Crawford v. Ozark Insurance Co.

• Decision Date: 13 February 1911
• Citation: 134 S.W. 951,97 Ark. 549
• Parties: CRAWFORD v. OZARK INSURANCE COMPANY
• Court: Arkansas Supreme Court

134 S.W. 951

97 Ark. 549

CRAWFORD v. OZARK INSURANCE COMPANY

Supreme Court of Arkansas

February 13, 1911

Appeal from Sebastian Circuit Court, Fort Smith District; Daniel Hon, Judge; reversed.

STATEMENT BY THE COURT.

Appellant had a policy of fire insurance in the Ozark Insurance Company, a mutual fire insurance company, for the sum of $ 1,000. The policy was in force from the 8th day of September 1904, to the 8th day of September, 1907. On the 15th day of April, 1907, the property insured was destroyed by fire. The appellant sued the insurance company, alleging its failure to pay the policy, and also joined in the suit the following individuals, to-wit: A. J. Ingle, Geo. W. Moss, Houston J Jayne, J. K. Simmons, James B. Moore, and I. R. Arbogast alleging that they had on the 28th day of February, 1906 executed a bond in the sum of $ 15,000, which bond was approved by the Auditor of the State of Arkansas March 7, 1906, and which was in full force on the 15th day of April, 1907, when the loss occurred; that the bond was conditioned for the prompt payment of all claims arising and accruing to any person of persons during the term of said bond by virtue of any policy issued by said company upon any property in Arkansas, etc.; that the insurance company and the bondsmen named had not paid the appellant the amount of his policy, which claim accrued to him during the term of said bond. Appellant prayed for judgment against the insurance company and the sureties named in the sum of $ 1,000 with interest. The insurance company denied liability, setting up various alleged defenses. The sureties adopted the answer of the company, and for further answer alleged that the policy of insurance was not executed during the time that the bond of February 28, 1906, which they signed, was in force; that by the terms of said bond the makers undertook to become liable only for claims arising and accruing to any person or persons by virtue of any policy issued by the said company during the term of the said bond, and that by its terms the said bond was in force and applied to the business transacted by said insurance company for a period of one year ending March 1, 1907, and that the policy herein sued on was executed September 8, 1904, and the loss alleged to have occurred to plaintiff was on April 15, 1907, by reason of which defendants are in no measure liable to plaintiff, on account of the alleged loss under and because of said alleged bond of February 28, 1906.

After the evidence was adduced the court directed a verdict in favor of appellant against the insurance company, and also to return a verdict in favor of appellees.

The verdict was returned in favor of appellants against the company in the sum of $ 960, and the verdict was also in favor of appellees. The judgment was entered according to the verdict. The company has not appealed. The appellants seeks by this appeal to reverse the judgment in favor of the appellees.

Judgment reversed.

J. M. Parker and W. H. Dunblazier, for appellant.

The repeal of the act under which the bond of July 22, 1903, was executed does not prevent recovery on that bond. Plaintiff's right was a vested one before the repeal of the act. 49 Ark. 193, 194; 5 Cyc. 749. Sureties on the bond of an insurance company may be made parties defendent, and final judgment rendered against them at the same time, and in like manner as against the company. Kirby's Dig. § 4376; 87 Ark. 72.

The law regulating mutual companies provided that the bond should be renewed every two years. The sureties on the bond of February 28, 1906, are, therefore, also liable, and the court erred in excluding it from evidence. Kirby's Dig. § 4348. If this statute is not repealed by Acts 1905, p. 489, repealing clause, and it is not unless there is something inconsistent with the above section contained in the act, then the bond last mentioned was in force for two years, i. e. until February 28, 1908. The obligors in the bond are presumed to have bound themselves with reference to the statute. 76 Ark 415; 5 Cyc. 753, note 56; Id. 756 and note; Id. 751 and note 2; 108 S.W. 548; 2 Am. & Eng. Enc. of L. 466; 70 Ark. 3.

C. E. & H. P. Warner, for appellees.

The liability of a surety is not to be extended by implication beyond the terms of his contract. To the extent and in the manner and under the circumstances pointed out in his obligation, he is bound and no further. 24 How. 315, 16 Law. Ed. 690; 15 Pet. 205, 10 Law. Ed. 713; 6 Ill. 582; 158 Pa. 392; 120 Ind. 86; 92 Ind. 240; 87 Ind. 541. Appellees were not liable on the bond of February 28, 1906, because the obligation of the sureties was expressly limited by the terms of that bond, providing that they "shall promptly pay all claims arising and accruing to any person or persons, by virtue of any policy issued by said company, during the term of this bond, " etc. 89 Ark. 394; 52 Ark. 201.

OPINION

WOOD, J., (after stating the facts).

The only question is: were appellees liable under the following clause of their bond, to-wit: they "shall promptly pay...