American Standard Life Ins. Co. v. Redford, 10776

• Decision Date: 22 June 1960
• Docket Number: No. 10776,10776
• Citation: 337 S.W.2d 230
• Parties: AMERICAN STANDARD LIFE INSURANCE COMPANY, Appellant, v. Charles R. REDFORD, Administrator of the Estate of Archibald W. Hart, Appellee.
• Court: Texas Court of Appeals

Page 230

337 S.W.2d 230

AMERICAN STANDARD LIFE INSURANCE COMPANY, Appellant, v. Charles R. REDFORD, Administrator of the Estate of Archibald W. Hart, Appellee.

No. 10776.

Court of Civil Appeals of Texas, Austin.

June 22, 1960.

Rehearing Denied July 13, 1960.

Hornsby & Kirk, Austin, for appellant.

Vandygriff, Presnal & Baker, Austin, for appellee.

ARCHER, Chief Justice.

Appellee, Charles R. Redford, Jr., Administrator of the Estate of Archibald W. Hart, sued appellant, American Standard Life Insurance Company, for hospital and other medical expenses under an insurance policy issued by appellant to A. W. Hart. Trial was before the court without a jury. Appellee recovered judgment against appellant for the sum of $1,061.51 plus $127.98 as statutory penalty and $350 as attorneys' fees or a total of $1,539.49.

The appeal is based on two points of error and are as follows:

'First Point: The court erred in rendering judgment against appellant for any amount because the policy sued upon provided that sickness during which a surgical operation was performed should be covered only when the sickness originates after the policy had been continuously in force for the six (6) preceding months or more without lapse during that period and the undisputed evidence disclosed that the policyholder had permitted his policy to lapse during that period.

'Second Point: The court erred in rendering judgment against appellant for penalty and attorneys' fees in the amount sued for because appellee did not plead or prove the necessary demand or loss required by Article 3.62 of the Insurance Code.'

The facts are stipulated.

Under the insuring clause on the first page of the policy sued upon, such clause is expressly made 'subject to all provisions and limitations hereinafter contained.'

Part I--Hospitalization--of the policy is also expressly made 'subject however, to all of the provisions, exclusions and limitations set forth in this policiy.'

The policy expressly provided under 'Limitations and Reductions for Parts I and II Only' (Parts II and III are not involved in this suit) as follows:

'* * * 3. Sickness during which a surgical operation is performed shall be covered under Part I of this policy but only when the cause of sickness originates after this policy has been continuously in force for the six (6) preceding months or more without lapse during that period.'

The expenses sued for were incurred in connection with a sickness during which a surgical operation was performed.

The proofs of loss stated that the first date symptoms of illness were noticed was March 3, 1959. The doctor did not diagnose the brain tumor until subsequent to March 3, 1959. The policyholder entered the hospital on March 25, 1959, suffering from a brain tumor. The diagnosis of this brain tumor resulted in a surgical operation therefor on April 13, 1959. The brain tumor was the cause of death on May 29, 1959.

The policy lapsed due to the failure to pay the premium due on November 25, 1958. General Provision No. 3 of the policy provided for a fifteen day grace period. Under its terms, the policy therefore terminated on December 10, 1958, at 6:00 P.M. The policy was reinstated effective December 20, 1958 upon payment of the regular quarterly premium of $10.25 for three months from the date of reinstatement. The policyholder did not pay any premium for the period from December 10, 1958 to December 20, 1958.

Contracts of insurance are...