Opinion
14468
April 16, 1937.
Before HOLMAN, J., County Court, Richland, September, 1936. Affirmed.
Action by M.C. Lamb against Metropolitan Mutual Fire Insurance Company. From an adverse judgment plaintiff appeals.
Amended complaint and order of Judge Holman directed to be reported follow:
AMENDED COMPLAINTM.C. Lamb, as plaintiff in the above-entitled action, complaining of the Metropolitan Mutual Fire Insurance Company, a corporation as defendant, therein alleges:
1. That the plaintiff is now, and was at all times herein mentioned, a citizen and resident of the city of Columbia, county of Richland, and State of South Carolina, and that the defendant is, and was at all times herein mentioned, a corporation under the laws of the State of South Carolina engaged in the insurance business.
2. That on the 9th day of April, 1936, the defendant issued its standard fire and windstorm insurance policy No. 202032 to the plaintiff herein, whereby the defendant insured the furniture and fixtures in the plaintiff's mercantile establishment in the city of Columbia at 1317 West Lincoln street, in the sum of $400.00 and wherein the defendant did insure the plaintiff's stock of merchandise in said building in the sum of $110.00.
3. That on the 18th day of April, 1936, and at about 4 o'clock a.m. of the said day, the storehouse in which the plaintiff was doing business and wherein was located the plaintiff's furniture, fixtures, and stock of goods, as aforesaid, insured as aforesaid, was totally destroyed by fire, and the plaintiff suffered and sustained a total loss of his furniture, and fixtures, and stock of goods in the sum of $510.00, insured as aforesaid whereby the defendant became, was, and now is indebted to the plaintiff under the said policy of insurance in the sum of $510.00, and the plaintiff alleges that all times have passed, and all things have happened, whereby the defendant should have paid the plaintiff the sum of insurance, but notwithstanding the defendant has refused and still refuses to pay the plaintiff the said sum, or any sum.
Wherefore, plaintiff sues the said defendant and demands verdict and judgment against the said defendant in the sum of $510.00, and for the costs of this action.
And for a second cause of action:
The plaintiff realleges and affirms paragraphs numbered 1 and 2 as alleged in his first cause of action.
3. Plaintiff alleges that the defendant now claims and pretends, and offers as an excuse for nonpayment of its liabilities to the plaintiff under the aforesaid policy of insurance, that certain of the plaintiff's furniture and fixtures were at the time of the issuance and delivery of the said policy under retain title contract with the vendors thereof which said contract, in legal effect, was a mortgage upon the said furniture and fixtures under said retain title contract, and the plaintiff alleges that, in fact, certain of the said furniture and fixtures were at the said time under retain title contract, but in this connection, the plaintiff further alleges that the defendant at the time of the issuance and delivery of the said policy well knew, that certain of the said furniture and fixtures were under retain title contract and well knew each and every item thereof which was under retain title contract and well knew the several amounts of the purchase price thereof then remaining unpaid, and the plaintiff warned and advised the defendant of the then existing status of the said furniture and fixtures and insisted that notation thereof be made by the defendant, and requested the defendant to make provision in its said policy whereby the status of the said furniture and fixtures so under retain title contract might be provided for and against, but the defendant steadfastly refused to consider the said status of the said furniture and fixtures so under retain title contract, and informed this plaintiff that the said statutes with respect to the amounts remaining due upon the purchase price thereof was too insignificant, and of such small amount, as that the defendant preferred to take no regard thereof, and to make no provision therefor, but upon the contrary, waived any and all questions that might arise under the said insurance policy with reference to the said status of the said furniture and fixtures so under retain title contract, and the plaintiff now alleges that any and all excuse and pretense by the defendant as to its non-liability under the said policy with respect to the said furniture and fixtures, and the retain title contract therefor, is a willful and wanton disregard of this plaintiff's rights, and of the defendant's said waiver, and is done, and pretended, in a well-formulated scheme, purpose, and design to defraud this plaintiff of moneys due to him under the said policy of insurance by the said defendant, and the plaintiff is thereby injured and damaged in the sum of $2,490.00.
Wherefore, plaintiff sues the defendant and demands verdict and judgment against the said defendant in the sum of $2,490.00, and for the costs of this action.
ORDER OF JUDGE HOLMANThe plaintiff brought a complaint against the defendant in August, 1936, which was served upon the defendant on the 12th day of August, 1936. The defendant, on August 27th, demurred to this complaint and on August 31 the plaintiff served upon the defendant on amended complaint. This amended complaint was served within the time required by law. The defendant again demurred to the complaint by its demurrer dated September 17, 1936. This demurrer was upon several different grounds. "The second ground is that there is another cause of action pending, but I hold that the amended complaint, having been served within the twenty-day period, that this ground of demurrer is untenable. The demurrer further raises the question that two causes of action are improperly joined, one ex contract and one ex delicto, the one for the amount due under the policy and the other for alleged fraud in connection with the matter. This last cause of action demands punitive damages. Under the South Carolina decisions, if two causes of action are improperly joined or misjoined, the proper method of taking exception to this is by demurrer. This rule is reiterated in the case of Thackston v. Shelton, 178 S.C. 240, 182 S.E., 436. The Court holds in this case that an action ex delicto and an action ex contract could not be joined in one and the same complaint and sustained the ruling of Judge Featherstone sustaining the demurrer. See, also, Walker v. McDonald, 136 S.C. 231, 134 S.E., 222; Ebner v. Haverty Furniture Co., 138 S.C. 74, 136 S.E., 19. I, therefore, am of the opinion, and do hold, that the demurrer on the first ground as to the misjoinder of cause of action should be and is hereby sustained.
