United Am. Ins. Co. v. Selby

Decision Date20 July 1960
Docket NumberNo. A-7719,A-7719
Citation161 Tex. 162,84 A.L.R.2d 367,338 S.W.2d 160
Parties, 84 A.L.R.2d 367 UNITED AMERICAN INSURANCE COMPANY, Petitioner, v. William Henry SELBY, Respondent.
CourtTexas Supreme Court

Fred S. Harless, Dallas, for petitioner.

Jack Little, Big Spring, for respondent.

SMITH, Justice.

This is a suit on a policy of health and accident insurance for benefits for loss of time due to injury. Trial was had before the court without the intervention of a jury. A true copy of the policy was incorporated in the agreed statement of facts. All facts were stipulated and agreed to by written stipulations filed with the court. Judgment was rendered for respondent.

The Court of Civil Appeals affirmed the judgment of the trial court on two grounds. It held (1) that notice of injury was given by the insured within the time allowed by statute and within the time fixed by the provisions of the policy; (2) that the provision in the policy that the insured would not be indemnified for loss for injury during any period which the insured was not under the personal and regular attendance of a legally licensed doctor of medicine or osteopathy, was evidentiary and was not a condition precedent to recovery. These were the only questions before that court. 330 S.W.2d 495.

The same two questions are now here by application for writ of error. The original application alleged jurisdiction under Subdivision 6 of Article 1728, Vernon's Annotated Civil Statutes of Texas. The amount in controversy, according to the stipulations, being only the sum of $505.80, the application was dismissed for want of jurisdiction. The application was granted after petitioner amended its application with leave of the court first being had and obtained. The amended application alleged that this court had jurisdiction under Subdivision 3 of Article 1728, Vernon's Annotated Civil Statutes.

This, in effect, is a suit for damages. The question of whether written notice of the injury on which the claim was based must be given within twenty days, as provided in the policy, involves the construction of Article 5546, 1 Vernon's Annotated Civil Statutes of Texas. Petitioner contends that the Court of Civil Appeals' construction of this Article has the effect of allowing a general statute to repeal Article 3.70-3(5), 2 Vernon's Annotated Civil Statutes of Texas, Insurance Code. We agree with petitioner that this court has jurisdiction. Since the application contains a point coming within our jurisdiction, we have jurisdiction to pass upon all points presented. See Pittman v. Baladez, Tex., 312 S.W.2d 210.

We have concluded to sustain petitioner's point that the exclusionary clause in the policy to the effect that the indemnities provided in the policy do not cover any period during which the insured is not under the personal and regular attendance of a legally licensed doctor of medicine or osteopathy. Our conclusion on this point requires a rendition of judgment in favor of petitioner. This holding renders it unnecessary to decide the notice question.

The policy under Part Two insures against loss of time, as the result of an accident, and the schedule of indemnities provides for indemnities to be paid for total disability the sum of $200 per month for a period limited to 60 months. The policy, however, provides on page one that the 'benefits, provisions, exceptions, limitations and deductions on the following pages are a part of this policy.'

On page three we find the following:

'Part II

'Exclusions, Limitations and Reductions

'D. The indemnities provided in this Part do not cover any injury sustained by the Insured while insane; or any injury caused by war or any act of war or sustained while in military or naval service of any country at war; or aircraft accidents unless the Insured is a fare-paying passenger in a licensed passenger aircraft provided by an incorporated passenger carrier and while operated by a licensed pilot upon an established schedule over a regular passenger route between definitely established airports; or any injury sustained outside of the continental limits of the United States or Canada; or suicide or any attempt thereat, while sane or insane; or hernia; or any kind of disease or medical or surgical treatment therefor; or any period during which the Insured is not under the personal and regular attendance of a legally licensed Doctor of Medicine or Osteopathy, other than Insured. * * *.' (Emphasis added.)

It was stipulated that, during the period of disability, respondent was under the personal and regular attendance and treatment of only a naturopath; that, during said period of said disability, respondent was not under the personal and regular attendance or treatment of a legally licensed doctor of medicine or osteopathy, unless the licensed naturopath is deemed to have been such a legally licensed doctor of medicine or osteopathy as a matter of law by virtue of the fact that he was licensed to practice Naturopathy.

