Opinion
Civil No. 2668.
Filed February 13, 1928.
1. DESCENT AND DISTRIBUTION — UPON DEATH OF INSURED, OWNERSHIP OF INSURED PROPERTY BECAME VESTED IN HEIRS SUBJECT TO PAYMENT OF DEBTS AND ADMINISTRATION OBLIGATIONS (CIV. CODE 1913, PAR. 904). — Upon death of insured, ownership of insured property was changed by operation of law, and became vested in heirs, subject to payment of debts of estate, expenses of administration, and allowance to family under Civil Code of 1913, paragraph 904.
2. INSURANCE — DECEASED INSURED'S ADMINISTRATOR WAS ONLY PERSON WHO COULD SUE ON FIRE INSURANCE POLICY (CIV. CODE 1913, PARS. 400, 401). — Where insured property was destroyed by fire after insured's death, insured's administrator was the only person who could bring suit on policy; the administrator having right to sue under Civil Code of 1913, paragraphs 400, 401, as trustee of an express trust, and administrator must protect interests of creditors and heirs.
3. DESCENT AND DISTRIBUTION — FIRE INSURANCE CONTRACT DID NOT ATTACH TO REALTY AND DID NOT PASS AS INCIDENT TO TRANSFER OF TITLE ON INSURED'S DEATH. — Contract of fire insurance did not attach to realty, and did not pass as an incident to transfer of title to land on insured's death.
4. APPEAL AND ERROR — PRESUMPTION IS THAT FACTS EXIST TO SUPPORT JUDGMENT. — Presumption is in favor of existence of facts to support judgment.
5. DESCENT AND DISTRIBUTION — ASSIGNMENT OF RIGHTS OF HEIRS OF RESIDUE OF PROPERTY OF ESTATE AFTER PAYMENT OF DEBTS AND EXPENSES DID NOT CONVEY INTEREST IN LOT OR INSURED BUILDING. — Assignment of rights of heirs in residue of property of deceased's estate after payment of debts and expenses not determinable until final settlement of accounts and entry of order of distribution, would not convey any interest in lot occupied by insured building, or the building itself, since latter partook of nature of lot.
6. PROPERTY — ASSIGNMENT OF REALTY MUST BE BY DEED (CIV. CODE 1913, PAR. 1046). — No title or interest in realty can be transferred except by deed of conveyance under Civil Code of 1913, paragraph 1046, and assignment of realty must be by deed.
7. INSURANCE — WHERE INSURED DIED BEFORE FIRE, AND HEIRS ASSIGNED RIGHTS IN RESIDUE PROPERTY OF ESTATE, THERE WAS NO CHANGE IN TITLE OF INSURED PROPERTY EXCEPT THAT EFFECTED BY DEATH, AND INSURED'S ADMINISTRATOR COULD RECOVER ON FIRE INSURANCE POLICY (CIV. CODE 1913, PARS. 400, 401, 904, 967, 1046, 1069). — Where insured died before property was destroyed by fire, and heirs assigned some right in property of estate, not determinable until final settlement of accounts and entry of order of distribution, there was no change in title, interest, or possession of insured property except that effected by death of insured, and administrator, as personal representative of insured and trustee of an express trust, could recover on fire insurance policy under Civil Code of 1913, paragraphs 400, 401, 904, 967, 1046, 1069.
8. INSURANCE — WHERE INSURER OFFERED TO PAY FIRE INSURANCE NECESSARY TO DISCHARGE DECEASED INSURED'S DEBTS ONLY, DAMAGES OF FIFTEEN PER CENT OF AMOUNT OF LOSS WERE PROPERLY IMPOSED (CIV. CODE 1913, PAR. 3441). — Insurer's offer to pay fire insurance, or so much thereof as was necessary to discharge debts of deceased insured's estate, if any there were, was a conditional offer, and not to full extent of defendant's liability, and hence damages of fifteen per cent of amount of loss were properly imposed under Civil Code of 1913, paragraph 3441.
