Anchor Cas. Co. v. Robertson Transport Co.

• Decision Date: 25 March 1965
• Docket Number: No. 53,53
• Citation: 389 S.W.2d 135
• Parties: ANCHOR CASUALTY COMPANY, Appellant, v. ROBERTSON TRANSPORT COMPANY, Appellee.
• Court: Texas Court of Appeals

Page 135

389 S.W.2d 135

ANCHOR CASUALTY COMPANY, Appellant, v. ROBERTSON TRANSPORT COMPANY, Appellee.

No. 53.

Court of Civil Appeals of Texas, Corpus Christi.

March 25, 1965.

Rehearing Denied April 15, 1965.

Carey Williams, Houston, for appellant.

John L. McConn, Jr., of Butler, Binion, Rice & Cook, Houston, for appellee.

NYE, Justice.

Anchor Casualty Company, appellant, as intervenor, sued Robertson Transport Company for the sum of Two Thousand Two Hundred Dollars ($2,200.00) based upon the amount that it had paid to Clyde Haynes on a policy of collision insurance. Anchor succeeded to all of the rights of Haynes by subrogation with reference to an alleged claim against Robertson.

Haynes owned a truck that was leased to Robertson. Anchor carried the collision insurance on the truck. The truck was wrecked due to the negligence of Robertson while in its possession and control. Anchor paid Haynes' claim for the damage suffered and then intervened in this suit against Robertson. Anchor seeking the amount it had paid Haynes alleged that the truck was under a contract of bailment from Haynes requiring Robertson to be responsible for the damage caused by his negligence. Robertson's suit against Haynes was dismissed, leaving only the suit by Anchor against Robertson, which was tried before the court without the intervention of a jury. Robertson, in effect, defended on the basis that the contract of bailment was a special contract relieving it from any liability. Judgment was entered against Anchor that it take nothing from Robertson.

Anchor, perfecting its appeal to this Court, contends in three points that the trial court erred in refusing to render judgment for Anchor because: (1) the necessary elements for recovery were proved as a matter of law; (2) the only affirmative defense plead by Robertson was proved by Anchor to have no basis in fact; and (3) the only reason assigned by the trial court for refusing to render judgment for Anchor is immaterial ass a matter of law and does not support the judgment rendered. All of these points will be considered together.

The trial court found that it was never within the contemplation of Haynes and Robertson that Robertson would be held liable to Haynes or anyone claiming by or through Haynes for damages to the truck while it was in the care, custody and control of Robertson. The trial court concluded that Haynes could not recover from Robertson for the damage to the truck because such recovery was not within the contemplation of the parties at the time Haynes and Robertson entered into the contract and therefore Anchor as subrogee of Haynes and standing in the shoes of Haynes cannot recover from Robertson for the damage to the truck.

The lease in question was entered into by Haynes and Robertson after a series of negotiations. The lease provided in effect that Robertson would operate the truck and receive a set percentage of the gross take for its services. Thereafter, all of the expenses of the operation were to be deducted and the balance remaining, if any, was to be turned over to Haynes. If there was not sufficient revenue to cover the expenses of operation it was to be carried forward and deducted from any future amounts that Haynes would subsequently become entitled to. The contract provided that Haynes would personally drive and operate the truck. If it ever became necessary to substitute a driver, then such substitute operator would have to be approved by Robertson; otherwise, the contract would become null and void. A former employee of Haynes was driving the truck at the time of the damage, working, however, under the direction of Robertson. The contract further provided that Robertson was to deduct from the gross revenue before any payment was made to Haynes, the cost of collision insurance 'for the protection of the equipment (the truck in question) described herein.'

The contract further provided that

'* * * if the lessor (Haynes) already has fire, theft and collision insurance on his equipment, and the premium has already been paid, then the lessor shall be required to furnish to the lessee (Robertson) before this lease is effective, an endorsement from his fire, theft and collision carrier showing that the lessee (Robertson) is an additional insured under the lessor's (Haynes) fire, theft and collision coverage.'

Robertson contends that it was made clear by the terms of the lease that any loss or damage to the truck would be borne by insurance and not by Robertson or Haynes individually. To substantiate this position, Robertson points out that the lease agreement specifically provided for collision insurance for the protection of the vehicle; that the cost of such insurance was to be borne by Haynes, either by providing for insurance initially or to permit the cost of such insurance to be deducted by Robertson from proceeds which otherwise would go to Haynes; and that if Haynes already had collision insurance he was required to obtain an endorsement showing Robertson to be an additional insured under the collision coverage before the lease was to become effective. Robertson further contends that it was established by the evidence, and/or found by the trial court, that it was never the intention of the contracting parties (Haynes and Robertson) that either of them would bear any loss from damage to the truck, in that the evidence showed: That both Haynes and Robertson thought that Haynes had collision insurance initially protecting both parties from damages to the vehicle; that Robertson relied on Haynes' statement that he had such insurance initially, and further that Haynes would secure an endorsement showing that Robertson was an additional insured on his collision insurance policy. We agree with Robertson's contentions.

The record showed that Robertson and Haynes believed that the truck in question was insured for loss caused by a collision. Haynes had collision coverage prior to the lease of the truck in question to Robertson, but the insurance either expired by its own terms, or was inadvertently cancelled by Haynes prior to the time the lease went into effect. During negotiations of the lease it developed that the truck was mortgaged by Haynes to his bank. One of Robertson's employees testified to the effect, that he too believed that Haynes had the collision coverage insurance because it was the usual policy of banks to require such coverage to protect the chattel that was mortgaged. Robertson's employee contacted Haynes on several occasions prior to the loss requesting Haynes to send them the collision endorsement naming Robertson as an additional insured. Each time Haynes would be surprised that Robertson had not already received such endorsement, and would then go on to assure them that he would obtain the endorsement. No endorsement for Robertson was ever obtained by Haynes. Actually, Haynes...