Court Opinion

ID: 9547749
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:51:27.944087+00
Date Added: 2024-06-11T15:18:02.874065
License: Public Domain

TRAYNOR, J.
I dissent. In my-opinion plaintiff’s action is barred on the ground that plaintiff has been fully compensated by the carrier for the injury to its goods and would be unjustly enriched by a double recovery.
“When the plaintiff has accepted satisfaction in full for the injury done him, from whatever source it may come, he is so far affected in equity and good conscience, that the law will not permit him to recover again for the same damages.” (Lovejoy v. Murray, 3 Wall. (U.S.) 1, 17 [18 L.Ed. 129]; Miller v. Beck, 108 Iowa 575 [79 N.W. 344]; The Beaconsfield, 158 U.S. 303, 307 [15 S.Ct. 860, 39 L.Ed. 993]; Le Blond Schacht Truck Co. v. Farm Bureau Mut. Aut. Ins. Co., 34 OhioApp. 478 [171 N.E. 414]; Hart v. Western R. R. Corp., 54 Mass. (13 Met.) 99, 105 [46 Am.Dec. 719].) Whether the persons who are responsible to the plaintiff have acted jointly or separately is immaterial, for the controlling questions are whether the loss for which they are responsible is identical and whether the payment by one of them has fully compensated the plaintiff. As this court stated with respect to an injury for which several persons were responsible: “Whether it was caused by their joint or several acts is immaterial. It would be subordinating substance to mere form to say that these two actions do not under the circumstances rest upon one and the same cause. This being so, and it appearing that *353plaintiff had been once compensated for the injury suffered, the court below was right in denying her a second award of damages for the same act.” (Butler v. Ashworth, 110 Cal. 614, 620 [43 P. 4, 386].) “Where the bar accrues in favor of some of the wrongdoers by reason of what has been received from . . . one or more others . . . the bar arises, not from any particular form that the proceeding assumes, but from the fact that the injured party has actually received satisfaction. ...” (Dawson v. Schloss, 93 Cal. 194, 199 [29 P. 31]; Tompkins v. Clay Street R. R. Co., 66 Cal. 163,166 [4 P. 1165]; Urton v. Price, 57 Cal. 270, 272.)
Since the rule against double recovery is aimed at preventing unjust enrichment, it is not only immaterial whether plaintiff has one or several causes of action against tort feasors, but whether one of his causes of action is based on contract and the other on tort, whether the one requires proof of negligence and the other does not. The decisive consideration in barring an action seeking double recovery is that plaintiff shall not recover twice for his loss by taking advantage of the fortuitous circumstance that more than one person is responsible to him for that loss. (Prosser, Torts, 1105-1107; see, also, Ash v. Mortensen, 24 Cal.2d 654, 657 [150 P.2d 876]; Wheat v. Carter, 79 N.H. 150 [106 A. 602]; Coleman v. Gulf Refning Co., 172 Ark. 428 [289 S.W. 2].)
As a bailee the carrier had a right to bring an action for damages for the injury to the goods in its custody, even before it compensated the bailor for its loss. (Armstrong v. Kubo & Co., 88 Cal.App. 331, 334 [263 P. 365] ; Bode v. Lee, 102 Cal. 583 [36 P. 936]; Roberts v. Burr, 135 Cal. 156, 161 [67 P. 46] ; Whithworth v. Jones, 58 Cal.App. 492, 497 [209 P. 60]; Burkett v. United States, 71 F.2d 683; The Beaconsfield, 158 U.S. 303, 307 [15 S.Ct. 860, 39 L.Ed. 993]; Juniata Acceptance Corp. v. Hoffman, 139 Pa.Super. 87 [11 A.2d 494]; see Rest., Judgments, § 88(2); Holmes, The Common Law, 167 et seq.) Damages for the injury to the goods, which it would recover as trustee for its bailor before it paid the bailor’s damages, could be recovered by the carrier on its own account after it had satisfied the bailor. Since the carrier’s damages, including its outlay to compensate its bailor, would determine its cause of action against defendant, it is clear that the carrier would have to deduct from its claim the amount it had received as a result of the sale of part of the *354goods that were salvaged as well as the value of the goods remaining in its hands. If plaintiff is entitled to bring the present action, however, it is difficult to see on what theory it would be required to deduct from its claim the proceeds of the sale of the salvaged goods or the value of the goods remaining in the hands of the carrier. The sale was made, not "for the account of plaintiff, but for the account of the carrier who received the proceeds thereof, and the goods remaining in the hands of the carrier are no longer the plaintiff’s since it has received from the carrier the full amount for which it could have sold the goods had they arrived safely at their destination. Moreover, if plaintiff could bring this action, it is not clear why, as the majority opinion states, defendant could raise the defense of contributory negligence. It is settled that contributory negligence of the carrier is no defense in an action for damages to the goods of a shipper brought by the shipper against one who has injured the goods. (Hornstein v. Kramer Bros. etc. Lines, 133 F.2d 143, 147; see 2 Rest., Torts, § 489; Prosser, Torts, 425, and cases there cited.) To hold that in the present action defendant is entitled to raise that defense because plaintiff is already fully compensated for its damages by the carrier would simply mean that plaintiff cannot bring an action for its own account and is merely suing as a trustee for the carrier. Plaintiff, however, has not brought this action as a trustee nor does it want to be treated as such, for it has taken the position that contributory negligence of the carrier cannot be set up against it on the ground that its cause of action is different from that of the carrier. Although plaintiff concedes that it has received full compensation for its loss from the carrier and-has even turned over to the carrier what was received from the sale of the salvaged goods, it brings this action as if it were entitled in its own right to the damages it seeks from defendant. Plaintiff has offered no reasonable explanation why this action is brought by it rather than by the carrier. The conclusion seems inescapable that the purpose is to defeat legitimate defenses that defendant might have against the carrier.
