text:
    BIRMINGHAM FIRE INSURANCE COMPANY OF PENNSYLVANIA, Appellant, v. NEWSOM TRUCK LINES, INC., Appellee.
    No. 14571.
    Court of Civil Appeals of Texas. Houston.
    April 29, 1965.
    Rehearing Denied May 27, 1965.
    Fulbright, Crooker, Freeman, Bates & Jaworski, Newton Gresham and Tom Con-nally, Houston, for appellant.
    Oldham & Lorance, Arthur Stamm, Jr., Houston, for appellee.
   WERLEIN, Justice.

Appellee, Newsom Truck Lines, Inc., brought this suit against appellant on a “Motor Truck Cargo Policy” to recover damages allegedly resulting to a General Electric circuit breaker which, while being transported on appellee’s truck, struck an overhanging limb. The facts were stipulated by the parties and the trial judge rendered judgment for the amount of the agreed loss less the deductible amount provided for in the policy. It was stipulated that the circuit breaker constituted a high load rising to a height of several feet above the cab of the truck, and that no part of the truck was in contact with the overhanging limb which the circuit breaker struck.

In its one point of error appellant asserts that the trial court erred in construing the phrase “ * * * accidental collision of the vehicle with any other vehicle or object * * * ” so as to afford coverage to a collision between an overhanging limb and protruding cargo when no portion of the truck came in contact with the limb.

The policy insures appellee, “as provided in the form attached on shipments of lawful goods and merchandise (hereinafter called property) described therein, while in or on the vehicles described and in transit within the territory prescribed, against loss or damage caused, while this policy is in force, by the perils specified.” (Emphasis added.)

The “Truckmen’s Form” attached to and forming a part of the policy issued to appel-lee provides:

“This policy covers the liability of the Assured as carrier, bailee or warehouseman under tariff, bill of lading or shipping receipt issued by the Assured, for direct loss or damage, from perils hereinafter specified, on shipment of lawful goods or merchandise (hereinafter called Property) consisting of OIL FIELD AND/OR CONTRACTOR’S MACHINERY OR EQUIPMENT while loaded for shipment and in transit in or on vehicles owned, leased or operated by the Assured * * within the Continental United States and Canada.” (Emphasis supplied.)

The Truckmen’s Form attached also provides :

“THIS POLICY INSURES the Assured’s Liability for Loss of or Damage to Property Insured Hereunder Directly Caused by:
“(a) fire, including self-ignition or internal explosion of the vehicle;
“(b) collision, i. e., accidental collision of the vehicle with any other vehicle or object (the striking of curbing or any portion of the roadbed or the striking of rails on ties of street, steam or electric railroads, or contact with any stationary object in backing for loading or unloading purposes, or the coming together of trucks and trailers during coupling or uncoupling, shall not be deemed a collision);
“(c) overturning of the vehicle;
“(d) collapse of bridges or docks;
“(e) rising navigable waters or river floods;
“(f) perils of the seas, lakes, rivers or inland waters while on ferries only;
“(g) cyclone, tornado or windstorm, excluding loss or damage caused by hail, rain, sleet or snow, whether or not driven by wind.”

The sole question before this Court is whether the damage to the circuit breaker is within the coverage afforded by the policy since no part of the truck actually came in contact with the limb. Appellant contends that the foregoing provision is clear and unambiguous and hence there can be no recovery by appellee. There are several Texas cases apparently holding contrary to such contention. The Supreme Court of Texas has not passed on the question. There is a division of authority in other states. In some jurisdictions the foregoing provision has been construed in a manner which would permit recovery under the circumstances of the instant case, while in other jurisdictions recovery has been denied.

In Garford Trucking v. Alliance Ins. Co. of Philadelphia, 1952, 2nd Cir., 195 F.2d 381, the policy contained the following provision: “d. Collision of vehicle, overturning or other accident to the conveyance.” In such case no part of the truck struck the overhead bridge nor was the truck damaged in any way, but the turbine which was being transported sustained damage when it came into contact with the bridge. The court held that the assured could recover, since the occurrence came within the provision “other accident to the conveyance.” The court did not base its decision upon the collision provision in the policy.

In Employer’s Liability Assurance Corporation v. Groninger & King, Tex.Civ.App. 1956, 299 S.W.2d 175, error ref., n. r. e., the policy contained provisions almost identical with the provisions of the policy in the instant case, with respect to collision and overturning of the vehicle or conveyance. The court in its opinion considered both such provisions and affirmed the judgment of the trial court in favor of the assured apparently on both grounds. The court said:

“There is a division of authority as to whether there is liability when only the cargo and not the carrying truck itself makes contact with an object. This division of authority is recognized in Garford Trucking Co., Inc., v. Alliance Ins. Co., 2 Cir., 195 F.2d 381, and in 36 A.L.R.2d 506, 523, 526. In the Garford case the court held that there was liability when only the cargo made contact with an object. In our opinion the Texas rule is that under policies such as we have here, it is sufficient when the load or cargo collides with an object, though the carrying truck itself may not make actual contact with the object. Continental Ins. Co. v. Griffin, Tex.Civ.App., 218 S.W.2d 350; Mercury Ins. Co. v. Varner, Tex.Civ.App., 231 S.W.2d 519.”

It will be noted that the court in making the foregoing statement relied upon Garford Trucking v. Alliance Ins. Co. of Philadelphia, supra, although the Court in that case did not base its decision upon the collision provision of the policy, and also relied upon two cases decided by the East-land Court of Civil Appeals, with no writ history.

In Continental Ins. Co. v. Griffin, Tex.Civ.App.1949, 218 S.W.2d 350, one Paul Griffin, a house mover, who owned house moving equipment consisting of a truck, skids and dollies, obtained an insurance policy from Continental Insurance Company insuring him against damage to houses while on his truck in transit. The insurance policy contained the same provision with respect to collision as the policy in the instant case. The printed part of the policy provided for insurance against damage to goods and merchandise, consisting principally of “houses”, while being transported. The word “houses” was typewritten into the printed form. While the assured was moving a house on his truck along a highway, the house struck a culvert. Neither the truck nor the trailer struck anything. The court said:

“The policy plainly shows that it was intended to cover damage to a house while being transported on Griffin’s truck. We think it was the intention of the parties to insure Griffin against damage as a result of an accidental collision of a house on the truck with any other object.”

In Mercury Ins. Co. v. Varner, Tex.Civ.App., 231 S.W.2d 519, the appellee alleged that he was moving a drilling mast on a truck and trailer from one location to another. The fifth wheel device holding the kingpin broke or came loose, whereupon the trailer became detached and the load fell to the ground, breaking and damaging the drilling mast. The court properly held that the tipping of the mast on the trailer, and the resultant fall was a partial overturn that came within the meaning and intent of the term “overturn” as used in the policy. After so deciding, the court said; “We are also of the opiriion that there was a collision within the meaning of the policy.” Having decided the case under the overturning provision of the policy, it was, of course. unnecessary for the court to add the additional sentence with respect to collision.

In the instant case there was typewritten in the printed Truckmen’s Form the words “OIL FIELD AND/OR CONTRACTOR’S MACHINERY OR EQUIPMENT”. No specific property was described as was done in Groninger & King, supra. In that case the parties knew that houses are necessarily cumbersome objects to transport and quite likely to protrude in all directions from the moving vehicle, so that it would be practically impossible for the truck to collide with anything since more or less protected by the protruding house. The parties contracted for insurance with respect to specific property which was described in the policy. In the present case, however, oil field and/or contractor’s machinery or equipment may be large or small, and consist of many things. The parties did not contract with respect to the transportation of any specifically described property which would necessarily or in all probability extend above the top of the truck or beyond the sides or rear thereof.

We have read the out-of-state cases cited by appellee, and also those cited by appellant. We have concluded that the decisions relied upon by appellant are better reasoned and should be followed in deciding the instant case. Some of the cases relied upon by appellee in which the plaintiff recovered may be distinguished factually from the present case in that the cargo in such cases was specifically described in the insurance policies and consisted for the most part of large, cumbersome property that would necessarily extend out beyond the sides of the conveyance or above the cab thereof.

In Jorgenson v. Girard Fire & Marine Ins. Co., 1949, 229 Minn. 48, 38 N.W.2d 209, there was a clause in the policy that showed that the cargo consisted of a combine so loaded that or 6 feet of the cutter bar projected beyond the right edge of the truck body. In passing a stalled truck the outside edge of the cutter bar of the combine caught the corner of the stalled truck, doing injury to both trucks and the combine.

In Gould Morris Electric Co. v. Atlantic Fire Ins. Co., 1948, 229 N.C. 518, 50 S.E.2d 295, the cargo was described as 26 electric water heaters packed in crates, four of which protruded above the top of the truck. The court said that the policy insured against loss or damage to specific items of property and that the parties knew from the amount of insurance and the character of the shipment that in all probability portions of the cargo would extend above the top of the truck.

In Bucks County Const. Co. v. Alliance Ins. Co., 1948, 162 Pa.Super. 153, 56 A.2d 338, the cargo was described in the policy of insurance as a power shovel. The court said that “Because of the bulk of this equipment, specifically described in the policy of insurance, the insurer should not be relieved from liability if the loaded shovel extended over the sides of the conveyance, thus protecting the conveyance from colliding with anything but subjecting the shovel to the whole impact of collision.”

In C. & J. Commercial Driveway v. Fidelity & Guar. Fire Corp., 1932, 258 Mich. 624, 242 N.W. 789, the cargo consisted of automobiles specifically described as such. The court said: “When considered in its entirety, it will be noted that on its face the policy insures the automobiles on the hazards of the road while they are in transit.”

