Home Ins. Co. v. Boatner

• Decision Date: 28 January 1920
• Docket Number: (No. 6332.)
• Citation: 218 S.W. 1097
• Parties: HOME INS. CO. v. BOATNER et al.
• Court: Texas Court of Appeals

218 S.W. 1097

HOME INS. CO. v. BOATNER et al.

(No. 6332.)

Court of Civil Appeals of Texas. San Antonio.

January 28, 1920.

Rehearing Denied March 10, 1920.

Error from District Court, Nueces County; W. B. Hopkins, Judge.

Action by R. H. Boatner and Charles Weil against the Home Insurance Company. Judgment for plaintiffs, and defendant brings error. Affirmed in part, and reversed and rendered in part.

S. A. Early, of Corpus Christi, and Locke & Locke, of Dallas, for plaintiff in error.

Kleberg, Stayton & North, of Corpus Christi, and Atkinson & Atkinson, of Houston, for defendants in error.

FLY, C. J.

This is an action by R. H. Boatner and Charles Weil against the appellant to recover on two policies of insurance issued by appellant to Boatner and agreed by appellant to be paid to Weil, as mortgagee, as interest might appear, on a certain storehouse in Robstown, Tex., which was destroyed by fire on May 4, 1916. The policies were dated, respectively, September 2, 1915, and October 15, 1915. The building was completely destroyed. Appellant's defense was that Boatner had obtained other insurance, in violation of the terms of the policies, which contained a stipulation against further insurance without consent of appellant. Appellant also, in case that it was held liable, sought subrogation to the mortgage given on the property by Boatner to Weil. Charles Weil died during the pendency of the litigation, and Sarah Weil, independent executrix of his will, was made a party. The court instructed a verdict in favor of Sarah Weil for $3,412.67 and in favor of Boatner for $44.83.

The first assignment of error assails the action of the court in instructing a verdict in any sum in favor of Boatner, on the ground that the undisputed evidence showed that he was not entitled to recover any amount. The reason for this assertion is given in the first proposition under the assignment to the effect that the entire policy, under its terms, became null and void in case other insurance was procured without an agreement entered on the policy as provided therein. The first policy issued permitted concurrent insurance for $1,800 on the building, $2,000 on the stock of goods, and $200 on the iron-clad warehouse, aggregating $4,000. The policy was for $1,800 on the building and $200 on the warehouse. The second policy permitted $5,000, as follows, $3,000 on the building and $2,000 on the stock, and was issued for $1,000 on the building alone. Afterwards, on April 20, 1916, Boatner, without the knowledge or consent of appellant, obtained insurance on his building from the Washington-Providence Company for $1,000.

The additional insurance procured by Boatner without the consent of appellant was undoubtedly another "contract of insurance * * * on property covered in whole or in part by this policy," as provided in each of the policies issued by appellant. It was $1,000 more insurance on the store building which had been insured by appellant. The fact that concurrent insurance was permitted in the sum of $5,000 did not conflict or set aside the provision that the entire policy should become void in case of another contract of insurance on any of the property without written consent of the insurer, and procuring the additional insurance by Boatner destroyed the policy unless it is preserved and protected by the statute as to insurance policies in case of total destruction of property being liquidated demands. Insurance Co. v. Blum, 76 Tex. 653, 13 S. W. 572.

Article 4874, Revised Statutes, which was enacted in 1879, provides:

"A fire insurance policy, in case of a total loss by fire of property insured, shall be held and considered to be a liquidated demand against the company for the full amount of such policy; provided, that the provisions of this article shall not apply to personal property."

That statute has been construed so that a stipulation in the policy as to the insurance company being liable only for three-fourths of the amount of insurance in case of subsequent insurance without consent of the original insurer would not affect the liability of that insurer for the whole amount. Insurance Co. v. Ice Co., 64 Tex. 578. It is also held that proof of loss, although stipulated in the policy, in case of total loss of a house, cannot be enforced, and that any other stipulation in contravention of the article cited is void.

The rule prevails, however, when additional insurance is obtained without the knowledge or consent of the insurer, that the policy will be forfeited. In the case of New Orleans Ins. Co. v. Griffin, 66 Tex. 232, 18 S. W. 505, it is held:

"The requirement of consent to other insurance is not arbitrary, but reasonable and proper. Through it the company reserves the right to determine how much of the risk shall be carried by the assured; the public, as well as the assurer, is interested in preventing a situation in which a fire would be profitable to the assured."

This is the uniform ruling under the valued policy law. Gross v. Assur. Co., 56 Tex. Civ. App. 627, 121 S. W. 517; Nat. Fire Ins. Co. v. Dorroh, 63 Tex. Civ. App. 620, 133 S. W. 475; Dumphy v. Ins. Co., 142 S. W. 116; Ins. Co. v. Barr, 148 S. W. 845; Ins. Co. v. Dalton, 189 S. W. 771.

Neither the good nor bad intention of the insured, nor his ignorance of the terms of the policy, in the absence of fraud or mistake, would affect the force and validity of the clause of the policy as to additional insurance. Ins. Co. v. Dorroh, herein cited. As said in Morrison v. Ins. Co., 69 Tex. 353, 6 S. W. 605, 5 Am. St. Rep. 63:

"Every policy holder, in the absence of fraud, misrepresentation, or concealment, must be held to have knowledge of the * * * policy when he has opportunity to examine it before he accepts it."

There was no fraud, misrepresentation, or concealment pleaded or proved in this case, and the insured could have had the policy sent to him instead of to the mortgagee and could have examined it. Boatner instructed the agent of appellant to send the policies to Weil, the mortgagee. The contract cannot be evaded or set aside because of the failure of Boatner to read the policy.

Article 4947, Rev. Stats., has reference alone to any provision in a policy of insurance which stipulates for forfeiture of the contract if answers or statements made in the application for insurance or in the policy are untrue. In such case the statement must be material to the risk or actually contribute to the contingency or event on which the policy became due or payable. Undoubtedly the taking out of additional insurance without the knowledge or consent of the insured would be very material to the risk, and the provision as to additional insurance is a "promissory warranty" not included within the provisions of the statute. Ins. Co. v. Weeks Drug Co., 55 Tex. Civ. App. 263, 118 S. W. 1086; Gross v. Colonial Assurance Co., 56 Tex. Civ. App. 627, 121 S. W. 517; Ins. Co. v. Wright, 58 Tex. Civ. App. 237, 125 S. W. 363; Ins. Co. v. Caraway, 60 Tex. Civ. App. 566, 130 S. W. 458; Ins. Co. v. Buckingham, 211 S. W. 531.

Boatner had no authority under the provisions as to concurrent insurance to place additional insurance on the building. The policy in terms confined insurance on the...