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### THEAITORNEY GENERAL OPTEXAS
Gerald C. Mann

Hon. Il. L. Mllliken I~nsurance Expert **Aus~liu 11.**  **TJCXASI**

Opinion No. O-179 Re: Construction of Form77 - Motor Motor Transport Division Railroad Commission of Truck Public Liability Insurance Endorsement relating .to coverage of Texas Austin, Texas trucks not described in policy

Dear Mr. Mllliken:

Weare pleased herewith to comply with your request under date of January 18 for a construction of Form7’+“Motor Truck Endorsement-Texas Railroad Commission-Restricted Form” relating to the liability of the insurer under a public liability insurance policy contalnlng said endorsement for trucks operated by the insured not specifically described in said policy.

It is our opinion that all trucks operated by the insured (whether specifically described in the policy or not, andprovisions in the policy proper to the aontrary notwithstanding) would be covered by a public liability policy containing Form77 endorsement so as to make.the insurer liable to third person for Injury to person or property occasioned by the operation of said trucks while used in carrying property for hire in Texas. Webelieve this result is accomplished by the following paragraph of Form77:

“Coverage granted by the policy applies to all trucks andtrailers belonging to or under the dlrection of the namedinsured, whether particularly identified in the policy or not, while sameare being used in the business of carrying property for hire or compensation and coming within the terms of the statutes, abov~ereferred to, and it is agreed that,. subject to the policy limits, this policy covers the liability imposed by law upon the namedinsured for injury to or death of persons, other than the named insured or his employees, and loss or damageto property, other than the property of the namedinsured, or of his ‘employees, through such operation of such trucks andtrailers within the boundaries of the State of Texas, even though, such trucks or trailers maynot be specifically identified herein anything in the policy or endorsements thereto to the notwithstanding.” contrary- -

Hon. R. L. Milliken, page 2 (O-179)

Form

### 77,when attached to and executed by the Lnsured becomes a part of the contract between the insurer andthe assured as fully as though written into the policy proper, and superpedee any provisions in the policy proper which conflict therewith by virtue of the following provision of the. endorsement:

(‘Anyprovision, eltherh the body of the policy to which this endorsement is attached or in any other endorsement thereon or attached thereto, nowor hereafter, In conflict with or contrary to the provisions of this endorsement, shall be deemedto be cancelled hereby.” As stated in the first paragraph of Form

### 77,the pur ose of the endorsement is to. effectuate the purposes of Chapter 

### 31 f: , General and Special Lawsof the 4lst Legislature of Texas, 1929, and amendmentsthereto5 being designated as Article 911b Revised Statutes, andmore particularly Section 

### 13thereof.

It maybe noted that Form

### 77also provides that the insurer shall be entitled to reimbursement from the insured for “any loss -involving any automobile or trailer not described in the policy or endorsements thereto which has’been in operation for a period of more than ten (10) days without an endorsement having been requested therefor”, but this provision does not limit or diminish the Insurer’s liability to the injured third party.

The construction of the very paragraph of Form

### 77,first above quoted was under consideration in the case of Park et ux. v. American sldelity &Casualty Co. Inc., 92Fed.(2d) 

### 746,decided by the Federal Circuit Court of Appeals for the 5th Circuit in 

### 1937. In this case the insurer sought to avoid liability under the policy which contained the provision that It did “not cover any loss arising or resulting from an accident occurring while any of said automobiles were-.-being driven or operated by any person other than the assured or his paid employee.” The plaintiff relied upon the endorsement (Form

### 771,which was attached to the policy, andthe court held that it prevailed over the conflicting provisions above quoted in the policy proper. Judge Sibley In a concurring opinion said:

“The rider expressly extends coverage to all trucks operated ‘under the direction and control’ of the assured. In the suit against the assured, which wasDDEfended by the insurer, the jury in a special verdict expressly found the truck was operated under the d#rection and control of the assured. Ongeneral principles of estoppel by judgment the insurer cannot again contest that issue with the plaintiffs.”- -

Hon. R. L. Milliken, page 

### 3 (O-179)

Webelieve this decision is controlling struction of Form

### 77which we have given herein. Yours very truly ATTORNEY

GENERAL

in the conOFTEXAS By/s/ Walter R. Koch Walter R. Koch, Assistant APPROVED: Gerald C. Mann ATTOBNEY

GENERAL

OFTEXAS WRK-MR:wb