author: BISSETT, Justice.

text:
    BROWNSVILLE FABRICS, INC., et al., Appellants, v. GULF INSURANCE COMPANY et al., Appellees.
    No. 1120.
    Court of Civil Appeals of Texas, Corpus Christi.
    March 31, 1977.
    Rehearing Denied May 12, 1977.

      Richard B. Stone, Stone, Berryman & Giles, Corpus Christi, for appellants.
    Paul M. Green, San Antonio, Adams, Graham, Lewis, Jenkins, Jones & Graham, McAllen, for appellees.
   OPINION

BISSETT, Justice.

The insureds in this case, under a “Scheduled Property Floater Policy”, seek to recover losses which resulted from a fire that damaged the stock of merchandise in one of their stores and caused a business shutdown. The plaintiffs are Brownsville Fabrics, Inc. and McAllen Fabrics, Inc. The defendants are Gulf Insurance Company and William F. Havey, Stuart S. Jennings, Leroy James Nash, and Al P. Havey, individually, and doing business as Pan American Insurance Agencies. In addition to suing the insurer, Gulf Insurance Company, for the damages caused by the fire which they contend was due them under the policy, plaintiffs also sued the other named defendants for damages because of negligence in failing to provide them with the type of coverage which would have fully protected them from all damages to their stock of merchandise.

Trial was to the court, sitting without a jury. Judgment was rendered that plaintiffs take nothing against Gulf Insurance Company for any damage sustained to their stock of merchandise; that they take nothing against any of the defendants in their action for negligence; and that they recover from Gulf Insurance Company the sum of $78,000.00 for “business shutdown” under the policy, which recovery, however, was subject to a credit of $66,000.00 that had been paid by the insurer to plaintiffs prior to the date judgment was signed. Plaintiffs have appealed the judgment in its entirety.

Appellants, Brownsville Fabrics, Inc. and McAllen Fabrics, Inc., will be called “plaintiffs”; appellee, Gulf Insurance Company, will be designated as “Gulf”; and appellees, William F. Havey, Stuart S. Jennings, Leroy James Nash and Al P. Havey, d/b/a Pan American Insurance Agencies, will be referred to as “Agents”.

IN GENERAL

Plaintiffs were retailers and wholesalers of fabrics in the lower Rio Grande Valley. At all times pertinent to this appeal, they operated a store in Brownsville and a warehouse in McAllen. Agents, on or about December’ 12,1969, solicited plaintiffs’ business insurance. Plaintiffs then requested that Agents provide $400,000.00 coverage for the Brownsville store and $200,000.00 in like coverage for the McAllen warehouse. Because no one company would underwrite the complete coverage requested by plaintiffs and because cheaper fire and extended coverage insurance could be obtained by segregating those risks and placing them with companies authorized to deviate rates by the State Board of Insurance, Agents obtained four policies for plaintiffs. They consisted of three policies for fire and extended coverage which were written by insurance companies who are not parties to this suit, each of which provided a policy for one-third of the desired amount of fire and extended coverage; in addition, Gulf issued to plaintiffs a policy entitled “Scheduled Property Floater Policy”, No. SP 4 70 46 91, which insured plaintiffs from December 12, 1969 until December 12, 1972. Attached thereto and forming a part thereof was a writing, which was denominated “Merchants Property Policy”. Among other provisions, liability was limited to $400,000.00 for loss at the Brownsville store, and $200,-000.00 for loss at the McAllen warehouse. It further provided for loss because of “business shutdown” at either of the locations at the rate of $6,000.00 per week, not to exceed 26 weeks.

There was also attached to Gulf’s policy, No. SP 4 70 46 91, an endorsement styled “OTHER OR SPECIFIC INSURANCE ENDORSEMENT (EXISTING)”.

All of the policies were written on a reporting form basis with respect to plaintiffs’ stock on hand. The three fire and extended coverage policies were on a monthly reporting basis. Gulf’s policy provided for quarterly reporting.

On or about January 12, 1970, the fire and extended coverage for the Brownsville store was reduced from $400,000.00 to $125,-000.00; the coverage on the McAllen warehouse was reduced from $200,000.00 to $60,-000.00, and coverage in the amount of $90,-000.00 was added because of the acquisition of a new store in McAllen. Three new policies covering fire and extended coverage in the reduced amounts for the Brownsville store, the McAllen warehouse, and the additional amount for the new store in McAllen, were issued by the same three companies who had previously issued fire and extended coverage policies for $400,-000.00 coverage on or about December 12, 1969.

Gulf, pursuant to Agents’ request, then executed and delivered a writing to plaintiff, which was also denominated “Merchants Property Policy”. It was dated January 12, 1970 and limited liability on the Brownsville store to $125,000.00, limited liability on the McAllen warehouse to $60,-000.00, and further provided for coverage on the new store in McAllen in the amount not to exceed $90,000.00. The “writing” constituted a rider to the original policy No. SP 4 70 46 91. Its only effect was to reduce the limits of liability on the Brownsville store and on the McAllen warehouse from $400,000.00 and $200,000.00 to $125,000.00 and $60,000.00, respectively, and to add coverage for the new McAllen store in an amount limited to $90,000.00.

On March 15, 1971, a fire occurred at the Brownsville store, which caused considerable damage to plaintiffs’ stock of merchandise (stock) and to the building which housed the store. The building was repaired. Plaintiffs reopened the store for business on September 10, 1971.

Plaintiffs demanded that Gulf pay them $104,000.00 as damages for loss of stock, and $156,000.00 because of “business shutdown”. The demand was refused. Suit was then filed.

The last report by plaintiffs on the Brownsville store prior to the fire was made on November 30, 1970, when they reported $75,000.00 worth of stock on hand. In the loss adjustments between plaintiffs and the three companies who issued the fire and extended coverage policies, plaintiffs, in their proofs of loss, claimed $25,000.00 due under each policy; they were paid $25,-000.00 by each company for a total of $75,-000.00. Plaintiffs also received a net of $32,192.18 at a salvage sale for the damaged stock. Gulf, prior to judgment, paid plaintiffs (pursuant to an agreement between them) the sum of $66,000.00 as damages for “business shutdown”.

STOCK COVERAGE POINTS OF ERROR

The trial court found: Gulfs policy was designed to provide coverage in the full amount desired at each location for all risks and hazards other than those included within the three fire and extended coverage policies; plaintiffs did not, at any time, “object to the means employed to provide the desired coverage nor to any of the provisions, terms and conditions of the policies”; no premium was charged by Gulf to plaintiffs for fire loss coverage to plaintiffs’ stock; a short time after delivery of the policies, plaintiffs advised Agents that they desired to reduce the coverage on the Brownsville store from $400,000.00 to $125,-000.00, and on the McAllen store from $200,000.00 to $60,000.00, and to add coverage of $90,000.00 on a new store at McAl-len.

The trial court concluded: Gulf’s policy did not provide coverage on the loss by fire to stock, as claimed by plaintiffs; there is no evidence of any agreement between plaintiffs and either Gulf or Agents for stock coverage in excess of $125,000.00 on the Brownsville store as of the date of the loss; there was no consideration paid to Gulf by plaintiffs for coverage of the stock loss due to fire under the policy in question; and, there is no evidence that any representation was made to plaintiffs by either Gulf or Agents that excess stock coverage would be provided for the Brownsville store.

The above findings of fact and conclusions of law are attacked by plaintiffs on points 1, 2, 3, 4, 5, 6A, 6B, 7, 9A, 9B, 10 and 13. They argue, in substance, that under the evidence, as a matter of law, Gulf’s policy at the time of the fire on March 15, 1971 was a valid “all risk” policy, which, by its express terms provided insurance coverage for the fire damage and loss to the stock; that the undisputed evidence shows that Agents proposed to plaintiffs that they take out Gulf’s policy in addition to the $125,000 underlying fire coverage, and Agents did, in fact, request the policy from Gulf, and Gulf did, in fact, issue and plaintiffs did, in fact, accept such written agreement, “dated January 12, 1970, to provide excess all risk stock coverage of $125,000.00 for loss at the Brownsville location above the underlying insurance coverage of $125,-000.00 which existed at that time”; that under the undisputed evidence, an agreement was made between plaintiffs and Agents for stock coverage in excess of $125,000.00 on the Brownsville store; that they paid premiums for the coverage which they say covered the stock loss; and that consideration was paid to Gulf for the issuance of a policy that did insure them against loss to their stock by fire.

In addition to the foregoing findings of fact, about which plaintiffs complain in this appeal, the trial court found (Findings 13-15) that all policies were revised in accordance with plaintiffs’ desires and requirements which reduced the coverage as requested by plaintiffs, and that such policies, as revised, were delivered to and accepted by plaintiffs. The trial court further found in finding 17:

“17. The means initially employed by Gulf to exclude fire and extended coverage from the ambit of the insurance protection provided by the policy in question was the attachment of an endorsement styled “Other or Specific Insurance Endorsement (Existing)”. The policy, as initially delivered to Plaintiffs and accepted by them, required the maintenance of specific fire and extended coverage insurance in the amounts of $400,000.00 on the Elizabeth Street location in Brownsville and $200,000.00 on the Beaumont Avenue location in McAllen. This endorsement was attached to Plaintiffs’ policy at the time of the fire loss which is the basis of this suit.”

