Propeck v. Farmers' Mut. Ins. Ass'n of Grayson County

• Decision Date: 01 July 1933
• Docket Number: No. 11307.,11307.
• Parties: PROPECK v. FARMERS' MUT. INS. ASS'N OF GRAYSON COUNTY.<SMALL><SUP>*</SUP></SMALL>
• Court: Texas Court of Appeals

63 S.W.2d 227

PROPECK v. FARMERS' MUT. INS. ASS'N OF GRAYSON COUNTY.^*

No. 11307.

Court of Civil Appeals of Texas. Dallas.

July 1, 1933.

Rehearing Denied September 23, 1933.

Appeal from Grayson County Court; A. S. Noble, Judge.

Action by Le Roy Propeck against the Farmers' Mutual Insurance Association of Grayson County. From the judgment, plaintiff appeals.

Reversed and rendered.

J. H. Randell, of Denison, for appellant.

B. F. Gafford, of Sherman, for appellee.

LOONEY, Justice.

Appellant, Le Roy Propeck, sued Farmers' Mutual Insurance Association of Grayson county, Tex., on a fire insurance contract to recover for the destruction of a barn and contents, alleged to have been destroyed within the terms of the policy, and, from an adverse judgment, prosecutes this appeal.

Appellee is a mutual fire insurance association that insures its members on the assessment plan; the provisions of the policy and by-laws of the association constitute the contract between the parties. Appellant's policy was issued May 12, 1923, covering a dwelling in the sum of $800, contents $200, a barn $500, and its contents $200, a total of $1,700, the premium being 25 cents per $100, making each assessment $4.25. Prior to October 1, 1930, appellant paid all assessments levied under the contract, but on that date failed to pay, hence became delinquent on an assessment, of which he was duly notified, and, while in this state of delinquency, his barn and its contents were destroyed by fire. On the day of the fire, October 15, 1930, but after its occurrence, appellant remitted the belated assessment, which was received the following day and retained by appellee. Also on the day following the fire Mr. G. W. Brown, a director and a duly authorized representative of appellee, visited appellant's farm, inspected the burnt premises, made up a written report of the fire and damage, which was signed by Mr. Brown and appellant, and delivered to appellee. The by-law and policy provisions (blended) provide in substance that, should a member fail, refuse, or neglect to pay an assessment on the 30th day after the same is made, and notice thereof received, a forfeiture of membership and all rights and privileges pertaining thereto ensue, and the policy becomes null and void, and liability thereunder automatically ceases, and thus remains, until such time as the assured is restored to membership, which takes place on payment of all amounts due the association, but the last assessment, being a premium for past protection, shall be paid.

A number of issues were presented, but the paramount question presented below, and insisted upon here, is reflected by an excerpt from appellee's brief, as follows: "Appellee defended on the grounds that appellant became delinquent on October 1, 1930, 30 days after the assessment No. 109 was made upon him September 1, 1930, and by reason of his failure to pay same on or before that date, October 1, 1930. And that being delinquent under sec. 3, art. 5, of the by-laws, appellant forfeited all his rights, privileges and membership in the association, and his policy became null and void, and that all liabilities of the associations thereon automatically ceased."

If the case is to be narrowed to the question as stated by appellee, it is obvious that the court did not err in rendering judgment for appellee, but we cannot assent to the proposition that the case should be determined alone on the facts mentioned, because, as we view the record, it appears that, with full knowledge of all the facts, appellee treated the contract as continuing, and acted in such a way as to estop itself to insist upon forfeiture. However, in this connection, appellee contends, in effect, that these issues are not in the case, and cannot be considered as basis for judgment, because not pleaded. In this we think appellee is in error. In a supplemental petition, appellant alleged, among other things, that "his membership was never forfeited, and that he is and has always been in good standing as a member of the association. * * * The association has never denied liability, but it and its president, secretary-treasurer, directors and...