not entitled to recover under the insurance policy because the whole of the insured property was not destroyed by the fire was, as found by the jury, due appellee by appellant on its policy on February 1, 1931, from which date interest at 6 per cent. was properly allowed appellee. Of course the $6,000 which appellant paid Griffin on February 1, 1931, was then admittedly due appellee on his policy. Appellant had the right to pay out of this money the amount required to satisfy the Griffin note, which was secured by a lien on the proceeds of the policy of which appellant had due notice. But just how, in law or reason, appellant could be permitted to use money due by it to appellee to pay or purchase the note due by appellee to Griffin and charge appellee interest on the money so used is incomprehensible to me. By paying the money to Griffin, appellant relieved itself from any liability to appellee for interest on the amount so paid. It had the unquestionable right to so use the money, and also the right, for its full protection, to have the note assigned to it, but it could not thereafter charge appellee with interest on the note which was in effect charging interest on the money of appellee used in the purchase of the note.
By the express terms of the policy set out in the opinion of the majority of the court, appellant's right of subrogation to Griffin's right to charge interest on his note is limited to the amount of insurance upon which it claimed no liability existed on its part. No other reasonable construction can be given to the language of the policy. To construe the policy as supporting the right of appellant to withhold from appellee money admittedly due him, and to use the money in purchasing other obligations of appellee secured by the policy and drawing a larger rate of interest than appellant's obligation to appellee, is to wholly disregard the fundamental primary purpose and obligations of the parties to the insurance contract, which were the protection of appellee from loss by fire of the property insured, upon the payment by him of the premiums stipulated in the contract. To inject into the contract a license to appellant to withhold money due appellee under the contract, which it admits was justly due him, and use it for the purchase of outstanding obligations of appellee, and by such use of the money not only relieve itself of *Page 682 paying interest on the money so withheld, but obtain a larger rate of interest upon the note so paid or purchased by appellant, is, in my opinion, unreasonable and unwarranted. It seems to me that this statement of the result of the holding of the majority conclusively shows the unsoundness of their opinion.
No motion for rehearing has been filed by the appellee, who is apparently satisfied with the judgment rendered by this court, but I feel impelled, nevertheless, to record my dissent from the legal conclusion expressed in the majority opinion.