In Edgerton & Sons v. Minnesota Fire & Marine Ins. Co., 1955, 142 Conn. 669, 116 A.2d 514, the cargo consisted of a lathe which was so described. Furthermore, the truck itself came into contact with a culvert which caused the truck to rise up with its load so that a part of the load hit the overhead bridge. Such case is clearly distinguishable.

In the instant case since the cargo was not specifically described, appellant had no means of knowing the size or nature thereof. Appellee did know the size and nature of the cargo and was responsible for the manner in which it was arranged on the truck and transported. It cannot he said that the circuit breaker upon being placed upon the truck became a part of the vehicle or conveyance, especially in view of the definition of the term “vehicle” as used in the policy. The policy provides: “The term ‘vehicle(s)’ wherever used in this policy shall mean the motor vehicle (s), trailer (s), semi-trailer (s) or other vehicle (s) described herein.” Moreover, the policy in the instant case is not an “all risk” policy, designed to cover practically all losses. It is a “limited risk” policy insuring only against some seven specified perils hereinabove set out, one of which is “collision, i. e., accidental collision of the vehicle with any other vehicle or object.” This provision is simple and plain and means what it says. It is not complicated or ambiguous. Anyone could read it and understand it.

In Employers Mut. Cas. Co. of Des Moines, Iowa v. Nelson, Tex.Sup.1962, 361 S.W.2d 704, the court said:

“Although contracts of insurance are said to be construed strictly in favor of the insured, nevertheless they are to be construed generally as other contracts, in that unambiguous words and phrases are to be taken in their ordinary meaning unless there is something in the contract that would indicate a contrary intention. United American Ins. Co. v. Selby, 161 Tex. 162, 338 S.W.2d 160.”

Appellant relies on several cases in which recovery has been denied, under policies containing the same or similar provision with respect to collision as the policy in this case. In Old Colony Ins. Co. v. Anderson, 10th Cir., 246 F.2d 102, the cargo consisted of a drilling unit being transported. The boom chains broke, causing the unit to slide off the truck and onto the ground where it struck or collided with a parked truck on the roadside. The truck did not collide with any object, nor did it overturn. The court referred to the often cited case of C. & J. Commercial Driveway v. Fidelity & Guar. Fire Corp., supra, in which the plaintiff recovered for damage to cargo consisting of automobiles, when the front end of the front automobile came in contact with an overhanging plank and was damaged. The court said:

“Other well, and we think better, reasoned cases construe identical or similar insuring clauses as unambiguously insuring cargo only against damages caused by collision of the means of conveyance, and excluding from coverage damages caused by collision to the cargo alone. Thus, in Mendelsohn v. Automobile Ins. Co., 290 Mass. 228, 195 N.E. 104, with identical policy provisions and facts indistinguishably similar to C. & J. Commercial Driveway v. Fidelity & Guaranty Fire Corp., supra, the court arrived at an opposite result. The Massachusetts court could find no ambiguity in the insuring language, but on the contrary thought that the words used to define the peril insured against were ‘simple, everyday words and the structure of the sentence where they appear * * * not complicated.’ The court accordingly construed the contract as not including liability for damage resulting from the collision of the cargo and not the conveyance.”

The court also referred to the case of Garford Trucking v. Alliance Ins. Co., supra, and stated: “The Second Circuit thought that a collision of the cargo with an overhanging bridge was an accident to the conveyance within the meaning and coverage of the policy, although not a ‘collision of vehicle.’ ”

The decision of the Supreme Court of Massachusetts in the Mendelsohn case was followed in Barish-Sanders Motor Co. v. Fireman’s Fund Ins. Co., 1938, 134 Neb. 188, 278 N.W. 374, and Hamilton Trucking Service v. Automobile Ins. Co., 1951, 39 Wash.2d 688, 237 P.2d 781. In the latter case the collision provision was identical to that in the instant case. The cargo consisted of a saw that had been loaded on the flat bed of a truck. The saw was damaged by coming in contact with the framework of an underpass, but there was no collision with the truck. The court said:

“The words of the part of the policy under consideration must be accorded their ordinary meaning. The language used is plain and unambiguous. There is nothing to interpret or construe. We cannot avoid feeling as we read the cases cited by respondent that those courts have created ambiguities where none existed and have then used rules of construction to determine the intent of the parties and what they must have contemplated, thus enlarging the risk coverage of the insurance policies under consideration.”

See also Annotation, 36 A.L.R.2d 522-527.

In Wolverine Ins. Co. v. Jack Jordan, Inc., 1957, 213 Ga. 299, 99 S.E.2d 95, the provision with respect to collision was identical with that in the policy in the instant case. The loss occurred when the property being transported struck an underpass and was damaged. The vehicle transporting the property did not come in contact with the underpass or any other object and was not damaged in any way. The court said that it was well settled that the courts of Georgia, if there is any ambiguity in an insurance policy, will construe the contract most favorably to the insured; but that it was equally well settled that no construction is required or even permissible when the language employed by the parties in their contract is plain, unambiguous, and capable of only one reasonable interpretation. The court then said:

“The plain words of the policy insure against losses to the insured property which result directly to the property from a collision of the vehicle on which the property is being transported. This is the plain, unambiguous, literal meaning of the policy. The policy does not expressly cover damage to property caused simply ‘by collision’ or ‘by collision of the vehicle or property ; but this particular type of coverage is restricted to loss or damage to the property caused by collision of the vehicle described in the policy. * * *
“ * * * By its terms the instant policy insures only against specified perils, and the language employed to describe the peril of collision insured against is plain and unambiguous.”

We do not doubt that appellee thought that the policy in question furnished coverage under the circumstances of this case. Its misapprehension in that regard has probably resulted from failure to carefully read the policy and to ascertain the perils insured against. Since the insured’s loss was not caused by an accidental collision of the vehicle, we are compelled to reverse and render the case.

Reversed and rendered.


source: Caselaw Access Project

author: COLEMAN, Justice.

license: Public Domain

text:
    The CITY OF HOUSTON, Appellant, v. Charles CELAYA et ux., Appellees.
    No. 14481.
    Court of Civil Appeals of Texas. Houston.
    May 6, 1965.
    Rehearing Denied May 27, 1965.

      John Wildenthal, Jr., City Atty., Edgar Pfeil, Sr. Asst. City Atty., Herbert M. Beaz-ley, Asst. City Atty., Houston, for appellant.
    Frank T. Abraham, Bill Allen, Houston, Brown, Kronzer, Abraham, Watkins & Steely, Houston, of counsel, for appellees.
   COLEMAN, Justice.

Appellees sued to recover damages for personal injuries sustained when their automobile was struck from the rear by a garbage truck belonging to the City of Houston while they were stopped at a traffic signal.

Judgment was entered for the appellees based on jury findings that the brakes on the truck were defective; that the City of Houston garage negligently failed to make proper inspection of the truck prior to the collision, which was a proximate cause of the collision; that the City of Houston failed to maintain all brakes on the truck in good working order and in such adjustment as to operate as equally as possible with respect to the wheels on opposite sides of the vehicle prior to the collision, which was negligence and a proximate cause of the collision; that the City of Houston failed to maintain the brakes on the truck in question prior to the collision in such a manner as they would have been maintained by a person of ordinary prudence in the exercise of ordinary care under the same or similar circumstances, which was a proximate cause of the collision; that the garbage truck on the occasion in question was not capable of being stopped on a dry, smooth, level road free of loose material, upon application of the service “foot” brake within 30 feet if traveling 20 miles per hour before brake application [as required by an ordinance of the City of Houston], which was a proximate cause of the collision; and that the collision was not the result of an unavoidable accident.

Appellant has assigned several points of error which collectively present the contention that there was no evidence to authorize the submission of the issues on negligence and proximate cause to the jury, or that the answers made to those issues were so contrary to the weight and preponderance of the evidence as to require the granting of a new trial. By other points they attack the answer made by the’jury to the issue on unavoidable accident; the rendition of a judgment against the City because the negligence, if any, was negligence in the exercise of a governmental function; the refusal of the trial court to submit requested issues to determine whether the driver of the truck was acting under an emergency at the time of the collision, whether he acted as an ordinarily prudent person would have acted under the same or similar circumstances after such emergency arose, and whether such emergency, if any, was not the sole proximate cause of the collision in question.

The parties are generally in agreement that Mrs. Celaya properly stopped in response to a traffic signal and that thereafter the garbage truck collided with her automobile from the rear because of a failure of the brakes on the truck. There is a conflict in the evidence as to the nature of the failure. The driver testified by deposition sometime before the trial that immediately prior to the accident as he was approaching the stopped car he attempted to apply the brakes and the pedal went to the floor. The brakes worked all right prior to that time. He testified on deposition that the brakes didn’t “kick back” and didn’t freeze, “it just went down,” “ * * * when I went to hit for it, it was giving. See, the brakes was giving all the time and I was still trying to, you know, hit it and see whether it built up or something.” In answer to the question: “Pumped it?” he answered: “Yes.”

At the trial he testified that on the trip from the truck garage to the scene of the collision he had to apply the brakes and they worked . perfectly. That when he approached the scene the brakes were working and he slowed from 30 miles an hour to 15 miles per hour, but that when he got close to appellees’ car, he hit the brakes and they got hard. He testified that he didn’t remember his deposition testimony and that the manner of the operation of the brakes as explained in the deposition was not what occurred.

A fellow employee, Lark Pipkin, riding in the truck, testified that the brakes went out all of a sudden; that the driver did all he could; that he pumped the brakes, but they went clear to the floor board. He further testified that after the accident they continued to use the truck all day; that the brakes worked perfectly; that they took it easy and didn’t drive fast; that the car would “roll a piece” before it would come to a complete stop; that the brakes were pumped a lot. He testified that no repairs were made on the truck the day of the accident, but that the truck was in the garage the next day, and that no repairs were made at the scene of the accident. He testified that Mr. Milam, the District Director in charge of garbage collection, came to the scene and, in answer to the question: “Did Mr. Milam check the brakes?” said: “No, Mr. Milam, the only thing he done, he talked with the officer and after we left, I don’t know what they talked about. He just told us to go ahead on and try to finish the route, and we did what he said.” This testimony is significant in that it indicates that the truck left the scene while the officer and Mr. Milam were talking.

