National Auto. & Cas. Ins. Co. v. Holland, 17884

• Decision Date: 11 May 1972
• Docket Number: No. 17884,17884
• Citation: 483 S.W.2d 28
• Parties: NATIONAL AUTOMOBILE & CASUALTY INSURANCE COMPANY, Appellant, v. Sibyl S. HOLLAND, Appellee.
• Court: Texas Court of Appeals

Page 28

483 S.W.2d 28

NATIONAL AUTOMOBILE & CASUALTY INSURANCE COMPANY, Appellant, v. Sibyl S. HOLLAND, Appellee.

No. 17884.

Court of Civil Appeals of Texas,

Dallas.

May 11, 1972.

Rehearing Denied June 8, 1972.

Don Hinds, Yarborough, Yarborough & Hinds, Dallas, for appellant.

Jack B. Cowley, Carter, Jones, Magee, Rudberg, Moss & Mayes, Dallas, for appellee.

BATEMAN, Justice.

The appellee Sibyl S. Holland sued to set aside an unfavorable common law arbitration award. Her claim was against appellant National Automobile & Casualty Insurance Company under the 'uninsured motorist coverage' contained in an automobile liability policy issued by it to her. While operating her insured automobile she collided with an uninsured automobile and sustained serious bodily injuries. Appellee and appellant agreed to arbitrate her claim under the rules of the American Arbitration Association and to be bound by the award. The arbiter was Dallas attorney Robert S. Greenberg, who held a hearing and rendered a decision that appellee take nothing. This decision was assailed by this suit as being 'arbitrary and capricious in that the order denying Plaintiff recovery was a willful and unreasoning action taken without consideration and in disregard of the facts and circumstances of the case.'

The jury found, in answer to Special Issue No. 1, that in rendering such decision the arbitrator acted arbitrarily. Appellant had moved for instructed verdict and, after verdict, moved to disregard the jury's answer to Special Issue No. 1 and for judgment Non obstante veredicto, all of which motions were overruled. These motions and appellant's objections to Special Issue No. 1 all raise the questions of 'no evidence' and 'insufficient evidence' to support the submission of the issue and the finding of the jury in response thereto, and are presented in appellant's first eight points of error on appeal.

The arbiter Greenberg testified that the parties had made two stipulations at the hearing before him: (1) that Steve Taylor, the other party to the accident, was uninsured, and (2) that if appellee was entitled to recover she would be entitled to the maximum benefits provided by the policy. The trial court did not permit a showing as to what evidence was submitted to the arbiter. These rulings are not complained of on this appeal. Appellee introduced in evidence a pamphlet issued by American Arbitration Association entitled 'A Manual for Accident Claims Arbitrators,' in which the following appears:

'Accident Claims arbitrators should not use their authority to compel the parties to settle the claim under dispute. * * * He should render an award which in his judgment reflects the true value of the claim.'

Appellee took the position in the trial court, as she does in this curt, that Greenberg mistakenly conceived it to be his duty to 'settle' the dispute in the sense of working out a compromise, but that the stipulation of the amount, if any, which appellee would be entitled to recover prevented him from doing so and made the 'take nothing' decision the only one available to him. In support of that contention appellee's counsel elicited from him the following testimony:

'Q Well, what are your duties as an arbitrator when we say you are an arbitrator, what are you supposed to do?

A To settle a dispute between two parties.

Q Specifically in relation to an insured (probably intended to be uninsured) motorist claim what would it be an arbitrator's duty to perform?

A To settle the dispute between the party bringing the claim and the party resisting the claim.'

'Q Mr. Greenberg, I believe you told us earlier that it was your understanding as an arbitrator that you were to settle the dispute between the parties?

A Yes, sir, with certain rules to go by.'

'Q So you had the sole responsibility of making the arbitration?

A That was my understanding, yes, sir.

Q And it was your understanding you were to settle the claim between the parties?

A I was to determine the dispute, yes, sir.'

'Q So with those two stipulations what was it your understanding you had to resolve?

A The dispute between Sibyl Holland and the insurance company.'

'Q All right, what did the dispute involve in fact?

A Well, whatever other facts were necessary to consider the claim * * * of Sibyl Holland and whatever claim the insurance carrier presented.

Q And in summary that would be simply whether Mr. Taylor was legally liable to Sibyl Holland for any damages whatsoever, correct?

A Well, I think the legal question that was to be determined was whether or not the respondent company was liable but in order for the respondent company to be liable you would have to read the policy and interpret the policy.'

Greenberg also testified that the terms of the insurance policy as well as the common law would be applicable in the determination of the controversy and that Mr. Taylor had to be at fault in causing the accident and that Mrs. Holland had to be free of fault; that in addition to consideration of the negligence of the two parties he also had to consider whether the accident was unavoidable, and also what had been paid under the medical-pay clause. He then further testified:

'Q Will you tell us exactly what you mean when you say that it was your duty to settle the dispute between the parties?

A Well, as I understand it the parties came before an arbitrator and presented the claim and the defenses to the claim and it's up to the arbitrator to determine the validity or invalidity of the claim presented in accordance with the subject matter of the claim and the applicable facts and the applicable law applied to it.'

'Q Was it your thought you had to settle the case between the parties being unable to settle the case themselves?

A Well, I conceived my duty to make a decision, yes.

Q Do you ever recall telling anyone that your hands were tied, so to speak, in making an award because the parties had agreed that the judgment would be $10,000.00 or thereabouts in the event that Mrs. Holland won?

A Absolutely not, Mr. Moss.

Q You didn't tell that to anybody?

A Absolutely not.'

Joe Hill Jones, one of the attorneys for appellee, testified that within a week or ten days after the arbitrator's decision Greenberg told him that his hands were tied, that the parties had agreed that the damages sustained by the appellee were to be $10,000, the amount of the uninsured-motorist coverage, and in view of that stipulation between the parties he, Greenberg, couldn't rule on the case in any other way than to allow nothing.

This was in substance all of the evidence offered by appellee to show arbitrariness of the...