9. INSURANCE — WHERE INSURER OFFERED TO PAY FIRE INSURANCE NECESSARY TO DISCHARGE DECEASED'S INSURANCE DEBTS ONLY, INSURER WAS LIABLE FOR ATTORNEY FEES (CIV. CODE 1913, PAR. 3441). — Where insurer offered to pay fire insurance or so much thereof as was necessary to discharge debts of deceased insured's estate, if any there were, insurer was liable for attorney's fees under Civil Code of 1913, paragraph 3441, since it was a conditional offer and not to full extent of defendant's liability.
10. INSURANCE — WHAT IS REASONABLE ATTORNEY'S FEE TO BE PAID BY INSURER FAILING TO PAY LOSS SUSTAINED, UNDER STATUTE, IS QUESTION OF FACT TO BE DETERMINED FROM EVIDENCE (CIV. CODE 1913, PAR. 3441). — What is a reasonable attorney's fee under Civil Code of 1913, paragraph 3441, providing that insurance company, which fails after demand on it to make payment of loss sustained, shall be liable to pay holder of policy "all reasonable attorney's fees for prosecution and collection of such loss," is a question of fact that must be determined upon evidence.
11. INSURANCE — ATTORNEY'S FEE OF $500 ALLOWED PLAINTIFF SUING ON FIRE INSURANCE POLICY HELD NOT UNREASONABLE UNDER EVIDENCE (CIV. CODE 1913, PAR. 3441). — Attorney's fee of $500 allowed plaintiff in action on fire insurance policy, under Civil Code of 1913, paragraph 3441, where insurer refused to pay to full extent of its liability, could not be held unreasonable and excessive, where evidence was all to effect that services rendered by counsel for plaintiff were reasonably worth that sum.
See (1) 18 C.J., p. 877, n. 20, p. 940, n. 92. (2, 3) 18 C.J., p. 880, n. 54; 26 C.J., p. 487, n. 17. (4, 5) 4 C.J., p. 787, n. 46; 18 C.J., p. 896, n. 31. (6) 32 Cyc., p. 680, n. 58. (7) 26 C.J., p. 242, n. 85. (8) 26 C.J., p. 577, n. 6. (9-11) 26 C.J., p. 574, n. 75, p. 577, n. 7.
See 9 Cal. Jur. 470; 11 Cal. Jur. 1003; 9 R.C.L. 72.
See 9 R.C.L. 122.
See 9 Cal. Jur. 97.
APPEAL from a judgment of the Superior Court of the County of Gila. C.C. Faires, Judge. Affirmed.
Mr. Maurice Blumenthal, for Appellant.
Mr. Charles L. Rawlins, Mr. Cullen A. Little and Mr. George H. Rawlins, for Appellee.
November 13th, 1924, Jane G. Dellinger died intestate, seized with the title to a house and lot situate in Globe, Arizona, and she left heirs at law. The house, which was insured by her for three years, from February 28th, 1924, in the Home Insurance Company, New York, for $1,200 loss, if any, payable to Jane G. Dellinger, owner, was destroyed by fire on May 16th, 1926. On June 22d 1925, the plaintiff, Latimer, qualified as administrator and took possession of all the property of the estate, including the insured building, and continued in possession of the same until it was destroyed. Proof of loss having been made, defendant refused payment, and the administrator brought this suit.
It is provided in one clause of the policy that it shall be void "if any change, other than the death of the insured, take place in the interest, title, or possession of the subject of the insurance. . . whether by legal process or judgment or by voluntary act of the insured, or otherwise." It is also provided in the policy that the word "insured," wherever it occurs, shall include the legal representative.
On the face of the pleadings (the answer and reply) it appears that before the fire the heirs of the insured "assigned all of their right, title, and interest in and to the property belonging to the estate of the decedent," and this raises the only question in the case on the merits.
The trial was before the court, and resulted in a judgment for the total loss, fifteen per cent statutory damages, and attorney fees of $500. The defendant has appealed.
On the merits, the legal proposition is, Did the assignment by the heirs of their right, title, and interest in the property of the estate before the destruction of the insured property render the policy void as to such interest? The law on this proposition — and to it we shall go directly, disregarding immaterial contentions of a procedural nature — may be stated to be as follows: The policy of insurance issued to Dellinger was a contract of indemnity against fire loss by her, and, in case of her death, against fire loss by the creditors of her estate and also her heirs, so long as their interest in the insured property remained unchanged by acts of theirs.
