Prudential Ins. Co. of Great Britain v. Associated Emp. Lloyds, 15355

• Citation: 250 S.W.2d 477
• Decision Date: 20 June 1952
• Docket Number: No. 15355,15355
• Parties: PRUDENTIAL INS. CO. OF GREAT BRITAIN v. ASSOCIATED EMPLOYERS LLOYDS.
• Court: Court of Appeals of Texas. Court of Civil Appeals of Texas

Page 477

250 S.W.2d 477

PRUDENTIAL INS. CO. OF GREAT BRITAIN v. ASSOCIATED EMPLOYERS LLOYDS.

No. 15355.

Court of Civil Appeals of Texas, Fort Worth.

June 20, 1952.

Will C. Thompson, Vernon Coe, and W. S. Barron, Jr., Dallas, for appellant.

Cantey, Hanger, Johnson, Scarborough & Gooch, of Fort Worth, for appellee.

HALL, Chief Justice.

This appeal is between two insurance companies, seeking construction of a loss reinsurance contract between them pertaining to excess of loss on motor vehicles.

The contract was entered into by and between appellant, The Prudential Insurance Company of Great Britain, located in New York, the reinsurer, and appellee, Associated Employers Lloyds, the reinsured, who was plaintiff in the trial court.

A district court of Tarrant County, Texas, without the intervention of a jury, rendered judgment in favor of appellee and against appellant for the sum of $2,338.58, plus interest, etc.

Appellant's appeal is predicated upon four points, directed to error of the trial court: (1) in allowing recovery under the Motor Vehicle Excess of Loss Reinsurance Contract for loss where only a truck with trailer attached was involved, the contract between the parties providing that the reinsurance should apply only to losses involving 'two or more motor vehicles'; (2) in rendering judgment against appellant when appellee failed to prove its loss from fire as covered in the contract between the parties; (3) in allowing recovery against appellant when the evidence showed as a matter of law that the entire loss in question was caused by an 'upset' of the vehicle involved, such loss being expressly excluded by the contract; and (4) in refusing to dismiss the cause on the ground that the contract sued on expressly provided that any irreconcilable differences between the parties as to the interpretation of such contract should be submitted to arbitration.

As a general proposition we find that the term 'motor vehicle' ordinarily means a vehicle that is self-propelled, as defined by Article 6675a-1, section (b), Vernon's Tex.Civ.St. In said Article, under section (g), the term 'trailer' is defined thus: "Trailer' means every vehicle designed or used to carry its load wholly on its own structure and to be drawn by a motor vehicle.' Under section (a) of said Article, no doubt both a motor vehicle and a trailer are described as a 'vehicle.'

Under Article 1436-1, section 1, Vernon's Ann. Penal Code, we find the following: '* * * The terms hereinafter set out, as herein defined, shall control in the enforcement and construction of this Act, and it is further provided that wherever the term 'Motor Vehicle' appears in this Act, it shall be construed to include 'House Trailer. " However, under section 2 and 2a of said Article, the term 'motor vehicle' and the term 'house trailer' are more specifically described.

Article 6701h, section 1, subd. 3, Vernon's Tex.Civ.St., defines 'motor vehicle' thus: "Motor Vehicle'-Every self-propelled vehicle which is designed for use upon a highway, including trailers and semi-trailers designed for use with such vehicles * * *.'

In the contract between the parties, under the classification 'Motor Vehicle Excess Insurance,' paragraph 1 provides in part as follows: 'This contract, subject to the limitations hereinafter stated, reinsures the liability (including socalled garage-keeper's legal liability) which the * * * Associated Employers Lloyds of Fort Worth, Texas (hereinafter called the Reinsured) has assumed, or hereafter may assume, upon automobiles and other land motor vehicles of all descriptions, including their equipment and appurtenances * * * wherever located in the United States * * * for which the Reinsured is liable under policies, binders or other contracts issued through the Reinsured's Automobile Department.'

Under the exclusions, the contract provides that it will not be responsible for losses derived from 'collision' or 'upset' etc.

Under a section entitled 'Special Conditions,' we find the following:

'5. All loss settlements made by the Reinsured, provided they are within the conditions of the Reinsured's original policies and within the terms of this reinsurance, shall be unconditionally binding upon the Reinsurer and the Reinsurer's share shall be payable at the same time and in the same manner as the said Reinsured may elect to pay.

'6. The Reinsured must have paid or become liable to pay on account of any one loss or disaster, a sum in excess of Seven Thousand Five Hundred Dollars ($7,500) (exclusive of reinsurance, if any) before this reinsurance attaches, and in that event the Reinsurer shall only be liable for the excess over Seven Thousand Five Hundred Dollars ($7,500) up to, but in no event exceeding the sum of One Hundred Thousand Dollars ($100,000) by any one loss or disaster.

'18. It is agreed this reinsurance shall apply only to such losses as involve two or more motor vehicles.'

In the contract of...