Veal v. Fire Ass'n of Philadelphia

• Court: Texas Court of Appeals
• Writing for the Court: Buck
• Citation: Veal v. Fire Ass'n of Philadelphia, 30 S.W.2d 715 (Tex. App. 1930)
• Decision Date: 26 April 1930
• Docket Number: No. 12322.,12322.
• Parties: VEAL et al. v. FIRE ASS'N OF PHILADELPHIA.

30 S.W.2d 715

VEAL et al. v. FIRE ASS'N OF PHILADELPHIA.

No. 12322.

Court of Civil Appeals of Texas. Fort Worth.

April 26, 1930.

Rehearing Granted June 21, 1930.

Appeal from Parker County Court; Geo. A. McCall, Judge.

Action by J. H. Veal and another against the Fire Association of Philadelphia. From a judgment in favor of defendant, plaintiffs appeal.

Affirmed.

Preston Martin, of Weatherford, for appellants.

Thompson, Knight, Baker & Harris and Pinkney Grissom, all of Dallas, for appellee.

BUCK, J.

We heretofore awarded a judgment and wrote an opinion in this case, in which opinion we reversed the judgment of the trial court and rendered judgment for appellants, giving $339.23 to C. D. Hartnett Company and $160.67 to J. H. Veal. Upon motion for rehearing, we have concluded that we erred in rendering judgment for appellant, and we therefore withdraw the opinion handed down April 26, 1930, and render this opinion in lieu thereof.

Plaintiff J. H. Veal kept a grocery store and some dry goods and hardware at Lacasa. His store was the only one at Lacasa. He alleged and the evidence showed, that defendant, through its duly authorized agent, M. D. Paschall, of M. D. Paschall & Sons of Cisco, called upon plaintiff at his store and asked him to take out a policy of insurance with the defendant company on his store of merchandise. M. D. Paschall inspected said store of merchandise and urged plaintiff to take out $800 of insurance. Paschall found that the store of merchandise was of the reasonable value of $1,250. Veal did not at first want to take out any insurance, but Paschall urged him to do so, and, at last, on August 13, 1928, Veal agreed to take $500 of insurance, and at the time a premium of $3.50 for each $100, amounting to $17.50, was paid by Veal. Said policy of insurance was prepared at the home office at Dallas and later delivered to Veal, who placed it in his coat pocket, where it remained. On January 26, 1929, at about 7:30 o'clock p. m., and while Veal and his wife were absent at Ranger, some ten miles distant, for the purpose of buying some bread to be sold from his store, the store burned and was totally destroyed. Veal, who was only 24 years old, had never had a policy of insurance before, and Paschall undertook to tell him what he must do to comply with the terms of the policy. Paschall told Veal that he would have to keep a record of his sales, cash and credit, and keep books of what he handled in the store. He did not tell him how the books must be kept, but Veal complied with what he understood to be the instructions and kept a record of the additional purchases of goods and his cash sales, and the sales made on credit. He did not have an iron safe, which fact was known to Paschall, as the agent of the defendant, from his examination of the stock of goods. Veal had never kept an iron safe and did not know that the insurance policy required him to do so. He did not read the policy.

The next day after the fire occurred, Veal telephoned Paschall & Sons, and Paschall came over to Lacasa on the following day, and about two weeks later the adjuster from the insurance company came over with M. D. Paschall. On the following day the three men met at Cisco, and Veal was required to make an affidavit as to the fire, and his loss. Veal was well acquainted with Paschall and had known him all his life. A demand was made upon the insurance company for the amount of the insurance, and the insurance company refused to pay the same, owing to an alleged noncompliance with the "record warranty" clause, which is as follows:

"Section 1. The assured will take a complete itemized inventory of stock on hand at least once in each calendar year, and within twelve months of the last preceding inventory, if such has been taken. Unless such inventory has been taken within twelve calendar months prior to the date of this policy, and together with a set of books showing a complete record of business transacted since the taking of such inventory, is on hand at the date of this policy, one shall be taken within thirty days after the date of this policy, or in each case, this entire policy shall be null and void.

"Sec. 2. The Assured will make and prepare, in the regular course of business, from and after the date of this policy, a set of books, which shall clearly and plainly present a complete record of business transacted, including all purchases, sales and shipments, both for cash and on credit, or this entire policy shall be null and void.

