Elliott v. Lester

126 S.W.2d 756, 1939 Tex. App. LEXIS 514
CourtCourt of Appeals of Texas
DecidedMarch 11, 1939
DocketNo. 12730.
StatusPublished
Cited by19 cases

This text of 126 S.W.2d 756 (Elliott v. Lester) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Elliott v. Lester, 126 S.W.2d 756, 1939 Tex. App. LEXIS 514 (Tex. Ct. App. 1939).

Opinion

BOND, Chief Justice.

Appellee, Max Lester, Jr., in a'district court of Dallas County, recovered judgment against appellant, Edward Elliott, in the sum of $5,000, based on claim for loss and damage growing out of a motor bus collision, occurring on a state highway. Elliott appealed from the judgment and superseded its enforcement by executing and filing a supersedeas bond in double the amount of the judgment, with Lloyds America, a Lloyds insurance organization, as the sole surety on the supersedeas bond. In the appeal, the appellee, Max Lester, Jr., has ..filed a motion to require appellant to post an additional good and .sufficient supersedeas bond, on the ground that the surety is the primary obligor in payment of the judgment and is wholly insolvent.

The record shows that, at the time of the accident involved in the suit, Elliott was .operating over the highways of this State, as a common carrier of freight for hire, under permit or certificate of convenience duly issued by the Railroad Commission . of Texas, in accordance with the provisions of the Motor Bus Transportation Act of the 42nd Legislature (Art. 911b, R.S., Vernon’s Ann.Civ.St. art. 911b). The permit or certificate was issued on Elliott’s .posting'with the Commission a bond, or insurance policy, executed by Lloyds America, conditioned as prescribed by law. The statute in question, pertinent here, reads as follows:

“Sec. 13. Before any permit or certifi,cate of public convenience and necessity-may be issued to any motor carrier and before any motor carrier may lawfully operate under such permit or certificate as the case may be, such motor carrier shall file with the Commission bonds and/or insurance policies issued by some insurance company including mutuals and reciprocals or bonding company authorized by law to transact business in Texas in an amount to be fixed by the Commission under such rules and regulations as it may prescribe, which bonds and "insurance policies shall provide that the obligor therein will pay to the extent of the face amount of such insurance policies and bonds all judgments which may be recovered against the motor carrier so filing said insurance policies and bonds, based on claims for loss or damages from personal injury or loss of, or injury *758 to property occurring during the term of said bonds and policies and arising out of the actual operation of such motor carrier, and such bonds and policies shall also provide for successive recoveries to the complete exhaustion of the face amount thereof and that such judgments will be paid by the obligor in said bonds and insurance policies irrespective of the solvency or insolvency of the motor carrier, provided, however, such bonds and policies shall not cover personal injuries sustained by the servants, agents or employees of such motor carrier. Provided ' further that in the event the insured shall abandon his permit or certificate and leave the State, a claimant, asserting a claim within the provisions of said bonds or policies, may file suit against the sureties executing such bond or the company issuing such policies in a court of competent jurisdiction without the necessity of making the insured a party to said suit. * * * ”

An analysis of the bond and statute reveals that it was clearly the intention of the Legislature to make insurance carriers primary obligors for the public benefit, and a judgment against the motor carrier a mere condition precedent for suit against the insurance company’s bond or policy. The procedure, to the effect that the insurance carriers be not directly sued or mentioned in pleadings and proof, obviously, was for the beneficial convenience of the insurance companies. However, in all such cases, whether the insurance companies be party in name or not, after the injured party has secured a favorable pronouncement of judgment from a court of competent jurisdiction or verdict from a jury, the liability of the insurance company carrying the indemnity, to pay the judgment to the extent of its bond or policy attaches ; and, in cases where the insurance company participates in the suit, the plaintiff may, by motion, have the judgment set over against the insurance company, without further ado. Cannon Ball Motor Freight Lines et al. v. Grasso et al., Tex. Civ.App., 59 S.W.2d 337. Under the statute, the insurer is required to pay plaintiff’s judgment; it becomes the primary obligation of the insurer, and the mere fact that it was not and could not be mentioned or named in the suit, because of the incidental procedural statute, and adjudicated cases on the subject, does not change its status to the obligation it assumed.

While the Legislature, in passing Sec. 13, Article 911b, denied to injured parties right to.sue or join the insurance carriers in such suits, nevertheless, such carriers, under the condition of the bond, or policy; and the statute quoted above, are bound to pay the judgment, and the enforcement of it is directed against the company carrying the indemnity, and not the motor carrier. Aside from the clear meaning of the statute, we think that, where an insurance carrier comes into a suit, furnishes its own attorneys to defend the suit, participates in the trial, as if it were a party, and appears in the appeal, whether the insurance carrier is technically a party or not, the law treats it as a party; by participating in the proceedings, it is estopped by the judgment and bound to the extent of its bond or policy, and, in truth and fact, is the appellant in the appeal.

Under Article 2270 et seq., a su-persedeas bond is provided for, and, by the filing of such bond, appeal is perfected and the execution on the judgment is stayed by writ of supersedeas. The purpose of a su-persedeas bond is to furnish indemnity to the appellee, and to suspend the remedies allowed for realizing on the judgment. It is security in addition to the. personal liability of those responsible for the payment of the judgment, and effectively suspends the remedies for the enforcement of the judgment, pending the appeal. “The sole purpose of requiring an appeal or super-sedeas bond" must therefore necessarily be to furnish security to the appellee in addition to the personal responsibility of the appellant. Automobile Insurance Co. v. Teague (Tex.Com.App.) 32 S.W.2d 824.” Universal Automobile Ins. Co. v. Culberson et al., Tex.Civ.App., 51 S.W.2d 1071, 1072.

In the case of Ford v. State, Tex.Civ. App., 209 S.W. 490, 492, the question was presented as to whether an appeal on a su-persedeas bond suspends the judgment, or suspends its execution. The court said: “We hold that an appeal from a judgment of any character, upon a supersedeas bond, does not suspend the judgment, but only stays its execution pending the appeal. 2 R.C.L. § 97, p. 122; Nill v. Comparet, 16 Ind. 107, 79 Am.Dec. 411; Mull v. McKnight, 67 Ind. 525; Randles v. Randles, 67 Ind. 434; Walls v. Palmer, 64 Ind. 493; Padgett v. State, 93 Ind. [396] 397. The judgment itself remains in full force until it is reversed. If it be affirmed, the appellate court does not enter a new judgment in the case, nor revive the judgment of the trial court, but only removes the impediment to its execution. In this connection, *759

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Bluebook (online)
126 S.W.2d 756, 1939 Tex. App. LEXIS 514, Counsel Stack Legal Research, https://law.counselstack.com/opinion/elliott-v-lester-texapp-1939.