Schepps v. American Dist. Tel. Co. of Tex.

• Decision Date: 16 December 1955
• Docket Number: No. 15008,15008
• Citation: 286 S.W.2d 684
• Parties: A. G. SCHEPPS, d/b/a Schepps Grocery Supply, Appellant, v. AMERICAN DISTRICT TELEGRAPH CO. OF TEXAS, Appellee.
• Court: Texas Court of Appeals

Page 684

286 S.W.2d 684

A. G. SCHEPPS, d/b/a Schepps Grocery Supply, Appellant, v. AMERICAN DISTRICT TELEGRAPH CO. OF TEXAS, Appellee.

No. 15008.

Court of Civil Appeals of Texas, Dallas.

Dec. 16, 1955.

Rehearing Denied Jan. 13, 1956.

Burt Barr and J. Lee Zumwalt, Dallas, for appellant.

John W. Miller, and Turner, Rodgers, Winn, Scurlock & Terry, Dallas, for appellee.

YOUNG, Justice.

Plaintiff-appellant's tort action against appellee charging breach of an alleged contract to indemnify him against loss through burglary, was challenged by defendant in this summary proceedings, pursuant to Texas Rules of Civil Procedure, Rule 166-A, 'summary Judgment.' Defendant's motion therefor was supported by affidavit of its Chief Clerk and oral depositions of plaintiff and his store manager, Julius Schepps; plaintiff making detailed but unsworn reply, and his second amended original petition is not verified. Upon hearing, judgment was rendered for American District Telegraph Company limiting plaintiff's recovery, following written contract recitals, to the sum of $50; the latter duly prosecuting this appeal.

On all material dates plaintiff was conducting a grocery store and market known as Schepps Grocery Supply. Under the basic contract of August 25, 1950, pled by him, he was one of appellee's subscribers, the instrument being styled 'Central Station Burglary and Holdup Protection Service'; claiming, however, in lengthy pleading that the true contract between the parties was one of indemnity against loss by burglary, which provision was omitted from the writing through fraud of defendant's agent Fisher, committed prior to or at time of its execution. Contents of the 1950 contract must be outlined briefly. It recited that defendant as contractor would install on subscriber's premises equipment and wires connecting same to its Central Station for transmittal of electrical alarms; providing employees to investigate all signals of an irregular nature originating from described location, and in case of holdup alarms to notify the Police Department; subscriber agreeing to pay an installation fee of $350 and $403 per annum (monthly in advance) for a period of five years.

Material here are paragraphs 13, 16, and 17 of the written contract which was signed by plaintiff and D. M. Fisher, Company Agent: '(13) It is agreed by and between the parties hereto: that the Contractor is not an insurer; that the payments hereinbefore named are based solely on the value of the services provided for herein; that, from the nature of the services to be rendered, it is impracticable and extremely difficult to fix the actual damages, if any, which may proximately result from a failure on the part of the Contractor to perform any of its obligations hereunder; that, in case of the failure of the Contractor to perform any of its obligations hereunder, and a resulting loss to the Subscriber, the Contractor's liability hereunder shall be limited to and fixed at a sum equal to ten percent of the annual service charge, hereinabove provided for, but in no event amounting to less than the sum of fifty dollars, as liquidated damages, and not as a penalty, and this liability shall be exclusive. * * * (16) This agreement is not binding unless approved in writing by an authorized representative of the Company described above as the contractor. In the event of failure of approval, as aforesaid, the only liability of the Contractor shall be to return to the Subscriber the amount, if any, paid to the Contractor upon the signing of this agreement. (17) There are no verbal understandings changing or modifying any of the terms of this agreement. This agreement cancells and supersedes agreement dated 1-15-47.'

On October 17, 1950 defendant sent to plaintiff an approved copy of the instrument by letter of that date; plaintiff alleging, by the way, that the contract had been executed in duplicate, he retaining a copy.

In the same connection plaintiff referred in second amended original petition to a supplemental contract of defendant, sent to him on February 22, 1952, to run concurrently with the earlier writing and covering certain additional services; alleging: 'That in all other respects said supplemental agreement is on the printed form of the defendant as its contract of August 25, 1950, and it was likewise executed in duplicate, and the defendant has one copy, and the plaintiff one copy * * *'; and further: 'That the defendant, on or about the 28th day of February, 1951, delivered to the plaintiff a certificate by the Underwriters' Laboratory Incorporated, certifying that the defendant had furnished a Grade A central Station Burglar Alarm System to the plaintiff; * * *.'

