*1 judgment grant is called period, present deed on what we have The in years from the first cause period issue reversed and the is limited to “a oil, may long remanded order that there as date hereof as thereafter them, issue, gas trial on the minerals, merits or either of other or judgment respects all other af- de- is produced mined the lands is or from appeal The firmed. taxed costs are herein, paying or commercial scribed against Kilfoyle. quantities.” Mrs. part; Reversed and remanded af- Kilfoyle insists further Mrs. part. firmed in leasing retained power exclusive power 'Wright invalid because case The coupled with interest. relies, Dal particularly upon she which Cal.App.2d lapi Campbell, 1941, 45 v. point. In not in 114 P.2d attempt of a subdivision owner case power perpetual ed to reserve n execute oil lots, gas toas leases con simple which was fee title to full FIREMAN’S FUND INSURANCE COM power. subject reserved veyed PANY, Appellant, reservation down court struck The perpetuities. rule violative al., et WILBURN BOAT COMPANY re case, present in addition In the Appellees. leasing power serving exclusive No. 18722. ownership Wright of the surface retained minerals, rights in in the valuable Appeals Court United States drill, right upon cluding: ter (1) Fifth Circuit. lease; existing (2) the mination of March right execution bonuses to receive delay right leases; (3) to receive new leases; existing future from rentals expira right after <4) of reversion years grant royalty “20 tion of ;so gas long oil, or minerals thereafter quantities.” paying produced therefore, is, Wright’s power to lease (cid:127)coupled ownership surface rights the minerals. and substantial power to would lease an exclusive .Such
(cid:127)certainly See Prob in Texas. be valid Separation Presented lems Leasing from the Own Power Exclusive Royalties by Land, ership Minerals Jr., on Oil and Gas Jones, Institute
Lee seq. Law, pp. 271, stat Alabama et Alabama, relating powers, Code of utes 75-93, and the cases 1940, Tit. §§ construing have not been those statutes parties. find noth We
«discussed ing Alabama statutes decisions make result Alabama would n different Texas, and con Wright’s power reserved clude respects is in all valid. lease *2 appeal The second trial with- significance light
out fact finally the case was heard and decided on the merits court district without *3 jury the intervention of and a new rec- completely ord made the basis of the as appeal that is now us. The dis- before trict court concluded that the insurance policy was a Texas contract and that under the Texas law the defenses relied company the insurance were not judg- available to it. court The entered a ment in plaintiffs. favor of the The defenses asserted the insur- Chicago, Ill., A. Joe Hayes, B. Edward company many. They ance were all are Inger Tex., C. Sherman, Warren Keith, urged assumption here on the that the appellant. Chicago, Ill., for soll, findings evidentiary basic by the facts Tex., Dallas, T. G. Price, Hobert trial accepted true, court can be al- Tex., & Gul Gullett Schirmeyer, Houston though the insurer does attack some of appellees. Tex., Denison, for lett, the inferences drawn the trial court Judge, and TUTTLE, Chief from the place Before admitted facts. To JONES, Circuit focus, necessary issues in HUTCHESON it is to set out Judges. facts as found the district court. doing so, Before however, a short ex- Judge. planatory help TUTTLE, statement will in under- Chief standing findings. the court’s this appearance of third This is tried has It been this Court. case questioned not It is that there at were has court and trial in the times three plain warranty least three breaches of of the Supreme Court to the once been eight or nine untrue or false some first trial theOn States. United (these implying terms without used Boat plaintiffs, Wilburn peared that they were whether or were not fraudu- specific warran- Company, conceded lent) statements made or facts concealed. in- policy of marine ties contained These misstatements are of several against other use sued surance kinds: against pledge pleasure, private than (1) misrepresentations Actual made sale, violated. been had company when the was ob- thereupon held that the judge trial coverage tained or when the in- general interpreted under should tract creased, susceptible and which were thus perform- requiring literal law maritime being company; (2) acted on rule of warranties ance made Statements on a form submitted to This law. state not be affected could coverage the Wilburn