A Naturopath is neither a legally licensed doctor of medicine nor of osteopathy. Schlichting v. Texas State Board of Medical Examiners, Tex., 310 S.W.2d 557. It follows that petitioner was not at any time during the critical period involved under the personal and regular attendance of a legally licensed doctor of medicine or osteopathy. The exclusionary clause, supra, clearly and unequivocally provides that there shall be no coverage in such a situation. The provision is listed as an exclusion in the policy. The policy expressly provides that the insuring provisions are subject to the provisions, exclusions, and limitations in the policy. The Exclusions, Limitations and Reductions clause in plain, clear, and unequivocal language simply provides that there is no coverage in a case such as we have here.

Although the case of Burns v. American National Insurance Company, Tex.Com.App., 280 S.W. 762, 766, was one wherein the insurer was relying upon a 'condition precedent to recovery' clause, we believe the principles of law announced therein are controlling here. In that case the claim was based upon the obligation imposed by the terms of the policy to pay a certain sum of money each month under certain conditions. Each monthly sum was to be paid upon the happening of certain events and the performance by Burns of certain things. The policy contained a provision that if Burns should be disabled '* * * he or his representatives shall as a condition precedent to recovery hereunder, furnish the company every thirty days with a report in writing from his attending physician or surgeon, fully stating the condition of the insured and the probable duration of his disability.'

The court, in holding that the obligation on the part of Burns was a condition precedent to recovery, said: '* * * There could be no breach of the contract by the defendant in error, and therefore there could be no damages resulting to the plaintiff in error, until these conditions existed and the performance by him of the things which he had obligated himself to have done. One of the things he obligated himself to have done was to have his attending physician furnish a report every 30 days stating his physical condition. The law compels us to assume, in view of the testimony to the effect that the plaintiff in error was entitled to be paid the $100 monthly on account of his disability, that had the report of his physician been made in accordance with this provision, the defendant in error would have paid each month the sum it obligated itself to pay. Until the conditions prescribed by the terms of the policy had been met, no obligation was imposed upon the defendant in error to pay the plaintiff in error anything, and in the absence of such obligation, there could be no breach of the contract, and therefore no damage could accrue.'

The terms of the contract in that case just as here were free from ambiguity. In the present case, in view of the stipulation of the parties, there is no element of a cause of action based upon a breach of the contract alleged to have been executed by the petitioner, the party in default. The indemnities in the policy did not cover the period of claimed injury for the reason that the policy expressly excluded coverage for the period during which the insured was not under the personal and regular attendance of a legally licensed doctor of medicine or osteopathy. The general rule in most jurisdictions where this question has been decided by the courts is that the particular exclusion in question here is valid and reasonable and is a condition precedent to the right of recovery of benefits, and not against public policy. See Lustenberger v. Boston Casualty Company, 300 Mass. 130, 14 N.E.2d 148, 115 A.L.R. 1055; Provident Life & Accident Insurance Company of Chattanooga v. Harris, 234 Ky. 358, 28 S.W.2d 40; State ex rel. Mutual Benefit, Health & Accident Ass'n v. Trimble, 334 Mo. 920, 68 S.W.2d 685; Equitable Life Assurance Society of United States v. Burns, 254 Ky. 487, 71 S.W.2d 1009; 115 A.L.R. 1062, and many cases therein cited.

Respondent admits that the 'regular medical reports' provision contained in the policy involved in the case of Burns v. American National Insurance Company, supra, is such a provision as would operate as a condition precedent to recovery, but contends that 'Exclusion D', supra, is evidentiary and will not operate as a bar to a recovery. In support of this contention, respondent relies upon such cases as Federal Surety Co. v. Waite, Tex.Civ.App.1927, 297 S.W. 312, wr. dism.; Provident Insurance Company v. Shull, Tex.Civ.App.1933, 62 S.W.2d 1017, no writ history; American National Insurance Company v. Briggs, Tex.Civ.App.1934, 70 S.W.2d 491, wr. dism.; American Casualty Company v. Horton, Tex.Civ.App.1941, 152 S.W.2d 395, wr. dism., and Inter-Ocean Casualty Company v. Brown, Tex.Civ.App.1930, 31 S.W.2d 333, wr. dism. The Court of Civil Appeals (330 S.W.2d 498...

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