The third ground of demurrer goes to the insufficiency of the allegations of the complaint to allow a recovery of punitive damages thereunder. There seems to be some confusion as to this rule and as I understand the rule, it is not the intention of the person that governs and controls, but the final question is whether the breach of the contract has been accompanied by and with fraudulent acts. This must not be confused with an action for fraud and deceit to induce one to enter a contract. Under the allegations here, the cause of action is not sufficient to warrant the submission of the issue to the jury as to a breach of the contract accompanied by fraudulent act. These matters have been gone into very fully by our Supreme Court and a few cases cited are sufficient to show that this is the correct rule. No amount of willfulness or deliberateness in the breach of a contract will warrant punitive damages. Owens v. Metropolitan Life Ins., Co., 178 S.C. 105, 182 S.E., 322, 323. A quotation from this case is sufficient to make this ruling very clear:
"In connection with the allegations of the plaintiff, that the defendant failed and refused to pay plaintiff the amount owing her under the terms of said policy after she complied with the provisions thereof, she makes the following additional allegation, set forth in Paragraph 6 of the complaint:
"`VI. That because of the fact defendant has wilfully breached the contract, as aforesaid, and has wilfully, fraudulently, and with intent to cheat plaintiff, and has refused to settle with plaintiff the just amount due her under the terms of said insurance policy, plaintiff has sustained punitive damages in the sum of one thousand dollars.'
"In answering the complaint, the defendant admitted the insurance of the policy in question, but alleged that the same became invalid upon termination of the plaintiff's employment; and contended that, under the terms of the policy, `no disability benefits were to be paid, unless such disability occurred, not only during plaintiff's employment, but prior to the age of sixty years, and proof thereof duly filed with the company, which the defendant alleged was not done.'
"Before the trial of the case, pursuant to due notice on the part of the attorneys for the defendant, served on counsel for the plaintiff, his Honor, Judge G. Dewey Oxner, issued the following order in the case:
"`This cause comes before me at this time upon a motion by the defendant to strike from the Amended Complaint the sixth paragraph, which reads as follows:
"`"VI. That because of the fact defendant has wilfully breached the contract, as aforesaid, and has wilfully, fraudulently and with intent to cheat plaintiff, and has refused to settle with plaintiff the just amount due her under the terms of said insurance policy, plaintiff has sustained punitive damages in the sum of one thousand dollars."
"`This is clearly an action ex contract, and counsel for plaintiff so construed it at the hearing before me. The allegations in said paragraph are irrelevant. It appearing to the Court that said paragraph should be stricken from said Amended Complaint.
"`Now, on motion of Haynsworth Haynsworth, attorneys for the defendant,
"`It is ordered that the sixth paragraph of the Amended Complaint be, and the same is, hereby stricken therefrom.'"
Numerous other cases are to the same effect. See the following: Lilienthal v. South Carolina Public Service Co., 174 S.C. 177, 177 S.E., 98; Martin v. Seaboard Air Line Ry., 70 S.C. 8, 48 S.E., 616; Holland v. Spartanburg Herald-Journal Co., 166 S.C. 454, 165 S.E., 203, 84 A.L. R., 1336; Bennett v. Dodge Bros. Corp., 169 S.C. 389, 169 S.E., 80; Hall v. General Exch. Ins. Corp., 169 S.C. 384, 169 S.E., 78, 79; Welch v. Missouri State Life Ins. Co., 176 S.C. 494, 180 S.E., 447; Lawson v. Metropolitan Life Ins. Co., 169 S.C. 540, 169 S.E., 430.
Under the above-cited cases, the allegations of the complaint are not sufficient to warrant the imposition of punitive damages and, therefore, have no place in the complaint. The demurrer should also be sustained on this ground.
It is, therefore, ordered that the demurrer be, and the same is, hereby sustained on the ground that there is a misjoinder of causes of action and that the allegations of the complaint are not sufficient to warrant the imposition of punitive damages. Provided, however, plaintiff may keep his complaint as amended and may proceed to trial as and for actual damages on either one of the causes of action, without rewriting the complaint.
Messrs. Jennings Jennings, for appellant, cite: Demurrer: 154 S.E., 106. Punitive damages recoverable for breach of contract: 2 Nott McCord, 11. Waiver: 177 S.E., 98.
Mr. C.T. Graydon, for respondent, cites: Pleadings: 97 S.C. 27; 81 S.E., 189; 101 S.C. 399; 85 S.E., 968; 178 S.C. 240; 182 S.E., 436; 136 S.C. 231; 134 S.E., 222; 138 S.C. 74; 136 S.E., 19; 178 S.C. 105; 182 S.E., 322; 174 S.C. 177; 177 S.E., 98; 70 S.C. 8; 48 S.E., 616; 166 S.C. 454; 165 S.E., 203; 169 S.C. 389; 169 S.E., 80; 169 S.C. 384; 169 S.E., 78; 176 S.C. 494; 180 S.E., 447; 169 S.C. 540; 169 S.E., 430.
April 16, 1937. The opinion of the Court was delivered by
This case, by M.C. Lamb, plaintiff-appellant, against the Metropolitan Mutual Fire Insurance Company, defendant-respondent, was commenced in the County Court for Richland County, August 12, 1936, and the purpose of the action was to recover judgment in connection with an insurance policy issued by the defendant to the plaintiff, and the case comes to this Court on appeal from an order of his Honor, the County Judge, sustaining the demurrer of the defendant to the plaintiff's amended complaint.
After due consideration of the record in the case, we are satisfied that the trial Judge reached the right conclusion in sustaining the demurrer. The exceptions are, therefore, overruled and the judgment of the lower Court affirmed.
MR. CHIEF JUSTICE STABLER and MESSRS. JUSTICES BONHAM, BAKER and FISHBURNE concur.