Findings 13-15 and 17 are not attacked in this appeal.

In a typical “all risk” policy, the insurer undertakes the risk for all losses of a fortuitous nature, which, in the absence of fraud or other intentional misconduct of the insured, is not expressly excluded in the agreement. See Fidelity Southern Fire Insurance Company v. Crow, 390 S.W.2d 788, 792 (Tex.Civ.App.—Waco 1965, writ ref’d n. r. e.); 44 Am.Jur.2d Insurance § 1433 p. 297-8 (1969); 88 A.L.R.2d 1122,1225 (1963). An “excess” policy is one that provides that the insurer is liable only for the excess above and beyond that which may be collected on other insurance. 32 Tex.Jur.2d § 420 (1962).

Gulf’s policy became effective on December 12, 1969. When Gulf issued the rider on January 12, 1970, which reduced the limits of coverage on the locations existing at the time the policy was issued and added the new location in McAllen, it did not issue a new or revised specific insurance endorsement. Consequently, the endorsement which was attached to the original policy was in force at the time of the fire loss. The January 12, 1970 rider did not, change or reduce the required amount of specific insurance from $400,000.00 to $125,-000.00 on the Brownsville store. At the time of the loss, the limit of Gulf’s policy on the Brownsville store, pursuant to the terms of the January 12, 1970 rider, was only $125,000.00, and not $400,000.00 as originally provided.

There is evidence that Agents devised a means of initially providing $400,000.00 coverage for the stock for the Brownsville store and $200,000.00 coverage for the McAllen warehouse at a premium saving to plaintiffs. Since certain fire and extended coverage insurers were permitted to deviate their rates downward by the State Board of Insurance, the fire and extended coverage risks could be segregated and written by one or more companies, depending on the total amount of exposure. The balance of the exposure could be covered in a scheduled personal property floater policy, where the rates could not be deviated, which would also provide for losses due to business shutdown. The latter type policy was the policy which was issued by Gulf. To prevent exposure on this policy under the premiums charged for fire and extended coverage hazards which otherwise would have been covered, the specific insurance endorsement, which has been set out in full in a footnote to this opinion, was attached to and made a part of Gulf’s policy. That endorsement, along with the “merchants property policy”, formed integral parts of the “floater policy”, and must be considered together. The limits of liability to personal property (stock) at each location are set out in the merchants property policy portion of the floater policy. The amount of specific insurance which is required to be maintained at each location is prescribed in the “specific insurance endorsement”. The endorsement particularly provides that the insured cannot recover more than the difference between the limit of liability and the amount of specific insurance required by the endorsement.

The specific insurance endorsement, which required plaintiffs to maintain $400,-000.00 fire and extended coverage on the stock in the Brownsville store was never changed, altered or revised. It was in full force and effect on the date of the fire. It is conclusively shown by the evidence that plaintiffs did not maintain the required $400,000.00 fire and extended coverage. It is further conclusively shown by the evidence that Gulf did not consent in writing to a reduction in the amount of specific insurance that was required to be kept in force on the stock in the Brownsville store. Those undisputed facts, of themselves, are sufficient to sustain the conclusion by the trial court that “the policy in question did not provide coverage of personal property (stock) loss due to fire”. Moreover, since the limit of liability with respect to the stock in the Brownsville store at the time of the loss was $125,000.00 and the amount of fire and extended coverage required was $400,000.00, there could not have been any liability imposed on Gulf since the required amount of specific insurance under the endorsement exceeded the limits of coverage under the merchants property policy.

Even if Gulf had issued a revised “specific insurance endorsement” at the same time it issued the revised merchants property policy (the January 12,1970 rider), and had provided for the maintenance of $125,000.00 fire and extended coverage on the stock in the Brownsville store, there would have been no recovery under the policy. The limit of Gulf’s liability for loss to the stock in the Brownsville store on the date of the fire was in equal amount with the three fire and extended coverage policies on the contents of the store. The limit of liability was $125,000.00 and the amount of required fire and extended coverage would have been $125,000.00. Therefore, there was no difference between the limit of liability and the amount of required specific insurance. Where the “specific insurance endorsement”, the “merchants property policy”, and the other provisions contained in the “floater policy”, all of which constitute the policy which was issued to plaintiffs by Gulf, are considered, it is clear that there can be no recovery for personal property (stock) loss unless the limit of liability exceeds the amount of required specific insurance. That is not the case here.

There is no evidence that Agents made any reference to “excess” insurance when they contacted plaintiffs concerning their business insurance. There is no evidence that plaintiffs requested that either Gulf or Agents provide plaintiffs with “excess” coverage.

Under the record here presented, Gulf’s policy, as amended by the January 12, 1970 rider, considering the force and effect of the initial specific insurance endorsement, which was never amended or revised, did not provide insurance to plaintiffs for loss to their stock at the Brownsville store, which they sustained as a result of the fire. Points 1, 3, 4, 6A, 6B and 13 are overruled.

A premium is the consideration paid by a person for insurance protection or coverage. Rosenstock v. Wheeler, 310 S.W.2d 350 (Tex.Civ.App. — Houston 1958, writ ref’d). Here, the premiums charged by Gulf and paid by plaintiffs were not paid under a policy that provided stock coverage in excess of $125,000.00 on the Brownsville store. Points 9A, 9B and 10 are overruled.

There is no evidence that there was any direct communication between plaintiffs and Gulf until after the fire occurred. There is no evidence that Gulf, at any time pertinent to this appeal, knew that plaintiffs had requested or obtained a reduction in the amount of specific insurance on either the Brownsville store or the McAllen warehouse. There is no proof that Agents had any authority to bind Gulf by any agreement which they may have made with plaintiffs. The evidence conclusively shows that Agents were “soliciting agents” of Gulf and nothing more, and that they solicited insurance in the Rio Grande Valley Area for Gulf and other insurance companies. It is also established by the evidence that Agents did not have the authority to issue Gulf’s policy or to amend or modify any rider or endorsement attached thereto.

There is no testimony from anyone that will support plaintiffs’ contention that they had an agreement with either Gulf or Agents for “excess” coverage on the stock in the Brownsville store over $125,000.00. The personal contacts were between Agents and Mr. Angel Archeola, plaintiffs’ manager of the Brownsville store. Mr. Archeola did not testify. Apparently, from the references to the statement of facts made by plaintiffs in their brief, their claim that such an agreement was made is based solely on three letters that were written by the Agents.

One of the letters was in the nature of a proposal which Agents submitted to plaintiffs. It was suggested:

“We propose two policies to cover Brownsville Fabrics, Inc., and McAllen Fabrics, Inc.
The first policy is a Fire and Extended Coverage Policy which will give protection against Fire. .
The second policy will be a Merchants Property Policy which 'gives all risk coverage. . . . ”

Mr. Archeola then requested that Agents obtain $400,000.00 insurance on the Brownsville store. That information was relayed to Gulf by means of a letter from Agents. They requested:

“Please issue a merchants property policy as per your quotation of $400,000 limit at 720 E. Elizabeth, Brownsville, Texas, file # 3204 and $200,000 at 1721 Beaumont Ave., McAllen, file # 765 .
******
The MPP is to be excessed over stock fire and extended coverage which will be written on a stock reporting policy with Select Insurance Company having 25% of the line .
******
Please make these coverages effective December 12, 1969.”

Gulf promptly issued a policy, which was delivered to plaintiffs on or about December 22, 1969. A few days later, plaintiffs told Agents that they wanted to reduce the insurance coverage on the Brownsville store in the amounts already noted. Following such notification, Agents wrote Gulf another letter and requested that Policy No. SP 4 70 46 91 be revised as follows:

“Brownsville Fabrics, Inc., at 720 East Elizabeth, change the amount of insurance to $125,000.
McAllen Warehouse at 1721 Beaumont Avenue, change the amount of insurance to $60,000.
And we want to add $90,000 on the McAl-len Store at 104 South 16th Street.”

On January 4, 1971, John Latham from the Corpus Christi Office of Gulf wrote Agent A1 Havey requesting delinquent monthly reports for the months of September, October, November and December for the year 1970. He stated that the policy contained “. . . a number of errors resulting in much confusion . . . ” but that he was hesitant to rewrite the policy if there would be “continued delinquency in filing monthly reports. . . ” Agent A1 Havey sent the reports to Latham on January 6, 1971 with an accompanying letter inquiring as to the basis for rewriting the policy. On January 13, 1971, Latham replied that the policy must be rewritten to eliminate confusion over their limits of insurance; that the rates were “grossly inadequate”; and adjustment most likely would be necessary; and, they needed to update their information regarding the specific fire and extended coverage policies. Nothing was done along the lines suggested by La-tham.

It is not shown by the record that Gulf or Agents made any representations to plaintiffs that the Gulf policy provided excess coverage for loss of or damage to stock because of fire. There is no evidence of any confusion between plaintiffs and anyone with reference to the extent of coverage afforded by Gulf’s policy, the conditions therein contained, any endorsement attached thereto, or the rate of premiums charged. Any confusion which may have existed was solely in Gulf’s office. That confusion is understandable. The original policy covered two locations and the specific insurance endorsement and the “merchants property rider”, as originally written covered only those two locations. The execution and delivery of the January 12, 1970 rider superseded the previous rider and not only reduced the limits of liability for the two original locations but added liability for a third location, all without changing anything in the specific insurance endorsement. Under those facts, it was reasonable to assume that perhaps the premiums which were being charged were inadequate.

