Untitled Texas Attorney General Opinion

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THEAITORNEY GENERAL
OPTEXAS
Aus~liu 11. TJCXASI
Gerald C. Mann

Hon. Il. L. Mllliken Opinion No. O-179
I~nsurance Expert Re: Construction of Form 77 - Motor
Motor Transport Division Truck Public Liability Insurance En-
Railroad Commission of dorsement relating .to coverage of
Texas trucks not described in policy
Austin, Texas
Dear Mr. Mllliken:
We are pleased herewith to comply with your request un-
der date of January 18 for a construction of Form 7’+“Motor Truck
Endorsement-Texas Railroad Commission-Restricted Form” relating
to the liability of the insurer under a public liability insurance
policy contalnlng said endorsement for trucks operated by the in-
sured not specifically described in said policy.
It is our opinion that all trucks operated by the insur-
ed (whether specifically described in the policy or not, and pro-
visions in the policy proper to the aontrary notwithstanding)
would be covered by a public liability policy containing Form 77
endorsement so as to make .the insurer liable to third person for
Injury to person or property occasioned by the operation of said
trucks while used in carrying property for hire in Texas. We be-
lieve this result is accomplished by the following paragraph of
Form 77:
“Coverage granted by the policy applies to all
trucks and trailers belonging to or under the dlrec-
tion of the named insured, whether particularly iden-
tified in the policy or not, while same are being
used in the business of carrying property for hire
or compensation and coming within the terms of the
statutes, abov~e referred to, and it is agreed that,.
subject to the policy limits, this policy covers the
liability imposed by law upon the named insured for
injury to or death of persons, other than the named
insured or his employees, and loss or damage to prop-
erty, other than the property of the named insured,
or of his ‘employees, through such operation of such
trucks and trailers within the boundaries of the
State of Texas, even though, such trucks or trailers
may not be specifically identified herein anything
in the policy or endorsements thereto to the contrary
notwithstanding.”
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Hon. R. L. Milliken, page 2 (O-179)

Form 77, when attached to and executed by the Lnsured
becomes a part of the contract between the insurer and the as-
sured as fully as though written into the policy proper, and
superpedee any provisions in the policy proper which conflict
therewith by virtue of the following provision of the. endorsement:
(‘Any provision, eltherh the body of the policy
to which this endorsement is attached or in any other
endorsement thereon or attached thereto, now or here-
after, In conflict with or contrary to the provisions
of this endorsement, shall be deemed to be cancelled
hereby.”
As stated in the first paragraph of Form 77, the pur ose
of the endorsement is to. effectuate the purposes of Chapter 31f: ,
General and Special Laws of the 4lst Legislature of Texas, 1929,
and amendments thereto5 being designated as Article 911b Revised
Statutes, and more particularly Section 13 thereof.
It may be noted that Form 77 also provides that the in-
surer shall be entitled to reimbursement from the insured for “any
loss -involving any automobile or trailer not described in the pol-
icy or endorsements thereto which has’ been in operation for a
period of more than ten (10) days without an endorsement having
been requested therefor”, but this provision does not limit or di-
minish the Insurer’s liability to the injured third party.
The construction of the very paragraph of Form 77, first
above quoted was under consideration in the case of Park et ux.
v. American s ldelity & Casualty Co. Inc., 92 Fed.(2d) 746, decided
by the Federal Circuit Court of Appeals for the 5th Circuit in
1937. In this case the insurer sought to avoid liability under
the policy which contained the provision that It did “not cover
any loss arising or resulting from an accident occurring while any
of said automobiles were -.-being driven or operated by any person
other than the assured or his paid employee.” The plaintiff re-
lied upon the endorsement (Form 771, which was attached to the pol-
icy, and the court held that it prevailed over the conflicting pro-
visions above quoted in the policy proper. Judge Sibley In a
concurring opinion said:
“The rider expressly extends coverage to all trucks
operated ‘under the direction and control’ of the as-
sured. In the suit against the assured, which was DDE-
fended by the insurer, the jury in a special verdict ex-
pressly found the truck was operated under the d#rection
and control of the assured. On general principles of
estoppel by judgment the insurer cannot again contest that
issue with the plaintiffs.”
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Hon. R. L. Milliken, page 3 (O-179)

We believe this decision is controlling in the con-
struction of Form 77 which we have given herein.
Yours very truly
GENERALOF TEXAS
ATTORNEY
By /s/ Walter R. Koch
Walter R. Koch, Assistant

APPROVED:
Gerald C. Mann
ATTOBNEY GENERALOF TEXAS
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