                                         NO.    i3114

           T N THE SUPREME COURT OF THE STATE OF MONTANA

                                            19 75



S'I'ATE 3fi MON'I'HNA ex re1 NAWD'S
T.V. AND APPLIANCE I N C . , e t a l . ,

                                    Relators,



'CHL DlSTRICT COURT OF THE THIRTEENTH
JUDICIAL DISTRICT OF THE STATE OF
MONTANA, I N AND FOR THE C U T O      O NY F
YELLOWSTONE, and t h e HON. ROBERT H. WILSON,
Judge o f t h e T h i r t e e n t h J u d i c i a l D i s t r i c t ,
Jcdge p r e s i d i n g ,




Counsel of Record:

        For R e l a t o r s :

               McNamer, Thompson and Cashmore, B i l l i n g s , Montana
               C h a r l e s Cashmore argued B i l l i n g s , Montana



               Crowley, K i l b o u r n e , Haughey, Hanson 6 G a l l a g h e r ,
                B i l l i n g s , Montana
               A l l e n J. L e r n e r a r g u e d , B i l l i n g s , Montana



                                                    Submitted :         October 3 0 , 1975




        /-              )    J
                             , -'

                            fl                        Clerk
Mr. Justice Frank I. Haswell delivered the Opinion of the Court.
        Relators seek a writ of supervisory control to review
and modify a district court order requiring substitution and
joinder of several parties plaintiff in a damage action.    Spec-
ifically, the district court of Yellowstone County ordered sub-
stitution of fully subrogated insurers for their respective
insureds as plaintiffs, and ordered joinder of partially subro-
gated insurers as additional plaintiffs.
        Relators herein filed an action for damages against the
manufacturer of Magnavox television sets and its subsidiary as
a result of a fire on November 5, 1971, on the premises of one
of its franchised retailers in Billings, Montana.    The complaint
alleges the fire was caused by a defectively designed and manu-
factured TV set.   Recovery is sought on the basis of negligence,
breach of warranty and strict liability in tort.    Damages claimed
include property damage, personal injuries and business losses.
        Plaintiffs in the damage action, relators here, have been
compensated, in whole or in part, by their respective insurance
carriers and each carrier has become subrogated, to the extent of
its payment, to the rights of its insured against defendants.
        Defendants in the damage action moved (1) for summary
judgment against the plaintiffs who had been fully compensated
by their respective insurance carriers, and (2) for partial summary
judgment against those plaintiffs who had been partially compen-
sated by their respective insurance carriers, or in the alter-
native for joinder of such carriers as real parties in interest.
Plaintiffs responded by requesting the district court to permit
ratification in lieu of substitution or joinder for both classes
of carriers under Rule 17(a), M.R.Civ.P.
        On September 10, 1975, the district court entered an order:
(1) Denying defendants' motions for summary judgment and partial
summary judgment, (2) requiring fully subrogated carriers
substituted for their respective insureds, and (3) requiring
partially subrogated carriers joined as additional parties plain-
tiff.
         The issue before this Court is whether the district
court's order is correct. There is no issue in this proceeding
                      court ' s
concerning the district/ denial of summary judgment or partial
summary judgment.
         The controlling statute on the remainder of the district
court's order is Rule 17(a), M.R.Civ.P., which provides in
pertinent part:
         "(a) Real Party in Interest. Every action shall
         be prosecuted in the name of the real party in
         interest * * *. No action shall be dismissed on
         the ground that it is not prosecuted in the name
         of the real party in interest until a reasonable
         time has been allowed after objection for ratifi-
         cation of commencement of the action by, or joinder
         or substitution of, the real party in interest;
         and such ratification, joinder, or substitution
         shall have the same effect as if the action had
         been commenced in the name of the real party in
         interest."
         At the outset we note that subrogated insurance carriers
are real parties in interest within the meaning of Rule 17(a),
M.R.Civ.P.,    and governed by its provisions.           State ex rel. Slovak
v. Dist. Ct.,        Mont   .      ,   534 P.2d 850, 32 St.Rep. 420; Bergh
V.   Rogers,      Mont .        , 536 P.2d 1190, 32 St.Rep. 644.
         The general rule is that a fully subrogated insurer is
the real party in interest and must bring suit in its own name
against the wrongdoer responsible for the loss.             The reason for
this rule is that when a loss is fully paid by an insurer and the
insurer becomes subrogated to the insured's claim against the
wrongdoer, the insured no longer has a right of action against the
wrongdoer.     United States v. Aetna Casualty       &   Surety Co., 338
U.S. 366, 70 S.Ct. 207, 94 L ed 171; J. C. Livestock Sales Inc.
v. Schoof, 208 Kan. 289, 491 P.2d 560; Connor v. Thompson Con-
s t r u c t i o n and Development Co.,               (Iowa 1 9 6 9 ) , 166 N.W.2d                109.

46 C. J . S .    I n s u r a n c e 5 1209 ( c ) ( 2 ) ( b ) , p. 171; 6 Wright               &   Miller,

F e d e r a l P r a c t i c e and P r o c e d u r e : C i v i l 51546, p. 656; 1 6 Couch

on I n s u r a n c e 2d, 561:26.