The investigating officer testified that after he arrived he tested the brakes by backing the truck a few feet and stopping and then going forward a few feet and stopping, and that he found the brakes adequate; that he saw no one repair the brakes.

Mr. Milam testified that he got to the scene about 20 minutes after the accident; that Earl Winfrey was the driver of the truck and Lark Pipkin and Orville Wright were helpers; that the police arrived soon after he got there; that he called the garage and directed that a mechanic be sent out to the scene and then instructed Winfrey to drive the truck across Post Oak and wait for the mechanic; that he parked it in front of a U-Tote’m Store on Beechnut; that he left before the mechanic arrived.

Orville Wright did not testify. There is evidence that repairs were made to the brake on one rear wheel the day after the collision. There was testimony that the hydro-vac or booster was removed and replaced at the scene of the accident. An expert witness offered by appellant testified that a hard brake would be caused by a failure of the hydro-vac and that replacing a hydro-vac is not something you would do on the street; that it would take about two hours, and then the brakes would have to “bleed” for thirty minutes.

Appellant’s points of error are based on its theory that the brakes were “hard” when the driver attempted to apply them prior to the collision. We cannot say that the evidence requires such a finding. There is sufficient evidence to support a conclusion that the brakes were soft. A condition of “softness” is relative. While the officer testified that as far as he could tell the brakes were in good working order, he was not ashed whether they were hard or soft. He stated that he drove the truck “a foot or two,” and obviously was not required to make a hard application of the brakes in order to stop the truck. The credibility of the witnesses and the weight to be given their testimony are matters for determination by the jury. The answers of the jury to the negligence and proximate cause issues are supported by substantial evidence and are not contrary to the great weight and preponderance of the evidence.

There was testimony that the garbage trucks made many stops each day and in addition had to make several trips to the garbage dump. There was expert testimony that vehicles put to such use should have periodic inspections and that visual inspection of the brakes by removing the wheels should be a matter of routine. It is undisputed that no routine inspection of the truck or the brakes thereon was undertaken by the garage and the garage had the duty to inspect the trucks. There was testimony that the trucks were inspected at the garage only when the driver reported trouble. It is a matter of common knowledge that at times automobile brakes fail suddenly. There is testimony that a cause of brake failure can be the soaking of the brake lining by a seepage of oil or brake fluid and that this is a condition which could be ascertained by visual inspection. There is also evidence that soft brakes can be caused by loss of fluid or by excessive wear on brake linings, conditions which proper inspection would detect. Under the evidence in this case the jury could reasonably have found, as they did, that the failure of the City garage to make periodic inspections of the brakes on this truck was negligence and a proximate cause of the collision. This constitutes negligence in the operation of the municipal garage, which is not a governmental function of the City. The City, therefore, is not shielded from liability for damages caused by its negligence. City of Houston v. Shilling, 150 Tex. 387, 240 S.W.2d 1010, 26 A.L.R.2d 935.

There was no error in the refusal of the trial court to submit the requested issues on emergency and sole proximate cause. There is nothing in the evidence to suggest an emergency brought about by conditions other than sudden brake failure. No< negligence on the part of appellees is suggested by the evidence. The issue on proximate cause as submitted was predicated on an affirmative answer to the issue on emergency, and, therefore, was not required to be submitted unless the issue on emergency should have been submitted. No issues were submitted to the jury concerning specific conduct of appellant or its agents arising during or after the emergency. Issues on “sudden emergency” were not raised by the evidence. Beck v. Browning, 129 Tex. 7, 101 S.W.2d 545; White v. Munson, Tex.Civ.App., 162 S.W.2d 429; Ynsfran v. Burkhart, Tex.Civ.App., 247 S.W.2d 907, ref. n. r. e.

It would unduly lengthen this opinion to set out the evidence relating to damages. We have carefully studied the testimony and are of the opinion that it fully supports the awards made by the jury and that the damages awarded were not excessive.

There was testimony that Mrs. Celaya had a pre-existing, but non-symptomatic, arthritic condition and x-ray pictures made prior to the collision indicated emphysema, but there was testimony that this condition was not symptomatic. There was testimony that the injury suffered in the collision caused increased susceptibility to respiratory infections and that the arthritic condition was aggravated by her injury. There was general medical testimony that the medical bills were made necessary by the injury sustained in the collision. The points presenting the objection that the evidence failed “to separate the medical charges for treatment of conditions of Mrs. Celaya’s health proximately resulting from the accident, if any, from those medical charges necessarily due to treatment of pre-existing physical conditions of Mrs. Celaya,” do not present error.

Finally, appellant urges that the judgment should be reversed and a new trial ordered because counsel for appellees procured from the official court reporter certain x-ray films during the course of the trial without the prior approval of the trial court, or the knowledge of counsel for appellant, and took them to the home of a doctor for his examination and evaluation prior to being called as an expert witness. A motion for mistrial was made and it was denied. It is contended that this action constitutes fundamental error and a deprivation of the appellant’s rights to a fair and impartial trial under the State and Federal Constitutions. There is no contention that the records were in fact altered or lost or in any manner tampered with. Appellant has cited no authority to sustain his point. We are unable to see how the action, of which complaint is made, harmed appellant, or in any manner caused the rendition of an improper judgment.

The judgment of the trial court is affirmed.


author: WALTER, Justice.

text:
    HEMPHILL COUNTY, Texas, Appellant, v. Walter ADAMS et al., Appellees.
    No. 3971.
    Court of Civil Appeals of Texas. Eastland.
    April 23, 1965.

      J. D. Crow, County Atty., Hemphill County, Canadian, for appellant.
    Allen, Allen & Reavis, Perryton, for ap-pellees.
   WALTER, Justice.

Hemphill County filed suit against Harry Rathjen and Walter Adams for conversion of two jeep motor vehicles. The defendants’ motion for summary judgment was granted and the plaintiff has appealed.

Hemphill County’s Civil Defense Unit had as its director, Harry Rathjen, who was also sheriff of Hemphill County. The sheriff was appointed director by the Commissioner’s Court on February 9, 1959. During the time Rathjen served as director, the unit acquired two jeeps.

Hemphill County alleged that on November 22, 1961, it owned a jeep motor vehicle which had been donated to the Hemphill County Civil Defense Unit by the Texas Surplus Property Agency under the direction of the defense department of the United States; that thereafter while Walter Adams was sheriff of Hemphill County, he assigned said jeep vehicle by endorsing the title thereto in the following manner: “Hemphill County, Texas by Walter Adams, Sheriff” to Ray Dudley Motor Company; that the motor company paid $600.00 for said vehicle, and that Walter Adams had no authority to sell any property of the county and the transfer and assignment of said jeep was fraudulent and an unauthorized conversion and sale of plaintiff’s property.

It further alleged that on September 22, 1961, Hemphill County owned another jeep motor vehicle which had been donated to the Hemphill County Civil Defense Unit by the Texas Surplus Property Agency; that Walter Adams assigned said jeep by endorsing the certificate of title thereto as “Hemphill County, Texas, by Walter Adams, Sheriff”, to Harry Rathjen; that on the 21st day of November, 1961, Rathjen made an assignment and transfer of said vehicle to Dudley Motor Company for a consideration of $450.00, and that such transfer was fraudulent and an unauthorized conversion.

It was further alleged in the county’s petition that “such fraud and loss to the plaintiff did not become known until on or about the 1st day of May, 1963, and that it was impossible for the plaintiff to have knowledge and plaintiff did not have knowledge of the same until on or about said date.” The county’s petition asked for a judgment against Rathjen and Adams for $1,-050.00, for conversion of the two jeeps.

Harry Rathjen answered and asserted that the County Attorney of Hemphill County had no authority to bring this suit in that the Commissioner’s Court had not consented to the filing of such suit, and that all necessary parties had not been included. The above answer was verified. Rath-jen also excepted to the County’s petition because it appeared from such petition that any cause of action which it might have was barred by the two year statute of limitation.

Walter Adams filed a verified answer and asserted that the County Attorney had no authority to file such suit. He also excepted to the plaintiff’s petition and asserted that it was barred by the two year statute of limitation. Adams further answered that the title to the vehicles was in the name of Harry Rathjen, sheriff of Hemphill County; that Rathjen paid for said vehicles with his own private funds; that he, Walter Adams, succeeded Rathjen as sheriff on the 3rd day of July, 1961; that Rathjen offered to sell said vehicles to Hemphill County and the County rejected said offer; that the County did not pay any consideration for said vehicles and was never the legal or equitable owner thereof; that Rathjen sold said vehicles; that he, Walter Adams, received no part of the consideration for executing Said title; that all of the consideration was paid to Rathjen, the legal and equitable owner of said vehicles.

Walter Adams requested the County to admit the truth of the following fact: “That Hemphill County, Texas, never paid any money or other consideration of any nature for either of the Jeep Vehicles for which plaintiff seeks recovery of the proceeds of sale by its original petition.”

The County’s reply to said request for admission in part is as follows: “It is not true that Hemphill County, Texas, never paid any money or other consideration of any nature for either of the jeep vehicles for which Plaintiff seeks recovery of the proceeds of sale by its Original Petition. Hemphill County was the Civil Defense Unit and as such was the sole authority entitled to receive Civil Defense property. Such property could not lawfully be accepted or received except for Civil Defense Use and by the Hemphill County Civil Defense alone.”

