German Ins. Co. v. Pearlstone

• Decision Date: 11 May 1898
• Citation: 45 S.W. 832
• Parties: GERMAN INS. CO. v. PEARLSTONE et al.
• Court: Texas Court of Appeals

45 S.W. 832

GERMAN INS. CO. v. PEARLSTONE et al.

Court of Civil Appeals of Texas.

May 11, 1898.

Appeal from district court, McLennan county; Marshall Surratt, Judge.

Action by I. M. Pearlstone & Son against the German Insurance Company. Judgment for plaintiffs. Defendant appeals. Affirmed.

Oeland & Brown, for appellant. Alexander & Atkinson, for appellees.

KEY, J.

This is a suit upon two policies of fire insurance. The plaintiffs recovered in the court below, and the defendant has appealed.

1. The first question for decision arises upon the action of the court in overruling a general demurrer to the plaintiffs' petition, the contention being that it does not appear therefrom that plaintiffs were the owners of the property insured at the time of its destruction by fire. The only averments in the petition that bear on this subject are these: "That on the 3d day of September, 1895, defendant, in consideration of the sum of $87.50, to it in hand paid, issued its policy of insurance No. 76,304, wherein and whereby it insured plaintiffs in the sum of $2,500 against loss by fire for the period of one year on their stock of merchandise, consisting of dry goods, clothing, notions, groceries, produce, and such other merchandise not more hazardous, as is usually kept for sale in country stores, while contained in the two one-story, metal-roof stone buildings in I. C. addition in rear, occupied by the assured as a general store, and situated adjoining and communicating on lots Nos. 5 and 6, in block No. 3, in Buffalo, Texas, which stock so insured by said policy was then and there of the reasonable value of $25,000. Plaintiffs further show to the court that on the 4th day of October, 1895, the said defendant, in consideration of the sum of $35 to it in hand paid, executed and delivered to plaintiffs its policy of insurance No. 76,311, wherein and whereby it insured these plaintiffs in the sum of $1,000 against loss by fire on the goods, wares, and merchandise hereinbefore described, and plaintiffs show that they have complied with all the conditions of said policies. It is further shown to the court that about the 19th day of August, 1896, while said polices were in full force and effect, the property insured thereby was, without default of these plaintiffs, destroyed by fire, and on the 5th day of October, 1896, full proofs of loss were made out by plaintiffs and forwarded to defendant, and received and accepted by said defendant, no objection being made thereto. Defendant is notified to produce said proofs of loss on trial hereof. Plaintiffs show to the court that by reason of the premises defendant became liable and promised to pay these plaintiffs the sum of $3,500 in accordance with the terms of said policies, but though often requested, they have hitherto failed and refused, and still fail and refuse, to pay the same, or any part thereof, whereby these plaintiffs have been damaged in the full sum of $4,000." Fire insurance is a contract of indemnity; and, unless the owner of the policy is also owner of or interested in the property covered by it at the time the latter is destroyed by fire, he sustains no loss, and therefore cannot recover upon the policy. This point is well settled by the authorities, and this court has recently ruled upon it. Insurance Co. v. Davis, 45 S. W. 604, and authorities there cited. And it must be conceded that the petition in this case does not, in express terms, allege that the property belonged to the plaintiffs at the time it was destroyed by fire. However, the petition does aver that the defendant insured the plaintiffs against loss by fire "on their stock of merchandise, consisting of dry goods," etc. This constitutes an averment of ownership of the property by plaintiffs, and it is not expressly limited to any particular date. Besides, the petition charges that the policies were in force and effect at the time of the fire, and, as they could not have been in that condition (if the policies were then owned by plaintiffs) unless they had an interest in the property, the latter fact is argumentatively or impliedly charged. Furthermore, the petition charges that the defendant insured the plaintiffs against loss of their property by fire; that it was destroyed by fire; and thereupon the defendant became liable to the plaintiffs for the sum of $3,500, the face of the policies. Now, the liability alleged could not exist unless the plaintiffs owned or had an insurable interest in the property at the time it was burned; and the averment of such liability, in connection with the other averments referred to, indicate that the petition was constructed upon the theory that the plaintiffs owned the property at the time of its destruction, and that it was intended that it should be so understood. Dist. Ct. Rule 17 (20 S. W. xii.) prescribes that in passing upon a general exception every reasonable intendment arising upon the pleading excepted to shall be indulged in favor of its sufficiency, and that rule has been often applied. In view of this rule, we hold that the petition was not obnoxious to a general demurrer, and in support of our ruling we cite Pennington v. Schwartz, 70 Tex. 211, 8 S. W. 32; Loper v. Telegraph Co., 70 Tex. 694, 8 S. W. 600; Wynne v. Bank, 82 Tex. 378, 17 S. W. 918; Rutherford v. Smith, 28 Tex. 322; Cattle Co. v. Carroll, 63 Tex. 49; and Pan Handle Nat. Bank v. Security Co. (decided by this court at this term) 44 S. W. 15.

