Hartford Fire Insurance v. Walker

BROWN, Associate Justice.

On the 2d day of November, 1898, the Hartford Fire Insurance Company, through its general agent, for the State of Texas, D. E. Grove, issued and delivered to A. J. Walker, the defendant in error, a policy of insurance for $1692.71, upon a gin house and certain gin machinery consisting of engines, boilers, etc., all situated in Montague County, the property of said A. J. Walker. The property was destroyed by fire, and the company having refused to pay the policy, this suit was instituted by Walker to recover the amount named in the policy. No question is presented in this court upon the pleadings of either party, but the pleadings of both are sufficient to present the issues which the evidence tends to support.

The facts are, briefly, that J. H. Blanton was local agent for the insurance company at the city of Gainesville, Texas, with authority to receive applications for insurance upon gin property and to forward them to D. E. Grove at Dallas, Texas, who alone had the power to issue a policy upon that class of property. Blanton had no authority to issue a policy for the plaintiff in error upon the gin property. When the policy was sent by Grove to Blanton, it was accompanied by the application, upon which was the following indorsement, which Walker was required to sign before the policy should be delivered: “T acknowledge receipt of policy No. 11630 issued on this application and hereby warrant that I have read and considered all the questions and answers in the application, and said answers are correctly recorded under my direction and I warrant them to be true as written. (Signed.) A. J. Walker, Assured.” When the policy was delivered, Walker signed the indorsement above copied and the application was returned to Grove at Dallas.

In the application the following question was asked: “Has any , company declined this risk?” Answer, “No.” Walker had before that time applied, through Blanton,' to another company for insurance upon the same property, which application was refused, and when the application to plaintiff in error was made, Walker did not know that it was to be sent to a different company, and Blanton knew at the time that the application had been, rejected by another company. Walker could neither read nor write except to sign his name. The application contained these provisions: “(He) covenants and agrees to and with the said company that this application is a just, true, and full exposition of all the facts and circumstances in regard to the condition, situation, value, and risk of the property to be insured, and that no fact or information material to the risk has been omitted or withheld; and further submits the statements and answers foregoing as a basis on which the insurance is to issue, and that they are understood as forming the basis and a part of any policy contract that may be issued hereon by the Hartford Fire Insurance Company. * * * It is further understood and agreed that the general agent of the Hartford Fire Insurance Company alone has authority to act for the company in any manner as to the insurance hereby requested.”

Hpon the face of the policy in large red letters was this indorsement: “As per written and printed form attached hereto, special reference being had to the assured’s application No. 11630, on file in this company’s office at Dallas, Texas, which is hereby made his warranty and a part of this policy. It being specially stipulated that the general agent signing this policy alone has authority to represent or act (as agent or otherwise) for the company in any manner as to this policy.” The policy contained the following provisions pertinent to the question presented. “This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements or conditions as may be indorsed thereon or added thereto, and no officer, - agent, or other representative of this company shall have power to waive any condition or provision of this policy, except such as by the terms of this policy may be subject to agreement indorsed hereon or added hereto, and as to such provisions and conditions, no officer, agent, or other representative shall have such power, or be deemed or held to have waived such provision or condition, unless such waiver, if any, shall be written upon or attached hereto; nor shall any privilege or permission affecting the insurance under this policy exist or be claimed by the insured unless so written or attached.” And further: “Special reference being had to the assured’s application on which this policy is issued, and which is made a part hereof.” The policy also contained the usual clauses of forfeiture.

The trial judge gave the following charge to the jury: “Ih his application for this insurance the plaintiff was asked the following question, viz: ‘Has any company declined this risk?’ To which he answered ‘No.’ Now, you are instructed that if any company had declined such risk, then the plaintiff can not recover, unless you believe from the evidence that said Blanton knew that said risk had been declined, but if said Blanton knew that said risk had been declined, then the fact that plaintiff ansAvered said question ‘No’ would not defeat his right to recover.” The jury returned a verdict for the plaintiff, upon which judgment was rendered by the District Court and affirmed by the Court of Civil Appeals.

The evidence did not authorize the District Court to assume that Blanton had authority to issue policies, and, upon that assumption, to charge that his knowledge of the former rejection of the risk would estop the company to claim the benefit of the warranty. The charge complained of can only be sustained upon the ground that article 3093 of the Revised Statutes declares the solicitor of insurance to be the general agent of the company and conferred upon Blanton authority to issue policies of insurance in the name of the Hartford Fire Insurance Company.

