New Orleans Ins. Co. v. Gordon

• Decision Date: 15 March 1887
• Citation: 3 S.W. 718
• Parties: NEW ORLEANS INS. CO. <I>v.</I> GORDON.
• Court: Texas Supreme Court

3 S.W. 718

NEW ORLEANS INS. CO.

v. GORDON.

Supreme Court of Texas.

March 15, 1887.

Appeal from Harris county.

Hutcheson, Carrington & Sears, for appellant. W. P. Hamblen, for appellee.

WILLIE, C. J.

H. O. Gordon brought this suit for the use of Theodore Keller against the appellant to recover $700 for the loss by fire of a store-house insured by the latter; the policy having been assigned by Gordon to Keller after the fire occurred. It seems that the policy was issued August 3, 1884, and contained, among others, the following provisions: "If the property be sold or transferred, or any change take place in the title or possession, (except by succession by reason of the death of the assured,) whether by legal process or judicial decree or voluntary transfer or conveyance, this policy shall be void. * * * If the interest of the assured in the property be any other than the entire, unconditional, and sole ownership of the property for the use and benefit of the assured, or if the building insured stands on leased ground, it must be so represented to the company, and so expressed in the written part of the policy; otherwise the policy shall be void." About three days previous to the issuance of the policy, viz., on July 31, 1884, Gordon had made to Keller a deed for the property insured, which deed was acknowledged and recorded on August 6, 1884, subsequent to the date of the policy. This deed was made for the purpose of enabling Gordon to obtain a loan of money for Keller from the Houston Homestead & Loan Association. Gordon could not do this directly, because he was not a shareholder in the company. Keller was; and the company, with knowledge of the purpose for which the deed was made, were willing to loan the money; but, upon examination, Gordon's title was found defective, and so the loan failed. Gordon, however, thought he might remedy the defects in his title, and so let the deed to Keller stand, so that, if he should succeed, the loan could be effected. The defects, however, had not been remedied up to the time of the fire, and hence the apparent title remained at that time in Keller, but he subsequently reconveyed to Gordon. There was evidence to show that Gordon was indebted to Keller at the time the deed was made, and there was some evidence to the effect that Keller expected to get some of the benefit of the money loaned to Gordon in payment of what the latter owed to Keller. Keller, however, says that the money was to go towards work done on the property conveyed, and that was what it was wanted for. Keller did not know whether Gordon would have given him any of the money or not. He supposed it was to pay him and the carpenters. Keller seems to have had no recollection as to having possession of the deed until he went with Gordon to the homestead association to procure the loan. When the policy was offered in evidence, it was objected to, because it had been fully assigned so as to place the legal title in Keller, and was not evidence of any right in Gordon to bring this suit, or to recover the insurance money. This objection was overruled by the court. Judgment was rendered for the plaintiff.

Upon the state of case made by the evidence, the defendant claims that the policy was avoided, whether the deed to Keller was made before or after the execution of the policy. It is very true that if the deed conveyed any interest or ownership in the land, or burdened the title of Gordon with conditions within the meaning of the policy, it would be in violation of one or the other of the clauses of the policy which we have recited, and be violative of its provisions, no matter which of the two instruments was first in taking effect. The main argument of the appellant to support its position, that the deed did have this effect, rests upon the assumption that it was in the nature of a mortgage to secure an indebtedness of Gordon to Keller. The evidence of Keller is to the contrary. He shows nothing but a mere hope or supposition that Gordon would pay him...