There is no evidence that Agents made any representation, written or oral, to plaintiffs that “stock coverage in excess of $125,000.00 would be provided”. The fact that Agents used the words “The M P P is to be excessed . .’’in their letter to Gulf is not evidence that they made the asserted representation to plaintiffs. There is no support in the evidence for plaintiffs’ claim that an agreement was made between them “and either Agents or Gulf for personal property (stock) coverage in excess of $125,000.00”. Points 2, 5 and 7 are overruled.

Plaintiffs assert in points 11 and 12 that the undisputed evidence conclusively shows that Gulf and Agents waived any ground of defense which they may have had to the action brought by plaintiffs, and that they are estopped to assert any defense thereto. They base their assertions on the grounds that Gulf and Agents had knowledge of so-called discrepancies, mistakes, confusion, errors and inadequacy of premium charges, and concealed such facts from plaintiffs.

Waiver is generally defined as the intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right. Massachusetts Bonding & Insurance Co. v. Orkin Exterminating Company, 416 S.W.2d 396 (Tex.Sup.1967). Estoppel to assert a right can only exist where the person who is sought to be es-topped has a valid right. See Bailey v. Sovereign Camp, W.O.W., 116 Tex. 160, 286 S.W. 456 (1925). For the elements required in order for an equitable estoppel to exist, see Gulbenkian v. Penn, 151 Tex. 412, 252 S.W.2d 929 (1952). “In order for an estop-pel to exist, it devolves upon the party seeking the advantage thereof to establish that he has been misled to his injury.” Concord Oil Co. v. Aleo Oil & Gas Corp., 387 S.W .2d 635, 639 (Tex.Sup.1965).

The doctrines of waiver or estoppel cannot enlarge or extend coverage as defined in an insurance contract; such an application exceeds the function of those doctrines. Minnesota Mutual Life Insurance Company v. Morse, 487 S.W.2d 317, 320 (Tex.Sup.1972); Massachusetts Bonding & Insurance Co. v. Dallas Steam Laundry & Dye Works, 85 S.W.2d 937, 939-42 (Tex.Civ.App.—Eastland 1935, writ ref’d); 1 ALR3d 1139, 1147 (1965); 45 C.J.S. Insurance §§ 616-17 (1946).

There is no evidence that Gulf had any notice or knowledge, actual or constructive, of any representations or agreements, if any, between Agents and plaintiffs. There is no evidence that Gulf had notice of or consented to the reduction of the amounts of fire and extended coverage insurance with the other companies at ahy time that could possibly amount to a waiver of the defenses urged by them or to an estoppel to plead and assert those defenses. The fact that Agents had knowledge that three fire and extended coverages were reduced from $400,000.00 to $125,000.00 on the stock in the Brownsville store will not support plaintiffs’ claims of waiver-and es-toppel against Gulf. It is settled law that a soliciting agent’s knowledge of the reduction of coverage, without more, cannot be made the basis of either waiver or estoppel against an insurer where the insurer did not have knowledge of such reduction and where the agent had neither actual nor apparent authority to issue the policy or provide coverage. Home Ins. Co. of New York v. Lake Dallas Gin Co., 127 Tex. 479, 93 S.W.2d 388 (1936, opinion adopted).

Neither Gulf nor the Agents made any actionable misrepresentations to plaintiffs as to the nature and extent of their fire insurance coverage at any of their business locations, nor did they conceal any material fact from plaintiffs pertaining to such coverage, nor did they fail to disclose any material facts to plaintiffs with respect thereto. Plaintiffs’ claim of waiver and estoppel against Gulf cannot be sustained. Points 11 and 12 are overruled.

NEGLIGENCE POINTS OF ERROR

Defendants also contend that they were entitled to a recovery against Gulf on the ground that it was “guilty of acts and omissions constituting negligence” which “was the proximate cause of Plaintiffs’ stock loss damages due to the fire”, because:

“. . . the undisputed evidence shows that Gulf knowingly ‘hid behind the log’ on certain so-called erros (sic), mistakes, omissions and inadequate premium charges pertaining to the policy in question and concealed such facts if they existed from Plaintiffs until after the fire loss at which time Gulf asserted prior to this suit and as defenses in this suit such errors, mistakes, confusion, omissions and inadequate fire premium charges to re- ' strict and' earve oüt- itóTire lóss liability to Plaintiffs for Plaintiffs’ stock loss, all to the damage of Plaintiffs in the amount of $109,000.00.”

A detailed summary of the evidence under the points on negligence would amount to a repetition of what has already been said. Further discussion is not necessary. The trial court found that the Agents were not negligent in their dealings with plaintiffs, that Gulf was negligent in failing to issue a revised specific insurance endorsement when it revised the coverage rider on January 12, 1970, but that such negligence was not a proximate cause of any of the damages suffered by plaintiffs. After reviewing the record in its entirety, we find no evidence of any negligence on the part of Gulf which proximately caused any of the damages sustained by plaintiffs. Points 14, 15, 16, 17, 18 and 19 are overruled.

BUSINESS SHUTDOWN POINTS OF ERROR

Gulf, prior to trial and in accordance with an agreement between it and plaintiffs, paid plaintiffs $66,000.00 for business shutdown. The trial court found that plaintiffs were entitled to compensation for 13 weeks’ shutdown; consequently the previous tender by Gulf was credited in the judgment, and plaintiffs were awarded an additional $12,000.00 by the judgment itself.

The trial court, in explanation of the 13 weeks’ shutdown award,, found: 1) the building which housed plaintiffs’ Brownsville store could have been cleared of the stock and debris and repairs commenced within 4 weeks from the date of loss; 2) the repairs to the building could have been completed within 7 weeks after they were begun; and 3) plaintiffs could have restocked the store and resumed business at the Brownsville location within 2 weeks after the repairs to the building were finished. Plaintiffs attack the findings by “no evidence” (20) and “against the great weight and preponderance of the evidence” (21) points of error. In point 23, they contend that the trial court erred in concluding that plaintiffs are entitled to recover for only 13 weeks of business shutdown because there are no proper findings of fact which support such a conclusion of law.

Plaintiffs ceased business operations at their Brownsville location on March 15, 1971 (the date of the fire). They resumed business operations at that location on September 10, 1971. Those facts are undisputed.

Following the fire, discussions between the parties commenced immediately. Plaintiffs were represented by Mr. Wilbur Step-ner, their adjuster, and Gulf was represented by Mr. Don Lassiter, its adjuster. The parties agreed to take a joint inventory which was to be valued on the date of the loss by a firm in New York, where the permanent records of the stock which had been sold to plaintiffs were kept. It is undisputed that a period of 4 weeks was required to take the physical inventory and send it to New York to be valued. Apparently, there was a delay in obtaining the values from New York. Stepner testified that some of the delay was caused by the cancellation of appointments in New York by persons who were representing Gulf in the matter. The exact delay, if any, in terms of days or weeks by acts on the part of Gulf’s representatives was not established.

After the inventory had been valued in accordance with the agreement, the damaged stock was sold at a salvage sale, which was conducted at the site of the Brownsville store. The sale was held on April 20, 1971. Mr. Frank Joyce, a representative of a salvage company, testified that it would not have been reasonable to have removed the damaged stock to a different location pending the salvage sale. It took the buyer approximately one week to get the stock out of the premises following the sale. There is testimony from others that the salvage sale could have been held by March 27,1971, that the damaged stock could have been moved out of the building by April 3, 1971, and that repair work could have been started at any time after April 3, 1971.

Mr. Anthony Carnesi, the owner of the building where the Brownsville store was located and plaintiffs’ lessor, commenced studying the necessary repairs to the building immediately after the fire. He testified, in substance, that he did everything prudently possible to complete the repairs to the building without delay. He stated that he needed time to adjust his own loss with his own insurance company, which was represented by Lassiter (who also represented Gulf in the claims which were made by plaintiffs). He needed (and used) Mr. Robert Velten, an architect. He suggested to Donald B. Ferguson, Inc. (Ferguson) that it prepare a proposal concerning the necessary repairs. This was done promptly and a written proposal was submitted to him on March 26, 1971. It was then reviewed by Velten, and the proposal, with very few changes, was accepted by Carnesi on May 4, 1971. Work commenced immediately. Car-nesi further testified that plaintiffs did nothing to delay the repair work.

The repairs, as approved on May 4, 1971, included replacement of half of the floor tile. Work was supervised by Mr. George Villarreal, Ferguson’s representative. Several days were required to clear the store of debris left from the salvage sale before actual work could be started. The contractor worked continuously on the repairs until June 3, 1971, when he was informed by Velten and Carnesi to temporarily stop the repair because additional changes would be made. Repair operations were suspended. Work was resumed on June 28, 1971. Villarreal stated that the repairs as initially contemplated by the contract could have been completed within two to four weeks from the day work was halted. Instead, the changes in the repair work delayed turning over the keys of the building to plaintiffs until August 6, 1971.

