Merchants' & Bankers' Fire Underwriters v. Williams

LEVY, J. The suit is by appellee on a fire insurance policy issued by appellant. The insurance was entirely on appellee’s one-story frame building, occupied by him and tenant as a drug store and doctor’s office, and was in the sum of $750. The building insured was totally destroyed by fire while the policy was' in force. In a trial before the court without a jury, a judgment in favor of appellee was entered. [1] There was a demurrer to the petition, which was overruled by the court, and the appellant duly excepted to the ruling made. The first assignment of error, complaining of the overruling of the demurrer, presents the point that the petition has failed to state a cause of action, in that it does not allege that the amount of the policy sued for is unpaid. The petition avers to the extent that the appellant executed and delivered its policy in writing to the plaintiff, insuring him from May 1, 1914, to May 1, 1920, against loss or damage by fire to the amount of $750 on his one-story frame building being occupied by him and tenant as a drug store and doctor’s office, and that on November 20, 1914, said building was totally consumed and destroyed by fire, and prays for judgment for the amount of the policy. Under the statute of this state the policy becomes a liquidated demand to the full amount in case of a total loss by fire of the building insured. Article 4874, Vernon’s Sayles’ Stat. Therefore the legal effect attaching to the facts as pleaded in the petition would affirmatively show, it is quite clear, an obligation on the part of appellant to pay or indemnify the appellee in the sum of money to the amount of $760 upon a contingency of total loss by fire of the building insured, and which did happen. The alleged fact that the loss did occur is in effect a declaration that the sum of money is due and thát the policy would be payable according to its terms. But the fact of the loss by fire and that the money is due does not constitute a breach of the contract, and would not be a fact from which the court could infer that the appellant has not paid or breached the policy. In matters of contract it will be presumed that the parties thereto intend to do what they have contracted to do, until the contrary or breach is shown. Consequently, properly construing the petition, there is no allegation stating or from which it can be implied that the amount of the policy sued for is unpaid by appellant. And the precise question for ruling is whether it was essential, in order to state a cause of action good as against a demurrer, to allege, not only the undertaking or obligation of the parties, but as well the failure of the insurance company to pay the money or perform its obligation. It is the primary requisite of a petition that it state substantially a cause of action. And “a cause of action” was clearly defined by the court in Phillio v. Blythe, 12 Tex. 124, as follows: “It may be defined to consist as well of the right of the plaintiff in the action, as of the injury to such right. In Chitty on Pleadings, vol. 1. p. 288, the three principal points of a cause of action are said to be: (1) The right, whether founded upon contract or tort; (2) the urging to such right; and (3) the consequent damages. It may be admitted that the term ‘cause of action’ is sometimes used in a more limited sense, and that, where the cause [of action] is founded on a contract, the contract itself is denominated the cause of action; but more frequently, and where the term is used with more precision and accuracy, the term embraces a much wider scope, and includes, not only the contract, but its performance, if executory, and also the breach of such contract. For instance, the statute requires a plaintiff, in his petition, to set forth a full and clear statement [of his cause]. This requisition would not be filled by a bald statement of the terms of the contract, if a contract lay at the foundation of the action. An averment of the performance of the contract by the plaintiff, of its breach by the defendant, and, according to Chitty, of the consequent damages, is equally essential with a statement of the terms of the contract itself, as, together, they contribute the body, or substance, of the cause of action.” The above definition of cause of action was further approved and adhered to by the court in Railway Co. v. Hill, 63 Tex. 381, 61 Am. Rep. 642. And it has been held that it must appear from the petition— “by averment that they [defendants] have violated their contract by refusing to make payment of the note agreeable to their undertaking, in order that the petition may show a cause of action.” Whitaker v. Record, 25 Tex. Supp. 383; Brackett v. Devine, 25 Tex. Supp. 195; Holman v. Criswell, 13 Tex. 38; Grant v. Whittlesey, 42 Tex. 320; Gaudalupe Co. v. Johnston, 1 Tex. Civ. App. 713, 20 S. W. 833. In Holman v. Criswell, supra, the court states that while the plaintiff would not ordinarily be required to prove, in order to sustain his case, the nonpayment, it is nevertheless essential, in order to state a cause of action, for him to aver the fact that the debt sued for is unpaid, as a breach or injury affecting him. In Richards v. Insurance Co., 80 Cal. 505, 22 Pac. 939, a petition in an action on a life insurance policy was held demurrable because it failed to allege that the policy sued on was unpaid. [861] It is not perceived that the above requisites of pleading -would be inapplicable to an action on an insurance policy, for an insurance policy is a contract of the parties, and actionable, as other contracts, in favor of the insured when the failure to pay the money, which is the breach, occurs. It is believed that the court erred in overruling the demurrer, and that for the error the judgment must be reversed and the cause remanded. In view of the ground for reversal, it is not thought that the other questions raised can be properly passed on, and we do not do so. Reversed and remanded. Footnotes [1] ig^jEor other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes [2] @=>For other oases see same topic and KBY-NTJMBBR in all Key-Numbered Digests and Indexes