British Amer. Assur. Co. v. Mid-Continent Life Ins. Co., 1257-5644.

• Decision Date: 15 April 1931
• Docket Number: No. 1257-5644.,1257-5644.
• Citation: 37 S.W.2d 742
• Parties: BRITISH AMERICAN ASSUR. CO. OF TORONTO, CANADA, v. MID-CONTINENT LIFE INS. CO. et al.
• Court: Texas Supreme Court

37 S.W.2d 742

BRITISH AMERICAN ASSUR. CO. OF TORONTO, CANADA, v. MID-CONTINENT LIFE INS. CO. et al.

No. 1257-5644.

Commission of Appeals of Texas, Section B.

April 15, 1931.

Error to Court of Civil Appeals of Fourth Supreme Judicial District.

Suit by Mid-Continent Life Insurance Company and another against the British American Assurance Company of Toronto, Canada, and the Continental Insurance Company of New York. Judgment for plaintiffs was affirmed as to the British American Assurance Company and reversed and rendered as to the Continental Insurance Company by the Court of Civil Appeals [21 S.W.(2d) 1106], and the British American Assurance Company brings error.

Judgments of district court and Court of Civil Appeals reversed, and judgment rendered.

E. G. Senter, of Dallas, for plaintiff in error.

T. M. West, of San Antonio, and Davenport, West & Ransome, of Brownsville, and J. Franklin Spears, of San Antonio, for defendants in error.

LEDDY, J.

There is no controversy as to the facts in this case, as the trial court's findings are not challenged by any of the parties hereto.

It is disclosed that defendant in error, A. A. Maupin, owned a five-acre tract of land near Harlingen, Tex., upon which was situated a residence. The defendant in error, Mid-Continent Life Insurance Company, held a valid and subsisting lien against said property to secure the payment of vendor's lien notes, upon which Maupin was liable, in the principal sum of $4,500, the total amount due upon said indebtedness at the time of the trial being $5,806.49.

The mortgagee holding this indebtedness, without the knowledge of defendant in error Maupin, procured the issuance of a fire insurance policy by plaintiff in error, British American Assurance Company, in the sum of $4,000, covering the building on the premises, the same being in favor of Maupin with the usual loss payable clause to the mortgagee. Defendant in error Maupin subsequently learned of the issuance of this policy, and, after receiving such knowledge, procured the issuance in his favor, without any loss payable clause to the mortgagee, a policy by the defendant in error Continental Insurance Company of New York in the sum of $4,000, covering the same property.

The residence insured by these two policies was subsequently destroyed by fire, and this suit was instituted by the Mid-Continent Life Insurance Company against the British American Assurance Company on the policy, to which was attached the loss payable clause in its favor, and it also sought to recover against the Continental Insurance Company of New York upon an assignment of the amount due under its policy by the assured Maupin.

The trial court rendered judgment in favor of the Mid-Continent Life Insurance Company against the British American Assurance Company for the full amount of its policy and in the sum of $1,500 against the Continental Insurance Company of New York under its policy for $4,000. The recoveries thus awarded amounted to $5,500, the agreed value of the property destroyed.

The Court of Civil Appeals, 21 S.W.(2d) 1106, reversed the judgment against the latter company, but affirmed the recovery for the full amount of the policy issued by the British American Assurance Company.

Each of the policies covering this property contained the standard concurrent insurance clause, which reads as follows: "This entire policy, unless otherwise provided by an agreement endorsed hereon or added hereto, shall be void if the insured now has or shall hereafter make or procure any other contract of insurance, whether valid or not, on property covered in whole or in part by this policy."

Under the settled law of this state the violation of the foregoing stipulation against other insurance rendered each of these policies void and barred any recovery thereon by the assured. New Orleans Ins. Ass'n v. Griffin, 66 Tex. 232, 18 S. W. 505; East Texas Fire Ins. Co. v. Blum, 76 Tex. 653, 13 S. W. 572; Orient Ins. Co. v. Prather, 25 Tex. Civ. App. 446, 62 S. W. 89; Wilson v. Ætna Ins. Co., 12 Tex. Civ. App. 512, 33 S. W. 1085; Hartford Fire Insurance Co. v. Post, 25 Tex. Civ. App. 428, 62 S. W. 140; Providence-Washington Ins. Co. v. Levy & Rosen (Tex. Com. App.) 222 S. W. 216; Ætna Ins. Co. v. Waco Co. (Tex. Com. App.) 222 S. W. 217; Ætna Ins. Co. v. Jackson (Tex. Civ. App.) 282 S. W. 656, 657; Boatner v. Home Ins. Co. (Tex. Com. App.) 239 S. W. 928.

It is argued that the second policy taken out by the assured is valid because he was not responsible for the issuance of the first. The evidence shows the first policy was procured without his knowledge or consent by the mortgagee, who paid the premium thereon. Maupin, however, had expressly contracted to insure the property in favor of the mortgagee and agreed, if he failed to do so, the latter was authorized to obtain such insurance. He was duly notified of the issuance of the first policy, and that the premium therefor had been charged to his account. Under such circumstances the policy inured to his benefit. In any event he became bound by its terms when he acquired knowledge of its issuance and thereafter permitted it to continue in force. Camden Fire Insurance Co. v. Sutherland (Tex. Com. App.) 284 S. W. 927, 928.

It is also claimed that, because this commission held in the above-cited case the second policy procured by the assured was valid and enforceable, such decision is authority for a similar holding in this case. That decision was based solely upon the proposition that the company at the time of the issuance of the second policy was shown to have had full knowledge of the existence of the first. That such fact formed the basis of the holding plainly appears from the opinion rendered by Judge Powell. In the course of the opinion it is stated: "As we have already shown, Sutherland had insurance largely in excess of the concurrent insurance allowed by the policy in suit, and, under the provision last quoted [concurrent insurance clause], the policy in suit would be...