Traders & General Ins. Co. v. Lucas

• Decision Date: 28 June 1955
• Docket Number: No. 12826,12826
• Court: Texas Court of Appeals
• Parties: TRADERS & GENERAL INSURANCE COMPANY, Appellant, v. W. I. LUCAS et al., Appellees.

Page 188

281 S.W.2d 188

TRADERS & GENERAL INSURANCE COMPANY, Appellant, v. W. I. LUCAS et al., Appellees.

No. 12826.

Court of Civil Appeals of Texas, Galveston.

June 28, 1955.

Rehearing Denied July 21, 1955.

Butler, Binion, Rice & Cook, Frank J. Knapp, and John L. McConn, Jr., Houston, for appellant.

Spiner, Pritchard & Thompson, Clark G. Thompson, and Richard E. Neill, Houston, for appellees.

HAMBLEN, Jr., Chief Justice.

This suit was filed in the District Court of Harris County by appellees, W. I. Lucas and D. J. Carter, seeking recovery under a Texas Standard Automobile Liability Insurance Policy issued by appellant, covering the operation of a 1949 Ford automobile. Appellees, C. O. Broussard and wife, intervened individually and on behalf of their minor children, praying that appellant be required to satisfy a judgment previously recovered by such intervenors against appellee Carter. Trial was before the court without a jury, and resulted in a judgment favorable to appellees Broussard in the amount of the judgment previously recovered by them against appellee Carter, and in favor fo appellees Carter and Lucas for attorneys' fees incurred by them.

The facts giving rise to the litigation are substantially undisputed, and are as follows: In February, 1953, appellee Carter, who was then 19 years of age, desired to purchase a 1949 Ford automobile. Being unable, because of his minority, to finance such purchase, he arranged with his brother-in-law, Lucas, to take title to the vehicle in Lucas' name, and to sign the deferred payment notes and chattel mortgage thereon, it being understood, as a part of the arrangement, that Carter would make all payments for the purchase of said automobile, and would have possession of, maintain and use the same as his own. After the consummation of such arrangement, Carter, upon the suggestion of Lucas, desired to secure insurance against liability for personal injury and property damage which might be incurred as a result of the operation of such vehicle. He made application by telephone to J. B. Ross & Company, a recording agent of appellant, to whom he had been referred by the seller of the automobile. It is undisputed that in the several telephone conversations between appellee Carter and J. B. Ross & Company, all of the facts relative to the manner in which the Ford automobile was purchased, the status of the legal title, Carter's age, and his possession, use and enjoyment of the automobile, were fully and completely divulged, his expressed purpose being to secure protection for himself against the stated risks. As a result of such application, J. B. Ross & Company, as agent for appellant, issued a Texas Standard Automobile Liability Insurance Policy, describing the 1949 Ford automobile, and naming W. I. Lucas as the insured. J. B. Ross & Company stated to Carter that it was necessary to designate Lucas as the insured because the legal title to the vehicle was in Lucas's name.

On June 21, 1953, appellee Carter, while driving said insured automobile, was involved in a collision with a vehicle in which the Broussards were riding. The Broussards sued Carter and Lucas to recover damages for personal injuries, and recovered judgment against Carter alone for the total sum of $9,250, plus interest and court costs. They were denied recovery against Lucas. Carter and Lucas then filed the suit resulting in the judgment here appealed from.

After entry of judgment, the trial court, in response to request therefor by appellant, made findings of fact and conclusions of law. Among such is one to the effect that appellee Carter was insured under the terms of the policy issued in the name of Lucas by virtue of a clause therein which is referred to as the omnibus clause, and which, in so far as here applicable, provides: '* * * the unqualified word 'insured' includes the named insured and also includes any person while using the automobile * * *, provided the actual use of the automobile is by the named insured or with his permission.' The trial court also held, as reflected by such findings and conclusions, that appellee Carter was protected by an oral contract of insurance made between Carter and J. B. Ross & Company; that appellant was estopped to deny that D. J. Carter was covered by appellant's policy or had waived its right to make such denial; and that appellant's policy should be reformed to include appellee Carter as a named insured. The asserted error of the trial court in making such findings and conclusions is the basis of appellant's points of error numbered one to four, inclusive. By its fifth point of error, appellant contends that the policy of insurance sued upon was rendered void by the false statement pertaining to 'sole ownership' made in the declarations of the policy.

From our examination of the record here presented, it appears to be conclusively and undisputedly established that at the time this policy of insurance was issued, J. B. Ross & Company was fully advised that Carter was a minor, nineteen years of age; that legal title to the automobile was in-the name of Lucas; that the automobile would be used by Carter and garaged at his home; and that all payments for the automobile, as well as the premium for the insurance policy, would be made by Carter. In short, Carter simply related all of the foregoing...