He explained the economic facts of life to Tannerfors in his letter of July 28, 1965 (P-1-r), and requested her approval of the bifurcation. The next day he broached the same subject to all counsel in his letter of July 29, 1965 (D-6), setting forth the economic hardships faced by his client.
Rodgers, still under the belief that American Fidelity had disclaimed coverage under Bray's policy, emphasized in both communications that the maximum amount Tannerfors could expect to receive was $10,000.00, and that producing his client for medical examinations in this country would be a great inconvenience.
Gurny, convinced of the authenticity and seriousness of Tannerfors' injuries because of his previous association with one of her treating physicians (Tr. 2.119-2.122), determined that the issue of liability was the only issue of concern in Bray's defense.
All counsel acquiesced to the bifurcation. Rodgers reported to Tannerfors that her presence was not required for the trial. (P-1-t)
As the date for the June 1966 trial approached, American Fidelity, through the efforts of its Florida representative, located Bray and arranged for him to attend the trial. Bray, still laboring under the impression that his presence in the suit was nominal, attended the trial for two days. (Tr. 3.64)
Gurny never discussed the case with Bray outside the courtroom, nor did he discuss it with him before placing him on the stand, and when Bray finished testifying, Gurny instructed him to "go home and forget about it." (Tr. 3.66-3.67)
The jury rejected Gurny's theory that the proximate cause of the accident was the phantom automobile, and found liability exclusively against Bray.
A trial date of June 29, 1966 was set on the issue of damages before the Superior Court judge without a jury. At the commencement of the damages trial, Gurny finally offered the full policy in settlement of the claims. (D-7) But by this time, and largely for other reasons, Rodgers had decided to decline the offer, and the trial on damages proceeded in the absence and without the knowledge of Bray, who had been sent home with the advice to forget about it.
Rodgers recognized throughout the litigation that Tannerfors' injuries were so severe that both the most and the least she could recover if there was coverage of $10,000/$20,000 was $10,000.00. (Tr. 4.65, 4.67, 4.75) However, he realized that a judicial apportionment among the other four injured parties, Gernant, Berchtenbreiter, Glahn and Cooper, would be required no matter what recovery was achieved.
The potentially equal claims for damages, although small in comparison to Tannerfors', required a judicial apportionment to determine their participation in the distribution of the other $10,000.00.
Thus, although Gurny offered the full policy at the commencement of the trial on damages in settlement of all claims, Rodgers could not settle the Tannerfors claim for $10,000.00 without specific authorization from his client in Sweden. Rodgers felt that as long as he was putting the Gernant and Berchtenbreiter damage issues before the trial judge, he might as well put Tannerfors' damages before the court for determination. (Tr. 4.105)
The trial on damages consisted of the testimony of one physician and the submission of the hospital records of the injured parties. (P-1-u) Gurny, convinced that Tannerfors' injuries were legitimate and valued at more than $10,000.00 (Tr. 2.120-2.121), did not object to the introduction of the hospital records despite the fact that they were almost two years old. (Tr. 2.144) He had taken no steps to have Tannerfors examined by his own experts, nor had he sought to ascertain her current physical condition.
The trial judge awarded damages for personal injury to Gernant in the sum of $9,000.00, the Berchtenbreiter administrator in the sum of $10,000.00, Frances Cooper in the sum of $500.00, Harry Glahn in the sum of $500.00, and Tannerfors in the sum of $75,000.00. (P-1-u)
The proceeds of the Bray insurance policy were apportioned among the claimants. Tannerfors received $10,000.00, the maximum amount available under the policy limits, in partial satisfaction of her claims. (D-8) The other claimants received their proportional amounts from the remaining $10,000.00. (Tr. 4.64)
Bray, now back in Florida and ignorant from the outset of his potential liability in the suit, was never informed of the final judgments entered against him. (Tr. 3.18)
It was not until he received a phone call from Tannerfors' present attorney, in the early summer of 1971, that Bray realized a judgment of $75,000.00 had been entered against him in the New Jersey auto accident lawsuit. (Tr. 3.19, 3.39)
Tannerfors' present attorney explained to Bray that, if Bray assigned to Tannerfors his right to sue American Fidelity for the excess judgment, Tannerfors would release him from that judgment. (Tr. 3.39)
On June 15, 1971, Tannerfors' attorney sent such an assignment form for Bray's execution (P-1-p) and a covering letter (P-1-q) confirming the previous telephone conversation.
