Case Name: NATIONAL SURETY MARINE INS. CORPORATION v. FAILING
Court: Supreme Court of Texas
Jurisdiction: Texas
Decision Date: 1948-04-07
Citations: 211 S.W.2d 567
Docket Number: No. A-1475
Parties: NATIONAL SURETY MARINE INS. CORPORATION v. FAILING.
Judges: TAYLOR, J., joins in this dissent.
Reporter: South Western Reporter Second Series
Volume: 211
Pages: 567–574

Head Matter:
NATIONAL SURETY MARINE INS. CORPORATION v. FAILING.
No. A-1475.
Supreme Court of Texas.
April 7, 1948.
Rehearing Denied May 19, 1948.
Vinson, Elkins, Weems & Francis, C. M. • Hightower and W. D. Deakins, Jr., all of Houston, for petitioner.
Andrews, Kurth, Campbell & Bradley, T. D. Anderson and F. L. Andrews, all of Houston, for respondent.

Opinion:
SIMPSON, Justice.
Tweed Everett Failing brought this suit against the National Surety Marine Insurance Corporation growing out of the loss of certain machinery and equipment which he claimed was covered by a policy of insurance the company had issued to him. The trial was before the court upon an agreed statement of facts, and judgment was rendered in favor of the company. The Court of Civil Appeals reversed the judgment of the trial court and rendered judgment for Failing. 205 S.W.2d 139.
There is involved here the construction of the insurance policy the company had issued to Failing. He owned certain drilling equipment which was used in testing and sampling subsurface mineral structures, and which was permanently mounted on an automobile truck. While the equipment was being used for drilling in Polk County, Florida,.cavities in the earth were encountered and it was decided to, abandon drilling. The crew was undertaking to remove the drill stem from the well bore when the earth caved in and cratered, and Failing's equipment sank into this crater and was lost. This equipment was scheduled in the policy and insured against those hazards which the policy covered to the extent of $3000, the sum for which suit was filed.
The essential parts of the policy will be quoted, and as it is partly printed and partly iypewritten, to differentiate what is printed from what is typewritten, the typewritten parts are italicized:
"TRANSPORTATION POLICY "NATIONAL SURETY MARINE INSURANCE CORPORATION
" IN CONSIDERATION OF TIJE STIPULATIONS NAMED HEREIN AND Premium of TWO THOUSAND TWO .HUNDRED THIRTY ONE AND 31/100 Dollars ($2,231.31), Insures TWEED EVERETT FAILING for the term of THREE YEARS on Insured Property, namely, goods and merchandise, including packages, consisting of scheduled property as per form attached, their own or held by them in trust, or on commission, or on consignment, or on which they have made advances, or sold but not delivered, to an amount not exceeding TWENTY FIVE THOUSAND AND NO/100 Dollars (§25,000.00), in any one casualty, either in case of partial or total loss, or salvage charges, or expenses, or all combined, while in transit or otherwise zvithin 'the limits of the Continental U. S. and Canada.
"THIS POLICY SHALL NOT BE VALID UNLESS ENDORSEMENT ISSUED BY TI-IIS COMPANY IS ATTACHED HERETO, AND, FURTHER, IS SUBJECT TO THE STIPULATIONS, CONDITIONS, WARRANTIES AND DECLARATIONS CONTAINED ABOVE, ON THE BACK HEREOF AND SUCH OTHERS AS MAY BE ENDORSED HEREIN OR ADDED HERETO, ALL OF WHICH ARE HEREBY MADE A PART OF THIS POLICY.
*
"It is the intent of this policy (subject to all terms and conditions) to cover the described equipment together with all appurtenances forming part of the individual unit.
"THIS POLICY, EXCEPT AS HEREINAFTER PROVIDED, INSURES AGAINST DIRECT LOSS OR DAMAGE BY:
' "(a) Fire and lightning;
"(b) Explosion, excepting explosion originating within steam boilers or internal explosion;
"(c) Cyclone, Tornado, Windstorm and hail;
"(d) Earthquake;
"(e) Collapse of Bridges;
"(f) Collision, derailment or overturning of land conveyances while the insured property is being transported thereon;
"(g) Marine perils while on regularly operated barges, ferries and/or in cars on transfers operated in connection •therewith;
"(h) Riot, Riot attending a strike, and Civil Commotion;
"(i) Theft of an entire item of equipment, whether or not comprising part of operating unit;
"(f) Flood, (meaning thereby the rising of navigable waters);
"(k) Collision of insured property with any other object, except as hereinafter provided.