Upon the death of the insured, the ownership of the property was changed by operation of law. It became vested in the heirs, subject to the payment of the debts of the estate, the expenses of administration, and the allowance to the family. Par. 904, Civ. Code 1913. It is made the duty of the administrator to take possession of the property of the estate, both real and personal, pending the administration (par. 967, Civ. Code), and to care for and preserve the same (par. 1069, Id.).
This is not a contest between the heirs and creditors as to how the proceeds of the policy should be disposed of, or to whom; it is between the insurance company and the personal representative, who, under the terms of the policy, succeeded to the procedural rights of the insured. The administrator is the only person who could bring the suit. The creditors could not sue; neither could the heirs, the contract not having been with them. Although they are the real parties in interest, their interests must be protected by the administrator if by anyone. The right of the administrator to sue is preserved by paragraphs 400 and 401, Civil Code, as trustee of an express trust, the cestuis que trustent being the heirs and the creditors. The contract of insurance did not attach to the realty and did not pass as an incident to a conveyance or transfer of the title to the land ( Wyman v. Wyman, 26 N.Y. 253), but its validity under the terms of the policy depends upon the title of the insured property not being changed to another except through the death of the insured. If the assignment of their right, title and interest in the property of the estate by the heirs had the effect of conveying the title obtained by them through inheritance to their assignee, the provision of the policy against the change of title and interest would be violated.
The contract of assignment relied upon by defendant to effect that result was not put in evidence. We have no way of knowing what operating words, if any, it contained. We do not understand that it was a conveyance by deed of the real property inherited by the heirs at law, but an assignment of their right, title or interest in and to any residue of the property of the estate after the payment of the debts and expenses of administration. Such must have been the finding of the trial court, as without it the judgment would have been otherwise, the presumption being in favor of the existence of facts to support the judgment. The assignment, we take it, was of some right in the property of the estate not determinable until the final settlement of the accounts and the entry of the order of distribution. Such an assignment would not convey any interest in the lot occupied by the building or the building itself, as the latter partook of the nature of the lot.
It has been settled by this court that no title or interest in the realty can be transferred except by a deed of conveyance. Par. 1046, Civ. Code; Maconchy v. Delehanty, 11 Ariz. 366, 21 Ann. Cas. 1038, 17 L.R.A. (N.S.) 173, 95 P. 109. In other words an assignment of realty must be by deed.
Under the facts as they appear, we conclude that there was no change in the title, interest, or possession of the insured property except that effected by the death of the insured, and that the administrator, as the personal representative of the insured and the trustee of an express trust, was entitled to ask for and recover the loss occasioned by the fire.
The defendant contends that its offer to pay the insurance, or so much thereof as was necessary to discharge the debts of the estate, if any there were, should relieve it from the fifteen per cent penalty provided by the statute. As we have seen, such offer was no offer under the law. It is not as though the defendant had made a good-faith offer to the extent of its liability under the statute. Since it was a conditional offer and not to the full extent of defendant's liability, the damages of fifteen per cent of the amount of the loss was properly imposed. Germania Fire Ins. Co. v. Bally, 19 Ariz. 580, 1 A.L.R. 488, 173 P. 1052; Springfield Fire Marine Ins. Co. v. Goodgame, 20 Ariz. 425, 181 P. 190.
For the same reason, the defendant contends that attorney fees should have been denied. This position is as untenable on the one question as on the other. The court, after hearing the evidence on the amount of attorney's fees, allowed the plaintiff the sum of $500. It is contended by defendant that this is excessive and unreasonable. The evidence was all to the effect that the services rendered by counsel for plaintiff were reasonably worth that sum. There was no evidence that the services were worth less. The statute provides (par. 3441, Civ. Code), that the insurance company that fails, after demand upon it, to make payment of the loss sustained, shall be liable to pay the holder of the policy "all reasonable attorneys' fees for the prosecution and collection of such loss." What is a reasonable attorney's fee is a question of fact, like any other, that must be determined upon the evidence, and, while the fee here charged does seem rather large, it was determined by the evidence, and the only evidence submitted to the court.
Being satisfied that the judgment of the lower court properly went for the plaintiff, it is affirmed.
LOCKWOOD and McALISTER, JJ., concur.