The changes which were made following the cessation of repair work on June 3,1971 were substantial. In the main, the additional repairs required further repairs to the roof of the building, the resetting of a window, and the replacing of the entire floor instead of only half of it as was originally contemplated. While plaintiffs requested some changes after the repairs were under way, it is conclusively established that those changes caused very little delay, if any, in completing the work.

Presumably, the changes which were made were necessary for the structural soundness, safety, and practical utility of the building. The exact reason for the changes was not established; however, Car-nesi in response to questions asked him testified:

“Q Now, after the construction commenced, were there any additions or changes made in regard to the work that Ferguson Construction Company was to do on the building?
A Yes. We entered into some additional agreements whereby the contractor would do additional work.
Q Who had requested these changes, do you recall, or additions?
A Well, there are two factors involved: One, in the repair of a building that has been in a fire, sometimes you do not know what all the damage is or what the best means of repairs is Until you actually get into the construction of it.
So as an example, with regard to the roof, the initial proposal is made by the contractor. We were not sure just what direction to take at that point, but as time went on, why, we decided the whole roof needed to be changed in view of the possible danger of the weakening that would have resulted as a result of the high heat that occurred to the building during the fire.”

Carnesi’s testimony was not disputed. It supports a reasonable inference that the need for additional repairs, which dictated a change in the repairs originally agreed upon, was not discovered until after work had commenced pursuant to the initial proposal and agreement. There is no evidence that the additional repair work was not made necessary by the fire. There is nothing to indicate that Carnesi, Velten, plaintiffs, or the contractor did anything to delay the completion of the repairs. The record shows that the contractor completed the work with dispatch and in a workmanlike manner. >.-

Mr. Abraham Baum, an executive of plaintiff corporation, testified that as a general rule it takes from three to four weeks to restock a store similar to the Brownsville store and to get it ready for retail sales after the building is finished. That testimony was not contradicted. It is conclusively established that the store in question was restocked after August 6,1971 and reopened for business on September 10, 1971.

A salvage sale by March 27, 1971, in the light of the undisputed evidence that 4 weeks were required to value and price out the contents of the Brownsville store following the fire, would not have been feasible. The actual sale was held some 5 weeks after the fire. That was not an unreasonable delay. About 1 week was required to clear the premises following the salvage sale. The overwhelming preponderance of the evidence is that actual repairs to the building where the store was situated could not have been commenced until after the expiration of at least 6 weeks from March 15, 1971. The actual repairs, including the 3 weeks during which they were suspended, required approximately 13 weeks to complete. The store was actually restocked in about 5 weeks from the date that the keys to the building were delivered to plaintiffs and in about 4 weeks from the date that the repairs were completely finished.

There is some evidence to support the trial court’s findings. Point 20 is overruled.

However, when all of the evidence is considered and weighed, together with all inferences that can reasonably be drawn therefrom, both in support of and contrary to the findings of fact which have been challenged, we are of the opinion and so hold that the findings that the building could have been cleared and repairs commenced within 4 weeks from the date of the fire, that the repairs could have been completed within 7 weeks after they were commenced, and that the store could have been restocked and retail sales operations resumed therein within 2 weeks after the completion of the repairs to the building, are so against the great weight and preponderance of the evidence as to be manifestly wrong and unjust. Points 21 and 23 are sustained.

We have carefully considered all of plaintiffs’ remaining points of error. They are overruled.

DISPOSITION OF THE APPEAL

Those portions of the judgment which decreed: 1) that plaintiffs take nothing against Gulf in their action to recover “for loss of stock by fire” under Gulf’s policy, and 2) that plaintiffs take nothing against Gulf and the Agents “on the claim predicated upon negligence” are affirmed. That portion of the judgment which awarded plaintiffs a recovery against Gulf for a period of 13 weeks “business shutdown” for $78,000.00, which was credited with $66,-000.00, resulting in a net recovery to plaintiffs of $12,000.00, is reversed and the cause with respect to plaintiffs’ action for a recovery under the “business shutdown” provision of Gulf’s policy is remanded to the trial court for a new trial. The action for a recovery for “business shutdown” is severed from the other actions brought by plaintiffs. Costs of this appeal are taxed 50% to plaintiffs and 50% to Gulf.

The judgment of the trial court is AFFIRMED IN PART and REVERSED AND REMANDED IN PART.

      . It is agreed by the Insured, based upon a premium credit considered, that the amount(s) of specific insurance specified at the location(s) indicated below will be kept in force until the expiration of such insurance as noted herein unless otherwise agreed to in writing by the Company. If the Insured fails to comply with this requirement, this Company shall not be liable for that part of any loss which would have been recoverable or due thereunder had such specific insurance been in force, whether valid or not, or collectible or not. With respect to any specific insurance, this policy shall be considered as excess Insurance and shall not apply or contribute to the payment of any loss until the amount due from all such specific insurance whether collectible or not shall have been exhausted. However, this Company’s liability shall not exceed the difference between the limit of liability under this policy at any specified location and the amount of specific insurance at such specified location for loss or damage arising out of the perils insured against by such specific insurance.
      Location Perils
      720 E. Elizabeth Fire and Extended
      Brownsville, Texas Coverages &
      1721 Beaumont Ave. Vandalism and
      McAllen, Texas Malicious Mischief
      Amount of Expiration ■Specific Insurance Date
      400,000. 12/12/72
      200,000. 12/12/72
      All Other Terms and Conditions Remain Unchanged


source: Caselaw Access Project

author: AKIN, Justice.

license: Public Domain

text:
    Glen LLOYD and KDFW-TV, Inc., Appellants, v. ALASKA WORLDWIDE, INC., d/b/a Wilson International, Appellee.
    No. 19261.
    Court of Civil Appeals of Texas, Dallas.
    March 31, 1977.

      Donald L. Case, J. Kyle Du Valí, T. Michael Wilson, Jackson, Walker, Winstead, Cantwell & Miller, Dallas, for appellants.
    David Westfall, Bailey, Williams, West-fall, Lee & Fowler, Dallas, for appellee.
   AKIN, Justice.

This is an appeal from a temporary injunction granted appellee-plaintiff, Alaska Worldwide, Inc., doing business as Wilson International, enjoining appellants, Glen Lloyd and his employer, KDFW-TV, Inc., the owner of a television station, from broadcasting stories which interfere with plaintiff’s business, from communicating with plaintiff’s employees, from going about plaintiff’s place of business, from doing any acts calculated to harass or injure plaintiff’s business, and from harming or destroying any materials in defendants’ possession. Because we hold that the injunction violates the Texas and United States Constitutions and that it is unsupported by the evidence, we dissolve the injunction.

As part of KDFW’s news broadcasts, Lloyd presents “Action Four," a program designed to assist consumers with complaints and questions, both of which the program solicits. After receiving complaints about Wilson International, a “job-search” firm engaged in the business of preparing resumes and providing names of prospective employers for persons interested in overseas employment, Lloyd produced two segments of “Action Four,” each lasting two minutes, which were broadcast on February 1 and 2,1977. In these programs, Lloyd stated that two Wilson International clients claimed that a Wilson International employee made misrepresentations to them. Essentially, these clients asserted that the employee of Wilson International guaranteed that Wilson International would locate for them highly paid positions with substantial fringe benefits in Arab countries. Instead, a written contract between the client and Wilson International provided that the client would be responsible for contacting prospective employers. Each client only received mailing lists of prospective employers and copies of resumes. Some of these prospective employers were no longer in business. The evidence indicates that it was rare, if ever, that Wilson International clients secured jobs as attractive as promised. For these services, clients paid up to $450 upon signing the contract. Lloyd also stated on television that Wilson International had refunded one client’s money voluntarily and that it had refunded the other client’s money after “Action Four” became involved. At one point, Lloyd referred to one of these people as Raving been “ripped-off.” Another segment of the telecast also included a quote from Joe Wilson, president of Wilson International, that he appreciated having the complaints called to his attention “because we want to run a good business, and we want to treat people fairly.” After these broadcasts, Lloyd received additional complaints concerning Wilson International which he forwarded to Wilson at Wilson’s request.

Wilson International’s attorney, in oral argument, conceded, and the record reflects, that there was no evidence that Lloyd made any false statements in the broadcasts. However, he contends that the injunction was proper because of Lloyd’s motive in broadcasting the story, which ap-pellee characterized as malicious and as a deliberate attempt to harm the business as indicated by Lloyd’s use of the term “ripped-off.” We cannot agree that freedom of speech and freedom of the press are limited to those with the purest of motives. Section 8 of Article I of the Texas Constitution states:

Every person shall be at liberty to speak, write or publish his opinions on any subject, being responsible for the abuse of that privilege; and no law shall ever be passed curtailing the liberty of speech or of the press. .

