North River Ins. Co. of New York v. Reeder

• Decision Date: 28 October 1926
• Docket Number: (No. 3273.)<SMALL><SUP>*</SUP></SMALL&gt
• Parties: NORTH RIVER INS. CO. OF NEW YORK v. REEDER.
• Court: Texas Court of Appeals

288 S.W. 257

NORTH RIVER INS. CO. OF NEW YORK v. REEDER.

(No. 3273.)^*

Court of Civil Appeals of Texas. Texarkana.

October 28, 1926.

Rehearing Denied November 11, 1926.

Error from District Court, Bowie County; Hugh Carney, Judge.

Action by John L. Reeder against the North River Insurance Company of New York. Judgment for plaintiff, and defendant brings error. Reversed and rendered.

By its policy dated October 9, 1922, plaintiff in error insured defendant in error (from said date to October 9, 1925) in the sum of $1,250 against loss by fire of a dwelling house identified as "No. 1" in the policy, and in the sum of $750 against the loss by fire of another dwelling house identified as "No. 2" in said policy. The consideration to plaintiff in error for the policy was $18.28, paid to it at the time it issued same, and defendant in error's two promissory notes for $18.28 each, payable to plaintiff in error at McKinney, Tex.; one of them June 12, 1923, and the other June 12, 1924. It was stipulated in the policy that plaintiff in error should not be liable for any loss or damage to the property insured while any promissory note "given for premium remained past due and unpaid"; and it was stipulated in each of the promissory notes above referred to that, if it was not paid at its maturity, the policy should "be suspended, inoperative, and of no force or effect so long" as the note "remained overdue and unpaid." The dwelling house identified in the policy as "No. 2" was destroyed by fire November 8, 1924. At that time the promissory note first mentioned above had been paid, but the other one, then past due, had not been paid; and the fact that it had not was urged by plaintiff in error as a defense against the recovery sought by defendant in error of the amount of the insurance (to wit, $750) on said house No. 2. At the conclusion of the testimony the court instructed the jury to return a verdict for defendant in error, and, they having done so, rendered judgment in his favor against plaintiff in error for the sum of $729.91, the amount of said insurance less $20.09, the amount of said unpaid note.

Thompson, Knight, Baker & Harris and Pinkney Grissom, all of Dallas, for plaintiff in error.

Johnson & Waters, of New Boston, for defendant in error.

WILLSON, C. J. (after stating the facts as above).

The stipulations in the policy and notes referred to in the statement above were valid ones. Thomas v. Insurance Co. (Tex. Com. App.) 277 S. W. 1041; Insurance Co. v. Baggett (Tex. Civ. App.) 275 S. W. 313; Duncan v. Insurance Co., 113 Tex. 305, 254 S. W. 1101. As they were, and as it appeared that the note due June 12, 1924, had not been paid November 8, 1924, when the fire occurred, the judgment should have been in favor of plaintiff in error, unless it appeared from the testimony heard at the trial that it was guilty of conduct which deprived it of a right to set up the violation of the stipulations as a defense against the recovery sought against it. Defendant in error insisted in the court below and insists here that it appeared plaintiff in error (acting by its local agent at New Boston, one J. W. Eddins, who issued the policy sued upon) was guilty of such conduct, and, as supporting its contention, refers to testimony in the record showing facts as follows: Defendant in error instructed Eddins to draw drafts on him for the premium of the policy as the parts thereof became due, and arranged with the New Boston National Bank to pay the drafts. Eddins accordingly drew drafts for the part of the premium payable at the time the policy was executed and for the part covered by the note which matured June 12, 1923, and said drafts were paid by said bank. At or about the time the note maturing June 12, 1924, became due, defendant in error requested Eddins to have the time of payment thereof extended until the fall of that year, so he could pay it out of the proceeds of cotton he expected then to sell. Thereupon Eddins wrote to plai...