Rathjen and Adams asserted in their motion for summary judgment that because Hemphill County paid no consideration for the jeeps it was not entitled to recover. Rathjen and Adams filed affidavits in support of their motion.

In reply to the motions for summary judgment Hemphill County filed an instrument that was signed and sworn to by the County Attorney. He asserted in part “that it has not been determined that Hemphill County, Texas, never paid any consideration for the vehicles;” that “this plaintiff says that defendant Rathjen, himself, never lawfully paid any consideration for said vehicles, and that if he did pay for the same, that he did so in fraud of the County of Hemphill and without its consent”; that “Plaintiff further denies the truth of the statement contained in the affidavit of said defendant Harry Rathjen, sworn to on July 17, 1964 and filed in this Cause. On the contrary, plaintiff says that the individual commissioners and the County Judge of Hemphill County (which are the sole and only administration and custodial body) each deny and have denied and yet deny that they, or plaintiff, were or was familiar with the fact that defendant Rathjen sold the jeeps or that he intended to sell said jeeps at the time of the sale. Hemphill County, as plaintiff denies such allegation of the defendant. Hemphill County says that said defendant has uttered a statement subject to the false swearing and perjury provisions of law which in this instance controverts proceedings held by another body. Plaintiff likewise denies that said defendant lawfully paid any consideration for said jeeps and for the reasons above given.”

“Plaintiff says that the affidavit sworn to on July 17, 1964, by the said defendant, Walter Adams, and filed in this Cause, is untrue wherein the same says that title to the jeeps was vested in the Sheriff of Hemphill County, Texas. That title to said jeeps was never vested in the Sheriff of Hemphill County, Texas, and this statement is absolutely untrue. That title to said jeeps was vested in Hemphill County, Texas, at the time the same was conveyed by said defendant, Walter Adams, and prior to that was vested in Hemphill County Civil Defense. That at no time in the history of said titles to said jeeps was the same reposed in any Sheriff of Hemphill County, Texas. That this is a salient fact in issue in this lawsuit. This plaintiff makes a direct, unqualified denial of the truth of the said statement by said defendant. This plaintiff says that said defendant lies when he makes such statement. This plaintiff says that such statement is a fiction, unsupported by fact and fraud on this Court and a violation of the False Swearing and Perjury laws of this State.”

Harry Rathjen’s oral deposition was taken and he testified therein substantially as follows: The jeep was never used for civil defense and the title to said jeep was in the County. I received it for Hemphill County and for purposes of Civil Defense. If I had considered that the jeep belonged to me I would have applied for the title in my name. At such time, I did not consider that the jeep belonged to me. I considered the jeep belonged to Hemphill County and that’s the way the title was issued and title stayed in Hemphill County until the 22nd day of September, 1961, at such time Walter Adams as sheriff signed “Hemphill County by Walter Adams, Sheriff” and conveyed this jeep to me as my personal private property. At the same time I applied for a title in my name. This was on the quarter ton jeep. I sold the two jeeps. I received $650.00 for the little jeep and $400.00 for the other jeep. I agree that up to September 22, 1961, before Walter Adams signed this title, the title to said vehicle was in Hemphill County and belonged to Hemphill County. After Walter Adams signed the title on such date I received title to the vehicle. I thereafter made application for title.

This is a suit for conversion. That term has been defined:

“ * * * as the unlawful and wrongful exercise of dominion, ownership, or control by one person over the property of another, to the exclusion of the exercise of the same rights by the owner, either permanently or for an indefinite time, and may be effected by taking actual corporal possession and control over the property of another so as to prevent the owner from the exercise of such rights.” 14 Texas Jur. 2d page 5.

On the hearing of a motion for a summary judgment the court must determine whether there is any issue of fact to be tried. The court cannot weigh the evidence, determine the credibility of the witnesses or try the case on affidavits. All doubts as to the existence of a genuine issue as to a material fact must be decided against the party moving for a summary judgment. The court must accept as true all evidence of the party opposing such a motion which tends to support his contention and must give him the benefit of every reasonable inference which may be drawn therefrom. Gulbenkian v. Penn, 151 Tex. 412, 252 S.W.2d 929; Box v. Bates, (Sup.Ct.) 162 Tex. 184, 346 S.W.2d 317.

After applying these well established principles of law to the facts in this case, we have concluded that material issues of fact exist on the elements of conversion. The evidence does not conclusively demonstrate that the County’s cause of action was barred by the two years statute of limitation. All of the evidence tendered by the appellees to support their motion for summary judgment was categorically denied in the affidavit of the County Attorney. The depositions of the appellee Rath jen and his affidavit and the affidavit of appellee Adams must be viewed as evidence of interested parties. In James T. Taylor and Son, Inc., v. Arlington Independent School District, Tex., 335 S.W.2d 371, our Supreme Court held:

“The general rule is that the testimony of an interested witness does no more than raise a fact issue to be determined by the jury.”

The judgment is reversed and the cause is remanded.


author: McDONALD, Chief Justice.

text:
    The SUPERIOR OIL COMPANY, Appellant, v. Newman ROBERTS et al., Appellees.
    No. 4348.
    Court of Civil Appeals of Texas. Waco.
    May 6, 1965.
    Rehearing Denied May 27, 1965.

      Murray Christian, Williams, Lee & Lee, Thomas H. Lee and Jesse J. Lee, Houston, for appellant.
    Plummer & Wade, M. W. Plummer, Sr., Houston, for appellees.
   McDONALD, Chief Justice.

This is an appeal from a judgment for plaintiffs in a suit for accounting between cotenants.

Plaintiffs Roberts et al., own an undivided interest in a lj4 acre tract of land in Colorado County, Texas. Defendants Cravens, Todd and Jackson own the other 1/2 interest in such property. On 10 April, 1947 defendants Cravens, Todd and Jackson executed a mineral lease on the entire tract to defendant Superior Oil Company.

Defendant Oil Company included the lease of such entire tract, in a pooling unit of several hundred acres, of which it was the operator; and has paid itself $7,165.33, as the 11/2 acre tract’s prorata part of production from the unitized area. The actual production was not from the 1J4 acre tract, but from a nearby tract included in the unitized area.

Plaintiffs alleged that they are cotenants with defendant Oil Company in the 1J4 acre tract, and sought an accounting and recovery from defendant Oil Company of of the sums collected by defendant Oil Company (less 14 of the tract’s prorata of expenses of production).

Defendants Cravens, Todd and Jackson did not answer; defendant Oil Company answered by general denial, and plead the 2 and 4 year Statutes of Limitation in bar of such of plaintiffs’ cause of action as accrued prior to such times.

Trial was before the court without a jury, which rendered judgment for plaintiffs against defendant Oil Company for $3082.62 (14 of the sums received by defendant as the I54 acre tract’s prorata of production from the unitized area, less j4 of the cost of production allocable to such tract).

Defendant appeals, contending the Trial Court erred:

1) In allowing any recovery against defendant under the undisputed facts.
2) In allowing a recovery for any sum greater than $639.56, the stipulated net value of all production within 2 years preceding the filing of suit.

We revert to defendant’s 1st contention. Plaintiffs and defendants Cravens, Todd and Jackson were cotenants of the 1^4 acres here involved, plaintiffs owning an undivided ]4 interest and defendants Cravens, Todd and Jackson owning an undivided }4 interest. When Cravens, Todd and Jackson executed the lease of the entire tract to defendant Oil Company, such lease was only effective to convey the 1/2 interest of Cravens, Todd and Jackson. Plaintiffs and defendant Oil Company then became cotenants or concurrent owners of the leasehold interest in the property. Willson v. Superior Oil Co., Tex.Civ.App., (n. r. e.) 274 S.W.2d 947; Bruni v. Vidaurri, 140 Tex. 138, 166 S.W.2d 81.

If a cotenant or concurrent owner of lands severs minerals from the mineral estate without the consent of the other cotenants or concurrent owners he must pay the other cotenants their proportionate share based on the proceeds less expenses of severance. White v. Smyth, 147 Tex. 272, 214 S.W.2d 967, 5 A.L.R.2d 1348.

Moreover, if a cotenant or concurrent owner of property receives rents, profits, delay rentals or bonus from the entire property, he must account proportionately to the other cotenant or concurrent owner. Sparks v. Robertson, Tex.Civ.App., W/E Ref., 203 S.W.2d 622; Grieder v. Marsh, Tex.Civ.App., (n. w. h.), 247 S.W.2d 590; Manning v. Benham, Tex.Civ.App., (n. w. h.), 359 S.W.2d 927; Cline v. Niblo, 117 Tex. 474, 8 S.W.2d 633; Shield v. Shield, Tex.Civ.App. (n. r. e.) 286 S.W.2d 252.

Defendant contends that since the actual production was not from the 1 acre tract of which plaintiff was [4 owner, that plaintiffs are precluded from recovery.

Defendant Oil Company entered the entire 1]4 acre tract (including plaintiffs’ ]4 interest), into the unitized unit of which it was the operator, and then allocated to itself such entire tract’s prorata of production from the unitized area. Defendant paid itself the profits from property in the unitized area — which belonged to plaintiffs. We think under such circumstances defendant Oil Company held plaintiffs’ prorata of the profits in trust, and must account for such profits as were made from plaintiffs’ portion of the land.

Defendant’s 2nd contention is that the 2 year Statute of Limitation precludes plaintiffs from recovery of any accounting prior to 2 years before filing suit.

