Ellinger v. Equitable Life Assurance Society of the United States

132 Wis. 259 | Wis. | 1907

The following opinion was filed April 9, 1907:

Cassoday, C. J.

The statute declares:

“The court before which an action is pending, or a judge thereof, may, in discretion and upon due notice, order either party to give to the other, within a specified time, an inspection and copy or permission to take a copy of any books, papers and documents in his possession or under his control containing evidence relating to the merits of the action or of the defense therein.” Sec. 4183, Stats. (1898).

One of the circuit court rules provides that such application may be made “by either party to compel the other to give him inspection and a copy, or permission to take a copy, of any books, papers or documents in his possession or under his control which may be necessary to enable the applicant to frame his complaint, answer or reply, as the case may be, or wbicb shall be material to any application made by him for any provisional remedy.” Subd. 1, sec. 1, Circuit Court Rule XIX (New Rule XVIII). Another subdivision of the same rule authorizes such inspection as “may be necessary to enable the party applying therefor to prepare for trial.”

This court has repeatedly held, in effect, that this rule, though adopted prior to the section of the statute quoted, was not superseded by that statute, but that the two continued in force, and to a certain extent supplemented each other. Noonan v. Orton, 28 Wis. 600; Kraus v. Sentinel Co. 62 Wis. 660, 23 N. W. 12; Schuetze v. Continental L. Ins. Co. 69 Wis. 252, 254, 255, 34 N. W. 90; Ellinger v. Equitable L. Assur. Soc. 125 Wis. 643, 647, 104 N. W. 811. Upon proper application the rule authorizes such inspection whenever it “may be necessary to enable the applicant to frame his” pleading or “to prepare for trial.” .Upon such application the statute authorizes such inspection whenever the books, papers, or documents sought to be inspected “contain evidence relating to the merits of the action or of the defense therein.” Of course, such “evidence relating to the merits of the action” would be helpful in preparing for trial, and might be all that would be necessary to enable the applicant to frame his pleading.

Another section of the same rule requires that “the petition or affidavit to obtain such inspection . . . must state” that such books, papers, or documents “are not in the possession or under the control of the applicant, and that he is advised by his counsel and verily believes that such inspection and copy of such books, papers or documents as are therein mentioned is necessary to enable him to frame his complaint, answer or reply, or to obtain some provisional remedy, or to prepa/re for trial, as the case may be, and shall state the facts and circumstances relied on to obtain the order for such inspection and copy or permission to take a copy of such books, papers or documents.” Sec. 2, Circuit Court Rule XIX.

Tbe affidavit of tbe plaintiff’s attorney in making sucb application for inspection in tbis case, so far as acting upon tbe advice of counsel is concerned, seems to bave been a substantial compliance with tbe portion of tbe rule last quoted. Tbe manifest purpose of tbe rule and statute, when taken together, was to secure to tbe party making proper application sucb right of inspection whenever “necessary to enable him to frame bis” pleading or “to prepare for trial,” or when tbe document sought to be inspected contains “evidence relating' to tbe merits of” tbe controversy. Sucb is tbe general scope of inquiry prescribed by tbe statute and tbe rules of court.

Tbe important question in tbe case at bar is whether tbe order granting sucb inspection, and from which tbis appeal is taken, is justified by the facts in tbe record upon which it is based. Tbe facts set forth in tbe foregoing statement need not be here repeated. Tbe purpose of tbe application appears to bave been to ascertain by sucb inspection tbe amount of tbe reserve fund and surplus funds and other funds properly belonging to tbe plaintiff’s policy during tbe twenty years it was in force. In addition to tbe defendant’s agreement to pay $15,000 on satisfactory proof of tbe plaintiff’s death, tbe contract of insurance provides that tbe “tontine dividend period” for the policy should be completed March 10, 1904, and also contained tbe following provisions:

“(3) That no dividend shall be allowed or paid upon tbis policy unless tbe person whose life is hereby assured shall survive tbe completion of its tontine dividend period as aforesaid, and unless tbis policy shall be then in force..