"THIS POLICY DOES NOT INSURE AGAINST
"(a) Loss or damage occasioned by the weight of a load exceeding the registered lifting capacity of any machine;
"(b) Loss or da>mage to automobiles, motor trucks or other automotive equipment designed for highway use, (except tractors of caterpillar type, automobile trailers and exploration and drilling equipment usual to assured's business, mounted on automobiles or motor trucks), plans, blue prints, designs, or specifications or to underground property;
"(c) Loss or damage to any property which has become a permanent part of any structure;
"(d) Loss or damage to dynamos, exciters, lamps, switches, motors or other electrical appliances or devices caused by electrical injury or disturbance whether from artificial or natural causes unless fire ensues and then for the loss by fire only;
"(e) Wear, tear, latent defect and/or gradual depreciation;
"(f) Loss if, at the time of loss or damage, there is any other insurance which would attach if this insurance had not been effected, except that this insurance shall apply only as excess and in no event as contributing insurance and then only after all other insurance has been exhausted;
"(g) Loss or damage occasioned by war, invasion, hostilities, acts of foreign enemies, civil war, rebellion, insurrection, military or usurped power or martial law or confiscation by order of any government or public authority or risks of contraband or illicit trade."
It was stipulated that there was no record of an earthquake at or near the point where the equipment was lost. Nor was there any-overturning of the truck upon which the machinery was mounted. On the contrary, the truck, except for listing about twenty degrees^ remained 'upright as it sank and came to rest at the bottom of the crater. It is conceded by Failing that a cave-in or cratering such as caused the loss is not enumerated in the endorsement attached to the policy as one of the eleven specific risks covered by it.
The Court of Civil Appeals held that the insertion of the language "or otherwise within the limits of the Continental U. S. and Canada" had the effect of extending complete coverage except as expressly limited by the exclusions enumerated in the policy. It will be noted that this policy was designated by its printed heading as a "Transportation Policy," and that the printed provision insured against loss only while the property was in transit. The effect of the typewritten language "or otherwise" was to extend the coverage to loss from risks insured against regardless of whether the property was in transit at the time of damage. Had this language not been added, the property would not have been protected under the policy unless it was "in. transit," and, accordingly, since Failing's equipment was not being transported at 'the very time it sank into the crater, it might have been plausibly argued that the policy did not extend to the mishap. But this language did not in any sense change the nature of the risks insured against; it merely enlarged the printed provision so as to insure Failing's property whether in transit or at rest when damaged. The Court of Civil Appeals fell into error in giving this language so comprehensive a significance as to extend the policy's coverage to every conceivable loss.
The policy provides at the outset that in case of loss, whether in transit or otherwise, anywhere within the continental United States and Canada, the property scheduled "on a form attached" was insured to an amount not exceeding $25,000 in any one casualty. Then followed, in printed, capitalized letters, the declaration that the policy "shall not be valid unless endorsement issued by this company is attached hereto." This capitalized portion is in effect a caveat, clear, even imperious in its nature, warning the assured that he must consult the endorsements attached to the policy, since without endorsements he had no insurance. When he inspects the endorsements'he finds, after certain general-warranties and conditions and a scheduling of the property insured, a tabulationunderneath a typewritten, capitalized headline of eleven different risks, lettered (a)'to (k), against which the headline states the policy insures. Then is listed, equally clear, against what the policy does not insure. So here, and not elsewhere in the policy, is supplied a particularization of the risks against which the insurance is written. These endorsements are so plainly worded, prominently displayed, and simply arranged, that even a cursory examination of the instrument shows beyond peradventure the perils which the policy covers. And under the stipulated facts the loss in suit is certainly not a casualty falling within the coverage thus plainly provided,
i If the language in the opening sentence of the policy insuring Failing's property pp to $25,000 "in any one casualty" be construed to mean that Failing was insured against every conceivable casualty except those specifically excluded, there would have been absolutely no use for the parties to list eleven particular risks against which the policy ran. It would ascribe to the parties not only the futile but even the fatuous motive of listing eleven specific perils which the policy was to cover, when other language had already comprehensively included these eleven as well as every other conceivable risk, save, of course, the listed exclusions.
This contract is plain. To read and understand its meaning and scope is not in the least difficult. The language is neither ambiguous nor vague. It is a simple matter to harmonize every part of the agreement and give them all effect. The parties have plainly contracted that the scheduled property should be insured against loss in any one casualty up to the stated amount if the loss or damage result directly from any one or more of the eleven listed perils. As the parties have so plainly agreed, let them be bound.
The authorities cited by the Court of Civil Appeals and in the briefs of counsel for Failing have been considered. None of those decisions involves a situation like that presented here, but each is readily distinguishable upon the facts from the case at bar.
The judgment of the Court of Civil Appeals is reversed and that of the trial court affirmed.