The burden was on the defendant to prove its defense of limitation. The Trial Court rejected such defense. Under the facts of the instant case, limitation cannot commence to run until plaintiffs had notice that there was a repudiation of their rights by defendant. Under the record we cannot say that plaintiffs knew or should have known more than 2 years prior to suit, of the conduct and actions of defendant Oil Company. 15 Tex.Jur.2d, Sec. 42, p. 211; 57 Tex.Jur.2d, p. 614; Courseview v. Phillips, 158 Tex. 397, 312 S.W.2d 197, 205, pt. 7; Slay v. Burnett, 143 Tex. 621, 187 S.W.2d 377, pts. 27 and 28.

All of defendant’s points and contentions are overruled.

Affirmed.


author: CROSS, Presiding Judge.

text:
    Buddy AULGUR, Respondent, v. Ronald ZYLICH, Appellant.
    No. 24165.
    Kansas City Court of Appeals. Missouri.
    April 5, 1965.
    Motion for Rehearing and for Transfer to Supreme Court Denied June 7, 1965.
    Application for Transfer Denied July 12, 1965.

      Paul H. Niewald, Gordon, Adams, Nie-wald & Risjord, Kansas City, for appellant.
    Ira K. Witschner, Thomas J. Conway, Jr., E. E. Thompson, Kansas City, for respondent.
   CROSS, Presiding Judge.

This is an action for damages in the amount of $10,000.00 for personal injuries sustained by plaintiff on March 3, 1962, when an automobile driven by defendant was allegedly caused to run into and strike plaintiff while he was walking on a public street

Plaintiff’s petition was filed on March 22, 1962. On May 14, 1963, written interrogatories were propounded by defendant to plaintiff, inclusive of Interrogatory No. 8 which asked for names and addresses of persons having knowledge of the incident alleged in plaintiff’s petition.

Plaintiff filed written answers to defendant’s interrogatories on May 28, 1963 and in response to Interrogatory No. 8 stated, “I understand that there were two or three witnesses but their names are unknown to me at this time”.

Trial of the case began on April 20, 1964 and was to a jury. During the trial plaintiff produced witnesses John Botkin and Helen Frazer and undertook to examine them concerning the accident. Defendant objected to their testimony on the ground their names had not been disclosed by plaintiff’s answers to defendant’s interrogatories. The trial court sustained defendant’s objections and refused to allow the proffered witnesses to testify. Upon examination out of the jury’s hearing they testified they were first interviewed as witnesses by plaintiff’s attorney approximately two months prior to the trial.

The trial resulted in a jury verdict and judgment for defendant. Plaintiff timely filed a motion for a new trial based on the sole ground that the trial court committed prejudicial error in refusing to allow plaintiff’s witnesses Frazer and Botkin to testify, because they were material eye witnesses whose testimony was essential to plaintiff’s recovery. The motion is supported by allegations that plaintiff gave truthful answers to defendant’s interrogatories, that the witnesses were found after such answers were made, and that no subsequent interrogatory was exhibited by defendant. The motion was sustained by the trial court and this appeal resulted.

The only issue in this appeal is whether the trial court erred in granting a new trial after refusing to admit the testimony of witnesses for plaintiff not disclosed by his answers to defendant’s interrogatories.

Defendant concedes that plaintiff’s answer to Interrogatory No. 8 was true at the time given. But, says defendant, the answer became incorrect approximately two months before trial when plaintiff found witnesses Botkin and Frazer, and it then became plaintiff’s duty to amend his answer or otherwise notify defendant of such discovery in order that he not be surprised and to afford him opportunity to prepare his defense. To hold otherwise, argues defendant, would defeat the purpose and intent of interrogatories which are designed to effect a full disclosure of witnesses in order that all parties might prepare for trial. It is defendant’s contention that the trial court’s action in refusing the testimony of plaintiff’s witnesses was within its sound discretion, proper under the circumstances, and that the granting of a new trial was erroneous and to defendant’s prejudice.

To the contrary, it is plaintiff’s position that there was no continuing duty on him to amend his answer, which was truthful at the time it was filed, in order to communicate new information subsequently learned, particularly since defendant made no effort, after receiving plaintiff’s original answer, to further avail himself of discovery procedures to learn whether plaintiff had obtained later knowledge of witnesses to the occurrence. It is suggested by plaintiff that if there is such continuing duty on a party, who has truthfully answered interrogatories, to keep his adversary informed of the results of his diligence in trial preparation — then it can be said that a litigant is compelled by his adversary to “go to work for him” — a state of affairs proscribed by Judge Stone in State ex rel. Lawrence v. Craig, Mo.App., 329 S.W.2d 810.

However, plaintiff’s basic appeal contention is to the effect that the trial court was vested with judicial discretion to decide the question presented. Admitting that the trial court could have, in the exercise of its sound discretion, either refused or accepted the testimony of the witnesses when offered during trial, plaintiff argues that the court thereafter was still vested with a sound discretion to review its trial ruling, and, in the exercise of that prerogative, to correct its own error by sustaining plaintiff’s motion for a new trial.

Civil Rule 56.01, V.A.M.R., as supplemented by Civil Rule 57.01, requires a party to disclose, by answer to properly exhibited interrogatories, “the identity and location of persons having knowledge of relevant facts.” There is no requirement by civil rule or statute that a party shall continue to furnish his adversary such information after having truthfully answered the interrogation originally propounded. To our knowledge no Missouri decision has so held.

Some authority on this question is found in federal decisions and in a limited number of state cases. The holdings are not uniform. Illustratively, it is held in Capone v. Norton, 8 N.J. 54, 83 A.2d 710, that if subsequent to the date of truthful and complete disclosure the interrogated party learns of additional witnesses he need not gratuitously provide the adverse party with the identity and location of such witnesses. To the contrary, it is held in Gebhard v. Niedzwiecki, 265 Minn. 471, 122 N.W.2d 110, that a party must disclose information received, after answering interrogatories, which is of substantial nature and which would render the previous answers untruthful, unreliable or incomplete.

For the purpose of this appeal it is not necessary for this court to decide whether plaintiff was required by Missouri discovery rules to amend his original answers and advise defendant of information learned since filing them. The essential question for our decision is not whether plaintiff technically conformed to the prescribed procedures of civil practice. Our concern is whether the trial court acted within the bounds of its own authority.

It is well established that the trial court has a broad discretion to choose a course of action during trial when evidence is challenged on the ground it has not been disclosed by answers to interrogatories. In the sound exercise of that discretion, the trial court may admit or reject such evidence, or otherwise determine and impose appropriate sanctions for violations of rules governing interrogatories. This rule is stated in Barron & Holtzoff, Federal Practice and Procedure, Vol. 2A, Section 776, p. 44 (1963^4 pocket part) as follows:

“DISCRETION OF THE COURT. The discretion of the court extends also to the determination of the sanction where the answer to an interrogatory is inaccurate. The situation occurs most often where a party, in response to an interrogatory asking for the names of witnesses of whom he has knowledge, fails to mention a particular witness known to him, and subsequently calls that witness at the trial. It is impossible to lay down any rule as to the proper course to be followed in such circumstances, and the sound discretion of the trial court should be respected. That court will consider the explanation, if any, for failure to name the witness in the answer to the interrogatory, the importance of the testimony of the witness, the need for time to prepare to meet the testimony, and the possibility of a continuance. In the light of all these factors it may then determine to permit the witness to testify, it may exclude the witness, or it may grant a continuance so that the other side may take the deposition of the witness or otherwise prepare to meet his testimony”.

Missouri decisions are consonant with the rule above quoted. In Central & Southern Truck Lines, Inc. v. Westfall GMC Truck, Inc., Mo.App., 317 S.W.2d 841, the trial court, on the first day of trial, denied defendant leave to amend its original answers to interrogatories so as to name additional witnesses previously undisclosed, and thereafter refused to allow those witnesses to testify. Recognizing the breadth of the trial court’s discretion to determine such questions, this court said: “In any event, the trial judge is to be accorded a broad and sound discretion when called upon to pass on this type of problem, and we find no abuse of that discretion by his refusal to permit the out-of-time filing of the amended answers to the interrogatories and his refusal to permit a newly named person therein to testify.”

In Fitzpatrick v. St. Louis-San Francisco Railway Co., Mo.Sup., 300 S.W.2d 490, the trial court exercised its discretion to allow testimony on behalf of plaintiff which was based on locations and conditions he had not disclosed in answering interrogatories. Declining to interfere with the trial court’s ruling, the Supreme Court said: “The trial court should be given a wide discretion to prevent the party propounding the interrogatory from being misled and prejudiced, as well as to protect the answering party against his own mistake or inadvertence. Under the facts of this case defendant has not shown itself to be prejudiced by the ruling and we hold that the trial court did not err in admitting the evidence.”

And, in Critcher v. Rudy Fick, Inc., Mo. Sup., 315 S.W.2d 421, the reception of evidence on behalf of defendant, contrary to his answers to interrogatories, was held not to be error, in view of the trial court’s wide discretion in ruling such question. In so ruling the Supreme Court stated: “Answers to interrogatories are not pleadings, and while in some circumstances the answers should have a limiting effect on the scope of proof at the trial, the trial court should be given a wide discretion to prevent the party propounding the interrogatories from being misled and prejudiced and to protect the answering party against his own mistake or inadvertence. * * * It has not been ruled that in no event can a party offer testimony contrary to the answers given to interrogatories, and plaintiff has not demonstrated that she was prejudiced by the admission of the testimony in this case. Under the precise facts and circumstances presented on this appeal the admission of the testimony was not error.”

Accordingly, we rule in this case that the trial court was vested with judicial discretion to accept or reject the testimony offered, or follow some appropriate alternate course of action, and that such discretion will not be interfered with if soundly exercised.

The trial court’s discretion in the premises was not exhausted by its use for trial purposes. The trial ruling of the court excluding plaintiff’s witnesses was no more than a preliminary or interim disposition of the issue. The filing of defendant’s motion for a new trial reactivated the original question for final decision by the trial court in the exercise of the same discretionary power that authorized its original ruling. Thus, the court was afforded an opportunity to correct its own error. State ex rel. McNutt v. Northup, Mo.Sup., 367 S.W.2d 512.

