Southern Travelers Ass'n v. Stillman, 13563.

• Decision Date: 18 June 1937
• Docket Number: No. 13563.,13563.
• Parties: SOUTHERN TRAVELERS ASS'N v. STILLMAN et al.
• Court: Texas Court of Appeals

109 S.W.2d 285

SOUTHERN TRAVELERS ASS'N v. STILLMAN et al.

No. 13563.

Court of Civil Appeals of Texas. Fort Worth.

June 18, 1937.

Rehearing Denied October 1, 1937.

Appeal from District Court, Tarrant County; Bruce Young, Judge.

Suit by the Southern Travelers Association against Dora Stillman and others. From an adverse judgment, the plaintiff appeals.

Affirmed.

George C. Kemble and R. B. Young, Jr., both of Ft. Worth, for appellant.

Roy A. Scott, of Ft. Worth, for appellees.

SPEER, Justice.

This suit was filed by Southern Travelers Association, hereinafter referred to as appellant, in one of the district courts of Tarrant county, Tex., against Dora Stillman, Roy Scott, her attorney, and W. E. Alexander as district clerk of Tarrant county, Tex., who will be referred to as appellees where all are involved.

The nature of appellant's cause of action was in form of a bill of review and for injunction against all of the appellees to restrain them from having execution issued and served in a judgment theretofore obtained by Mrs. Stillman against the appellant.

Appellant alleges it is a mutual accident and health insurance company, a corporation, incorporated and chartered under chapter 6, title 78, of Revised Civil Statutes of Texas (1925); that on May 13, 1932, Dora Stillman, represented by Roy Scott, instituted a suit against appellant in the Forty-Eighth district court of Tarrant county, Tex., on a policy of insurance held by the husband of Dora Stillman and that citation was claimed to have been served on J. V. Hardy, who was at that time secretary of appellant association, and a member of the board of directors; that the citation was returnable on June 13, 1932, and that Dora Stillman, through her attorney Roy Scott, took a default judgment for $1,000 against appellant on June 18, 1932; that the appellant filed no answer in said cause, and did not learn of the judgment until September 6, 1932, and that the term of court expired on July 31, 1932.

Further allegation is made that the default judgment is and was void for the reason no proof was offered in its support at the time it was rendered. It is further averred that if process was served on J. V. Hardy, that fact was fraudulently concealed by him from the appellant, and for that reason no answer was filed in said suit, and that if appellant had known of the suit and service of process it would have answered and contested same; that appellant had a valid defense which it would have urged, in that the policy of insurance sued on was what is known to appellant as "Class H Membership," and that by the terms of the policy the liability of appellant depended upon the happening of certain conditions which it alleged did not exist; that the petition of Dora Stillman in said suit did not allege the conditions of said policy which would entitle her to recover thereon. In support of its prayer for injunction and in the alternative appellant alleged that under its by-laws and the laws of this state, especially article 4797, Rev. Civ.St.1925, all judgments rendered against it are deemed satisfied when associations such as appellant shall levy an assessment against the members of the same class and pay the amount collected, along with any other available funds in the hands of the association for that purpose, to the claimant under such judgment; that an assessment had been made on all members of the same class as that in which the husband of Dora Stillman was included, and that the sum of $5.80 was received therefrom, and said amount had been tendered to Dora Stillman, and, she having declined to accept the same, that amount had been deposited with the clerk of the court for the use and benefit of Dora Stillman in satisfaction of said judgment.

Prayer is for injunction restraining appellees from attempting to collect the amount awarded in the original suit, No. 1790 — A; that said judgment be set aside, and that it be permitted to present its defense thereto; and in the alternative that, if the original judgment be not set aside, then that the court so reform it that the payment by appellant of the amount received by it from an assessment against all members in the named class will satisfy the payment thereof.

The appellees answered by general denial. A jury was waived and the case tried to the court, who, having heard the pleadings and testimony offered, found against appellant in its every contention. Judgment was rendered to this effect, from which this appeal is perfected.

The appeal is predicated on three propositions based on proper assignments of error. The substance of the propositions is:

(1) The undisputed testimony showed the agent of appellant, upon whom service of process was had, fraudulently concealed from the corporation the fact that suit had been filed and that he had been served with citation, until after judgment had been rendered by default for $1,000; therefore appellant was entitled to have the judgment set aside and be permitted to present its defense.

(2) Since article 4797, Rev.Civ.St.1925, provides that a judgment rendered against a mutual accident insurance company shall be satisfied by payment of the full amount realized from an assessment made in accordance with the by-laws to meet the contingency insured against, the court was without authority in the original suit to enter judgment for the maximum amount of the policy and to order execution for its collection; therefore the judgment was void and its enforcement should be enjoined.

(3) It being made to appear that an assessment had been made against the members of the class in which Mr. Stillman was insured, and the full amount procured therefrom had been tendered to Dora Stillman, any judgment that may have been...