The Texas Supreme Court, in Ex parte Tucker, 110 Tex. 335, 220 S.W. 75, 76 (1920), held that this section prohibits a court from limiting what a person may say of another. In so holding, the court stated:

The purpose of this provision is to preserve what we call “liberty of speech” and “the freedom of the press,” and at the same time hold all persons accountable to the law for the misuse of that liberty or freedom. Responsibility for the abuse of the privilege is as fully emphasized by its language as that the privilege itself shall be free from all species of restraint. But the abuse of the privilege, , the provision commands, shall be dealt with in no other way. It is not to be remedied by denial5 of the right to speak, but only by appropriate penalties for what is wrongfully spoken.
It has never been the theory of free institutions that the citizen could say only what courts or legislatures might license him to say, or that his sentiments on any subject or concerning any person should be supervised before he could utter them. Nothing could be more odious, more vio-lative or destructive of freedom, than a system of only licensed speech or licensed printing. .
Let it once be admitted that courts may arrogate the authority of deciding what the individual may say and may not say, what he may write and may not write, and by an injunction writ require him to adapt the expression of his sentiments to only what some judge may deem fitting and proper, and there may be readily brought about the very condition against which the constitutional guaranty was intended as a permanent protection. Liberty of speech will end where such control of it begins.
For these reasons the court held that prior restraint of false and defamatory statements are prohibited under Article I, section 8. We cannot conceive that any less protection should be afforded to statements which, on the record before us, must be regarded as true.. •

The supreme court notes, however, that speech may be restrained in extreme situátions: !

Equity will protect the exercise of natural and contractual rights from interference by attempts at intimidation or coercion. Verbal or written threats may assume that character. When they do, they amount to conduct, or threatened conduct, and for that reason may properly be restrained.

Id. We find here no evidence of the kind of intimidation or coercion that may be subject to restraint. Obviously, any publication of an unflattering nature may “intimidate” or “coerce” an individual to change or rectify the behavior which, is reported if the publication has adverse business or social effects. Such an effect does not, in itself, remove its constitutional protection. “Threat,” in law, means “an expression of an intention to inflict loss or harm on another by illegal means, especially when effecting coercion or duress of the person threatened.” Webster’s New Internat’l Dictionary, p. 2633 (2d ed. unabr. 1941); see McMorries v. Hudson Sales Corp., 233 S.W.2d 938, 940 (Tex.Civ.App.—El Paso 1950, no writ). Wilson International has failed to show that any contemplated acts of Lloyd or KDFW-TV are in any way illegal. The supreme court in Tucker did not intend that any statement which may coerce another should be subjected to injunction. The coercion must be by verbal or written statements that the defendant will perform illegal acts harmful to the plaintiff. We have found no case in which the Texas Supreme Court has approved an injunction on this basis. In light of the broad language of Tucker regarding the liberty' of speech and freedom of the press, we conclude that the exception is to be drawn narrowly and that an injunction .should issue ,only./),n- the most..compelling circumstances. Wilson International’s contention that the broadcasts were malicious and were intended to harm its business obviously does not come within this narrow exception. Indeed, this court, in affirming a denial of a temporary injunction, speaking through Chief Justice Guittard in Dallas Oil and Gas, Inc. v. Mouer, 533 S.W.2d 70, 74 (Tex.Civ.App.—Dallas 1976, no writ), stated:

The petition alleges that plaintiffs have been damaged by false and defamatory statements in the press, but it does not state grounds for a temporary injunction because injunctive relief is not available as a prior restraint of defamatory publications, however false and however damaging. Such a prior restraint would in itself violate the guarantees of freedom of speech and freedom of the press in Texas Constitution, article I, section 8.

Similarly, the injunction violates the First Amendment of the U. S. Constitution, as applied to the states through the Fourteenth Amendment. In Near v. Minnesota, 283 U.S. 697, 713, 51 S.Ct. 625, 630, 75 L.Ed. 1357 (1931), the U. S. Supreme Court condemned a prior restraint of “scandalous and defamatory” publications concerning public officials, which were not attacked as false, as “the essence of censorship.” The fact that the defendant in Near could have availed himself of the defense that “the charges are true and are published with good motives and for justifiable ends” did not overcome the injunction’s constitutional deficiency. In Organization for a Better Austin v. Keefe, 402 U.S. 415, 418-19, 91 S.Ct. 1575, 1578, 29 L.Ed.2d 1 (1971), the Court rejected the idea that coercion alone would take speech out of the First Amendment, saying: “No prior decisions support the claim that the interests of an individual in being free from public criticism of his business practices in pamphlets or leaflets warrants use of the injunctive power of a court.” Thus, consumers have a right to publicize business practices of which they disapprove. Concerned Consumers League v. O’Neill, 371 F.Supp. 644, 648-49 (E.D. Wis.1974); see Stansbury v. Beckstrom, 491 S.W.2d 947, 948 (Tex.Civ.App. — Eastland 1973, no writ). This right, of course, may be exercised by the media in the interest of the public.

The injunction also enjoins defendants from going about Wilson International’s place of business, communicating with its employees and officers, or doing any acts calculated to harass or injure its business. There are situations in which such an injunction would be justified. E. g., Florence v. Florence, 388 S.W.2d 220, 222 (Tex.Civ.App. — Tyler 1965, writ dism’d); Dickson v. Dickson, 516 S.W.2d 28, 30 (Tex.Civ.App. — Austin 1974, no writ). However, before such an injunction is proper, there must be some showing of conduct directed toward the plaintiff from which he is entitled to be free. Here, Lloyd went to Wilson International’s office for the purpose of interviewing an employee and left voluntarily after the interview was denied. He conducted an interview with Joe Wilson, president of Wilson International, and forwarded complaint letters to Wilson International, both at Wilson’s request. He placed a telephone call requesting information concerning Wilson International’s business and the number and disposition of the complaints received. There is evidence that he told a Wilson International employee that he would solicit this information from Wilson International’s clients in a broadcast if it was not supplied. Lloyd also suggested that dissatisfied clients file complaints with various official agencies, which was done. These actions, taken alone or in concert, are not the type of conduct that may be enjoined. Likewise, the record does not show any contemplated conduct by appellants that would be enjoinable. The appellant’s investigation of the story did not produce the adverse effects on Wilson International’s business; instead, it was the information they received and broadcast which produced the adverse effects. As we have held, the injunction on the contents of the broadcasts is void. We also hold that the part of the injunction prohibiting appellants from going about Wilson International’s place of business or contacting officers or employees of Wilson International cannot stand.

The injunction also prevented defendants from harming or destroying any materials in their possession. The record is devoid of any indication that defendants have any intention of harming or destroying any material. Since injunctions are issued only to prevent imminent harm, this part of the injunction was also improper. Luccous v. J. C. Kinley Co., 376 S.W.2d 336, 341 (Tex.1964).

Injunction dissolved.

      . The injunctions which were sustained against attacks based on Art. I, § 8, in Carpenters Local 213 v. Ritter’s Cafe, 149 S.W.2d 694 (Tex.Civ.App.—Galveston 1941, writ ref’d) and Dallas General Drivers v. Wamix, Inc., 156 Tex. 408, 295 S.W.2d 873 (1956) are distinguishable because they were directed at picketing, which is subject to greater restriction than pure speech. American Radio Ass’n v. Mobile Steamship Ass’n, Inc., 419 U.S. 215, 229-30, 95 S.Ct. 409, 42 L.Ed.2d 399 (1974); see Cain, Brogden & Cain, Inc. v. International Brotherhood of Teamsters, Local 47, 155 Tex. 304, 285 S.W.2d 942, 948 (1956).


author: ROBERTSON, Justice.

text:
    SUN OIL COMPANY, Appellant, v. EMPLOYERS CASUALTY COMPANY and Employers National Insurance Company, Appellees.
    No. 19158.
    Court of Civil Appeals of Texas, Dallas.
    March 31, 1977.
    Jack K. Dahlberg, Jr., Law Offices of Guy Allison, Corpus Christi, for appellant.
    Royal H. Brin, Jr., Strasburger & Price, Dallas, for appellees.
   ROBERTSON, Justice.

Sun Oil Company, appellant herein, sued Employers Casualty Company and Employers National Insurance Company, appellees, seeking indemnity for sums expended in settlement of a tort action brought against it for the death of an employee of Charles R. Merrill, d/b/a Merrill Lease Service, an insured of appellees. The insurers moved for summary judgment, contending that no cause of action lay against them until a final judgment had been rendered against their insured. The trial court granted the motion, and Sun Oil appeals. We affirm.

On August 8, 1972, appellant, Sun Oil, and Merrill entered into a written contract whereby Merrill was to perform services on properties owned or leased by appellant. Merrill agreed to indemnify and hold appellant harmless from any liabilities concerning the performance of work under the agreement and purchased insurance from appellees. Subsequently, an employee of Merrill died from injuries received on the job, and his heirs and beneficiaries sued appellant. After entering into a settlement for $607,500 with those heirs and beneficiaries, appellant sued Merrill under the indemnity clause of the contract. That suit is pending in San Patricio County.

Appellant also filed this action directly against the primary and excess liability insurers of Merrill and alleges that it is a third-party beneficiary of the insurance policy issued to Merrill. As such, appellant contends that it has a present cause of action against both Merrill and his insurers for indemnification of the loss sustained by the settlement described above. Alternatively, appellant asserts that even if no present cause of action lies against the insurers, the trial court should have abated the cause instead of rendering judgment. We cannot agree with either of these contentions.

Despite appellant’s assertions, we need not decide the general question of whether it was a third-party beneficiary under the contract. We need only decide whether, as a matter of law, appellant has any enforceable third-party rights at the present time. The right of a third-party beneficiary to enforce a contract is a question of substantive law, Cumis Insurance Society, Inc. v. Republic National Bank, 480 S.W.2d 762, 769 (Tex.Civ.App.—Dallas 1972, writ ref’d R. r. e-.),.and even if the policy were deemed to inure to the benefit of an injured third-party, that would not automatically entitle appellant to enforce its provisions at this time.