Our action in this appeal is guided by well established rules. Trial courts are vested with discretionary authority over questions of fact and matters affecting the determination of fact issues in ruling on motions for new trial. McCandless v. Manzella, Mo.Sup., 369 S.W.2d 188. The trial court’s discretion in granting a new trial is based on the advantage inherent in his opportunity to observe the entire trial, including the various incidents of the trial not ordinarily reflected in the printed record. Davis v. Johnson, 332 Mo. 417, 58 S.W.2d 746. This is particularly true where (as in this case) the record on appeal is abridged and incomplete. Baker v. Brown’s Estate, 365 Mo. 1159, 294 S.W.2d 22. An appellate court will not interfere with a trial court’s discretionary new trial ruling unless there has been an abuse of that discretion, Sapp v. Key, Mo.Sup., 287 S.W.2d 775, and it will be presumed that the trial court properly exercised its discretion, Paepke v. Stadelman, 222 Mo.App. 346, 300 S.W. 845.

A rule most frequently repeated is that appellate courts are more liberal in upholding a trial court’s action in granting a new trial than in denying it. See Stone v. Engler, Mo.Sup., 349 S.W.2d 38 and cases found in Vol. 3, Missouri Digest, Appeal and Error, ^ 977(3). The reason for this rule which discriminates in favor of grants of new trials is that “they are not decisive of the case, but only open the way for a reinvestigation of the entire case on its facts and merits.” 5A C.J.S. Appeal and Error § 1619 p. 136.

Our review of the entire record under the foregoing rules does not cause us to believe that any abuse of the trial court’s vested discretion resulted from its sustention of plaintiff’s motion for a new trial. We believe it was the inherent privilege of the court, upon subsequent deliberate, unhurried consideration, to reverse the ruling it had made under the stress and pressure of trial urgency. Furthermore, we find no manifest injustice to defendant resulting from such action. The order granting a new trial is not decisive of the case, but merely opens the way for its determination on the merits — a course which the law generally favors. A retrial will not only obviate the element of surprise to defendant but will also afford plaintiff an opportunity to present evidence vital to his cause of action. It is our conclusion that the judgment should be affirmed.

It is so ordered.

All concur.

      . For text authority see: 27 C.J.S. Discovery § 30(2), p. 88; Vol. 2A Barron & Holtzoff, Federal Practice and Procedure, Sec. 771.1. Annotation: Discovery-Disclosure of Witnesses, 27 AX.R.2<3, p. 737;
      Annotation: Interrogatories — Continuing Answers, 88 AX.R.2d, p. 657.


author: HOWARD, Judge.

text:
    Martin LANDIE and Sol Landie, Respondents, v. CENTURY INDEMNITY COMPANY, a corporation, Appellant.
    No. 24149.
    Kansas City Court of Appeals. Missouri.
    April 5, 1965.
    Motion for Rehearing and for Transfer to Supreme Court Denied June 7, 1965.
    Application for Transfer Denied July 12, 1965.

      Roy A. Larson, Jr., Kansas City, Sprinkle, Carter, Sprinkle & Larson, Kansas City, of counsel, for appellant.
    Jack N. Bohm, Kansas City, for respondents.
   HOWARD, Judge.

In this case respondents, plaintiffs below, seek to recover from appellant, defendant below, that part of a judgment which is in excess of the limits of an automobile liability insurance policy issued by appellant. We shall refer to the parties as they appeared below. Since the procedures had in previous litigation vitally affect the issues in the present case, we will list such previous proceedings in chronological order.

One C. F. Dawkins was engaged in the business of selling used buses, trucks and parts in Wolcott, Kansas, and was the insured under an automobile liability policy issued by the defendant in the present case, Century Indemnity Company.

About the middle of November, 1954, Dawkins loaned an old truck-tractor to Martin Landie, who with his brother, Sol Landie, was engaged in the junk business and in the business of buying and moving old houses. The two Landies are the plaintiffs in the present case. The Landies put a fifth wheel on the borrowed truck-tractor and attached a trailer thereto, and proceeded to move a house with such rig.

While so moving the house on a public highway in Jackson County, Missouri, on November 27, 1954, one Chester Redman collided therewith and received serious personal injuries.

On November 29, 1954, Redman filed suit against both Landies. The Landies were insured under a liability insurance policy issued by the Central Standard Insurance Company of Sioux Falls, South Dakota, and such company assumed the defense of this damage suit on behalf of the Landies.

In April, 1955, C. F. Dawkins (who owned the truck-tractor involved in the accident and who was insured by the Century Indemnity Company) was made a party defendant in the Redman suit. Century Indemnity Company defended Dawkins in the Redman suit.

About October of 1955, the Central Standard Insurance Company went bankrupt and ceased to represent the Landies, who then, through their private attorney, made an oral demand upon the Century Indemnity Company to assume their defense. This oral demand was refused. Thereafter, on March 10, 1956, written demand was, for the first time, made upon Century Indemnity Company to defend the Redman case on behalf of the Landies, which demand was refused. This demand was made on the theory that they were operating the truck-tractor owned by Dawkins with his permission, and were therefore covered by the policy issued to Dawkins by Century Indemnity Company as an additional insured.

On May 9, 1956, Redman dismissed his lawsuit against Dawkins.

On November 6, 1956, the Landies through their private attorney, wrote another letter to Century Indemnity Company again demanding that the company defend, the Redman case on their behalf, and also advising that such case could be settled for $15,000.00 (this was the limit of the policy issued by Century Indemnity Company to Dawkins), and demanding that the company settle this lawsuit for this amount.

By letter of November 15, 1956, Century Indemnity advised the Landies that there was no coverage for them under the policy and that they would not defend the Redman suit, on behalf of the Landies, except under a full reservation of rights.

The Landies refused to enter into an agreement for the reservation of rights and Century Indemnity did not defend the Red-man suit in their behalf.

On November 21, 1956, an agreement was reached by Redman and the Landies whereby it was agreed that, regardless of any judgment recovered by Redman against the Landies, the Landies would be required to pay only $7,500.00, and that Redman would not attempt to collect more from them but would be limited to attempting to collect from any insurance which might be available in the case.

Thereafter, and on the same day, November 21, 1956, judgment was entered in the Circuit Court of Jackson County, Missouri, for the plaintiff Redman and against the defendant Landies in the amount of $22,500.00. This represented the $15,000.00 limit of the insurance policy issued by Century Indemnity plus the $7,500.00 that the Landies had agreed to pay.

The Landies then paid the sum of $7,500.-00 to Redman as per their agreement.

Century Indemnity did not make any payment and thereafter Redman instituted garnishment proceedings against the company to collect his judgment against the Landies. After trial to the court judgment was rendered for the plaintiff Redman April 28, 1960, in the amount of $15,000.00. In this proceeding the court found that the insurance policy issued by the Century Indemnity Company to Dawkins did, in fact, cover the operation of the vehicle by the Landies. This judgment has now become final and Century Indemnity has paid the $15,000.00 and costs, plus interest.

On May 15, 1961, the Landies filed the present suit against the Century Indemnity Company seeking to recover from the insurance company the $7,500.00 which they had paid to Redman under the agreement referred to above. This $7,500.00 payment was over and above the limits of the policy issued by the company. Plaintiffs in this suit also seek to recover their attorney fees and expenses incurred in defending the original Redman suit.

After trial to a jury in the Circuit Court of Jackson County, Missouri, a verdict was returned on April 21, 1964, awarding judgment to the plaintiffs Landies in the amount of $8,365.00, being the $7,500.00 excess of the Redman judgment, plus $865.00 attorney fees and expenses.

It appears that at the trial the company conceded and the parties agreed that because the company had failed to defend the Lan-dies when the policy did in fact cover them, the company was liable to the Landies for attorney fees and expenses in defending the Redman suit. This amount was agreed to be $865.00.

We thus have a factual situation wherein the insurance company has failed and refused to defend an insured and while persisting in such refusal to defend, has refused to settle the suit against its insureds within the limits of the policy, although such settlement was demanded by the insured.

It appears to be the position of the defendant insurance company that it had reasonable grounds to believe, and in good faith did believe, that the Landies did not have permission from Dawkins to operate the borrowed truck-tractor on the public highways in moving a house and consequently there was no coverage under the policy, and that, because they acted in good faith in contending that there was no coverage they are not liable for any judgment against their insured in excess of the policy limits.

It appears to be the contention of the plaintiffs Landies that they were covered by the policy (and this fact has been finally and conclusively settled by the final judgment in the garnishment proceedings) and that the company was thereby obligated to defend them, and in such defense was obligated to use good faith in considering offers of settlement. Since the company failed to defend it is liable for the judgment against plaintiffs to the limits of their policy (which has now been paid) plus their attorney fees and expenses in defending the Redman suit (which the company now admits). Plaintiffs further contend that the company was not in good faith, but in fact acted in bad faith, when they refused to settle the Redman suit within the limits of the policy pursuant to the notification and demand contained in their letter of November 6, 1956, and that, because the company acted in bad faith in refusing to settle within the policy limits it is liable to them for the amount of the Redman judgment in excess of the policy limits.

In the argument counsel advised that they were unable to find any Missouri case involving the double-barrelled proposition of refusal to defend and refusal to settle. Considerable research by the writer has likewise failed to reveal any such Missouri case. In fact, only a small handful of cases in any way involving this factual situation have been found in the United States.

The policy in question obligated the company to defend any suit against the insured claiming damages because of injury arising out of the ownership, maintenance or use of any automobile, even if such suit is groundless, false or fraudulent and the company reserved to itself the exclusive right to make such investigation, negotiation and settlement of any claim or suit as it deems expedient.

