Parsons v. Parsons

SPEER, J.

Fannie E. Parsons, the defendant in error here, brought this suit against Felix N. Parsons, administrator of the estate of Herman -Parsons, deceased, to recover sums aggregating $1,312 and interest thereon, which she alleged she had paid for said Herman Parsons, at his request, on account of annual premiums due by him on a life policy for $3,000 issued by the Kansas City Dife Insurance Company. She alleged that the payments were made in the sum of $164 each and were made annually beginning April 12, 1913', to and including the year 1920. She further alleged that the payments were made under an agreement between her and Herman Parsons whereby she was to be repaid the amount of such payments and interest thereon, when said policy should be collected. She further alleged the death of Herman Parsons and that the administrator had collected the amount due on the policy; that her claim had been presented for payment as required by law, and the - same had been refused. The answer tendered the issues that the suit coul<} not be maintained since the claim had been refused by the administrator more than 90 days before the filing of the suit, and that the cause of action was barred by the statutes of two years’ limitations. The plaintiff recovered in the trial court and that judgment was affirmed in the Court of Civil Appeals. 275 S. W. 200.

The holding of the trial court and the Court of Civil Appeals permitting plaintiff to recover -interest upon the premium payments advanced by her is the only question presenting any serious difficulty, and is the one upon which the writ of error herein was granted.

It is true, generally, that interest, unless otherwise promised, is payable when me debt upon which it accrues becomes due, and cannot be collected, and does not begin to run, before such maturity. Hutchins v. Wade, 20 Tex. 7; Connor v. City of Paris, 87 Tex. 32, 27 S. W. 88; Ruzeoski v. Wilrodt (Tex. Civ. App.) 94 S. W. 142; Askew v. Bruner (Tex. Civ. App.) 205 S. W. 153; Trevathan v. Hall (Tev. Civ. App.) 209 S. W. 447.

But even this rule is subject to the more general one that if the contract speaks specifically, it will in all cases control. The rule allowing interest (where not otherwise provided) after maturity of the debt only is itself predicated upon the implied promise gathered from all the circumstances of the case. We are only discussing recoveries of interest as such, and not cases of damage sometimes denominated, or measured by, “interest.”

Undoubtedly, where the contract in any wise stipulates for interest from date, or from any other event as to that, it will control, and such intention may be evidenced not alone by the express stipulations of the instrument, or agreement, but may be proven by circumstances and inferences, as well. The Court of Civil Appeals so held in this case, and its holding is supported by the authorities. The general rule is that one who lends money to, or makes advances for, the benefit of another, is entitled to interest upon the amount so lent or advanced, although nothing is said about interest at the time of the transaction. 33 C. J. p. 201, § 57. This for the reason that in that character of case the circumstances'are such as to evidence an intention of the parties that one who thus makes a present loan or advance to another shall be compensated for it. In the absence of a showing to the contrary, such inference is plainly the most reasonable one to draw from the circumstances. In other words, the nature of the contract is such as reasonably to raise an inference that the loan or advance was not to be a gratuity. In this case defendant in error’s cause of action was predicated upon a loan or advance of definite sums of money from time to time for the benefit of the deceased, and there is nothing shown to indicate, much less to compel the inference, that the loans were to he gratuitous. There is nothing in the facts to show that defendant in error did not’ intend to charge, or that Herman Parsons did not intend to pay, interest. But on the contrary, we think the evidence entirely justifies the' holding of the trial court and the Court of Civil Appeals that both parties did intend that interest should be paid upon the loans. The witness Evans testified to a conversation with Herman Parsons concerning the contract with Fannie Parsons, the substance of which was:

“That if Fannie Parsons would pay the premiums. on that policy, she could be protected in the policy and have her money out when the policy was collected; on the premiums, as she paid that, she would have first lien on the policy for what she had paid in, and I instructed them how, in order to protect her, it shohld be done; that it was necessary for that policy to be indorsed to her as her interest might appear.”

Now, here is an admission from Herman Parsons to the effect that he had contracted, if Fannie Parsons would pay the premiums on the policy, she should be protected in the policy and have her money out when the policy was collected. This protection is not limited to the principal any more than to the interest, for it says “her money,” and by any reasonable construction it would mean any money as to which she would fairly be entitled to protection within the meaning of the contract. As thus proven, the contract is in the nature of one of indemnity to protect Fannie Parsons out of the proceeds of the policy for any amount of premiums slie might pay. This clearly is the intention of the parties to the contract as thus proven. If the intention between the parties to indemnify is reasonably clear, it is not necessary that the contract should be in any particular form of words or be 'expressed in technical terms. If the intention to indemnify is apparent from the whole, it will be construed as a contract of indemnity by whatever name the parties designated it (31 O. J.- p. 421, § 11), and it is well settled that where under the provisions of _ an indemnity contract, the indemnitee makes advances in reference to the matter indemnified, he is entitled to interest on such advances from the time they are made, unless the right to such interest is waived (31 C. J. p. 435, § SO; 14 R. C. L. p. 59, n. 1). In such cases, and in all other cases, where the reservation of interest is implied — that is, proved, by the nature of the promise — it becomes part of the debt and is recoverable as of right. Redfield v. Ystalyfera Iron Co., 110 U. S. 174, 3 S. Ct. 570, 28 L. Ed. 109; Redfield v. Bartels, 139 U. S. 694, 11 S. Ct. 683, 35 L. Ed. 310; Richmond, etc., Co. v. Richmond, etc., Co., 68 F. 105, 15 C. C. A. 289, 34 L. R. A. 625. The case before us comes clearly, we think, within the rule of indemnity contracts, and is therefore stronger than the usual case depending entirely upon the inference to be drawn from the ordinary circumstances surrounding the transaction. Defendant in error would not be protected by payment of any sum short of the aggregate of premiums advanced plus interest from the respective dates of payment. There is evidence tending to show that the parties to the contract so intended, and the decisions of the trial court and the Court of Civil Appeals upon this point are final and binding upon this court.

Nothing needs to be added to what has been said by the Court of Civil Appeals upon the other points in the case. They have been rightly decided.

We therefore recommend that the-judgments below be affirmed.

CURETON, C. J.

The judgment recommended in the report of the Commission' of Appeals is adopted and will be entered as the judgment of the Shpreme Court.