The Sixteenth Legislature enacted a law entitled, “An act to define who are agents of insurance companies and to fix their liability for acting without authority of law,” the first section of which reads as follows: “Be it enacted by the Legislature of the State of Texas, that any person who solicits insurance on behalf of any insurance company, whether incorporated under the laws of this or any other State or foreign government, or who takes or transmits other than for himself any application for insurance or any policy of insurance to or from such company, or who advertises or otherwise gives notice that 'he will receive or transmit the same, or who shall receive or deliver a* policy of insurance of any such company, or who shall examine or inspect any risk, or receive, or collect, or transmit any premium of insurance, or make or forward any diagram of any building or buildings, or do or perform any other act or thing in the making or consummating of any contract of insurance for or with any such insurance company other than for himself, or who shall examine into or adjust or aid in adjusting any loss for or on behalf of any such insurance company, whether any of such acts shall be done at the instance or request, or by the employment of such insurance company, or of or by any broker or other person, shall be held to be the agent of the company for which the act is done or the risk is taken, and as far as relates to all the liabilities, duties, requirements, and penalties set forth in this act.” This section of the law of 1879 constitutes article 3093, except that for the word “act,” as Used in the original statute, the codifiers used the word “chapter,” as shown in parenthesis. In the act of the Legislature authorizing the revision of the laws of the State, which became a law in 1891, the codifiers were required, in revising the laws, to include all articles of the former Revised Statutes which had not been repealed and to add in their order the amendments of the Revised Statutes, where they were expressed as amendments of certain articles in the order in which they should come according to their subjects and the numbers of the articles given, and concerning other statutes, this language is used: “And all other of said statutes passed as aforesaid which are general and permanent in their nature shall be collated and arranged into their proper titles, chapters, and articles with marginal references and chapter head lines similar to those used in the present Revised Statutes; provided, that in revising the statutes referred to in this section, said commissioners shall, without making radical changes therein, so revise them as to render them concise, plain, and intelligible.” The commissioners for revision were not authorized to make changes in the substance of the statute laws of the State, but simply to arrange them in convenient form. To make sure that the laws of the State were not materially changed hy such revision", the Legislature which adopted the code as revised enacted a chapter of general provisions to govern in the construction and application of the laws embraced in the Eevised Statutes, of which general provisions section 19 is in these words: “That the provisions of the Eevised Statutes, so far as they are substantially the same as the statutes of this State in force at the time when the Eevised Statutes shall go into effect, or of the common law in force in this State at the said time, shall be construed as continuations thereof and not as new enactments of the same.” Article 3093 is substantially the same as section 1 of the Act of 1879, before quoted, and we must construe the language of that article as we would the Act of 1879.

By using the language, “shall he held to be the agent of the company for which the act is done or the risk taken as far as relates to all the liabilities, duties, requirements, and penalties set forth in this act,” the Legislature meant the liabilities, duties, and penalties prescribed in the subsequent sections of the act named, which were that the person who performed such acts for any insurance company which had not complied with the laws and requirements of the statute should be guilty of a misdemeanor, subject to the fines and penalties prescribed in section 2 of the act, and that such person should be personally liable for the taxes which might he assessed against the companies thus represented, and should also be liable to the policy-holder for any loss sustained upon the policy issued by him. The liability of the company prescribed by the act was that being thus represented in the State, it should be considered as doing business in this State and subject to taxation the same as other insurance companies that were regularly engaged in the business. This law declared the person performing the acts specified to be the agent of the company for which he acted, either by appointment or who assumed to act without authority for the purpose of punishing the person performing the acts, and to make him liable to the State and others for acts so performed, and also to make him agent of the company so far as to render it liable for taxes for doing business within the limits of this State, but that act did not purport to confer any power or authority upon such person with reference to the making of contracts or to make the insurance company liable for any act that he did except as specified in that law.

If the language quoted from article 3093 be construed to refer to the chapter of which it is a part instead of the original act of the Legislature for the scope of the agency, then the effect of the law in declaring such person to be the agent of the insurance company can not be held to confer powers to. con tract which are not expressed in the law, but the matter of authority would depend upon the terms of his appointment or upon facts which would show the extent of his power. The construction which the Court of Civil Appeals places upon the law would constitute one a general agent who advertises as agent of a company or makes and forwards a diagram of. a building for another, for the statute applies to such in the same terms as to a solicitor of insurance.

For the error committed by the trial court in giving the instruction complained of, the judgments of the District Court and the Court of Civil Appeals are reversed and the cause is remanded.

Reversed and remanded.