Federal Underwriters Exchange v. Coker

Decision Date08 April 1938
Docket NumberNo. 13739.,13739.
Citation116 S.W.2d 922
PartiesFEDERAL UNDERWRITERS EXCHANGE v. COKER.
CourtTexas Court of Appeals

Saunders & Williams and Touchstone, Wight, Gormley & Price, all of Dallas, for plaintiff in error.

O. E. Nelson and John Q. Humphrey, both of Wichita Falls, for defendant in error.

SPEER, Justice.

Plaintiff in error, Federal Underwriters Exchange, sued defendant in error, P. Coker, in the district court of Archer county, Tex., to set aside an award of the Industrial Accident Board, fixing compensation to Coker, and the latter filed a cross-action for compensation on account of an injury sustained, which had been duly presented to the Accident Board. When the testimony was all in and before the charge to the jury was read, plaintiff in error took a nonsuit.

The cause was tried to a jury on special issues, and upon the verdict rendered, judgment was entered for defendant in error, from which this appeal was perfected.

The case as presented to us is as if trial was had on the cross-action, and therefore it is more convenient to refer to P. Coker as plaintiff, and to the Federal Underwriters Exchange, the insurance carrier, as defendant, and the parties will be thus designated.

Because of the nonsuit taken by the insurance carrier, who was plaintiff in the original action, it becomes unnecessary to refer to its petition, but it may be said that the judgment of the court shows that the issues had been prepared by the court when the order was entered, and for this reason some issues were submitted which could well have been omitted, yet we do not consider they or their answers affect the judgment rendered.

The employee, who was defendant in the original suit, and who filed cross-action, and became plaintiff, for all purposes after the nonsuit was entered, and whom, as stated, we are designating plaintiff, pleaded all jurisdictional matters; a contract of employment by H. H. Fraser and an accidental injury resulting in the loss of four fingers, while in the discharge of his employment. The trial was begun on March 19th, 1936, and on that day the defendant (carrier) filed an answer to the cross-action in which it was specially pleaded that the policy of insurance was issued to H. H. Fraser, and that at the time plaintiff received his injuries, he was not an employee of the said Fraser, but was in the employ of a partnership composed of H. H. Fraser and George Proctor, and was not covered by the policy; it specially denied that at the time of the accident it knew of the partnership relation existing between Fraser and Proctor. On the same day plaintiff (the employee) filed a trial amendment, alleging that defendant had waived and was then estopped to deny liability to plaintiff, for that after it had been notified of the accident and its result, the employer made two pay-roll reports to defendant, as he was obligated to do, showing the nature of the work being done by him on the lease owned jointly by himself and Proctor, and with full knowledge of all the facts defendant had demanded and received the premiums due on the policy of insurance, thereby expressly and impliedly obligating itself to compensate the employees on said lease, under the existing conditions. That by its acts and conduct defendant had waived and was now estopped to deny liability to plaintiff for the injuries sustained at the time and under the conditions existing, all of which were well known to it at the time it demanded and received payment of premiums on the policy.

The record before us discloses that prior to the time of the accident, Fraser and Proctor owned an oil lease in Archer county, as well also a rotary drilling machine; they were both desirous of developing the lease by drilling thereon; Fraser was an experienced driller and Proctor was not; to accomplish this development, they agreed orally between themselves that Fraser would make a location on the lease, and with the jointly owned machine would drill a well; employ all labor, carry compensation insurance, pay all bills, and render account of expenses thus incurred, to Proctor, who in turn would reimburse him for one-half of all moneys so expended. Plaintiff was employed and paid by Fraser. He was injured while in the course of his employment. It was shown that by the terms of plaintiff's employment he was to work on twelve-hour shifts, seven days in the week; he was injured on Sunday. A Mr. Nutt was employed by defendant to investigate the accident. During the investigation Mr. Nutt was told by both Fraser and Proctor all details of their relationship in regard to ownership of the lease and the machinery, as well as the contract between them for Fraser to drill the well; Nutt reported these facts to defendant; after receiving this information, the defendant requested and received premiums on the policy running in the name of Fraser. Fraser, Proctor, and plaintiff all testified plaintiff was employed by Fraser and was working for him when the accident occurred; the jury found this as a fact, and that plaintiff was not employed by nor working for Fraser and Proctor at the time he was injured; in answer to issues also found that the last-named two parties were engaged in a joint adventure, and that the drilling of the well was not a partnership enterprise between them.

There is no material conflict in the testimony, and the principle points involved on this appeal go to the effect of the testimony in establishing plaintiff's right to recover on the policy issued to Fraser.

Defendant has brought forward 49 assignments of error upon which it has presented 26 points or propositions relied upon; many of these propositions, however, are dependent upon 2 controlling issues, both of which are properly before us; they being (1) because plaintiff's contract was one for services to be performed on Sunday, in the absence of an allegation by him that the work to be performed was one of necessity, and not in violation of the Penal Code, his contract was void and no liability attached under the policy; (2) since the testimony showed that as a matter of law Fraser and Proctor were engaged in a joint adventure, and that Fraser was not an independent contractor, plaintiff was in fact in the employ of the joint adventurers and not of Fraser alone, therefore the injuries of plaintiff were not covered by the policy. As we view the record, all of defendant's assignments, except one, may be disposed of under the two heads named. The exception being one complaining of argument by counsel for plaintiff, this one we will mention later.

A close study of this voluminous record, and the helpful briefs of the parties, persuade us that the cause should not be reversed for another trial, and we shall give our reasons for the conclusion reached.

As is contended by defendant, there were no allegations made that the labor contracted by plaintiff to be performed was such as is excepted by article 284, Penal Code of 1925; but this was not necessary in a case of this kind. There was an allegation of a contract of employment to engage in labor not shown to be prohibited by law. The rule of construction adhered to by the courts of this state is that if a contract under one condition would be valid and under another void, the presumption is in favor of its validity.

In Texas Employers' Ins. Ass'n v. Henson, Tex.Civ.App., 31 S.W.2d 669 (reversed by Supreme Court on other grounds than that here involved, 48 S.W. 2d 970), the court had under consideration a contract which required work on Sunday, and whether or not it was such as would support a claim for compensation. The court there said (page 672): "Not all work or labor performed on Sunday is unlawful. `Works of necessity,' for example, are excepted. P.C. art. 284. There is, therefore, no presumption that a contract is illegal simply because it provides for work on Sundays. On the contrary, the presumption of innocence of law violation obtains. For the contract in question to be shown to be illegal, as a question of law, it was not sufficient merely to show by the uncontroverted evidence that it required work on Sunday, but also a kind of work coming within none of the exceptions making same lawful. No such contention is presented. Maryland Casualty Co. v. Marshall, Tex.Civ.App., 14 S.W.2d 337."

The question before us was considered by the Supreme Court in Casualty Reciprocal Exchange v. Stephens, 45 S.W.2d 143; there it was said (page 145):

"Plaintiff in error contends that its general demurrer to the original petition and its request for an instructed verdict should have been sustained, because the terms of employment required...

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