International Security Life Insurance Co. v. Spray
| Decision Date | 26 May 1971 |
| Docket Number | No. B--2531,B--2531 |
| Citation | 468 S.W.2d 347 |
| Parties | INTERNATIONAL SECURITY LIFE INSURANCE COMPANY, Petitioner, v. Mintie Beatrice SPRAY et vir, Respondent. |
| Court | Texas Supreme Court |
A. J. Bryan, David F. Farris, Fort Worth, for petitioner.
Bradbury, Tippen & Cross, Bryan Bradbury, Abilene, for respondent.
Mr. and Mrs. Preston Spray recovered judgment against International Security Life Insurance Company on a hospital and medical expense policy. That judgment has been affirmed by the court of civil appeals. 461 S.W.2d 176. The insurance company objects here only to the award of attorney fees. It contends that there is no permissible manner, under Texas judicial precedent, whereby attorney fees for the appellate phase of the litigation may be recovered. If that be the effect of precedent, it will now be corrected.
The policy was issued on May 15, 1968. In April and May of 1969 Mrs. Spray suffered from persistent and severe nosebleed. She was hospitalized for ten days, and finally an artery ligation performed by an ear, nose and throat specialist stopped the bleeding. In response to the claim under the policy, the insurance company on July 8, 1969 wrote to Mr. Spray advising that no benefits could be paid for the reason that 'the cause of any such disabilities originated before the effective date' of the policy.
This suit was filed October 16, 1969 in the county of the residence of Mr. and Mrs. Spray. A plea of privilege was first filed by the insurance company. The company failed to appear at the venue hearing, and the plea of privilege was overruled on December 18, 1969. A plea in abatement was also filed, and the company denied that it was liable for any amount. Fourteen exclusions within the policy were specifically pleaded--ranging from treatment for narcotic addiction to injuries caused by war.
The case was reached for trial on May 8, 1970. The statement of facts contains the testimony of Mrs. Spray, her doctor, and her attorney. No evidence was presented by the insurance company, and its attorney did little more than cross-examine her attorney briefly on the matter of reasonableness of attorney fees.
The trial court entered judgment for the plaintiffs on May 8, 1970 for $1147, plus $137.64 penalty, plus attorney fees. The insurance company's notice of appeal was incorporated in the final judgment. The only points of error presented to the court of civil appeals were directed at the excessiveness and impropriety of attorney fees. The question of excessiveness has been disposed of by the court of civil appeals, and we face only the question as to whether this portion of the judgment was effective as entered by the trial court. The provision in the trial court's judgment awarding attorney fees reads as follows:
Article 3.62 V.A.T.S. Insurance Code, provides that 'where a loss occurs and the * * * company * * * liable therefor shall fail to pay the same within thirty days after demand therefor,' the company becomes liable for 12% Of the loss
The statute provides for recovery of reasonable attorney fees which the insured must pay to his attorney because of the necessity of pursuing legal action to collect the loss covered by the policy. The purpose of the statute would be defeated if only the fees incurred in the trial court were recoverable and the fees incurred during the appeal remained the expense of the policyholder. No such distinction or limitation may be found in Article 3.62. When it imposes liability on the company for 'reasonable attorney fees for the prosecution and collection of such loss,' it includes all fees incurred for that purpose.
The decision as to the amount of attorney fees for appellate services is made by the appellate court in some jurisdictions. E.g., Rauch v. First National Bank in Little Rock, 244 Ark. 941, 428 S.W.2d 89 (1968); Zingheim v. Marshall, 249 Cal.App.2d 736, 57 Cal.Rptr. 809 (1967); Taylor v. Taylor, 119 So.2d 811 (F...
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...fees upon the appellant's unsuccessful appeal."). The supreme court has long recognized this practice. See International Sec. Life Ins. Co. v. Spray, 468 S.W.2d 347, 349 (Tex.1971) (approving form of trial-court judgment where "a total award [of attorney's fees] is first fixed and then a pr......
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