Garfield Mut. Fire and Storm Ins. Ass'n v. Calhoun

• Decision Date: 31 December 1975
• Docket Number: No. 1005,1005
• Citation: 532 S.W.2d 663
• Parties: GARFIELD MUTUAL FIRE AND STORM INSURANCE ASSOCIATION, Appellant, v. Allen T. CALHOUN, Appellee.
• Court: Texas Court of Appeals

Page 663

532 S.W.2d 663

GARFIELD MUTUAL FIRE AND STORM INSURANCE ASSOCIATION, Appellant, v. Allen T. CALHOUN, Appellee.

No. 1005.

Court of Civil Appeals of Texas Corpus Christi.

Dec. 31, 1975.

Rehearing Denied Jan. 30, 1976.

Walter R. Long, Jr., Long & Whitehead, Karnes City, Crain, Crain & Sheppard, Cuero, for appellant.

Nathan Hoffman, Law Office of O. F. Jones, Victoria, for appellee.

OPINION

YOUNG, Justice.

This suit was brought by Allen T. Calhoun to recover under an alleged fire insurance policy issued by the Garfield Mutual Fire and Storm Insurance Association insuring Calhoun against loss by fire of his residence and its contents located in Goliad County, Texas.

The association in its answer generally denied any liability. Trial was before a jury and submitted on special issues. In answer to the special issues submitted, the jury in substance found that a policy of insurance issued by the association did exist with Calhoun suffering damage to his residence of $9,000.00 and to the contents of $13,250.00. Based on those jury answers, the trial court rendered judgment against the association and in favor of Calhoun for insurance benefits of $6,000.00 plus attorney's fees of $2,125.00. From that judgment the association appeals.

Calhoun resided in his family home near Goliad, Texas, On January 6, 1972, the date of the loss. The home was purchased by him from his mother sometime prior to 1966. Calhoun's mother at that time had a policy of fire insurance coverage on the house and its contents, which insurance Calhoun took over upon purchasing the home.

Upon the purchase and notification to the appellant, Calhoun's name was substituted as the owner of the residence on or about September 1, 1966. The policy of insurance as originally issued provided for damages arising from fire with an overall limit of $10,700.00. This included $4,000.00 on the dwelling; $4,000.00 on the rent house; $2,000.00 on the furniture; and $700.00 on the barn. The only item in controversy here is the dwelling and its contents (furniture). Calhoun testified that the premium on the policy had been paid each succeeding year and that he had paid the premium covering the period in which he alleges his damages occurred. The residence in question and its contents were destroyed in the latter part of the evening around 10:00 p m. on January 6, 1972, by an explosion and fire. Subsequently the premises were inspected by Romeo Korth, the secretary-treasurer of appellant association. His testimony established that the damages occurring on the dwelling and furniture exceeded the coverage afforded by appellant's insurance policy. Appellee gave the required notice and proof of loss as required by appellant. Nevertheless, liability was denied by appellant.

Calhoun then brought suit against appellant to recover under a policy of insurance allegedly issued by appellant covering the dwelling and its contents. Upon trial, it was determined that neither the appellee nor appellant had a copy of the policy originally issued to Calhoun's mother. Calhoun testified that he never had, nor had he ever seen, that policy of insurance; he just paid the premium on it when it became due. It is undisputed, however, that there was an outstanding policy of insurance on the Calhoun residence and furniture on the date of the damage issued by appellant allowing $4,000.00 coverage on the dwelling and $2,000.00 coverage on the contents. Exactly what coverage was provided for in the absent policy was disputed; whether it was limited to fire and lightning only or whether it included explosions as well.

At the close of appellee's evidence, appellant moved for an instructed verdict asserting as grounds, among other things: (1) that there is no evidence showing the terms of the alleged certificate of insurance which is pleaded by the plaintiff as the basis of his cause of action; and (2) that there is no evidence to indicate that the plaintiff was insured against either fire or explosion, and if there is any evidence that he was insured against fire, there certainly is no evidence that he was insured against explosion; all the evidence shows that the damages resulted from explosion and not from fire.

It was appellee's contention that although a major portion of his losses resulted directly from the explosion, there was a fire that caused the explosion and thus he had coverage for his losses. The trial court denied appellant's motion, and appellant tendered to evidence thereafter.

The case was then submitted to the jury on special issues. In answer to certain special issues, the jury answered: (1) that on January 6, 1972, the plaintiff Allen T. Calhoun was insured under a policy issued by the defendant Garfield Mutual Fire and Storm Insurance Association; (2) that there was no damage caused to plaintiff's house by fire; (3) that the damage caused to plaintiff's house by reason of fire was not a total loss; (4) that the extent of damage to the contents of plaintiff's house caused by fire was $100.00; (5) that the extent of damage to plaintiff's house caused by explosion was $9,000.00; (6) that the extent of damage to the contents of plaintiff's house caused by explosion was $13,250.00; (7) and that reasonable attorney's fees were $1,250.00 in the trial court; plus $900.00 if the case were appealed to the Court of Civil Appeals; and plus $500.00 if the case were appealed to the Supreme Court of Texas. From this verdict the trial court rendered its judgment for appellee.

It is undisputed that a policy of insurance issued by appellant on the Calhoun premises did exist and was in effect at the time of the fire and explosion. In answer to certain interrogatories, Mr. Romeo Korth, secretary-treasurer of appellant testified that, although not knowing of the exact terms of the policy between appellant and Calhoun, the appellant had outstanding a certificate of insurance that purported to afford Mr. Calhoun $4,000.00 dwelling coverage and $2,000.00 furniture coverage at the time of Calhoun's loss. The evidence also shows that the original policy issued to Calhoun's mother had only fire coverage and did not have extended coverage which would include losses resulting from explosion. In fact, Calhoun testified that his mother had told him that the premises were covered only for fire. There was no evidence that subsequent to purchasing the property and taking over the premises and the insurance policy thereon that Mr. Calhoun acquired any additional coverage for anything other than fire coverage.

A blank duplicate (known as the Texas Standard Form) of the policy alleged to be in effect at this time was introduced into evidence, not for the purpose of showing coverage, but for the purpose of showing the type of policy that appellant issued and which Mr. Korth testified was identical to the policy that was issued to Mrs. Calhoun and was in effect at the time of the loss. Therefore, although the insurance policy in question was not available for examination, a facsimile was provided with additional evidence going to show the extent of the coverage to be for fire only.

The extent of the coverage having been shown and established, the question next presented was whether appellee's loss fell within such coverage, i.e., were the damages incurred by appellee the result of fire or were they the result of an explosion. If the losses were caused solely by the explosion and not by antecedent fire, then there is no coverage. It has been generally held that insurance against loss by fire includes all loss from explosion which is the direct result of a an antecedent fire upon the insured premises. In such cas the explosion is regarded as a mere incident of the fire and the damage sustained is the direct and proximate result of the fire. Liverpool & London & Globe Ins. Co., Limited v. Currie, 234 S.W. 232 (Tex.Civ.App.--El Paso 1921, writ ref'd); Northwestern Nat. Ins. Co. v. Westmoreland, 215 S.W. 471 (Tex.Civ.App.--El Paso 1919, no writ). See also North British & Mercantile Ins. Co., Ltd. v. Arnold, 171 S.W.2d 215 (Tex.Civ.App.--Galveston 1943, no writ).

In determining the liability of the insurer for the damage sustained, we deem it advisable to note the distinction between fires that are hostile and those which are friendly, in view of the testimony of Calhoun that the explosion could have been caused by the pilot light...