             Thus f u l l y s u b r o g a t e d c a r r i e r s w i l l be a l l o w e d t o be

substituted as the real parties i n interest.                                  The p u r p o s e o f t h e

l a s t s e n t e n c e o f Rule 1 7 ( a ) , M.R.Civ.P.,             i s t o i n s u r e t h a t good

f a i t h amendments s u b s t i t u t i n g t h e r e a l p a r t y i n i n t e r e s t w i l l be

a l l o w e d and w i l l r e l a t e back t o t h e f i l i n g o f t h e o r i g i n a l s u i t

w i t h o u t b e i n g b a r r e d by t h e s t a t u t e o f l i m i t a t i o n s .      Courts are

l e n i e n t i n a l l o w i n g s u b s t i t u t i o n when a n h o n e s t m i s t a k e h a s been

made i n d e t e r m i n i n g which p a r t y s h o u l d f i l e s u i t .             Substitution

brings t h e p a r t y a c t u a l l y e n t i t l e d t o recover i n t o t h e s u i t ,

making i t res j u d i c a t a and p r o t e c t i n g t h e d e f e n d a n t from a sub-

s e q u e n t s u i t by t h i s p a r t y .     3A Moore's F e d e r a l P r a c t i c e 2d,

P a r a . 1 7 . 0 1 [ 8 ] , 1 7 . 0 2 , pp. 2 4 , 25, 53.          W e f i n d no r e a s o n t o

h o l d o t h e r w i s e u n d e r Montana's Rule 1 7 ( a )          .
             When a n i n s u r a n c e c a r r i e r p a y s o n l y p a r t o f i t s i n s u r e d ' s

l o s s because t h e l o s s exceeds t h e coverage of t h e insurance p o l i c y

o r t h e p o l i c y c o n t a i n s a d e d u c t i b l e amount, b o t h t h e i n s u r e d

and t h e c a r r i e r have a c l a i m f o r r e l i e f a g a i n s t t h e wrongdoer

and e i t h e r may b r i n g s u i t i n h i s own name t o t h e e x t e n t o f h i s

r e s p e c t i v e claim.        In federal courts, i n the past, the r u l e

g e n e r a l l y h a s been t h a t when e i t h e r t h e i n s u r e d o r t h e i n s u r e r

s u e s and t h e o t h e r p a r t y d o e s n o t v o l u n t a r i l y j o i n i n b r i n g i n g

t h e s u i t , t h e d e f e n d a n t c a n move t o have t h e a b s e n t p a r t y j o i n e d

t o p r o t e c t h i m s e l f from m u l t i p l e law s u i t s .        United S t a t e s v.

Aetna Cas.        &   S u r e t y Co.,    s u p r a ; 6 Wright       &    Miller,        F e d e r a l Prac-

t i c e and P r o c e d u r e :     C i v i l S1546, pp. 659, 660.

             J o i n d e r , however, i s no l o n g e r t h e o n l y method o f p r o -

t e c t i n g t h e d e f e n d a n t from m u l t i p l e l a w s u i t s .     I n 1966 t h e
federal Rule of Civil Procedure 17(a) was amended to allow
"ratification of commencement of the action by, or joinder or
substitution of, the real party in interest" when the defend-
ant objects to the absence of the real party in interest from
the suit.        Montana similarily amended its Rule of Civ. Procedure
17(a), by an order of this Court dated September 29, 1967,
effective January 1, 1968.
           Since the federal amendment in 1966, ratification has
principally been used to bind a partially subrogated insurance
carrier to the law suit initiated by its insured.         Southern
National Bank of Houston, Tex. v. Tri Financial Corp., 317
F.Supp. 1173.       Other cases approving ratification include:      Honey
v. George Hyman Construction Co., 63 F.R.D. 443; Pace v. General
Electric Company, 55 F.R.D. 215; Urrutia Aviation Enterprises,
Inc. v. B.B. Burson       &   Asso. Inc., 406 F.2d 769.
           The present rule has been construed in this language in
6 Wright    &   Miller, Federal Practice and Procedure Civil B 1555,
p. 709:
           "Formal joinder or substitution of the real party
           in interest will not be necessary when he ratifies
           the commencement of the action. * * * "
           Ratification will bind the partially subrogated insurance
carriers to the present litigation and allow defendants to present
all of their defenses as well as protect them from subsequent
law suits.
           Respondent contends that Rule 17(a) gives the district
court the discretionary power to determine whether compliance
will be by joinder or ratification.         It is argued that since
the district court has ordered compliance by joinder the judg-
ment cannot be overturned unless the court abused its discretion.
This contention is not supported by the plain language of the
statute.        In the construction of a statute, the function of the
    court is simply to ascertain and declare what is in terms or
    substance contained in the statute and not to insert what has
    been omitted.    Section 93-401-15, R.C.M. 1947; Dunphy v. Ana-
    conda Co., 151 Mont. 76, 438 P.2d 660.
              Rule 17(a), M.R.Civ.P., does not grant the district
    court discretionary power to pick the method of complying with
    the rule.     The rule plainly provides that a reasonable time will
    be given to allow the real party in interest to bind himself to
    the suit by ratification, joinder, or substitution,        The method
    of compliance is optional with the real party in interest.        For
    the district court to have the discretionary power to determine
    the mode of compliance, the language of the rule would have to
    be changed.     The accomplishment of such change under the guise
    of construction would give the rule an added meaning not to be
    found in the plain and unambiguous language of the rule.       Montana

    Deaconess Hospital v. Cascade County, 164 Mont. 256, 521 P.2d
    203; Ross v. City of Long Beach, 24 Cal.2d 258, 148 P.2d 649;
    Scott v. Society of Russian Israelites, 59 Neb. 571, 81 N.W. 624.
             Defendants in the district court will be as adequately
    protected through ratification by partially subrogated insurance
    carriers as by joinder in the light of the purposes of the real
    party in interest requirement of Rule 17(a), M.R.Civ.P.
             The order of the district court is modified to permit
    ratification at the option of partially subrogated insurance
    carriers.     In all other respects, the writ is denied.



                                            Justice




/   /   Chief Justice