Third-party beneficiary status hinges on determining whether the claiming party is a donee beneficiary or a creditor beneficiary. Incidental beneficiaries have no enforceable rights. Republic National Bank v. National Bankers Life Ins. Co., 427 S.W.2d 76 (Tex.Civ.App.—Dallas 1968, writ ref’d n. r. e.); Restatement of Contracts §§ 133, 147 (1932); 4 Corbin, Contracts §§ 774, 779 (1951); 2 Williston, Contracts § 356 (3d ed. 1959). Although the distinctions between these categories are often unclear, it is generally recognized that if performance of a promise would satisfy a duty owed by the promisee to the third party and no intention to make a gift appears, the third party is a creditor beneficiary. Cumis Insurance Society, Inc. v. Republic National Bank, 480 S.W.2d 762, 767 (Tex.Civ.App.—Dallas 1972, writ ref’d n. r. e.); Restatement, supra § 133; Corbin, supra § 787; Williston, supra § 361. In the present case, appellant apparently asserts its status as some form of creditor beneficiary, claiming that the insurers’ performance of their agreement would satisfy the contractual duties of Merrill.

The basic flaw in this argument is that there is no present duty owed to appellant by Merrill. The existence of that duty is being litigated in a separate lawsuit, and until that obligation is established by final judgment, appellant has no standing to sue the insurers as a third-party beneficiary. Great American Ins. Co. v. Murray, 437 S.W.2d 264, 265 (Tex.1969); Seaton v. Pick-ens, 126 Tex. 271, 87 S.W.2d 709, 710 (1935); Moxon v. Ray, 125 Tex. 24, 81 S.W.2d 488, 489 (1935); Morris v. Allstate Ins. Co., 523 S.W.2d 299 (Tex.Civ.App. — Texarkana 1975, no writ). In other words, if appellant has any third-party rights under the policy, its rights arise when Merrill’s liability for indemnity is established. The policy does not impose primary liability on the insurer; rather it provides indemnification against the liability of the insured. Only after this liability is established by a final judgment does the duty arise which binds the insurer to indemnify. Hutcheson v. Estate of Se’Christ, 459 S.W.2d 495 (Tex.Civ.App.— Amarillo 1970, writ ref’d). Therefore, we do not hold that appellant can never recover under the theories advanced here. We merely conclude that, at the present time, no cause of action lies against these insurers. Our judgment is thus not res judicata on any future claims based upon a later adjudication of Merrill’s liability.

There is no indication in the record that appellant urged his alternative theory of abatement in the trial court. A party who seeks abatement because of a pending prior action must seasonably allege and prove the facts authorizing that action. Continental Oil Co. v. P. P. G. Industries, 504 S.W.2d 616 (Tex.Civ.App. —Houston [1st Dist.] 1973, writ ref’d n. r. e.). Since appellant did not preserve this point below, it may not be urged as error here.

Accordingly, the judgment of the trial court is affirmed.


author: OSBORN, Justice. WARD, Justice, PRESLAR, Chief Justice, OSBORN, Justice.

text:
    Tomas B. GALLEGOS, Appellant, v. The MILLERS MUTUAL FIRE INSURANCE COMPANY OF TEXAS, Appellee.
    No. 6553.
    Court of Civil Appeals of Texas, El Paso.
    April 6, 1977.
    Rehearing Denied May 4, 1977.

      Merkin & Gibson, William L. Merkin, Sidney K. Gibson, Stephen A. Hines, El Paso, for appellant.
    Scott, Hulse, Marshall & Feuille, George W. Finger, James T. McNutt, Jr., El Paso, for appellee.
   OPINION

OSBORN, Justice.

This is a workmen’s compensation case in which the trial Court granted the insurance carrier a summary judgment on the grounds that its insurance policy had been cancelled prior to the date of the claimant’s accident. We have concluded that there is a fact issue as to the cancellation of the policy, and the summary judgment is reversed and the case remanded to the trial Court.

The Millers Mutual Fire Insurance Company of Texas, hereinafter called “Millers,” alleged that it had issued its policy of insurance to the employer, Mauro Hernandez, d/b/a Tigua Dependable Plasterers, covering a period from April 10, 1973, to April 10, 1974, but that the policy was cancelled effective December 31,' 1973, at the request of Mr. Hernandez. The accident of Mr. Gallegos, the employee, occurred on January 7,1974. He contends the policy had not been properly cancelled at that time.

The summary judgment proof includes the affidavits of Gus Pineda, the agent who wrote the policy, and Houston Myers, an underwriter with Millers. Mr. Pineda states that Mr. Hernandez called him on the phone advising that he wished to cancel his policy, and the affidavit states that it was cancelled on December 31, 1973, when Mr. Hernandez surrendered the original policy to him. Mr. Pineda also said he sent the policy to Millers on January 2, 1974, with a notice indicating that the cancellation was effective December 31, 1973. Mr. Myers said Millers received the notice on January 4, 1974, and that the Company advised the Industrial Accident Board of such cancellation on January 28, 1974. His affidavit states that the cancellation was effective at the time the policy was surrendered to the agent in El Paso. Paragraph 15 of the terms of the policy provides:

“15. Cancelation This policy may be canceled by the insured by surrender thereof to the company or any of its authorized agents or by mailing to the company written notice stating when thereafter the cancelation shall be effective. * * *”

After the hearing on the motion, but before judgment was entered, Appellant filed an affidavit of Mauro Hernandez and Appellant took his written deposition, which was filed. In the affidavit, he said:

“On approximately December 29, 1973, I went to see Mr. Gus Pineda about the amount of money I owed to Pineda-Rode-haver Insurance Agency, which was approximately $1,428.30. At that time I paid Mr. Pineda the full amount owing them, $1,428.30, which was for premiums for Miller Mutual Fire Insurance Company of Texas policy number 6508041, my workmen’s compensation insurance policy. I then told Mr. Pineda that I was behind on my job and that I wanted to let the workmen’s compensation insurance lapse, which I understood would happen e"when the policy expired. The premiums were fully paid at that time until April 10, 1974. I did not intend for the insurance to be cancelled on December 31, 1973, or any other time prior to its normal expiration. I received a refund of approximately $500.00 from the insurance company several weeks after Mr. Tomas Gallegos’ accident.”

In reply to an interrogatory asking if he had requested that the Millers policy be cancelled prior to January 8,1974, Mr. Hernandez said:

“No. I asked the company not to. I told them that I couldn’t pay any more insurance or wages because I was owing them $1,428.30 and I was $22,000.00 behind on my job so I was deeply in debt, and then I was owing the withholding taxes on the employees. I had to go to Mr. Pineda and tell him that I couldn’t pay any more on the workman’s compensation, and he said then to bring the insurance and he’d cancel it. But I understood that it was going to be canceled when the premium ran out. It’s common knowledge that when you buy insurance you buy it for a year. I did not intend for the policy to be canceled on December 31, 1973, and did not know that it was. My intention was for the policy to terminate at the time the premium expired. I wanted the insurance, but couldn’t pay any more money.”

He also said he surrendered the policy to Mr. Pineda at Mr. Pineda’s request.

In passing on Appellant’s first point of error concerning there being a material issue of fact as to whether the policy was terminated prior to the date of injury, we apply the rule set forth in Great American Reserve Insurance Company v. San Antonio Plumbing Supply Company, 391 S.W.2d 41 (Tex.1965). The general rule with regard to whether physical surrender of the policy constitutes a cancellation of the policy is set forth in 45 C.J.S. Insurance § 458 (1946), as follows:

“The mere physical surrender of a policy of insurance does not of itself terminate the contract, and whether a return or physical surrender of the policy constitutes an exercise of insured’s right to cancel depends on intent as ascertained from surrounding circumstances. No cancellation will be effected by the surrender of the policy for a different pur-

When we disregard all conflicts in the evidence and accept as true the evidence which tends to support the position of the Appellant, and resolve all doubts as to the existence of a genuine issue of a material fact against the Appellee, we conclude that the summary judgment should not have been granted. The policy was delivered to Millers’ agent, at his request. The policyholder did not ask to have the policy cancelled, but only agreed to let it lapse at the end of the policy period. Mr. Hernandez did not pay for coverage to December 31, but for the full policy year. When this evidence is viewed in the light most favorable to the party opposing the motion, there is no conclusive proof that the policyholder returned the policy intending that it be cancelled prior to April 10, 1974. Although the policy itself only requires surrender of the policy to an authorized agent, the law will inquire as to the purpose or intent at the time of surrender in determining whether a cancellation is to be effective. This is not a case of uncommunicated intent as was Seale v. Nichols, 505 S.W.2d 251 (Tex.1974). When Mr. Hernandez paid the premium for a full year, and said “I asked the company not to” cancel, intent was expressed. The Appellee has failed to meet its burden as to this particular issue of the case and is not entitled to judgment as a matter of law. Appellant’s Point of Error No. 1 is sustained.