On the night of May 29, 1953 the store of plaintiff was burglarized, persons unknown making forcible entry into his steel safe, removing therefrom the sum of $25,777.47 in money and appropriating same to their own use, to his damage in said amount; with demand made upon defendant for reimbursement and $5,000 attorneys' fees. This suit followed, plaintiff in his amended petition charging in substance that the prior contract of August 1950 was induced by certain material representations on part of defendant's agent, D. M. Fisher, upon which he relied to his injury; reflected in part by the following allegations: 'That they would fully indemnify him for any and all losses ther might occur by reason of the failure of the said system to operate, or the prevention of the burglary by them as above set out. That the amount charged for such service would be less than the charge made by an insurance company, that he would receive ample and full protection and indemnity at less cost than he could secure from an insurance company; * * * That said representations were made by said D. N. Fisher for the purpose of inducing the plaintiff to believe the same and rely thereon, and thereby induce him to make and enter into a contract with the defendant for the protection and indemnity of his property and damages thereto, and that this plaintiff did rely upon said representation and agreed to the defendant installing said system in his property and agreed to make the payments and receive the protection and indemnity from the defendant as represented by said Fisher. * * * Plaintiff further alleges that the representations made by the defendant by its agent, D. N. Fisher, on or about the 25th day of August, 1950, and at the time of the delivery of said written agreement of August 25, 1950, which were made on that date, he did not read said written contract, but was caused to believe, and did believe, that it was in accordance with the representations of the said defendant's agent, D. N. Fisher, and that it would fully protect and indemnify him from any and all losses or damages which he might suffer by reason of burglary, theft, or other causes which said system was to protect him from. That he did not agree to any limitation of liability, and the limitations therein stated was placed therein without his knowledge or consent and was a fraud upon the part of the defendant, and should not be held binding on this plaintiff, but that the defendant under the agreement was at all times, and is now, liable to the plaintiff for any and all losses and damages suffered by him, especially as hereinafter stated.'

In support of defendant's motion for summary judgment filed January 6, 1955, was the affidavit of Mrs. Wanda Phillips, its Chief Clerk, relating to the above mentioned Certificate of Underwriters' Laboratories, Inc., admittedly received by plaintiff February 28, 1951; and verifying defendant's letter written in such connection. This 'Certificate,' apparently issued for purpose of enabling plaintiff to secure lower insurance rates, is referred to in said letter, which reads:

'March 1, 1951

'Schepps Grocery Supply

'1301-03 South Harwood Street

'Dallas, Texas.

'Underwriters' Laboratories

'Certificate No. 607690

'Grade A Complete, Merc. Vault

'Gentlemen:

'We attach Underwriters' Laboratories Certificate covering the burglar alarm system installed in your premises. We are authorized by the Underwriters' Laboratories to issue this certificate for the purpose of indicating to those interested the grade and extent of protection as defined by the Underwriters' Laboratories standards. The extent of protection of the equipment shown in this certificate is based upon our records of the system as installed, and in furnishing this certificate we specifically disclaim any responsibility or liability for any action taken by insurance underwriters or others in connection therewith, with the further understanding that the issuance of this certificate does not affect nor in any way change the terms of the contract under which we are operating burglar alarm service in your premises. Our action is taken for the convenience of the laboratories and without obligation of any nature in connection therewith.

'Do not destroy or lose this certificate. It may be required by the insurance companies in order that you may receive full recognition for your protection. We suggest that it be permanently posted adjacent to the system instrument.

'This certificate becomes effective 2-29-51 and expires 11-17-55.

'Very truly yours,

'American District Telegraph Co.

'C. G. Curry

'Operating Superintendent.'

Also a part of defendant's motion was the oral deposition of plaintiff A. G. Schepps and brother Julius, his store manager; and material here are excerpts of their testimony relative to the representations of Agent Fisher, made prior to execution of the service contract in question, dated August 25, 1950: '(Julius Schepps) Q. Now, what was it he said again? A. Because we had that new A. D. T. system in it and it would carry half price on the insurance if we decided to buy it. Q. Well, you could have gotten insurance at half price according to his statement? A. Yes, sir. * * * Well, he didn't recommend that you not take insurance, did he? A....