It is contended that the rule against double recovery does not apply to this action on the grounds that plaintiff recovered from the carrier by virtue of its contract and that its claim thereunder is independent of any claim against defendant as a tort feasor. - In support of this contention an analogy to an insurance contract is invoked. It is asserted that had plain*355tiff been compensated under an insurance contract it would not be barred from bringing an action against one who injured its goods, and that similarly it should not be barred because it has received compensation for its loss under a contract with a common carrier whose liability for the damages, like that of an insurer, does not depend on any fault of its own.
Certain insurance benefits are regarded as the proceeds of an investment rather than as an indemnity for damages. Thus it has been held that the proceeds of a life insurance contract made for a fixed sum rather than for the damages caused by the death of the insured are proceeds of an investment and can be received independently of the claim for damages against the person who caused the death of the insured. The same rule has been held applicable to accident insurance contracts. As to both kinds of insurance it has been stated: “Such a policy is an investment contract, giving the owner or beneficiary an absolute right, independent of the right against any third person responsible for the injury covered by the policy.” (Gatzweiler v. Milwaukee Elec. Ry. & L. Co., 136 Wis. 34 [116 N.W. 633, 128 Am.St.Rep. 1057, 16 Ann.Cas. 633, 18 L.R.A.N.S. 211] ; Suttles v. Railway Mail Assn., 156 App. Div. 435 [141 N.Y.S. 1024, 1026]; see 18 A.L.R. 678; 95 A.L.R. 575; 29 Am.Jur. 1003-4.) Hence in the ease of life or accident insurance, the insurer, in the absence of a provision to the contrary in the insurance contract, has no right to be subrogated to the rights of the owner or beneficiary of the policy against the wrongdoer who caused the insured’s death or injury. An insurer who fully compensates the insured, however, is subrogated to the rights of the insured against one who injured his property if the insurance was for the protection of the property of the insured, and was therefore an indemnity contract. (See Vance, Insurance (2d ed.), 668-681; 6 Appleman, Insurance, §§ 4051, 4052; 29 Am.Jur. 999-1001, 1003-1004.) In such eases subrogation is the means by which double recovery by the owner is prevented and the ultimate burden shifted to the wrongdoer where it belongs. (Hart v. Western R. R. Corp., 54 Mass. (13 Met.) 99, 105 [46 Am. Dec. 719].) The wrongdoer must bear the ultimate burden of the injury and cannot escape liability because the owner is insured, for the insurance was not taken for the benefit of the wrongdoer but for that of the owner.
So long as there was no merger of law and equity procedure *356an insurance company subrogated to the right of the insured could not bring an action at law but could only sue in equity when it availed itself of the rights of its insured against a third person. (See cases collected, 96 A.L.R. 864; Clark, Code Pleading, 109.) The result was that the insured had to bring the action in his own name, and the defendant could not raise the defense that the insured was paid for his damages because the allowance of such a defense would, for procedural reasons, have defeated any recovery against the wrongdoer. Since courts have recognized that under modern procedure one who is subrogated to the rights of another can bring any action that the other could have brought, they have also recognized that when the insured is fully compensated for his property damages by an insurer, the latter may bring an action for the damages against a third person and that if the insured brings the action he can do so only as a trustee for the insurer. (Harrington v. Central States Fire Ins. Co., 169 Okla. 255 [36 P.2d 738, 96 A.L.R. 859]; Firemen’s Ins. Co. v. Bremner, 25 F.2d 75, 76; see Offer v. Superior Court, 194 Cal. 114, 120 [228 P. 11]; cases collected 96 A.L.R. 868, 869; 29 Am.Jur. 1016; 6 Appleman, Insurance, p. 604; see, also, Lord & Taylor v. Yale & Towne Mfg. Co., 230 N.Y. 132, 141 [129 N.E. 346] ; Vahlsing, Inc. v. Hartford Fire Ins. Co. (Tex.Civ.App.), 108 S.W.2d 947; Clark, Code Pleading, 109-110.)
In the present case the defendant does not escape liability if plaintiff is barred from bringing this action, for defendant is liable to the carrier for any injury suffered by the carrier caused by defendant’s negligence. Since the carrier has a cause of action of its own for all its damages the equitable doctrine of subrogation is not needed; the amount of the carrier ’s damages is simply increased by the fact that it was liable to plaintiff for the injury to plaintiff’s goods and has compensated plaintiff therefor.
It appears, therefore, that if plaintiff is suing in its own right, it cannot recover compensatory damages for the wrong, for it has been fully compensated for all of its actual damages. If plaintiff is not suing in its own right, it has failed to bring itself within any justifiable exception to the requirement of modern pleading that an action must be maintained by the real party in interest. The only purpose the action can serve is somehow to defeat the defenses that the defendant may have against the carrier. This court should not lend its aid to the accomplishment of such a purpose.