Universal Automobile Ins. Co. v. Culberson

• Decision Date: 30 October 1935
• Docket Number: No. 1906-6445.,1906-6445.
• Citation: 86 S.W.2d 727
• Parties: UNIVERSAL AUTOMOBILE INS. CO. v. CULBERSON et al.<SMALL><SUP>*</SUP></SMALL>
• Court: Texas Supreme Court

86 S.W.2d 727

UNIVERSAL AUTOMOBILE INS. CO. v. CULBERSON et al.^*

No. 1906-6445.

Commission of Appeals of Texas, Section A.

October 30, 1935.

Error to Court of Civil Appeals of Tenth Supreme Judicial District.

Action by D. H. Culberson against the Universal Automobile Insurance Company, in which Minnie Lou Witt intervened. Judgment for the plaintiffs was reversed by the Court of Civil Appeals [54 S.W.(2d) 1061], and the defendant brings error.

Judgment of the Court of Civil Appeals affirmed.

T. R. Mears, of Gatesville, J. L. Goggans, of Dallas, and McClellan, Lincoln & Williams, of Waco, for plaintiff in error.

R. B. Cross and Robert W. Brown, both of Gatesville, for defendants in error.

GERMAN, Commissioner.

On March 6, 1930, plaintiff in error, Universal Automobile Insurance Company, issued an automobile accident policy covering a car belonging to defendant in error, D. H. Culberson. The terms of this policy will be hereinafter more fully reviewed. Shortly after the policy was issued and while the car was being driven by Culberson's daughter, there was an accident in which Miss Minnie Lou Witt was injured. In a suit brought by Miss Witt against Culberson, she was awarded a judgment for $10,536.88 and costs of suit. The various proceedings prior to the rendition of this judgment are set out in the opinion of the Court of Civil Appeals which is reported in 54 S.W.(2d) 1061. After the issuance of execution, which was returned unsatisfied, Culberson brought this suit against the insurance company to recover the amount of the judgment against him in favor of Miss Witt, together with $750 attorney's fees, interest, and costs. Miss Witt intervened in this suit and asked judgment in her favor for $10,536.88.

The insurance company filed two pleas in abatement; one as to the suit by Culberson, and the other as to the suit by Miss Witt. These pleas were overruled. In its answer it set out at great length many facts and circumstances tending to show that in many particulars Culberson had failed and refused to co-operate with the company in making a full and fair defense to the action; and had colluded with Miss Witt in such manner as to permit the judgment to go against him. The pleadings setting out this matter were stricken out by the trial court on special exceptions, and the Court of Civil Appeals held that this was error. The opinion of the court upon that point is supported by a full and clear statement of the various allegations of the pleadings tending to raise the issue of failure to co-operate. We therefore approve the conclusion of the Court of Civil Appeals in that regard, and its action in reversing and remanding on that ground.

We do not approve the opinion of the Court of Civil Appeals in all other respects, and, in view of another trial, we proceed to discuss the rights of the parties under the policy of insurance; this being necessary in view of various assignments of error in petitions for writs of error by both parties.

The portion of the policy defining the primary obligation of the company as regards personal injuries to third persons by reason of the ownership of the car is in item 6 of "Schedule of Perils and Extent of Each Coverage," and is as follows: "The Company does hereby agree to insure the Assured named and described in the `Schedule of Statements' herein, for the term therein specified against direct loss by reason of liability imposed by law upon the Assured for damages by reason of the ownership or maintenance of the automobile described in Statement 6 of the `Schedule of Statements,' and the use thereof for the purposes described in Statement 7 of the `Schedule of Statements' (including loading and unloading thereof), to an amount not exceeding the limits hereinafter stated, if such loss be sustained on account of Bodily injuries or death accidentally suffered or alleged to have been suffered by any person or persons (excluding any employee of the Assured suffering injuries or death while engaged in the operation, maintenance or repair of the automobile insured hereunder or while engaged in the usual course of the trade, business, profession or occupation of the Assured) as the result of an accident while this policy is in force; provided there is a specific premium charge made in writing in Item 6 of the `Schedule of Coverage' on the preceding page. The liability of the Company under this Item 6 for loss or expense on account of an accident resulting in bodily injuries to or in the death of one person is limited to the amount named in Item 6, Section 2 of the Schedule of Perils and subject to the same limit for each person, the total liability of the Company for loss or expense on account of an accident resulting in bodily injuries to or in the death of more than one person is limited to the amount named in Item 6, Section 2 of the Schedule of Perils." (Italics ours.)

The amount named in item 6 of section 2 of the Schedule of Perils was limited to $5,000.

Item 7 pertained to damages and destruction of property.

There were further provisions more clearly defining liability and the limitations thereon; the same being contained in subdivisions (A), (B), and (C) immediately after items 6 and 7 above mentioned. These provisions are as follows:

"In the event that loss from the perils set forth in Item 6 and/or Item 7 is insured against hereunder, then as respects the peril or perils so insured against the limits of the Company's liability shall be:

"(A) To investigate all accidents covered by Item 6 and/or Item 7 of the `Schedule of Coverage' of this policy and at its expense to employ attorneys to represent the Assured in all suits brought hereon, whether groundless or not; and

"(B) In event a final judgment be rendered against the Assured, to pay the same to an amount not exceeding the limits specified herein; and in addition,

"(C) To pay, irrespective of the limit of liability stated in the Policy, all costs taxed against the Assured in any such defended suit, all expenses incurred by the Company, all interest accruing after entry of judgment until the Company has paid, tendered or deposited in Court such part of such judgment as does not exceed the limit of the Company's liability thereon, also any expense incurred by the Assured for such immediate surgical relief as shall be imperative at the time of bodily injury."

Subdivision (Q) of "Conditions, Limitations and Agreements" is as follows: "It is understood and agreed that the Insolvency or Bankruptcy of the Assured or other persons entitled to benefit...