Smith v. Eagle Star Ins. Co.

• Decision Date: 24 July 1963
• Docket Number: No. A-9532,A-9532
• Citation: 370 S.W.2d 448
• Parties: Mrs. A.L.SMITH, Petitioner, v. EAGLE STAR INSURANCE CO. Ltd, Respondent.
• Court: Texas Supreme Court

Page 448

370 S.W.2d 448

Mrs. A.L.SMITH, Petitioner, v. EAGLE STAR INSURANCE CO. Ltd, Respondent.

No. A-9532.

Supreme Court of Texas.

July 24, 1963.

Rehearing Denied Oct. 2, 1963.

Calloway Huffaker, Harold Green, Tahoka, for petitioner.

Key, Carr & Clark, Aubrey J. Fouts, Lubbock, for respondent.

HAMILTON, Justice.

This is a suit to recover on a fire insurance policy for the loss of a house brought by Mrs. A. L. Smith, petitioner, against Eagle Star Insurance Company, Ltd., respondent. Judgment was for the petitioner in the trial court. The Court of Civil Appeals reversed and rendered judgment for respondent insurance company. 365 S.W.2d 23. Mrs. Smith has appealed to this court.

Both parties filed motions for summary judgment in the trial court. The trial court granted petitioner's motion for summary judgment and denied that of respondent. Respondent insurance company brought one point of error to the Court of Civil Appeals, which is as follows:

'The trial court erred in failing to grant the motion for summary judgment of the defendant in the court below because the uncontradicted facts show that the plaintiff had no insurable interest in the property covered by the policy of insurance in question.'

The Court of Civil Appeals sustained this point of error, holding as a matter of law that Mrs. Smith, petitioner herein, had no insurable interest in the property covered by the policy of insurance in question.

The petitioner maintains by her points of error that she derived a pecuniary benefit and advantage by the preservation and continued existence of the house in question, and that she suffered pecuniary loss because of its destruction, and that the Court of Civil Appeals erred in holding that the uncontradicted evidence established the lack of insurable interest on the part of the petitioner.

She also maintains that under the pleadings, the affidavits and the depositions before the court that the trial court properly granted her motion for summary judgment, it being conclusively shown that she had an insurable interest in the property in question.

There does not seem to be much controversy as to the facts in this case. The problem is more the interpretation of the undisputed facts and applying the applicable law thereto. Mrs. Smith, the petitioner here, and her husband acquired Section 455, Block D. John H. Gibson Survey in Yoakum County, Texas, in the latter part of 1940 or early 1941. At this time Mrs. Smith and her husband thought that Section 455 adjoined the eastern boundary line of New Mexico. There was a county road running north and south along the New Mexico east boundary line, and being on the west side of what Mrs. Smith thought was Section 455. Along this road and on the west side of the south half of Section 455 was a set of improvements, including the house into which she and her husband and family moved in 1941. Some time after Mrs. Smith and her husband took possession of Section 455 together with these improvements, she heard by word of mouth that her house was located on a strip of land claimed by the State of Texas, and designated as Section 456, this strip of land being between Section 455 and the New Mexico boundary line. The amount of acreage in this strip was not indicated, but it was described as being approximately three miles long, twenty-five yards wide at the north end, which began at the north-west corner of said Section 455, and one hundred yards wide at the south end. Several years after 1941 the Smiths sold the north half of Section 455. They continued to occupy said improvements and use them as a base of operations for farming the south half of Section 455 until Mrs. Smith's husband's death in 1951. Their son, who lived with Mrs. Smith, operated the farm for one year and in the fall of 1952 Mrs. Smith, who had acquired the interests of her children in and to the land, leased the premises to a Mr. McPherson for a term of ten years at a rental of $2,000.00 per annum. As a part of the consideration for said lease, the lessee agreed to and did drill two ten-inch irrigation wells, one of which was on the strip in question. Mr. McPherson in turn leased to Mr. Benthal, who paid the rent each year, although he sublet the land to a Mr. Newton, who was occupying the improvements at the time of the loss for which this suit was brought.

In January of 1959 respondent company issued its fire and extended coverage policy to Mrs. Smith on a stucco dwelling house located on the 'south half of Section 455 and Section 456, Block D, known as the Gibson Survey, about 14 miles west from Plains on the east side of a state line road in Yoakum County, Texas.' This policy was for a five-year term at a premium of $288.00. The house covered by this policy was completely destroyed by fire in February, 1960.

The depositions of Mrs. Smith and her son who acted as her agent in leasing the place and in...