The Appellant next urges that the trial Court erred in entering summary judgment and in overruling his motion for new trial because the Appellee failed to comply with Rule 93(n)(6) by filing a verified plea that it was not the insurance carrier at the time of the alleged injury. In this connection, the carrier appealed the Board’s award, and in its petition affirmatively alleged that the policy had been cancelled. The claimant filed an answer and cross-action in which he alleged that the Appellee had in full force and effect a policy of workmen’s compensation insurance issued to his employer for the claimant’s benefit. The carrier answered by general denial and a plea of cancellation of the policy effective December 31, 1973. Such plea was not under oath as required by Rule 93(n)(6). Ap-pellee urges that this defect in its pleading was waived under Rule 90 when no special exception was filed by the Appellant. In a trial on the merits, a failure to raise such a defect would be waived. Watson v. Texas Indemnity Ins. Co., 147 Tex. 40, 210 S.W.2d 989 (1948). In Baca v. Transport Insurance Company, 538 S.W.2d 814 (Tex.Civ.App.—El Paso 1976, writ ref’d n.r.e.), we held that such waiver rule should not be applied, but in that case there was no affirmative pleading of the defense relied on. In this case, there is such a pleading but it was not verified.

Rule 93(n) applies “In the trial of any case * * Rule 90 requires the exception to be filed prior to judgment in a non-jury case. Our Courts have held that a summary judgment is a “trial” within the meaning of the Rules of Civil Procedure. Jones v. Houston Materials Company, All S.W.2d 694 (Tex.Civ.App. — Houston [14th Dist.] 1972, no writ); Leche v. Stautz, 386 S.W.2d 872 (Tex.Civ.App. — Austin 1965, writ ref’d n.r.e.). Also see the opinion in Hidalgo v. Surety Savings and Loan Association, 462 S.W.2d 540 at 545 (Tex.1971), where Chief Justice Calvert said: “The trial process includes both the pleading and the trial stages, whether the trial stage be in summary or conventional trial proceedings.” We believe a summary judgment hearing is a trial within the meaning of Rule 93(n), and that unless the carrier files a verified denial, those matters set out in Rule 93(n)(l-8), if pled by a plaintiff, are presumed to be true. We also conclude that a defect in the defendant’s pleadings may be waived if such defect is not raised by special exception as required by Rule 90. Such a conclusion clearly implements the purposes behind the Rule. Curry v. Griz-zaffi, 466 S.W.2d. 835 (Tex.Civ.App. — Dallas 1971, no writ). While there is no need to point out a defect in a moving party’s “evidence” under the holding in Swilley v. Hughes, 488 S.W.2d 64 (Tex.1972), such rule should not be extended to matters of “pleading” where we have a rule which expressly provides for a waiver of a defect in pleadings. The Appellant’s second and third points of error are overruled.

Our ruling on the Appellant’s first point of error makes it unnecessary that we pass upon the last two points of error. The summary judgment is reversed and the case is remanded to the trial Court.

WARD, Justice,

concurring.

I concur that this case should be reversed as a fact issue is presented as to the cancellation of the policy. I further believe the Appellant’s second point should be sustained. Further, I do not agree with the overbroad statement made indicating that insufficiency of the pleadings cannot be raised for the first time on appeal from summary judgment. That statement has been used in the past, but it is not always correct.

As applied to the pleadings of the non-movant, it was correctly used in the case of Lewter v. Dallas County, 525 S.W.2d 885 (Tex.Civ.App. — Waco 1975, writ ref’d n.r. e.), where the non-movant plaintiff failed to allege previous presentment of his claim to the County. The Court correctly held that the summary judgment was improperly granted and followed the spirit of Womack v. Allstate Insurance Company, 156 Tex. 467, 296 S.W.2d 233 (1956). That case held that in a summary judgment proceeding, if the evidence shows, or raises a fact question as to, a ground of recovery or defense in favor of the non-movant, even though such ground of recovery or defense is not pleaded, such evidence will preclude a summary judgment in favor of the moving party.

As applied to the pleadings of the mov-ant, then the question of whether or not the insufficiency of the pleadings can be raised for the first time on appeal depends upon the degree of the fault which is present in thp movant’s, pleadings., In .the present case, the insurance carrier from the time of filing suit alleged the cancellation of the workmen’s compensation insurance policy, and that was the ground asserted in its motion for summary judgment. The Appellant may not have been misled, but there was a complete failure to follow the requirements of Rule 93. That is something more than a “purely formal” defect in the movant’s papers. Since “virtually all burdens are on the movant,” why should we hold that the non-movant, upon penalty'of waiver, appear and except to the movant’s pleadings for having failed to verify them by affidavit? See Swilley v. Hughes supra, at 68. In Baca v. Transport Insurance Company, supra, there was a complete failure by the movant insurance company to plead the denial of good cause as required by Rule 93(n), and that case correctly held that the summary judgment should not have been granted. That case was decided in the spirit of the holding of DeBord v. Muller, 446 S.W.2d 299 (Tex.1969). There, the pleading of the movant DeBord never raised the proven affirmative defense of res judicata, a matter which was required to be pled by the terms of Rule 94. Here, the movant for summary judgment has undertaken to move for summary judgment on a matter not properly raised according to Rule 93. I would sustain the Appellant’s second point.

All of this merely points to the problems which are present when rules as to pleadings which were drawn with a conventional trial in mind have to be applied to the entirely different concept of summary judgment, and the problem will continue as long as Rule 166-A retains its present form.

PRESLAR, Chief Justice,

dissenting.

I respectfully dissent and would affirm the judgment of the trial Court by the application of presently existing law to the uncontroverted fact that no policy was in existence on the date of injury. See Rules 90 and 166-A, Tex.R.Civ.P.

ON MOTION FOR REHEARING

OSBORN, Justice.

The Appellee has filed a motion for rehearing in which it strongly urges that this case should be controlled by the decision in Seale v. Nichols, 505 S.W.2d 251 (Tex.1974). The motion urges that when Mr. Hernandez returned the policy to the agent, there was no communicated intent that the policy not be cancelled. It is further contended that what Mr. Hernandez said in his affidavit or deposition about what he understood or intended does not suffice to establish a communicated intent that the policy not be cancelled. If the summary judgment evidence contained nothing more, we would agree. But the motion for rehearing fails to note that in the affidavit Mr. Hernandez said:

“* * * I then told Mr. Pineda * * that I wanted to let the workmen’s compensation insurance lapse * * *.”

Clearly, those words reflect an expressed communicated intention on the part of the policyholder. As noted in the earlier quote from 45 C.J.S. Insurance § 458 (1946), cancellation will not be effected where the surrender of the policy is for a purpose other than cancellation. Where the expressed intent upon surrender of the policy is for it to lapse, rather than to be can-celled, the party moving for summary judgment has not met its burden of proof and summary judgment should not have been granted.

The Appellee’s motion for rehearing is overruled.

PRESLAR, C. J., dissents.


author: PRESLAR, Chief Justice.

text:
    H. MOLSEN & CO., INC., Appellant, v. Ernest B. HICKS and Norman Hicks, Appellees.
    No. 6563.
    Court of Civil Appeals of Texas, El Paso.
    April 6, 1977.
    Rehearing Denied April 27, 1977.

      Grady, Johnson, Smith & Blakeley, Thomas A. Blakeley, Jr., Dallas, for appellant.
    John L. Shepherd, Seminole, for appel-lees.
   OPINION

PRESLAR, Chief Justice.

A Buyer of cotton brought this action against the Sellers to recover damages arising out of the failure of the Sellers to deliver cotton to the Buyer as promised orally, and for their failure to keep an oral promise to sign and deliver a written contract that would comply with the Statute of Frauds providing for the sale of the cotton. The trial Court granted the summary judgment of the Defendant-Sellers on the basis of Section 2.201 of the Texas Business & Commerce Code, Statute of Frauds. We affirm.

Kenneth Newcomb, as agent for Royce Cooley, who in turn was the agent of H. Molsen & Co., Inc., negotiated with two farmers, Ernest B. Hicks and Norman Hicks, for the sale of their 1973 cotton production on some 5,000 acres to Molsen. Molsen contends that a written agreement was arrived at between Newcomb and the Hicks brothers; that the Hicks brothers agreed to sign it but never did; and that in reliance on such agreement to sign the contract, Molsen hedged its purchase by selling an equivalent number of bales for delivery at harvest time and suffered monetary damages when the Hicks brothers did not sign the contract and subsequently sold their cotton to another buyer after the price of cotton had gone up.

The Appellant, Molsen, asserts that the trial Court erred in granting the summary judgment as to each of the Defendants because there is evidence to raise a fact issue as to whether such Defendant is es-topped to assert the Statute of Frauds. In upholding the defense of the Statute of Frauds, the trial Court specifically states in its judgment that it is done on the basis of Section 2.201, Tex.Bus. & Comm.Code Ann. That Section provides that a contract for the sale of goods for the price of $500.00 or more is not enforceable unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought. There is no contract of writing here, but Appellant alleges that the Appellees are precluded from asserting the Statute of Frauds by the doctrine of promissory estoppel. That doctrine, in summary, may be said to be that if a party promises to sign a writing in a situation within the Statute of Frauds, and the other party relies on the promise to his detriment, the promise may be enforced as if the writing had been signed. See “Moore” Burger, Inc. v. Phillips Petroleum Company, 492 S.W.2d 934 (Tex.1972); Cooper Petroleum Company v. LaGloria Oil and Gas Company, 436 S.W.2d 889 (Tex.1969); Comment: Wright, Promissory Estoppel Marches On — Moore-Burger, 28 Baylor L.Rev. 703 (1976).

