Summary
holding assignment of wrongful death action to insurer of tortfeasor violated public policy
Summary of this case from In re Michael BogdanOpinion
Docket No. 44444.
Decided March 5, 1980.
Tolley, Fisher Verwys, for plaintiff.
Cholette, Perkins Buchanan (by Robert A. Benson), for defendant B.F. Goodrich, Incorporated.
Before: D.F. WALSH, P.J., and R.B. BURNS and J.H. GILLIS, JJ.
Plaintiff, Marjorie DeJong, appeals the order of dismissal entered on March 8, 1979, by the Oceana Circuit Court.
On August 11, 1978, plaintiff commenced a wrongful death action against defendants B.F. Goodrich, Incorporated, a Netherlands corporation, and B.F. Goodrich, Incorporated, a New York corporation (hereinafter referred to collectively as B.F. Goodrich) and defendant Gans Tire Company, Inc. MCL 600.2922; MSA 27A.2922. Plaintiff's decedent was killed on March 22, 1976, when, in the course of his employment, he was driving a truck which was hit head-on by a garbage truck owned by Acme Disposal Company, Inc. According to the allegations in plaintiff's complaint, the accident occurred as a result of the rupture of one of the tires of the garbage truck. B.F. Goodrich manufactured the tire. Defendant Gans had sold the tire to Acme Disposal. Plaintiff advanced three theories of liability: products liability, negligence and breach of implied warranty.
Defendant Gans successfully moved to bring in Acme Disposal as a third party defendant, alleging the possible contribution liability of Acme.
On November 24, 1978, Acme moved for accelerated judgment. The motion was based on plaintiff's releasing of Acme from all liability in connection with Maynard DeJong's fatal accident. GCR 1963, 116.1(5), MCL 600.2925d(c); MSA 27A.2925(4)(c). The May 12, 1978, "Release and Assignment" upon which Acme based its motion provided, in pertinent part, as follows:
"FOR AND IN CONSIDERATION of the payment of the sum of Two Hundred Thousand and 00/100 Dollars ($200,000.00), to Marjorie DeJong for herself and in her representative capacities for the estate of Maynard DeJong, deceased, and the estate of Matthew DeJong, a minor, the receipt whereof by Marjorie DeJong for herself and in her representative capacities is hereby acknowledged, and in consideration of the assignment of claims hereinafter enumerated, does hereby for herself and the estates of Maynard DeJong and Matthew DeJong, her and their successors and assigns, release, acquit, and forever discharge Acme Disposal Company, its insurer, Sentry Insurance A Mutual Company, their officers, employees, agent, heirs, representatives, assigns and successors in interest (`Releasees'), from any and all claims, actions and causes of action, on account of any and all damages resulting from or in any way connected with the accident or event that occurred on or about the 22nd day of March, 1976, which resulted in the death of Maynard DeJong.
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"Marjorie DeJong further assigns for herself and in her representative capacities to Sentry Insurance A Mutual Company the right to prosecute any and all actions in her name and in the name of the estate of Maynard DeJong, deceased, against any potential products liability defendant stemming from the accident which resulted in Maynard DeJong's death, with any recovery in such action, not including taxable costs and attorneys fees, to be divided 50 percent to the assignors herein and 50 percent to Sentry Insurance A Mutual Company, the assignee of these claims. As to any and all claims, Marjorie DeJong agrees to cooperate fully and completely in their prosecution by Sentry Insurance A Mutual Company.
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"Marjorie DeJong further signifies and acknowledges, for herself and in her representative capacities, the assignee herein, and its agents, employees, and attorneys make no representations, warranties, or promises that any sum whatsoever will be recovered from any claims assigned to assignee herein, and that the decision to prosecute and/or settle any such claims shall be solely the right of assignee herein."
Upon learning of the release and assignment, defendants moved for accelerated judgment. They claimed that plaintiff's claim was barred by the release and that plaintiff had disposed of the claim by assignment before the commencement of the action. GCR 1963, 116.1(5).
On March 8, 1979, Acme's motion for accelerated judgment was granted. On appeal, plaintiff does not challenge that ruling. In addition, however, the circuit court dismissed the complaint filed against defendants B.F. Goodrich and Gans. That dismissal is the subject of plaintiff's appeal. We affirm.
