Court Opinion

ID: 9834433
Source: CourtListenerOpinion
Date Created: 2023-09-01 23:35:16.489159+00
Date Added: 2024-06-11T07:44:13.502407
License: Public Domain

On Motion for Rehearing.
Counsel for appellees have filed a motion for rehearing in which they vigorously at-' tack that part of our opinion in which we held that the policies sued on do not cover loss resulting from theft by those to whom the insured had rented the insured cars for a trip. They insist that the words “lease agreement,” used in clause “C” of the policies under the head of “Perils Insured Against,” should be interpreted in connection with the other words next preceding it, which provide that the insurer shall not be liable for loss resulting from the “wrongful conversion, embezzlement, or secretion by a mortgagor or vendee in possession under mortgage, conditional sale, or lease agreement,” and that when so interpreted it is made clear that it was intended by the scrivener who prepared the policies to exempt only loss resulting from theft by two classes of persons, to wit: First, a mortgagor or vendee in possession under a mortgage; and, second, one in possession under a conditional sale or lease agreement.
After a more careful study of clause “C” we have reached the conclusion that we were in error in our holding’ above mentioned, and that appellees’ motion should be sustained.
We had no trouble in determining what was intended by the use of the words mortgagor or vendee in possession under a mort-_ gage, but our error was in holding that one who might hold under a contract of hire, for the purpose of making one trip, was one holding under a “lease agreement” as that term is used iii the policies. We have now reached the conclusion that it was the intention of the parties to use the two terms, “one in possession under conditional sale,” and “one in possession under lease agreement/’ as synonymous terms, and to designate but one class of persons.
It is well known that conditional sales or “lease agreements,” which may mean the same thing, are frequently made, wherein the seller reserves title to the property sold until the purchase money is paid, and under which the purchaser is placed in possession of such property. In such case the purchaser is in possession under a conditional sale or lease agreement. Such was, we think the “lease agreement” mentioned in the insurance policies under consideration.
In any event, it might be reasonably so concluded by the assured, and it is well settled in this state that insurance policies shall be construed strictly against insurance *497companies, as the policies are prepared by them. When a policy of insurance is in its terms inconsistent, or ambiguous in its provisions, it must be construed most favorably for the assured. Article 4950, Vernon’s Sayles’ Civil Statutes 1914; Security Ins. Co. v. Sellers-Sammons Co. (Tex. Civ. App.) 235 S. W. 617; Mo. St. Life Ins. Co. v. Hearne (Tex. Civ. App.) 226 S. W. 789; Brown v. Palatine Ins. Co., 89 Tex. 590, 35 S. W. 1060.
In the ease last cited, it is said:
“First, the language, being selected and used by the insurer to express the terms and conditions ,upon which it issued the policy, will be strictly construed against it, and liberally in favor of the insured. If the words admit of two constructions, that one will be adopted most favorable to the insured. Wood on Fire Ins. § 60; Bills v. Ins. Co., 87 Tex. 551; Goddard v. Ins. Co., 67 Tex. 71; Ins. Co. v. Hazelwood, 75 Tex. 347.
“Second, the language used must be construed according to the evident intent of the parties, to be derived from the words used, the subject-matter to which they relate, and the matters naturally or usually incident thereto. Wood on Fire Ins., §§ 182-187; Whitney v. Ins. Co., 72 N. Y. 117.
“Third, forfeitures are not favored by the law, and, if the language used is fairly susceptible of an interpretation which will prevent a forfeiture, it will be so construed.”
In Mo. St. Life Ins. Co. v. Hearne, it is held that the language of a policy of insurance, being the language. of the insurance company, if susceptible of two interpretations, that must be adopted which will sustain the claim of the assured and give him the indemnity it was his object to secure.
It seems to us that the principles announced are controlling in this ease. We shall, therefore, not disturb the judgment of the trial court upon the issue discussed.