We are of the opinion that the application of the doctrine to this case must fail for the reason that there was no complete agreement ever reached by the parties as to the terms of the written contract. The written contract is not before us, and there is some indication that it may be lost. The finality of such agreement and the terms that were agreed upon must be gleaned from the deposition of the two Appellees and the agent Newcomb, who negotiated with them. In deciding whether or not there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true, and every reasonable inference must be indulged in favor of the non-movants and any doubts resolved in their favor. Wilcox v. St. Mary’s University of San Antonio, Inc., 531 S.W.2d 589 (Tex.1975). Reviewing the evidence in that light, we conclude that no binding agreement was reached as to a written contract. The negotiations were carried on by Newcomb with the two Hicks brothers, and, at that time, he filled in blanks on a printed form contract. The best of the evidence is that there were farms listed, the number of bales or acres agreed upon, the price was agreed upon, and these items were inserted on the written form; and that neither he nor either of the Hicks brothers signed the writing. Mr. Newcomb testified several times that the acceptance of the contract or their signing of it was dependent on its being approved by their attorney, Mr. John Shepherd. He said at one point: “I typed up the statement and they were to take it to Mr. Shepherd for his approval and for him to look over and if it satisfied them, if it satisfied Mr. Shepherd, they would accept the contract and sign it.” And at another point, the question to Mr. Newcomb was: “All right. Now, was the agreement made from — on that day?” Answer: “Well, it was my understanding that it would — if it was approved by their attorney that it would be acceptable.” When asked what report he made to his principal, Mr. Cooley, he said: “That they had agreed to accept his offer and that they would sign the contract as soon as it was acceptable — as soon — if it was a satisfactory contract with their attorney.” Additionally, there was testimony by Mr. Newcomb that there were certain changes to be made in the printed form of the contract, and that he never knew whether those changes were ever made or not after the contract was taken to the attorney. He gave the contract to the Appellees to take to their attorney; and in response to a question as to whether when they left his office, the Appellees still had some question about the contract, he responded: “Yes. They were going to satisfy themselves.” As indicated, the writing prepared by Mr. Newcomb is not in evidence, but we are of the opinion that whatever its terms were, there was no meeting of the minds as to the final terms and no acceptance by the Appellees of the writings. The trial Court properly applied the Statute of Frauds, as there was no contract in writing. The judgment of the trial Court is affirmed.


text:
    Fernando VARELA, Appellant, v. SAFEWAY STORES, INCORPORATED, Appellee.
    No. 6574.
    Court of Civil Appeals of Texas, El Paso.
    April 6, 1977.
    Zimmerman & Navarro, P. C., L. Taylor Zimmerman, Edelmira Navarro, El Paso, for appellant.
    Kemp, Smith, White, Duncan & Hammond, Joe Lea, Jr., Michael D. McQueen, El Paso, for appellee.
   OPINION

PRESLAR, Chief Justice.

This case involves the question of irreconcilable conflicts in the jury’s answers to special issues. The trial Court entered judgment for the Defendant. We affirm.

li:This is a personal injury case filed by the Appellant, Fernando Varela, against the Appellee, Safeway Stores, Incorporated, for damages as a result of an injury which Appellant sustained while a customer in Appellee’s store. Plaintiff, as Appellant, assigns a single point of error that the Court erred in failing to grant Appellant’s motion to set aside the verdict of the jury and declare a mistrial and in entering judgment for the Appellee for the reason that the jury’s answers to Special Issues Nos. 1 and 3 were in irreconcilable conflict.

Our concern is with Special Issues Nos. 1, 2, and 3, and they are as follows:

“SPECIAL ISSUE NO. 1
“Do you find from a preponderance of the evidence that on the occasion in question the Defendant, Safeway Stores, Inc., created or kept a dangerous condition with regard to the dairy counter in question?”

To which the jury answered “No.” The instruction was then:

“If you have answered “Yes” to the preceding question, then, but not otherwise, answer Issue No. 2.
“SPECIAL ISSUE NO. 2
“Do you find from a preponderance of the evidence that the Defendant company, Safeway Stores, Inc., failed to discover such condition, if any you have found, as a reasonable prudent person or company would have discovered under the same or similar circumstances?”

That Issue was unanswered.

“SPECIAL ISSUE NO. 3
“Do you find from a preponderance of the evidence that such failure to discover, if any you have found, was a proximate cause of the occurrence in question?”

To which the jury answered “Yes.”

For purposes of this opinion, we may assume that Special Issues Nos. 1 and 3 are, as contended by Appellant, in conflict. But the ultimate question is not whether the findings are in irreconcilable conflict; rather, the question is whether the conflict in the findings is fatal to the entry of judgment. That question is determined by the rule laid down in the case of Little Rock Furniture Mfg. Co. v. Dunn, 148 Tex. 197, 222 S.W.2d 985 (1949).

The rule there laid down is that to require a judgment entered on a verdict containing conflicting answers to be set aside, the conflict between the answers must be such that one answer would establish a cause of action or defense, while the other would destroy it. Under that rule, the assumed conflict in this case is fatal if ignoring the answer to Special Issue No. 3, the answer to Special Issue No. 1 and other Issues would require a judgment for the Defendant. On the other hand, would disregarding Special Issue No. 1 require a judgment for Plaintiff based on the answer to Special Issue No. 3 and the other Issues? Special Issues Nos. 1 and 3 appear to be in conflict, but the question is whether that conflict is fatal for purposes of entering a judgment. Appellant demonstrates conflict by showing that when we ignore Special Issue No. 1, Special Issue No. 3 standing alone establishes a cause of action because negligence is implied. Our conclusion is that any implied negligence is erased by a deemed finding by the Court in response to Special Issue No. 2.

Special Issue No. 2 was unanswered, and, ordinarily, Plaintiff would have been entitled to have it answered. But, having failed to object to its conditional submission, Appellant has waived the right to have it answered. Under the provisions of Rule 279, Tex.R.Civ.P., there is a deemed finding in support of the Court’s judgment that there was no negligence in the failure of the Defendant to discover the condition. Little Rock Furniture Mfg. Co. v. Dunn, supra; Bay Petroleum Corporation v. Crumpler, 372 S.W.2d 318 (Tex.1963). With Special Issue No. 2 answered in the negative, there is no conflict which would prevent the entry of judgment on the verdict.

The judgment of the trial Court is affirmed.


text:
    E. J. MEYERS, Appellant, v. Norman M. BELFORD, Appellee.
    No. 6598.
    Court of Civil Appeals of Texas, El Paso.
    April 6, 1977.
    John H. Whitaker, El Paso, for appellant.
    Arturo R. Aguirre, El Paso, for appellee.
   OPINION

PRESLAR, Chief Justice.

This is an appeal from an order of the County Court at Law No. Three, El Paso County, dismissing Plaintiff’s appeal from a justice Court judgment. Issues mainly involve the appeal bond requirements of Rule 571, Tex.R.Civ.P. We affirm.

The Appellant, as Plaintiff, filed a claim in the justice Court alleging a debt of $86.13 against the Appellee, Defendant, plus $110.00 for attorney’s fees. Trial resulted in a judgment in favor of the Plaintiff in the sum of $25.16. The judgment was entered October 22, 1971. In open court, Plaintiff gave notice of appeal to the County Court, and the justice Court record was filed in the County Court.

On November 11,1976, Defendant filed his motion to dismiss on the grounds that (1) Plaintiff failed to file the requisite appeal bond; (2) Plaintiff failed to give proper notice of appeal; and (3) laches on the part of Plaintiff for allowing five years to elapse since the time of the justice Court judgment. Following notice and reply, a hearing was had and the order of dismissal resulted from which this appeal is taken.

Rule 571, Tex.R.Civ.P., provides:
“The party appealing, his agent or attorney, shall within ten days from the date of judgment, or order overruling motion for new trial, file with the justice a bond, with two or more good and sufficient sureties, to be approved by the justice, in double the amount of the judgment, payable to the appellee, * * * or if the appeal is by the plaintiff by reason of judgment denying in whole or in part his claim, he shall file with the justice a bond in the same ten-day period, payable to the appellee, with two or more good and sufficient sureties, to be approved by the justice, in double the amount of the costs incurred in the justice court and estimated costs in the county court, less such sums as may have been paid by the plaintiff on the costs * * *

There has been no such bond filed in this case, and the Court correctly dismissed the appeal. Appellant cites cases to the contrary, but these cases were before the amendment of Rule 571 in 1967. Prior to the amendment of 1967, one in the position of the appellant, and agáinst whom no affirmative relief had been granted, was held to be exempt by implication from the requirements to file an appeal bond. 4 Tex. Jur.2d, Rev., Part 2, Appeal and Error— Civil Cases, Sec. 1055 (1974). As can be seen, the Rule in its present form now requires an appeal bond from one in the plaintiff’s position. The filing of the appeal bond is a prerequisite to the jurisdiction of the County Court. 4 Tex.Jur.2d, supra, Sec. 1052. Since the County Court at Law was without jurisdiction, it properly dismissed the appeal, and this Court, then, is without jurisdiction of the further appeal and the proper judgment for us to enter is to dismiss the appeal.

The appeal is dismissed.