Southern Farm Bureau Cas. Ins. Co. v. Davis, 8411

• Decision Date: 03 December 1973
• Docket Number: No. 8411,8411
• Citation: 503 S.W.2d 373
• Parties: SOUTHERN FARM BUREAU CASUALTY INSURANCE COMPANY, Appellant, v. Glen DAVIS, Individually and as next friend of Felicia Gay Davis, a minor, Appellee.
• Court: Texas Court of Appeals

Page 373

503 S.W.2d 373

SOUTHERN FARM BUREAU CASUALTY INSURANCE COMPANY, Appellant, v. Glen DAVIS, Individually and as next friend of Felicia Gay Davis, a minor, Appellee.

No. 8411.

Court of Civil Appeals of Texas Amarillo.

Dec. 3, 1973.

Rehearing Denied Jan. 7, 1974.

Crenshaw, Dupree & Milam, Max C. Addison, Lubbock, for appellant.

Lemon, Close, Atkinson & Shearer, R. D. Lemon, Perryton, for appellee.

REYNOLDS, Justice.

Appellee Glen Davis, individually and as next friend of Felicia Gay Davis, a minor, recovered a money judgment from, and under a purported insurance contract made by, appellant Southern Farm Bureau Casualty Insurance Company. The dispositive query is whether there was, and we determine there was not, a valid contract of insurance in force. Reversed and rendered.

The focal point of the factual situation developed is a purported contract of insurance, alleged by appellee to have been in force and covering appellee's 1970 Chevrolet pickup on August 4, 1970, the date appellee's minor daughter, Felicia Gay Davis, was thrown from the back of the pickup, sustaining serious injuries. The importance of the chronology involved warrants a recapitulation of the evidence .

Since approximately 1968, Glen Davis had purchased various types of insurance coverage from Southern Farm Bureau Casualty Insurance Company, home officing in Waco, Texas, through Ralph Headlee, managing agent of appellant's Perryton, Texas, office. Such coverage consisted of insurance on several houses in Perryton, two personal automobiles and a 1962 Chevrolet pickup. Concerned here is the insurance policy pertaining to the 1962 pickup. The policy, No. WVGVO2, was issued July 10, 1969, for a six month period. The policy consisted of a printed contract denominated 'FAMILY AUTOMOBILE POLICY' of general terms and conditions and a separate printed declaration of terms and conditions with spaces completed with the data pertinent to the 1962 pickup, the property insured. By its terms, the policy expired on January 10, 1970, ¹ at 12:01 a.m., except, as provided in the declaration, the policy.

'. . . may be continued in force for successive policy periods by the payment of the required renewal premium in advance of each such period and the acceptance of such premium by a duly authorized representative of the company.'

No renewal premium was paid in advance of January 10; however, Davis submitted the renewal premium on January 12 to appellant's office in Perryton. The payment was forwarded to appellant's home office and received on January 14. No policy declaration was issued indicating renewal of the policy. Headlee testified that the vehicle was insured as of January 10 and no dispute is made of this testimony. The coverage was afforded, according to Headlee's testimony, since it was appellant's policy to renew the insurance if the renewal premium were received within ten days after expiration. This testimony was not corroborated by written evidence or otherwise.

Two or three weeks prior to July 10, the expiration date of the renewed policy, Davis received appellant's notice of the renewal premium due on that date. The renewal premium was not paid. On July 22, Joy Wright, a secretary employed by the Ochiltree County Farm Bureau, telephoned Davis and, according to Davis' version of the conversation, asked Davis if he desired to continue coverage on his vehicles. Davis said that he did and instructed Joy Wright to 'Go ahead and write it up . . . I will be down to take care of it in a few days.' He also informed her that he exchanged pickups and now owned a 1970 Chevrolet pickup and desired that it be included in the policy. Joy Wright told him, 'That will be just fine with us. We will need your serial number.'

On the same day, a letter addressed to Glen Davis and signed by Ralph Headlee contained the following language:

'We have been notified by our company office that the insurance on your 1968 Olds, policy WVGVO1 in the amount of $34.30 and your 1962 Chevy Pk-up, policy WVGVO2 in the amount of $34.30 is lapsed.

'You may already have mailed your check for this. If you have, please accept our thanks and disregard this letter. However, if you have not, and wish your insurance to remain in effect, please do so at once.'

This letter and the conversation with Joy Wright are the only instances upon which Davis relies for his contention that the policy which expired July 10, was, in fact, renewed and kept in force. It is undisputed that the July 22 conversation took place.

Davis' written statement made on September 4 and entered in evidence, read in part: 'I received this letter about the same week that I was called by the Ochiltree County Farm Bureau office.' Davis, however, testified at the trial, that he never received the July 22 letter, and in his September 4 statement he was referring to a computer card which he had received, notifying him of the due date of his renewal insurance.

Davis took no further action regarding the insurance on the 1970 Chevrolet pickup until August 5, 1970, one day after his daughter sustained her injuries, when the Perryton office was requested by another party to draw a draft on Davis, 'to pay for the two automobiles to reinstate it.' As a result of this requested action, appellant issued a declaration insuring the 1970 Chevrolet pickup effective August 10. Upon the refusal of appellant to pay the claim, Davis brought suit which resulted in the judgment that is the subject matter of this appeal.

Appellant insurance company's appeal is premised upon twenty-seven points of error. Points one through eighteen, and twenty-three and twenty-four all advance the central complaint that there was no evidence or insufficient evidence to establish that any person with authority to bind appellant made any offer to appellee Davis which was accepted by him for a contract of insurance on the vehicle in question covering the date of the accident, August 4, 1970. Preliminary to a discussion of the sufficiency of the evidence to show an offer and acceptance, it is necessary to examine and resolve the question of the authority of either Ralph Headlee or Joy Wright, or both, to make any offer to extend insurance coverage for the vehicle.

Appellant's main premise is that neither of these individuals were clothed with authority, actual or apparent, to the extent that any purported offer of insurance coverage made by either or both of them would be binding on appellant. The determination of actual authority is controlled by the document entered in evidence entitled 'Agency Manager's Contract,' which specifically delineates the extent of, and the limitations on, the agency manager's authority. The contract provides in part that Headlee was '. . . appointed an Agency Manager for the Southern Farm Bureau Casualty Insurance Company . . . for the purpose of soliciting and servicing . . . any or all lines of business the Company shall offer, . . .' The other pertinent provisions of the contract read as follows:

'3. LIMITATION OF AUTHORITY

You agree not to:

A. Make, alter or discharge any contract of insurance; waive any forfeiture; waive payment in cash; extend the time of payment of any premium; . . . nor receive any money due or...