Bray did not sign the assignment. On August 27, 1971, Bray was approached by Jack Nix, acting on behalf of Tannerfors, with another assignment for execution. Nix again explained to Bray that the purpose of the assignment was to relieve Bray of financial responsibility arising out of the Tannerfors judgment. (Tr. 3.24) Bray executed the assignment (P-1-p) after Nix's explanation of the purpose of the document on August 27, 1971. By this action he relieved himself of the burden of the judgment which had been filed against him.
Defendant American Fidelity contends that the assignment was invalid for lack of consideration, mistake of fact, and subsequent revocation by Bray. Under Klaxon v. Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1940), a federal court sitting in diversity must apply the conflicts principles of the forum state. Both parties agree that under New Jersey conflicts laws, this Court should apply the substantive law of Florida, the place of execution of the assignment, in determining its validity. The Court agrees. See Freedom Finance v. New Jersey Bell Telephone Co., 123 N.J.Super. 255, 302 A.2d 184 (L.Div.1973).
The crux of defendant's attack upon the assignment is that Bray misunderstood the nature and purpose of the assignment. The Court disagrees.
Understandably, Bray might have been perplexed when Tannerfors' attorney first offered to release Bray from liability under Tannerfors' judgment in exchange for an assignment of his rights against the defendant. However, it must also be remembered that Bray had no knowledge that he had any liability under any judgment at that juncture.
This Court is convinced that at the time he executed the assignment, Bray realized he was being released of financial responsibility under the Tannerfors judgment in exchange for authorizing Tannerfors to sue on his insurance policy. (Tr. 3.79-3.80)
Tannerfors' forebearance in asserting her legal rights against Bray under the New Jersey judgment is sufficient consideration to support an assignment of Bray's contractual rights under his insurance policy. Cf. McNulty v. Nationwide, 221 So.2d 208 (Fla.App.1969); Selfridge v. Allstate, 219 So.2d 127 (Fla.App.1969). The fact that Bray did not receive a written document memorializing Tannerfors' release of the judgment does not invalidate Bray's assignment of his cause of action:
It is well settled that parol evidence is admissible to establish the actual consideration supporting a written contract of the nature here asserted. It is also well settled that parol evidence is available to connect several written instruments as being parts of one transaction. [citations omitted] If it be a fact, as alleged, that the formal release given . . . was for a consideration in addition to that recited therein, it is competent, consistent with other rules of evidence, to establish such a parol testimony.
Asphalt Paving Inc. v. Ulery, 149 So.2d 370, 377 (Fla.1963).
Bray's testimony establishes that he understood that his execution of the assignment was in exchange for a release of financial responsibility under the Tannerfors judgment. (Tr. 3.79) Each party received consideration in the contractual bargain, and each party is bound to its contractual obligations. Defendant's assertions of lack of consideration and mistake of fact in relation to the assignment are thus misapplied, assuming, without deciding, that American Fidelity has standing to raise either of these two issues as to the assignment from Bray to Tannerfors.
Defendant next claims that even if the initial assignment from Bray to Tannerfors was valid, Bray later revoked the assignment of his rights under the insurance policy, and therefore plaintiff has since lost whatever rights she received under the initial assignment. The factual history of the revocation is significant in this regard.
On April 11, 1974, Claire Tomlin, a representative of American Fidelity, called on Bray at his home in Pace, Florida. Tomlin informed Bray that the assignment (P-1-p) which he had earlier executed had failed to release him of liability under Tannerfors' judgment. (Tr. 3.128-3.130) Tomlin presented Bray with two different forms for revocation of Tannerfors' assignment. (D-15 and D-17) Bray, in reliance on Tomlin's misrepresentations and believing that Tannerfors had deceived him and that he had not been released from liability for the judgment, executed both documents.
The defendant was not yet satisfied with having procured the April 11, 1974 revocations. On June 13, 1974, Claire Tomlin journeyed again to Bray's home to secure yet another affidavit, which purported to affirm the previous revocation of the assignment of his rights under the policy. (D-16) Bray executed this third document as well. The real purpose of the new affidavit, however, was to get Bray to swear to the allegations in paragraphs 6, 7, 8 and 9, which had nothing to do with the initial assignments.
It is noteworthy that the third document (D-16) was in affidavit form, and that before signing this document, Bray crossed out paragraphs 6, 7, 8 and 9:
6. I was advised by my insurance company and the attorney assigned to represent me, that the amount which was being claimed by Britta Randall was in excess of my insurance coverage.