As observed by the circuit court, important public policy considerations are raised by the facts of this case. These considerations were identified long ago by the Supreme Court in a case which we perceive to be indistinguishable and dispositive. In Upham v Dickinson, 38 Mich. 338 (1878), one joint wrongdoer took an assignment from the wronged parties of the right of action against his fellow wrongdoers. The assignee then brought suit for his own benefit but in the name of his assignors to recover from his associates the amount of injury suffered by the assignors. In affirming the circuit court's determination that the action could not be maintained, the Supreme Court, speaking through Justice COOLEY, stated:
"Had this suit been brought in the name of Rogers [the assignee] himself, as it might have been under our statute (Final v Backus, 18 Mich. 218; Grant v Smith, 26 Mich. 201), the questions made would have been more directly presented, but they would in substance have been the same as now. The real plaintiff seeks to place himself in the shoes of his assignors, and to recover in their right, and not otherwise. It is admitted that it is a general rule of law, based upon considerations of public policy, that the law will refuse its remedies to joint wrong-doers to enable them to adjust equities between themselves, or to alleviate hardships growing out of their trespasses upon the rights of others. Merryweather v Nixan, 8 T.R. 186; Lingard v Bromley, 1 Ves. B. 117; Thweatt's Admr v Jones, 1 Rand. 328, 332; Peck v Ellis, 2 Johns. Ch. 131; Acheson v Miller, 18 Ohio 1. The rule is supposed to have an important purpose in keeping parties within the limits of caution and prudence, and making them careful to observe the obligations the law imposes upon them. It is not perceived that there can be any ground for giving such aid indirectly when it would be refused if the demand were presented directly and in the name of the party himself." Id., 339-340.
We perceive no meaningful distinction between the facts in Upham and those presented to us in the instant case. The release and assignment unequivocably assigns to Sentry Insurance Company the right of action for wrongful death. It is clear, therefore, that the named plaintiff is only that — the nominal plaintiff. The assignee insurance company is liable for damage for which its insured, Acme Disposal, is liable. In our view, the public policy identified by Justice COOLEY is equally applicable to insurance companies which stand in the shoes of their wrongdoer insureds. Nor do we perceive any basis for limiting application of that public policy to those who are technically "joint tortfeasors". See Moyses v Spartan Asphalt Paving Co, 383 Mich. 314, 331; 174 N.W.2d 797 (1970). As in Upham, maintenance of this suit by the assignee (albeit in the name of the estate's personal representative) represents an attempt by the assignee to improve its position from that of a potentially liable defendant's insurer to that of a potentially profit-making plaintiff.
Sentry Insurance Company's maintenance of this wrongful death action in the name of the estate's personal representative is merely a disguised attempt to seek contribution, indemnity or profit. Having failed to satisfy the legislatively mandated prerequisites to a suit for contribution from other tortfeasors, Sentry's attempt to seek contribution must fail. MCL 600.2925a(3), MSA 27A.2925(1)(3). As representative of an active wrongdoer, Sentry has no right of indemnification. Hill v Sullivan Equipment Co, 86 Mich. App. 693, 698-699; 273 N.W.2d 527 (1978) (WALSH, J., dissenting), lv den 406 Mich. 880 (1979). A fortiori, the law must deny its remedies to one seeking a profit under these circumstances.
Another basis for dismissal can be found in the interplay of the real party in interest provision, GCR 1963, 201.2, MCL 600.2041; MSA 27A.2041, and the wrongful death statute. MCL 600.2922(2); MSA 27A.2922(2). As unequivocal assignee of the cause of action, Sentry Insurance Company is the real party in interest and suit must be brought in its name. GCR 1963, 201.2; 1 Honigman Hawkins, Michigan Court Rules Annotated, Rule 201, Committee Notes, page 444; 3A Moore's Federal Practice (2d ed), § 17.09, pp 17-82 et seq., Sharrar v Wayne Savings Ass'n, 254 Mich. 456, 459; 236 N.W. 833 (1931), Nierman v White's Motor Parts, Inc, 269 Mich. 608; 257 N.W. 751 (1934). The fact that the nominal plaintiff reserved for herself 50% of the proceeds to be recovered, if any, in the wrongful death action did not also reserve for her the status of real party in interest. James, Civil Procedure (1965), § 9.2, pp 384-385, Joseph Miele Construction Co, Inc v City of Niagara Falls, 21 F. Supp. 442 (WD NY, 1937). Under the wrongful death statute, however, actions for wrongful death must be brought by and in the name of the personal representatives of the deceased. MCL 600.2922(2). It is clear, therefore, that the circuit court did not err in determining that the complaint should be dismissed.
We affirm the circuit court's dismissal of the complaint filed against defendants B.F. Goodrich and Gans Tire Company. Costs to appellees.