Frank B. Hall & Co. v. Beach, Inc.

• Decision Date: 23 April 1987
• Docket Number: No. 13-86-273-CV,13-86-273-CV
• Citation: 733 S.W.2d 251
• Parties: FRANK B. HALL & CO., Appellant, v. BEACH, INC., Appellee.
• Court: Texas Court of Appeals

Page 251

733 S.W.2d 251

FRANK B. HALL & CO., Appellant, v. BEACH, INC., Appellee.

No. 13-86-273-CV.

Court of Appeals of Texas Corpus Christi.

April 23, 1987.

Rehearing Denied April 23 and May 20, 1987.

Don Weitinger, Weitinger, Steelhammer & Tucker, K.L. Carnley, Irving C. Stern & Associates, Houston, for appellant.

John T. McDowell, Bankston, McDowell & Olivier, Jeffrey W. Steidley, Olivier & Steidley, Houston, Franklin H. Perry, Delta Sue Best, Thompson, Coe, Cousins & Irons, Larry Gollaher, Dallas, for appellee.

Before UTTER, SEERDEN and DORSEY, JJ.

OPINION ON MOTION FOR REHEARING

UTTER, Justice.

This Court's original opinion of March 18, 1987, is withdrawn, and the following opinion is substituted therefor.

Appellee, Beach, Inc., brought suit against its insurance broker, Frank B. Hall & Co., and the carrier, Employers Insurance of Wausau, for failure to pay a claim under an insurance policy, violations of the Deceptive Trade Practices Act (DTPA) and negligence. The jury found in favor of Beach and awarded actual damages of $2,130,000.00. The trial court rendered judgment for $6,390,000.00. We affirm in part and reverse and render in part.

Beach is a trucking company, primarily engaged in the business of hauling and rigging oilfield equipment. In September of 1982, Beach contacted Hall to obtain a quotation for cargo and liability insurance for its oilfield operations. Beach obtained insurance coverage, through Hall, from Wausau. In August of 1983, Beach was hired by Eljay Drilling Corp. to move and rig-up a draw works. ¹

It was late in the afternoon when Beach arrived at the drilling site with Eljay's draw works on its trailer. It was decided that the draw works would be left on the trailer until the next day. The next morning, as Beach's crane was removing the draw works from the trailer and turning it in order to place it upon the "substructure," the spreader beam broke and the draw works fell, striking the corner of the substructure. The draw works suffered extensive damage.

Wausau denied the claim based on its interpretation of the policy issued to Beach that there was no coverage for "lifting and rigging" and that the draw works was not "in transit" within the meaning of the policy.

Beach filed suit against Hall and Wausau. Eljay intervened and filed claims against Beach and Wausau. Hall and Wausau cross-claimed against each other and counterclaimed as to Beach. The judgment was for Eljay against Beach and for Beach against Hall. Wausau was granted a take-nothing judgment against the claims of Eljay and Beach.

By its first point of error, Hall contends that the trial court erred in holding that the insurance policy did not cover the loss because the draw works was in transit at the time of the accident.

All parties agreed that whether there was coverage under the policy was a question of law for the court to decide. The trial court's ruling on that question necessarily depended upon the language of the policy and the facts of the case.

The cargo policy issued to Beach covered property "in transit at and between points and places ... from the time such property leaves the factory, store, or warehouse at initial point of shipment until such property is delivered at its destination...."

Hall contends that Beach was merely "unloading" the draw works when the accident occurred and that the draw works was still "in transit" while it was being unloaded. Wausau claims that Beach was not "unloading" but was engaged in an operation known as "rigging up." ²

The phrase "in transit" has consistently been construed by our courts to mean "in the course of passing from point to point." United States Fidelity and Guaranty Co. v. Hutson Construction Co., Inc., 544 S.W.2d 762 (Tex.Civ.App.--Dallas 1976, writ ref'd n.r.e.); Haggar Co. v. United States Fire Insurance Co., 497 S.W.2d 61 (Tex.Civ.App.--Texarkana 1973, no writ); Simons v. Niagara Fire Insurance Co., 398 S.W.2d 833 (Tex.Civ.App.--Fort Worth 1966, no writ). See generally Chief Freight Lines Co. v. Holiday Inns of America, Inc., 469 S.W.2d 413, 417 (Tex.Civ.App.--Dallas 1971, no writ) ("[N]ormally unloading is not part of the delivery but is performed by the consignee."). Such an interpretation of the word "transit" is consistent with the language of the policy in the case at bar, "until such property is delivered at its destination."

It is undisputed that the draw works arrived at the rig site the day before the accident. The workmen left the draw works on the truck and returned the following day to lift the draw works to the rig floor.