As we have now held that loss and damage resulted from theft by those who had hired the automobile while in their possession, under contract of hire, it becomes necessary to discuss the other assignments of appellant, which we will now proceed to do.
We overrule appellant’s contention that, though the conversion of the automobiles by those to whom they were rented constitutes theft under our criminal law, such conversion does not constitute “theft” as that term is used in the policy.
Article 4950, Revised Statutes, expressly provides that insurance policies issued in this state shall be interpreted according to the laws of Texas. Security Ins. Co. v. Sellers-Sammons Co. (Tex. Civ. App.) 235 S. W. 617.
As stated in the original opinion, the policies sued upon provide that in the event of loss or damage the assured should forthwith give notice of such loss, in writing, to the insurer, or its authorized agent who issued the policies; that the assured should, within 60 days, render a sworn written statement to the insurer, stating the knowledge and belief of assured as to the time and cause of the loss; that the assured should render to the insurer proof of loss, etc.
The trial court found that F. M. Bailey, the local agent of appellant Insurance Company, was notified of the theft of the insured cars, and that, in behalf of said company, he immediately disclaimed liability, insisting that the policies did not cover the loss resulting from the theft shown, and that by reason of such denial of liability the insurer waived notice, proof of loss, etc., required by the policies. Appellant assigns such finding of the court as error, insisting that there was not sufficient evidence to support the finding that appellant had waived the giving of notice, proof of loss, etc., required by the policies.
We overrule the assignment. We think there was sufficient evidence to sustain the court in the finding complained of.
F. M. Bailey, the local agent of appellant, who issued the policies sued on, testified that the only notification he had of the loss of the two stolen cars was on one day as he passed by Mr. Powell’s place of business that Mr. Powell said, “Bailey, you have bought yourself an automobile;” that after Powell had explained the loss, he said to Powell, “You appreciate the fact that that is not covered?” and Powell answered, “Well, I understand that;” that he told Powell that he (Powell) was in hard luck. He testified that he had explained to Powell at the time the policies were written that they did not cover theft by bailee.
William Glover, secretary-treasurer of the appellees, testified that shortly after the cars were stolen he took the matter of adjustment of the loss up with F. M. Bailey, and that Bailey said, in a general way, that his company was not liable for the theft of the cars, as such theft was by a bailee; that when Bailey denied liability, he said the policies did not cover theft by bailee; that he told him that the theft was by bailee, that appellee had turned the cars over to a man, and he ran off with them, and that he tried to argue with Bailey that the Insurance Company was liable, and Bailey told him that the policies did not cover theft by bailee.
That the requirements in the policies for notice of loss, proof of loss, etc., may be waived by a denial of liability on the part of the insurer is too well settled to require, at our hands, a discussion of the law relative thereto. Hartford Fire Ins. Co. v. Josey, 6 Tex. Civ. App. 290, 25 S. W 685; Ins. Co. v. Jacobs, 56 Tex. 366; Niagara Ins. Co. v. Lee, 73 Tex. 641. 11 S. W. 1024; Sun Mutual Ins. Co. v. Mattingly, 77 Tex. 162, 13 *498S. W. 1016; Ins. Co. v. Hilbrant (Tex. Civ. App.) 73 S. W. 558.
We now come to consider the further' contention of appellant that the judgment be reversed for the reasons; First, that the condition of the recovered car before it was stolen was not shown, and because it was not shown that the damage- to said car was not done after the same had been recovered; and, second, there was no evidence to support the finding of the court that the recovered car was damaged, as a result of the theft, in the sum of $700.
We overrule this last contention. AVhile there are some inconsistent statements by some of the witnesses as -to the damage to the recovered ear, two witnesses testified that they saw the car just before it was rented to the party who stole it, and that it was practically new, and was worth at that time $1,300, and that they saw it when it was recovered after the theft, and it was then worth $350 only.
For the reasons pointed out, the judgment is affirmed.
Affirmed.