Travelers Indem. Co. v. Beaty

• Decision Date: 05 May 1975
• Docket Number: No. KCD,KCD
• Citation: 523 S.W.2d 534
• Parties: The TRAVELERS INDEMNITY COMPANY, a corporation, Plaintiff-Appellant, v. Bob BEATY and Missouri State Highway Commission, Defendants-Respondents. 26957.
• Court: Missouri Court of Appeals

Page 534

523 S.W.2d 534

The TRAVELERS INDEMNITY COMPANY, a corporation, Plaintiff-Appellant, v. Bob BEATY and Missouri State Highway Commission Defendants-Respondents.

No. KCD 26957.

Missouri Court of Appeals, Kansas City District.

May 5, 1975.

Bob J. Keeter, Schroff, Keeter & Glass, Inc., Springfield, for plaintiff-appellant.

Robert L. Hyder, John H. Gladden, State Highway Commission of Missouri, Jefferson City, for defendants-respondents.

Before WASSERSTROM, P.J., and SHANGLER and DIXON, JJ.

SHANGLER, Judge.

The Travelers Indemnity Company brought an action for a declaration of rights and liabilities under a contract of automobile insurance issued to defendant Bob Beaty and under which the defendant Missouri State Highway Commission claims as a judgment creditor of the insured. The trial court found coverage and Travelers appeals.

As originally issued, the policy was written through the Ogle Insurance Agency and insured two Ford trucks. Thereafter, Belva Beaty, wife of the insured, at his instance made application to the Ogle Agency for additional coverage by endorsement to the original policy for a 1959 Mack Tractor and a 1967 Freuhauf Trailer. The application for the additional coverage shows execution by Belva Beaty on August 1, 1970. The endorsement which issued from Travelers in due course also recited August 1, 1970 as the effective date of coverage.

On July 31, 1970, the Mack-Freuhauf tandem collided with a bridge owned by the Missouri State Highway Commission. The Commission sued Beaty for recovery of damages to the bridge. Travelers provided Beaty a defense under a reservation of rights. A jury returned a verdict for the State Highway Commission for $27,000.

At the trial, the proof made by Ms. Beaty was that, notwithstanding the August 1, 1970 recital of the application, she signed the instrument undated and in blank on July 30, 1970 and then, under that date, paid the premium by her check and received from Ogle in his own hand a receipt for payment. As she left the Ogle office, Ms. Beaty asked whether the tractor and trailer were then insured, and he responded affirmatively.

Travelers contended then, as now, that the effective date of coverage for the tandem, both by application and endorsement, was August 1, 1970, and since the casualty occurred on July 31, 1970, there was no liability. Travelers has contended also that Ogle was not shown to be agent of the insurer and thus was without authority to bind Travelers.

On behalf of Travelers, Ogle testified that he was an insurance broker representing four different companies. Ms. Beaty, who was among his clients, came to his office on August 1, 1970 at about 9:30 a.m. and signed the application which at that time was complete except for some information he already had on file. She then paid him the premium cost for which he gave her a receipt. Ogle testified that he had authority to bind Travelers, and regularly did bind that insurer. Ogle conceded that he was informed of the collision with the bridge on the night of its occurrence, July 31, 1970.

The bound receipt book of the Ogle Agency was shown in evidence. The receipt entries were not sequential. Ogle had acknowledged payment of the Beaty premium by receipt number 144 dated July 30, 1970. The receipt numbered 143 immediately preceding however, was dated July 31, 1970. Ogle offered as explanation that he probably dated the receipt to Ms. Beaty to coincide with the date of her payment check. An examination of the exhibit discloses that some thirty other receipts were not dated sequentially.

It was also in evidence that the Beatys did not use their checks in strict sequence either. Thus, check number 1279, by which Ms. Beaty paid the insurance premium was dated July 30, 1970, whereas their check number 1278 was dated August 1, 1970 and number 1280 bore the date August 3, 1970. The explanation given was that the Beatys shared one check book and, occasionally, Mr. Beaty extracted some of them for his own use. These exhibits also shows that checks number 1275 and 1276, both dated July 30, 1970, cleared for payment on August 6, 1970, whereas check number 1279 written also on July 30, 1970, in payment of the premium did not clear until August 15, 1970.

The dispute focuses upon the legal effect to be given the application signed by Ms. Beaty. The printed form, which calls for the entry of data common for such purposes, bears the rubric: THE TRAVELERS INDEMNITY COMPANY. The last two segments on the reverse side of the application form consist of these printed legends and entries:

As we have shown, it was the testimony of Ms. Beaty that she had signed the form in blank with the expectation that Ogle would complete it and that her only handwriting on the application was her signature. There is no dispute that except for the signature of Belva Beaty, all of the entries in these last two segments of the application form--including the dates--were made by Ogle in his hand.

The declaration of the trial court that the coverage of the tractor-trailer commenced on July 30, 1970 was based upon express findings that Ogle had authority to bind Travelers and that he did so as of that date. Travelers contends that such a judgment proceeds upon either a reformation of the endorsement or upon an oral contract of insurance, theories not pleaded, and therefore, is coram non judice and void.

While a judgment cannot be sustained on a theory not pleaded (Northwest Missouri State Fair, Inc. v. Linville, 448 S.W.2d 274, 278(6, 7) (Mo.App.1969)), issues tried by consent of the parties are treated as though they had been raised by the pleadings, and are validly concluded by the judgment. Schwane v. Kroger Co., 480 S.W.2d 113, 117(4) (Mo.App.1972); Rule 55.33(b), V.A.M.R. The predicate for declaratory relief is a justiciable controversy between the parties as to their respective rights and duties which admits of specific relief by way of a judgment conclusive in character and determinative of the issues involved. Glick v. Allstate Insurance Company, 435 S.W.2d 17, 20(1) (Mo.App.1968). The controversy presented by the Travelers' petition was whether, in the face of the August 1, 1970 effective date of the endorsement, the insurer owed Beaty a defense against a claim from a casualty which occurred the day before. Under this pleading, and without objection from Travelers, defendant Beaty gave evidence of an oral agreement of insurance effective July 30, 1970; assuming agency and authority to bind, therefore, there was ample proof of the implied pleading of such an oral contract to support the judgment entered.

We conclude, nevertheless, that the Travelers' petition was a sufficient and valid basis for the declaration and judgment of the court. It may be conceded that the purpose of that pleading, as Travelers contends, was for a judicial construction of the endorsement--not a modification of it. In an action for declaratory judgment, however, the trial court has a wide discretion to mold the decree to the needs of the occasion, and may grant such relief as the proof warrants and equity dictates. Melton v. Ensley, 421 S.W.2d 44, 54(17--19) (Mo.App.1967); Borchard, Declaratory Judgments, p. 425. Thus, if as Travelers argues, the judgment of the trial court worked a reformation of the endorsement, then it was but a determination of the intention of the...