Hall further argues that the draw works was still "in transit" and had not yet been "delivered at its destination" because it had not been removed from the truck. Hall cites T.I.M.E.-D.C., Inc. v. Southwestern Historical Wax Museum, Corp., 528 S.W.2d 901 (Tex.Civ.App.--Waco 1975, no writ), for the proposition that a shipment is "in transit" while the carrier's driver is unloading it. In T.I.M.E., a common carrier was to deliver a wax figure to a museum. When the truck driver arrived at the museum, he could not get the crate out of the truck because it was wedged between other crates too tightly. The driver pried the crate with a two-by-four rather roughly, but was unsuccessful. He was stopped by the museum's vice-president, who feared damage to the wax figure. The driver went back to his warehouse and then returned with the crate loosened and removed it from the truck. The evidence supported the finding that the damage was caused by the driver when he attempted to pry the crate loose.

The court stated, "We agree with the [carrier] that the ... shipment in question was 'in transit' within the meaning of the Interstate Commerce Act until the wax figure was delivered to the [museum's] possession, which was after the damage was done." Id. at 903-4.

We disagree with Hall's interpretation of T.I.M.E. The wax figure was still "in transit" because the driver had unsuccessfully attempted to deliver it. The damage was inflicted upon the wax figure when the driver tried to pry it loose. He took it back to his warehouse and then successfully delivered it on his second trip to the museum. Therefore, the wax figure was "in transit" when damaged.

When Beach delivered the draw works to the rig site, its duties as a common carrier were completed. The draw works was no longer "in transit" within the meaning of the policy.

The policy does not mention coverage for loading or unloading. To read such a provision into it would be to rewrite the contract.

In addition, even if the draw works is not "delivered at its destination" until "unloaded" from the truck, Beach was not engaged in an "unloading" activity. The evidence is sufficient to support a finding that Beach was engaged in "rigging up" when the accident occurred.

Hall additionally argues that drawing a distinction between "unloading" and "rigging up" requires a "strained and immaterial distortion of the facts." Essentially, Hall contends that "unloading" cannot be separated from "rigging" because in order to "rig up" the draw works had to be "unloaded" from the truck. Although this is true to some extent, we are dealing here with technical terms. The evidence established that "unloading" does not always involve "rigging up" and "rigging up" does not always involve "unloading." There clearly is a distinction between the two activities.

Accordingly, the trial court did not err in holding that the draw works was not in transit. Hall's first point of error is overruled.

By its second point of error, Hall contends that the trial court erred in its allocation of peremptory challenges and that a materially unfair trial resulted.

The trial court gave Beach nine strikes and Eljay, Hall, and Wausau three each. Hall argues that no antagonism existed between Beach and Eljay, and therefore, they should have been aligned on the same side.

The existence of antagonism between litigants is a question of law. Garcia v. Central Power & Light Co., 704 S.W.2d 734 (Tex.1986); Diamond Shamrock Corp. v. Wendt, 718 S.W.2d 766 (Tex.App.--Corpus Christi 1986, writ ref'd n.r.e.). In making this determination, the trial court must consider the pleadings, information disclosed by pretrial discovery, information presented and representations made during voir dire of the jury panel, and any other information brought to the attention of the trial court before the exercise of the strikes by the parties. Garcia v. Central Power & Light Co., 704 S.W.2d at 737. The existence of antagonism must be finally determined after voir dire and prior to the exercise of the strikes. Id.

Due to the nature of this case, it is important to determine which "side" of the law suit Eljay is "aligned" on. Eljay is an intervenor in this suit. It sued both Beach and Wausau. However, Eljay was not sued by any of the other parties.

The pleadings reveal antagonism between Eljay and Beach regarding Eljay's claims against Beach. However, Eljay's claims against Wausau reveal that Beach and Eljay have common interests as to Wausau. Eljay made no claim against Hall, therefore, viewing only the pleadings, Eljay could not be considered antagonistic to Hall.

As Garcia points out, the pleadings are not the only factor to be considered, and although viewed in isolation the pleadings may support a finding of antagonism, the trial court must consider the entire record generated prior to the exercise of the strikes. Id.

Hall contends that the pretrial hearing and voir dire reveal that there was no antagonism between Beach and Eljay.

At the pretrial hearing, Eljay's attorney, Mr. Perry, testified that he "definitely wanted [Beach] to win against Hall" because Eljay would be able to recover more money if recovery was against Hall. Mr. Perry also stated that it was represented to him that Beach had a "negative net worth." He agreed that if neither Hall nor Wausau pays a judgment, Eljay would not be able to collect anything...