Title: Morris v. Morris

State: oregon

Issuer: Oregon Supreme Court

Document:

544 P.2d 1034 (1976)
A.L. MORRIS, Respondent, Cross-Appellant,
v.
Alta F. MORRIS, Appellant, and Oregon Mutual Insurance Company, Cross-Respondent.

Supreme Court of Oregon.
Argued and Submitted October 27, 1975.
Decided January 29, 1976.
*1035 John R. Barker, Portland, argued the cause for appellant. J. Terrence Bittner, Jones, Lang, Klein, Wolf & Smith, Portland, were on the briefs.
Milo W. Pope, Milton-Freewater, argued the cause for cross-respondent. With him on the brief was Charles A. Phipps, The Dalles.
James M. Habberstad, The Dalles, argued the cause for respondent, cross-appellant. With him on the brief were Dick & Dick, The Dalles.
Before O'CONNELL, C.J., and McALLISTER, DENECKE, TONGUE, HOWELL and BRYSON, JJ.
McALLISTER, Justice.
This is an action for a declaratory judgment to determine the right to fire insurance proceeds as between the life tenant Alta F. Morris and the remainderman A.L. Morris.
The facts were stipulated. The defendant, Alta F. Morris, is the life tenant of a farm in Wasco County. Her son, A.L. Morris, the plaintiff, is the remainderman. The defendant, Alta F. Morris, purchased fire insurance from Oregon Mutual Insurance Company insuring a farmhouse on the farm for $15,000, the full value thereof. All premiums on the policy were paid by Alta F. Morris and she is the only insured named in the policy. On March 10, 1973 the farmhouse was totally destroyed by fire. The fire was not caused by or contributed to by the negligence of defendant.
On April 27, 1973 before Oregon Mutual had paid the proceeds of the policy, plaintiff informed Oregon Mutual of his interest in the property. Defendant Alta F. Morris received all the proceeds of the policy and has not used the proceeds to reconstruct the farmhouse or to restore the property to its former condition, nor has she offered to reimburse the plaintiff for the loss resulting from the loss of the farmhouse.
The trial court found in favor of plaintiff against defendant Alta F. Morris, but found for Oregon Mutual. Both the plaintiff and defendant Alta F. Morris have appealed.
Plaintiff contends, and defendant denies, that a portion of the fire insurance proceeds, which Alta F. Morris received, belongs to plaintiff as remainderman. The only issue is whether plaintiff is entitled to any portion of the insurance proceeds.
It is the general rule that a life tenant is entitled to all the proceeds for a loss if the life tenant has procured the insurance policy in his own name and for his own benefit and has paid the premium from his own funds. The general rule is not changed by the fact that the insurance is for the full value of the property rather than only for the value of the life tenant's interest in the property. Annotation, Life Tenant  Insurance  Remainderman, 126 A.L.R. 336, 345 et seq.; 51 Am.Jur.2d 416, Life Tenants and Remaindermen, § 158; Restatement of Property, § 123(2).
In the Annotation in 126 A.L.R. the annotator, at page 345, states the rule thus:
Converse v. Boston Safe Deposit & Trust Co., 315 Mass. 544, 53 N.E.2d 841, 843 (1944), is typical of the cases holding in accord with the general rule. We quote from that case:
Accord: Home Insurance Company v. Adler, 269 Md. 715, 309 A.2d 751 (1973); Barner v. Barner, 241 Ark. 370, 407 S.W.2d 747 (1966); Russell v. Williams, 58 Cal. 2d 487, 24 Cal. Rptr. 859, 374 P.2d 827 (1962); Coleman v. Gardner, 231 Ark. 521, 330 S.W.2d 954 (1960); In re Gorman's Estate, 321 Pa. 292, 184 A. 86, 87 (1936), Comment, 35 Mich.L.Rev. 150.
Plaintiff has cited three cases from other jurisdictions, but, upon examination, we find those cases are inapposite and do not support his position.
Although there are no Oregon cases directly on point, our decisions in analogous situations are in accord with the general rule. In Miller v. Gold Beach Packing Co., 131 Or. 302, 282 P. 764, 66 A.L.R. 858 (1929), the tenant of a building secured a fire insurance policy covering the building. The building was destroyed by fire and the tenant declined to use the insurance proceeds to rebuild. The lessors brought an action to recover the value of their interest in the estate as remaindermen. This court said:
The court concluded that the contract for insurance was personal, the tenant was not the lessors' agent or trustee, and there was no rule of law which authorized giving any surplus beyond the tenant's fair compensation to the lessors. "They were strangers to the contract of insurance, and must now be content to remain strangers to its fruits." 131 Or. at 313, 282 P.  at 768. Accord: Trans. Equip. Rentals v. Ore. Auto. Ins., 257 Or. 288, 298-299, 478 P.2d 620 (1970); Yoshida v. Security Ins. Co., 145 Or. 325, 336-337, 26 P.2d 1082 (1933).
Plaintiff has cited Hale v. Cooke, 142 Or. 23, 18 P.2d 808 (1933), but the facts and issues in that case are not similar to the case at bar and the case is not in point here.
The judgment of the trial court is reversed with instructions to enter judgment for defendant Alta F. Morris. This disposition of the main issue makes it unnecessary to consider plaintiff's cross-appeal.