"The term `Complete record of business transacted,' as used above, is meant to include in said set of books a complete record of all the property which shall go into the premises and be added to the stock, and of all property taken from the stock, whether by the Assured or by others, even though not technically purchases or technically sales.

"If the business of the Assured under this policy be that of manufacturing, this complete record of business transacted must, in addition, show all the raw material received and all products manufactured therefrom, including the cost of manufacture, and must show waste in process of manufacture, and must show all the raw material and manufactured property which is taken from the building described.

"Sec. 3. The Assured will keep and preserve all inventories of stock taken during the current year and also all those taken during the preceding calendar year, which are on hand when this policy is issued, and will keep and preserve all books which are then on hand, showing a record of business transacted during the current calendar year and the preceding calendar year.

"The Assured will also keep and preserve all inventories taken after the issuance of this policy, and all books made and prepared after the issuance hereof, showing a record of business transacted.

"The books and inventories, and each of the same, as called for above, shall be by the Assured kept securely locked in a fire-proof safe at night, and at all times when the building mentioned in the policy is not actually open for business, or, failing in this, the Assured shall keep such books and inventories, and each of them, in some secure place not exposed to a fire which would destroy said building; and, in event of a loss or damage insured against to the personal property mentioned herein, said books and inventories, and each of the same, must be by the Assured delivered to this Company for examinations; or this entire policy shall be null and void, and no suit or action shall be maintained hereon for any such loss.

"It is understood and agreed that this clause and the requirements thereof is one of the inducing causes to the acceptance of the risk herein assumed and the issuance of this policy, and that the terms and requirements hereof are material to the risk, and to this insurance, and to any loss or damage happening to the property described in this policy.

"It is further agreed that the receipt of such books and inventories, or the request of either of them, and the examination of the same, shall not be an admission of any liability under this policy, nor a waiver of any provision or condition of this policy, or of any defense to the same."

At the time of the fire, Veal owed the C. D. Hartnett Company $339.33 for groceries, and after the fire, in order to secure said Hartnett Company, assigned the policy, or so much of it as was necessary to pay the debt, to C. D. Hartnett Company, and the Hartnett Company joined Veal as plaintiff.

The cause was tried before the county court without the intervention of a jury, and judgment was rendered for the defendant, from which judgment this appeal is taken. The trial court filed findings of fact and conclusions of law as follows:

"1. I find that the plaintiff J. H. Veal was the owner of a stock of groceries with some small stock of dry goods, and hardware, located in a country store house near Lacasa, Stephens County, on about August 12, 1928; that the agent of defendant company solicited said plaintiff to have some fire insurance written on his stock, or about that date; that such agent did on August 13, 1928, write in defendant company, a policy in defendant company, insuring said plaintiff's stock for a term of one year from that date against all direct loss or damage by fire except, as therein provided, to an amount not exceeding five hundred dollars.

"2. That said policy was delivered to said plaintiff and that he paid the agent of defendant a premium of $17.50 therefor.

"3. I further find, that on January 26, 1929, the plaintiffs' store, including his stock of goods, was totally destroyed by fire, with the exception of about $12.00 worth of goods, the fire occurring after six o'clock in the evening of that day at a time when the store was not open for business and while the defendant and his wife were away in Ranger, but that they returned to the store location after the fire and the same night. I further find that the plaintiff was operating what is known as a country store, located in a wooden store house, and that plaintiff and his wife made their home in the rear part of the store house.

"4. I find that the insurance policy issued by defendant to plaintiff J. H. Veal and the policy sued upon which was introduced in evidence contained the following stipulations and provisions, being what is commonly known as the Record Warranty Clause in words and figures as follows: (Here follows said clause.)

"5. I find that the plaintiff J. H. Veal did not have an inventory of his stock at the time of the issuance of the policy; that he did not take any inventory of his stock within 30 days after the policy was written, and that he never had taken any inventory during the little more than 12 months he was in business; and I find that there was no inventory on hand or taken when said plaintiff bought the stock.

"6. I find that the plaintiff J. H. Veal did not keep his books or records that he had in an iron safe at night;...