“(4) That all surplus or profits derived from sucb policies on the semi-tontine plan, as shall not be in force at tbe date of tbe completion of their respective tontine dividend periods, shall be apportioned equitably among sucb policies as shall complete their tontine dividend periods.

“(5) That upon tbe completion of tbe tontine dividend period on March 10, 1904, provided tbis policy shall not bave been terminated previously by lapse or death, said At-bert Ellinger shall have the option either: First, to withdraw in cash this policy’s entire share of the assets; i. e. the accumulated reserve, which shall be $5,645.25, and in addition thereto the surplus apportioned by this society to this policy; secondly, to convert the same into a paid-up policy for an equivalent amount, provided always that if the amount of said paid-up policy shall exceed the original amount of the assurance, a satisfactory certificate of good health from one of the society’s medical examiners shall be required; thirdly, to continue the assurance for the original amount, and apply the entire tontine dividend to the purchase of an annuity, the amount derived from such annuity, together with the annual dividend on this policy, shall be paid in cash to said Albert Ellinger or assigns; or fourthly, to withdraw in cash the share of the accumulated surplus apportioned by said society to this policy, and continue the policy in force on the ordinary plan.”

There is no question but that the plaintiff survived the completion of the tontine dividend period mentioned in the policy — March 10, 1904 — nor that the policy was then still in force. Such being the facts, the contract expressly gave to the plaintiff an equitable and proportionate share of “all surplus or profits derived from such policies on the semi-tontine plan” as should “not be in force at the date of the completion of their respective tontine dividend periods.” That contract, moreover, expressly gave to the plaintiff the choice of exercising “either” of the four options therein prescribed. One was that the plaintiff might “withdraw in cash this policy’s entire share of . . . the accumulated reserve, . . . and in addition thereto the surplus apportioned by this society to- this policy.” The amount of the accumulated reserve is mentioned in the policy, but the surplus apportioned by the defendant to the policy is not mentioned, and there is no way for the plaintiff to ascertain the amount to which he was so entitled March 10, 1904, except by information to be derived from the defendant. So the plaintiff could only ascertain the amount to which he was so entitled March 10, 1904, under the other options by information to be derived from tbe defendant. A knowledge of tbe facts on tbe part of tbe plaintiff was essential to an intelligent exercise of' tbe options thus secured by tbe contract. One of tbe objects of tbe lengthy examination of tbe plaintiff under sec. 4096 was, seemingly, to compel tbe plaintiff to elect wbicb clause of tbe contract be would rely upon, while in ignorance of tbe facts. Tbe plaintiff was not bound to accept tbe defendant’s volunteered statements as to such amounts, but for tbe purpose mentioned bad tbe right to an inspection of any books, papers, or documents in tbe defendant’s possession or under its control. Such reserve funds and surplus funds and profits are held by tbe defendant in trust for such policyholders, if any, as are entitled to tbe same, including tbe plaintiff. Huber v. Martin, 127 Wis. 412, 105 N. W. 1031, 1135. Tbe plaintiff, as well as other policy-holders, is entitled to know tbe amounts and conditions of such funds. Tbe application for inspection is not to discover whether tbe plaintiff has a cause of action. That is secured, if at all, by tbe contract itself. But it is important for the plaintiff to wisely allege facts in tbe complaint wbicb be may be able to prove after having made such inspection. In tbe language of this court several years ago:

“We see no good reason why tbe proposed examination should not be bad, in order that tbe complaint may, if possible, be made definite and certain in tbe particulars concerning wbicb discovery is sought.” State v. Baetz, 86 Wis. 29, 31, 56 N. W. 329.

Tbe statute and tbe rule are remedial and should be liberally construed. Ellinger v. Equitable L. Assur. Soc. 125 Wis. 643, 646, 104 N. W. 811, and cases there cited. There seems to be no good ground for bolding that tbe making of tbe order appealed from was an abuse of discretion.

By the Court. — Tbe order of tbe circuit court is affirmed.

TimliN, T., took no part.

A motion for a rehearing was denied June 20, 1907.