2. The property insured was a stock of merchandise, alleged to be worth over $20,000. The plaintiffs were, when the policies were issued and the fire occurred, retail merchants; and their stock of merchandise was constantly shifting, goods coming in by purchases frequently made, and going out through the medium of daily sales. Under these circumstances it was impossible for the plaintiffs to furnish a correct inventory or itemized list of the property destroyed by the fire, and the court did not err in overruling the defendant's special exception addressed to the petition because it was not accompanied by such inventory or list.

3. After they had qualified to testify as expert bookkeepers, appellant propounded to the witnesses Toby, Conner, and Picket the following question: "Would you consider the furnishing of a ledger and a journal a substantial compliance with the contract requiring the furnishing of a set of books showing a complete record of the business transacted, the evidence in this case having shown that seven or eight different books were kept?" The court sustained objections to this question, and appellant assigns error. We think an answer to the question would have invaded the province of the jury. Experts may be permitted to explain to juries the meaning of technical words or phrases, and perhaps it would have been permissible for the witnesses referred to to have explained what, in their opinions, would constitute a set of books showing a complete record of such a business as appellees were engaged in. But we do not think any witness should be permitted to give an opinion as to whether or not certain facts constitute compliance with a contract. Besides, the hypothesis upon which the question was based did not include all the facts. It assumed that appellees produced but two of the seven or eight books kept during the life of the policies, whereas they produced all the books for the entire year 1896, and the fire occurred August 19th, of that year. They also produced the ledger and journal for the entire year 1895, and the petty cash book, covering the time from October 21, 1895, to the end of that year. One of the policies was issued September 3 and the other October 4, 1895, and they were both in force when the fire occurred. So it appears that for seven months of the time appellees produced their full set of books, and for nine months of the time they produced the ledger, journal, and petty cash book; while for 45 days of the first and 17 days of the second policy they produced only the ledger and journal. The question propounded to the witnesses impliedly states that the latter two were the only books covering the life of any part of either policy that was produced.

4. The remaining question presented for decision arises upon the refusal of the court to give a special charge asked by the defendant, peremptorily instructing the jury to return a verdict for it. It is claimed that this charge should have been given, because the undisputed evidence showed that the plaintiffs had not complied with the "iron-safe clause" in the policy. That clause reads thus: "The assured under this policy hereby covenants and agrees to keep a set of books during the life of this policy, showing a complete record of business transacted, including all purchases and sales, both for cash and credit, together with the last inventory or the last two inventories of said business, if such inventories have been taken; and further covenants and agrees that, if no inventory in detail has been taken within twelve calendar months next prior to the issuance of this policy, that one will be taken in detail within thirty days from date hereof, or this policy shall be null and void; and the assured further covenants and agrees that, if no prior inventory, as provided for above, has been taken, and loss or damage occur within the meaning of this policy within thirty days above allowed for the taking of inventory in detail, after the issuance of this policy and prior to the taking of such inventory in detail, then this company shall be liable only on such goods as the original bills thereof, or certified copies thereof, can be produced; and the assured further covenants and agrees to keep such books and inventories, also all books, memoranda, vouchers, and other evidences of the business transacted prior to the issuance of this policy, securely locked in a fireproof safe at night, and at all times when the store mentioned in the within policy is not actually...