International Travelers' Ass'n v. Powell ( 1919 )

This case involves first whether an insurance company can enforce a provision of its policies and by-laws forbidding the maintenance of suits on its policies elsewhere than in the county of its domicile.

We have this day determined that such a contract stipulation is contrary to public policy, and that notwithstanding the same, plaintiff in error was subject to be sued on one of its policies in any county specified in subdivisions 29 and 24 of article 1830, R.S. International Travelers' Assn. v. Branum, 109 Tex. 543 [109 Tex. 543], 212 S.W. 630.

The plea of privilege in this case did not negative the exceptions contained in subdivisions 29 and 24 of article 1830, and therefore it was properly overruled. Art. 1903, R.S.

The remaining assignments of error complain of the rendition of judgment against plaintiff in error for the full amount which it promised to pay by the policy sued on, because defendants in error had filed a claim for a lesser amount.

It appears that before the expiration of the full period of disability for which the insured was entitled to indemnity he filed proofs of his claim, notwithstanding one of plaintiff in error's by-laws provided that if a member filed a claim before his disability ceased he waived all right to future benefits.

In our opinion the utmost effect which could be given to this by-law would be to protect plaintiff in error from further payment after it had discharged a claim presented to it for an inadequate amount. If plaintiff in error had paid the claim originally presented, it would be necessary for us to determine the validity of the by-law, in view of the provision of article 4807, R.S., that companies, such as plaintiff in error, become liable for the full amount provided by their policies or certificates on the happening of the contingencies insured against.

It is decisive of this case to hold that we would not regard it as either fair or reasonable to construe the by-law here invoked as intended to enable defendant in error to reduce its true liability by means of a mere unaccepted offer on the part of the insured to receive in satisfaction on his demand less than the amount to which he was entitled.

The judgment of the Court of Civil Appeals is correct, and is affirmed.

Affirmed.

Associate Justice Hawkins disqualified and not sitting.