Court Opinion

ID: 5028727
Source: CourtListenerOpinion
Date Created: 2021-10-01 05:12:14.142713+00
Date Added: 2024-06-11T08:18:04.170123
License: Public Domain

MASSEY, Chief Justice
(dissenting).
I am of the opinion that the judgment should be reversed and rendered rather than reversed and remanded. When Danaher accepted the endorsed draft from Davidson, he, Danaher, was “on notice” that the insurance company theretofore had succeeded to all or part of the very cause of action presently being asserted.
In his testimony Danaher admitted that when he saw the draft he knew that Davidson’s insurance company had made some sort of a settlement with him under and by virtue of the loss and damage Davidson sustained as result of the fire. The draft did not bear language which necessarily would have put Danaher on notice of such fact. I see no distinction to be made, however, were the case one where such language did appear — and was observed at the instant it was tendered.
Danaher was bound to have been aware that some sort of consideration had theretofore passed from the insurance company to Davidson or there would have been no insurance settlement. Necessarily, Danaher must be held to have known as a matter of law (whether or not he knew it as a matter of fact) that all or a part of the cause of action against him, originally Davidson’s, had become the property of the insurance company. Under equitable principles, ownership of part, if not all, of Davidson’s cause of action was automatically transferred when the insurance company consummated settlement of Davidson’s insurance policy loss. Having knowledge that there had been such a settlement, Danaher, perforce the operation of law, knew as of the time of Davidson’s tender that it was of consideration which did not include the release of that part of Davidson’s originally owned cause of action which had become the property of the insurance company.
I believe that Danaher must be held to have been informed and aware that Davidson was not tendering him the consideration he had agreed to accept. Although he accepted what was tendered, Danaher may not be heard to contend that he obtained a release of the whole cause of action, for he knew that such was not within the power of Davidson to deliver.