Moultis v. Degen

Ness, Justice

(dissenting):

I most emphatically disagree.

The critical issue is whether a cause of action in tort is a creditor’s claim within the meaning of the statute. In accord with our previous decisions, I would hold it is not.

In Wallace v. Timmons, 232 S. C. 311, 101 S. E. (2d) 844 (1958) this Court stated that S. C. Code Ann. § 19-474 (1956), now codified at § 21-15-640 (1976), refers to “claims of creditors, and relate(s) to debts of the testator payable from his estate.” (Emphasis added.) This creditor-debtor relationship was most recently recognized in Southern Coatings & Chemical Co., Inc. v. Belcher, 274 S. C. 76, 261 S. E. (2d) 162 (1979):

“... since the debtor is dead —, it becomes essential that the creditor furnish an affidavit showing how the deceased became indebted to him and that the debt had not been paid ...”

The majority does not trouble itself with this Court’s decision in Newman v. Lemmon, et al., 149 S. C. 417, 147 S. E. 439 (1929). There, in a wrongful death action on facts strikingly similar to those in the instant case, the Court unequivocally stated a cause of action in tort is not a debt, and that a tort claimant, having only a disputed claim, cannot be considered a creditor. See also Bourne v. Maryland Casualty Co., 185 S. C. 1, 192 S. E. 605 (1937), another decision to which the majority turns a blind eye, where we again held a right of action for tort is not a debt.

*10Authorities in other jurisdictions are in accord with our decisions in Newman v. Lemmon, supra and Bourne v. Maryland Casualty, supra. Frei v. Brownlee, 56 N. M. 677, 248 P. (2d) 671 (New Mex.—1962) held that a six months statute did not bar tort claims; Hancock v. Pyle, 191 Miss. 546, 3 So. (2d) 851 (Miss. — 1941) held that the six months statute applied only to contractual claims and not to those in tort; Collins v. Buffner, 185 Tenn. 290, 206 S. W. (2d) 298 (Tenn. - 1947) held that a “party who has a right of action in tort cannot be deemed a creditor until he obtains a judgment.” This holding was affirmed in Darby v. Union Planters National Bank of Memphis, 222 Tenn. 417, 436 S. W. (2d) 439 (Tenn. — 1969), holding a party having a right of action in tort against a representative of a deceased cannot be deemed a creditor of the estate until he obtains a judgment.

While I concede there is authority in other jurisdictions to the contrary, the majority can cite no South Carolina authority on point which supports its decision. Aside from the equities, I believe we are bound by the South Carolina precedents.

In reaching its decision here, the majority erroneously relies on Bonsall v. Piggly Wiggly Helms, Inc., 275 S. C. 593, 274 S. E. (2d) 298 (1981), a case not even remotely similar to the one now before us. Bonsall involved a corporate dissolution, and we were asked to construe S. C. Code Ann. § 33-21-60(b) (1976), which provides:

“The corporation shall immediately cause notice of the filing of the statement of intent to dissolve to be mailed to each known creditor of the corporation ...”

We held that where the tort claimant had notified the corporation of her claim and had been contacted about the claim by the store’s insurer,the claimant was a known creditor within the meaning of this statute to whom the corporation was required to give notice of dissolution. The intent of the statute was to require corporations to deal fairly with those to whom it has known obligations. Bonsall’s claim was known to the corporation, and thus it was required to give her notice of its dissolution. In the present case, the claim might not even accrue, much less be known, until after the time for filing has expired. The statutes are patently dissimilar in their objectives, and any attempted comparison is strained at best.

*11The majority also cites Judge Blatt’s decision in F.D.I.C. v. Fagan, 459 F. Supp. 933 (D. S. C. 1978), Professor Karesh’s law review article analyzing the Dubuque decision, and a 1964 Attorney General’s Opinion in support of its position. The Fagan case involved a contract claim, as did Dubuque. These authorities support the position that § 21-15-640 is a nonclaim statute as to contract claims, a conclusion with which I do not disagree; however, not one of these authorities expresses an opinion concerning the applicability of the statute to tort claims. In fact, Professor Karesh explicitly questioned whether the statute would apply to any contingent liability.

The evil done by the majority today is perhaps best illustrated by example. In this case, the claimant died and the alleged tortfeasor died shortly thereafter. However, a case can easily be imagined in which the tortfeasor dies first, while the claimant lingers for more than five months after the first notice to creditors. In that instance, the majority’s decision will bar the wrongful death claim even though it could not have been filed sooner. This decision will deny any remedy to one who has been wronged, while protecting the successors in interest of the wrongdoer.

The majority is apparently concerned that the normal six year statute of limitations will cast a lingering cloud over the estate assets. This concern is baffling, as the claimant may recover only to the extent the assets remain in the hands of the heirs, i.e., the heirs’ ability to transfer good title is unhampered. Moreover, if a “cloud” exists, the same “cloud” would have existed over the same assets for the full six years had the tortfeasor lived. Nevertheless, the majority penalizes an injured party simply because the tortfeasor died.

Finally, the majority holds the statute does not apply if the deceased was insured. I am unable to find any language in the statute authorizing this startling conclusion. Either the statute contemplates tort claims in the five-month limitation, or it does not. There is no in-between, and the deceased’s decision to insure or not to insure against certain risks should have no bearing on our interpretation of the statute. The majority’s “addition” to the statute allowing tort claims to be filed after the expiration of the five-month limitation if the deceased was insured is a gross invasion of legislative prerogative. Additionally, it deprives insurance companies of equal protection, as we have never before held, nor has a statute ever *12provided, that a statute of limitations is tolled because the defendant has insurance.

I would hold a cause of action in tort is not a creditor’s claim within the meaning of § 21-15-640, vacate the order sustaining the demurrer, and remand the case for trial.

Lewis, C.J., concurs.