Commercial Standard Ins. Co. v. Ebner

• Decision Date: 01 March 1950
• Docket Number: No. A-2450,A-2450
• Citation: Commercial Standard Ins. Co. v. Ebner, 149 Tex. 28, 228 S.W.2d 507 (Tex. 1950)
• Parties: COMMERCIAL STANDARD INS. CO. v. EBNER et al.
• Court: Texas Supreme Court

Page 507

228 S.W.2d 507

149 Tex. 28

COMMERCIAL STANDARD INS. CO. v. EBNER et al.

No. A-2450.

Supreme Court of Texas.

March 1, 1950.

Rehearing Denied March 29, 1950.

Milburn E. Nutt, Wichita Falls, for petitioner.

J. Ralph Schoolfield, Wichita Falls, J. R. Ogle, Wichita Falls, Smoot & Smoot, Wichita Falls, Geo. A. Smoot, Wichita Falls, for respondents.

HART, Justice.

Collier & Son, a partnership operating a commercial truck line under a certificate issued by the Railroad Commission, secured from Commercial Standard Insurance Company a policy of insurance in the amount of $1,000.00 in compliance with the provisions of Article 911b, Section 13, V. A. C. S., covering liability for loss of livestock while being transported by Collier & Son. John Ebner and others, composing the partnership of Wichita Meat & Provision Company, shipped cattle of the total value of $3,000.00 in one of the Collier trucks, and in the course of such transportation suffered a loss of cattle in the sum of $967.00. Ebner and his partners sued Collier & Son for their loss and judgment was rendered for the plaintiffs. They then sued on the judgment, naming the insurance company and Collier & Son as defendants. The insurance company filed an answer and also a cross-action against Collier & Son, in which it asserted that under the terms of the insurance policy it was entitled to judgment over against Collier & Son for all or at least a portion of any sums which it would be forced to pay to the shippers. Judgment was rendered for the shippers against the insurance company and the insurance company was denied all relief on its cross-action against the motor carrier. This judgment was affirmed by the Court of Civil Appeals. 223 S.W.2d 968.

The sole question raised by the application for writ of error involves the rights of the insurance company against the motor carrier, all grounds for contesting the liability of the insurance company to the shippers being expressly abandoned. The decision of this question requires a construction of Section 13 of Article 911b, which reads in part as follows: 'Sec. 13. Before any permit or certificate of public convenience and necessity may be issued to any motor carrier and before any motor carrier may lawfully operate under such permit or certificate as the case may be, such motor carrier shall file with the Commission bonds and/or insurance policies issued by some insurance company including mutuals and reciprocals or bonding company authorized by law to transact business in Texas in an amount to be fixed by the Commission under such rules and regulations as it may prescribe, which bonds and insurance policies shall provide that the obligor therein will pay to the extent of the face amount of such insurance policies and bonds all judgments which may be recovered against the motor carrier so filing said insurance policies and bonds, based on claims for loss or damages from personal injury or loss of, or injury to property occurring during the term of said bonds and policies and arising out of the actual operation of such motor carrier; and such bonds and policies shall also provide for successive recoveries to the complete exhaustion of the face amount thereof and that such judgments will be paid by the obligor in said bonds and insurance policies irrespective of the solvency or insolvency of the motor carrier; * * *.'

The insurance policy contained the following provision which is relied on by the insurance company as the basis of its claim: 'This Insurance Company shall in no event be liable under this policy, as respects the contents of each truck, for a greater proportion of any loss or damage than the sum hereby insured on the contents of the truck upon which the loss shall happen, bears to 100% of the value of the contents of that truck at the time of loss, but in no case to exceed the amount of insurance on the contents of that truck.'

Since the sum insured was $1,000.00 and the value of the contents of the truck at the time of the loss was $3,000.00, the insurance company contends that under the provision just quoted the proportion of the loss for which it is liable (as between it and the motor carrier) is one-third, or $322.33, and that it is entitled to recover over against the motor carrier the balance, or $644.67.

The motor carrier's reply is that the quoted provision of the policy is invalid because it conflicts with Article 911b, Section 13, and the endorsement on the policy, required by the Railroad Commission, which reads in part as follows:

'Anything in the policy or endorsements attached hereto to the contrary notwithstanding, it is agreed that this policy shall cover within the following limits unless greater limits are specified in the policy or endorsement attached (sic) thereto: (1) one thousand ($1,000) dollars for the loss of, damage or injury to property carried on any one motor vehicle (truck and/or trailer); * * *'.

'It is also understood, anything in the policy to the contrary notwithstanding,...