This is a standard policy provision and under this or essentially similar provisions it has been universally held that the company is contractually obligated to defend anyone who in fact comes within the policy definition of “insured”; that failure to so defend is a breach of contract and that reasonable or good faith belief that there is no coverage under the policy is no defense. The company fails to defend at its peril.

For such breach of contract the company is liable to its insured to pay any judgment recovered against him up to the limits of the policy plus attorney fees, costs, interest and any other expenses incurred by the insured in conducting the defense of the suit which it was the obligation of the company to perform under its contract. Also, the insured is released from the policy prohibition against incurring expenses and negotiating and settling claims. The company is thus obligated to reimburse the insured for such settlement, absent collusion, etc. See Freese v. St. Paul Mercury Indemnity Co., Mo.App., 252 S.W.2d 653, Bituminous Casualty Corp. v. Walsh & Wells, Inc., Mo.App., 170 S.W.2d 117.

This general rule is concisely set out in the annotation at 49 A.L.R.2d 694, l. c. 711 where it is said: “Thus, all the cases agree that where it is the insurer’s duty to defend, and the insurer wrongfully refuses to do so on the ground that the claim upon which the action against the insured is based is not within the coverage of the policy, the insurer is guilty of a breach of contract which renders it liable to the insured for all damages resulting to him as a result of such breach.” See the many cases, including Missouri cases, cited in the annotation.

In Pennsylvania Threshermen & Farmers Mutual Casualty Ins. Co., v. Messenger, 181 Md. 295, 29 A.2d 653, the Court of Appeals of Maryland held that such failure to defend where there was in fact coverage constituted a breach of contract for which the company would be held for all damages reasonably flowing from such breach so as to put the insured in as good a position as he would have been in if the company had performed its contract. Here the insured’s truck was involved in an accident in a state of which he was not a resident and he was sued by attachment. The company refused to defend and the truck was sold under execution. The court held that the company was liable for the value of the truck so lost by insured in addition to the balance due on the judgment, costs, etc., since such loss naturally flowed from the breach of contract.

Missouri applies the same measure of damages for breach of contract. See such cases as Wright v. Ickenroth, Mo.App., 215 S.W.2d 43, Security Stove & Mfg. Co. v. American Ry. Express, 227 Mo.App. 175, 51 S.W.2d 572 and Hellrung v. Viviano, Mo.App., 7 S.W.2d 288.

Thus the universal rule which Missouri follows is that an insurance company is liable to the limits of its policy plus attorney fees, expenses and other damages where it refuses to defend an insured who is in fact covered. This is true even though the company acts in good faith and has reasonable ground to believe there is no coverage under the policy. In the present case, after the judgment in the garnishment proceedings wherein it was conclusively determined that there was coverage under the policy, the defendant insurance company paid the $15,000.00 limit of its policy, plus interest and expenses in that case. In the present case the company agrees that since there was in fact coverage, it is liable for attorney fees, and expenses incurred by the Landies in defending the Redman suit. Thus, the one issue in the present case is whether or not the insurance company is liable to the Landies for that part of the Redman judgment in excess of the limits of its policy.

The defendant company contends that it acted in good faith and had reasonable grounds to conclude that there was no coverage under the policy and that therefore, even though this conclusion was mistaken and even though there was coverage under the policy, they cannot be held beyond the limits of the policy, and that such good faith in refusing to defend excuses them for failure to settle within the limits of the policy.

The plaintiffs Landies on the’other hand contend that since the company was in fact obligated under its policy to defend the Redman suit, they were obligated to consider and act upon the offer of settlement, within the limits of the policy, in good faith; that the company failed to do this, and, in fact, acted in bad faith when it refused to settle within the limits of the policy, and is therefore liable for the full judgment even though it is in excess of the limits of the policy.

It is now beyond dispute in Missouri and in most, if not all, of the other jurisdictions in the United States, that where the company does assume the defense of a suit against its insured it may be liable over and above its policy limits if it acts in bad faith, or in some jurisdictions acts negligently, in refusing to settle the claim against its insured within its policy limits when it has a chance to do so. See Zumwalt v. Utilities Ins. Co., 360 Mo. 362, 228 S.W.2d 750, McCombs v. Fidelity & Casualty Co., 231 Mo.App. 1206, 89 S.W.2d 114, and Maryland Casualty Co. v. Cook-O’Brien Const. Co., CA8, 69 F.2d 462. See also annotation 40 A.L.R.2d 168 and the many cases cited therein. Conversely, where the company in good faith believes there is a valid defense to the claim, even though the defense proves unsuccessful and results in a judgment against the insured above the policy limits, the company is not liable, because of such honest mistake, beyond the limits of its policy. See Frank B. Connet Lumber Co. v. New Amsterdam Casualty Co., CA8, 236 F.2d 117.

In Zumwalt v. Utilities Ins. Co., 360 Mo. 362, 228 S.W.2d 750, the Missouri Supreme Court gave careful consideration to this problem of failure to settle and concluded that where the company acted in bad faith in refusing to settle within the policy limits it was liable in tort to the insured for the entire resulting judgment against the insured, including that part thereof in excess of the policy limits. The court held that such cause of action in the insured was not based on breach of contract and was not based on negligence but was an action in tort for the wrong committed by the company when it failed to act in good faith in determining whether or not to accept the offer to settle the claim against its insured within the limits of its policy.

The Supreme Court pointed out that a company acted in bad faith in refusing to settle within its policy limits when it attempted to escape its obligations under the policy by an intentional disregard of the financial interests of the insured; that bad faith was shown when the company attempted to force the insured to contribute money to a settlement within the limits 'of the policy or where it appeared that the company preferred to gamble on escaping all liability by a favorable verdict rather than accept a reasonable settlement within the policy limits. Bad faith is shown by the failure of the company to act honestly to save the insured harmless as it has contracted to do in its policy. Good faith requires the company to make any settlement within the policy limits that an honest judgment and discretion dictates.

Our problem in the case at bar is how to correlate the two well settled rules discussed above when we have joined in one case the two problems of failure to defend and failure to settle. Aside from the California case which is discussed later in this opinion, we get no help from the very few cases from other jurisdictions on this precise point. See Pennsylvania Threshermen & Farmers Mutual Casualty Ins. Co. v. Robertson, D.C., 157 F.Supp. 405, and State Farm Mutual Automobile Ins. Co. v. Skaggs, 10 Cir., 251 F.2d 356.

The only case found which gives careful and full consideration to this exact situation is Comunale v. Traders and General Insurance Company, 50 Cal.2d 654, 328 P.2d 198, 68 A.L.R.2d 883, decided by the California Supreme Court in 1958.

In this case Comunale and his wife were injured in a collision with a truck operated by one Sloan who was insured by the Traders and General Insurance Company. The company refused to defend Sloan, claiming that there was no coverage under the policy and Sloan defended himself. During the course of the litigation and before judgment there was an offer to settle within the limits of the policy. Sloan notified the company of this offer and demanded that the company defend and settle but the company refused. The trial resulted in a judgment for the Comunales above the limits of the policy. After further litigation with the company the judgment was satisfied up to the limits of the policy. Comunale then obtained an assignment of all of Sloan’s rights against the company and brought this suit.

The court pointed out that under the policy there involved (as is also true in the present case) the company was obligated by its contract to defend suits brought against its insured and stated that where the company refused to defend, when there was in fact coverage, even though the refusal was in good faith, such failure to defend constitutes a breach of contract. The court also pointed out that the company which breached its contract by failure to defend could not thereby be put in a better position than a company which honored its contract and did defend. Thus the court concluded that in either instance the company, when coverage did in fact exist, was obligated to consider and act upon offers of compromise in good faith, and that failure to act in good faith in refusing to settle within the limits would result in the company being liable for the entire judgment, even though such judgment exceeded the limits of the policy.

The court said: “The decisive facts in fixing the extent of Traders’ liability is not the refusal to defend; it is the refusal to accept an offer of settlement within the policy limits.”

Because of the breach of contract the insured is entitled to be put in as good a position as he would have been in if the company had honored its contract and defended. This result is accomplished where there is no question of refusing to settle by requiring the company to pay the judgment within the limits of its policy, and also to pay for attorneys fees and other expenses incurred by the insured in his defense of the lawsuit where it was the obligation of the insurance company to itself defend the lawsuit, and páy out the money for attorney fees and other costs.

Where there is a wrongful refusal to settle within the limits of the policy, the insured is not made whole, i. e., he is not put in the same position as he would have been if the company had performed its contract and defended the suit, by a mere payment of the judgment up to the limits of the policy, plus attorney fees and expenses. Where the company performs its contract and defends the suit, the insured has a right to good faith consideration by the company of settlement offers within the limits of the policy. If the company refuses, in bad faith, to settle within the limits, the insured can recover the full amount of the judgment in excess of the policy limits from the company. Thus it follows that where the company breaches its contract and refuses to defend, the insured can only be put in as good a position as he would have been in had not the contract been breached, if the company is required to give good faith consideration to offers of settlement within the limits of the policy, and the insured is given the right to recover judgment in excess of the policy-limit when settlement within these limits is refused in bad faith by the company.

Attorneys for the defendant company contend that this California case should not be followed in Missouri because the theory of recovery for failure to settle is based on breach of contract in California, whereas it is based on tort in Missouri. The difference in theory as thus pointed out is correct, but it is not believed that this effects the persuasive logic of this opinion.

As pointed out in the Comunale case, under California law, there is an implied covenant of good faith and fair dealing between the parties; when the company does not give good faith and fair consideration to an offer of settlement within the limits of the policy, there is a breach of such implied covenant and the insured has a cause of action based on contract against the company to recover the amount he has been damaged by such breach. The measure of damages is the full amount of the judgment against him (plus expenses) even though it may exceed the policy limits.

In Missouri, as pointed out in the case of Zumwalt v. Utilities Insurance Company, 360 Mo. 362, 228 S.W.2d 750, recovery for failure to settle in an appropriate case is based on tort committed by the company when it acts in bad faith in refusing to settle. This recovery is not based on negligence and it is not based on contract. It is a non-negligent tort, committed by the company which acts in bad faith to the detriment of the insured. While the fundamental theory of recovery is based on contract in California and on tort in Missouri, it will be seen from a reading of these two cases that the touchstone in each instance is the bad faith of the company in refusing to settle. So, as a practical matter, the criteria which govern the decisions in these cases are actually the same, whether it be under the contract theory of California or the tort theory of Missouri.

The defendant company here contends further that the California case permitted recovery only because of a specific California statute, having to do with damages for breach of contract. From this they conclude that because the Missouri action sounds in tort rather than contract, and because Missouri has no comparable statute, the California case can not be used as authority in Missouri.

A careful reading of the opinion of the California Supreme Court in the Comunale case refutes this argument. The court in that opinion pointed out that there was an implied covenant of good faith and fair dealing which was breached by the company when it refused to settle, in bad faith, and that damages for such breach would include whatever was necessary to place the insured in as good a position as if the company had not breached its contract, including an obligation on the company to pay the entire judgment, even though it exceeded the limits of the policy. The court then considered the specific California statute only to show that the above conclusion was in conformity therewith. It did not rest its conclusions on the provisions of this statute.

Since it has now been conclusively determined that there was in fact coverage under the policy in the present case, the defendant company breached such contract by failure to defend. Such breach can not put the company in a better position than if it had properly performed the obligations of its contract. Such breach can not relieve the company of any of its obligations and such breach can not take away from the insured any of his rights. Under such circumstances the insured must be placed in a position which is equally as good as that which he would have occupied if the company had performed its contract.

It therefore follows that the company was still obligated to give good faith consideration to the possibility of settlement of this suit within the limits of the policy, and that if the company refused to accept an offer of settlement within the limits, and if the refusal was the result of bad faith on the part of the company, then the company is liable to the insured, in tort, for the damages resulting from such bad faith and the plaintiffs can recover their damages from the company, which may include that part of the judgment which the insured has paid over and above the limits of the policy.

The defendant Century Indemnity Company alleges error in the failure of the trial court to sustain its motion for directed verdict at the close of all the evidence and in overruling its motion for judgment after verdict. The basis for this allegation of error is that there was no sufficient evidence of bad faith on the part of said defendant to make a case for the jury.

When we remember that the critical question in this case is whether or not the defendant company acted in bad faith in refusing to settle the Redman case within the limits of its policy, we see that, considering the evidence most favorably for the plaintiffs, the jury could find that in this case Redman had received severe and permanent injuries, and that there were reasonable grounds to believe that a likely verdict might range from $30,000.00 to $50,000.00. Redman’s attorney, testifying in the present case as an expert, gave such evidence and there is no evidence in the record to the contrary. The jury could also find that the investigation of this matter by the insurance company was limited solely to the question of coverage, which, in this instance, turned on whether or not the Landies were using the borrowed truck-tractor with permission of the owner. The jury could find that the company concluded that there was no coverage and did not investigate the matter further; that there was no inquiry made into the nature or extent of plaintiff’s injuries, the facts surrounding the collision and the probable negligence of either or both of the drivers, or any other circumstances of the accident, other than was revealed by the police report. The jury could further find that in fact the defendant company refused to give any consideration to the offer of settlement, within the limits of the policy, but stood on its denial of coverage and failed and refused to consider any of the interests of the Landies, who were, in fact, their insureds. From this fact situation the jury could well have found, as they did, that the company acted in bad faith in refusing to settle.

The defendant company also complains of the giving of instructions 3 and 4 on behalf of plaintiffs. These instructions, together with the other instructions in the case, are not recommended as a model to be followed in the future, but they are not subject to the complaints leveled against them by the defendant company, and therefore no reversible error is found.

The first complaint of the defendant company is that instruction No. 3 submitted the issue of bad faith on the part of the company in refusing to settle the Redman case. The company contends that the issue of bad faith should be determined on its action in refusing to defend rather than in refusing to settle. What has been said heretofore in this opinion disposes of this contention adversely to the claim of the defendant company.

Defendant also contends that this submission of the narrow issue of bad faith in failure to settle constitutes an improper singling out of only one fact issue, and gives undue prominence to such single issue to the prejudice of other equally important fact issues. Since we have pointed out heretofore that the issue of bad faith in refusing to settle is the turning point in the case, this criticism is not valid and such cases as Shaffer v. Sunray Mid-Continent Oil Co., Mo., 336 S.W.2d 102, Banta v. U. P. R. R. Co., 362 Mo. 421, 242 S.W.2d 34, Spalding v. Robertson, 357 Mo. 37, 206 S.W.2d 517 and LaTour v. Pevely Dairy Co., Mo.App., 349 S.W.2d 436 are not controlling.

Defendant also complains that this instruction fails to require the jury to find the facts on which its verdict is to be based. This overlooks the holding's of such cases as Breshears v. Union Electric Company of Missouri, Mo., 313 S.W.2d 638, and Lewis v. Terminal Railroad Ass’n. of St. Louis, Mo.App., 61 S.W.2d 234, and the cases therein cited, which hold that where the essential facts are not really in dispute it is not necessary for a verdict directing instruction to affirmatively require the jury to find such facts. The attorney for the defendant company, testifying as a witness in the present case, supplied or corroborated much of the evidence on this point and thereby removed any possibility of dispute.

Defendant’s contention also ignores the requirements of Instruction No. 4 given on behalf of plaintiffs which directs the jury to consider certain facts designated therein in reaching their decision as to the existence of bad faith.

As to Instruction No. 4, defendant complains of the use of the words “reasonableness or unreasonableness” of the defendant’s actions. It contends that this only refers to the reasonableness of its action in denying coverage, and that since at the time of trial it had been conclusively determined that there was coverage, the jury could only be expected to find against the company. This overlooks the fact that Instruction No. 3 submitted the issue of bad faith on the question of refusing to settle, not on the question of denial of coverage. Since this has been held in the foregoing part of this opinion to be proper, the present complaint of the defendant is without foundation.

Defendant also complains of the use of the words “reasonable” and “unreasonable” by analogy to the action of the Missouri courts in reversing cases wherein burden of proof instructions required the jury to find that proof had been made “to their reasonable satisfaction”. These cases are not, in fact, analogous to the situation here presented and their authority is not persuasive in this case.

Again defendant complains that the facts the jury was authorized to consider by Instruction No. 4 concern only the issue of good faith in failing to settle instead of bearing on the company’s good faith or bad faith in denying coverage. This is true, but since the issue submitted, and properly so, was the issue of bad faith in failure to settle, this does not make the instruction erroneous.

Defendant here and in other parts of its brief, complains that if the case does not turn upon the issue of good or bad faith in denying coverage, the company will thereby be denied its right to litigate the question of coverage, and must, as a practical matter, admit coverage and defend in all instances. This, of course, can not be a ground for releasing the company from its obligation to exercise good faith in considering offers of settlement within the policy limits, where coverage does in fact exist, and entirely overlooks the adequate remedy the company has in such situations, by seeking declaratory judgment as to any substantial question of coverage that it may, in fact, desire to litigate.

Lastly, defendant complains of error by the trial court in failing to include in Instruction No. 7 a form of verdict allowing the jury to specifically and affirmatively find for defendant and against plaintiff on the issue of the $7,500.00 excess of the Redman judgment above the policy limits. Defendant, although admitting with commendable candor that it has not preserved any allegation of error as to Instruction No. 7, insists that this . court should consider its allegation as to error in this instruction under Supreme Court Rule 79.04 V.A.M.R. as constituting “plain error”.

Instruction No. 7 was given on the court's own motion and is the formal instruction which contains the form of verdict. The first form given advises the jury that if all their number agree upon the verdict, it should be in the following form:

“We the jury find the issues for the plaintiffs and do assess their damages at_dollars.”

The other form was similar except it provided for a verdict by less than twelve jurors. No other form of verdict was supplied to the jury.

The parties had agreed that plaintiffs were entitled, under any circumstance, to a verdict for $865.00 for attorney fees and expenses incurred in defending the Redman suit. Instruction No. 2 so informed the jury. Thus, in any event, the jury would return a verdict for the plaintiffs in some amount. They had a choice of either the agreed $865.00, or a verdict for this amount plus the $7,500.00 excess of the Redman judgment over the policy limit.

Such a form as is contended for by the defendant would constitute an itemization of the judgment, and would be undesirable and of doubtful propriety. In any event, the instruction as given could only militate against the defendant company if it were confusing to the jury, and when it is remembered that Instruction No. 2 explained to the jury that they were to give judgment for the plaintiffs in the amount of $865.00, regardless of what they decided as to the $7,500.00 mentioned in other instructions, and when it is also considered that plaintiffs’ verdict directing Instruction No. 3 concerning the $7,500.00 claim, advised the jury that if they found for the plaintiffs on this matter they should return a verdict for such amount of $7,500.00 “in addition to the amount mentioned in Instruction No. 2”, it appears that no reasonable jury should be confused. We also take note of the fact that Instructions No. 5 and 6, given at the request of defendant, clearly indicate that they apply only to the issue involving the $7,500.00 excess judgment over the policy limits.

Under these circumstances we are not convinced that the defendant was prejudiced by Instruction No. 7 and conclude that this is not a case wherein this court should exercise its discretion under Rule 79.04.

The judgment below is accordingly affirmed.

All concur.