brothers after the Cir., 201 F.2d in 5 affirmed Court increased, justify had been in order to Supreme Court, 348 U.S. increase, may but which statements reversed 99 L.Ed. S.Ct. actually upon not have been acted before and of trial this Court decision loss of the boat. These statements should be and held that state laws court “application” form on a were called insurance, applied in field marine findings form in the court’s of fact. This prece- “where entrenched federal at least form submitted lacking,” respect spe- to a dent part application company as a anof determined that issue. The Court cific coverage, or for increase in such entrenched federal there was no sought as a source of information but precedent effect to be accorded company. by warranties. relating, findings matter this insur- are: of fact The court’s thereof; subject ance or the matter pertinent hereto all times “At whether before or after loss.’ Wilburn, Henry Glenn, Frank “In June 1948 and for sometime them, residents and each of prior times thereto and at all other Grayson Denison, and citizens pertinent the Defendant hereto County, H. IT. Cleave- Texas and the doing permit busi- to do and was Illinois, Island, Agency Rock land (cid:127) ness in the State Texas. to as Cleave- referred hereinafter duly Agency, authorized awas land 4, 1948, “On or about June agent and was Defendant coverage time when the *4 insurance, writing engaged of policy surance in had been including insurance, for marine Glenn, 1949, May 22, extended to May 22, 1947, the On Defendant. Henry pur- Frank and Wilburn through issued Defendant chased the from Robert Wanderer Agency hull its marine Cleaveland D. Marshall and John for Shuler a. YA-28579, policy policy No. $9,000.00. re- consideration of aAs question herein, Robert D. Mar- purchase sult of this each of said. Island, shall, Illi- of Rock resident Wilburns owned an one- undivided Shuler, nois, a resident and John that, third interest in the boat. At Moines, Iowa, the then owners Des time the Wanderer was still located Wanderer, yacht or vessel Greenville, on waters at or near question, under the terms of here in Mississippi. It was intention of which the Wanderer insured was the Wilburns to move said boat from $10,000.00 the amount of from loss mooring Greenville, Missis- policy At the fire. time sippi, Texoma, large in- Lake was insurance issued Wanderer Denison, land lake located near Tex- located in near waters as, part being of said lake lo- Greenville, Mississippi. policy cated in Texas and the remainder provision contained effect thereof located in the State of Okla- it was warranted the As- homa. The Wilburns moved the boat sured, vessel, or the owners of the Greenville, Mississip- water from vessel would used for up pi, Mississippi River to the pleasure during private purposes up Red River and then the Red River policy term of the and would not be to the Lake Texoma Dam near Deni- permis- hired or chartered unless son, Texas. The boat was then granted by sion to do was so indorse- moved overland around the dam and Among policy. ment July launched on Lake Texoma in policy provision ditions of the was a August changes 1948 after certain effect that by the insurance ex- repairs were made to the boat. policy tended shall be void in After the boat was launched on Lake case the or the interest Texoma it taken to the Texoma thereby sold, sured should be as- Company, Boat and Dock a boat re- signed, pledged transferred or with- pair business located in Texas on previous out the consent of the De- Texoma, Lake where additional ex- pertinent provi- fendant. Another repairs remodeling tensive sion of the was: performed on the boat. At the time purchased “ the Wilburns the boat Policy Entire ‘This Shall Be carry- intended to use for assured concealed or if the has void ing passengers hire on Lake for any misrepresented material fact or [Emphasis Texoma. added.] concerning this insur- circumstance prior 4,. subject to June thereof, matter “For sometime or the ance pertinent any 1948, times or, at all sub- in case of fraud or false McKinney swearing touching sequent R. thereto L. the Assured binding operated Denison, Texas, the Defendant was owned Denison, perils agency Wanderer with full marine an insurance Texas, coverage and indorsements R. L. Mc- under the name Thereafter, writing Kinney Agency, would follow. the De- insurance n fendant types issued indorsement insur- for various various question showing represented. that the companies Mc- he ance Kinney assured, 1948, name of the June prior effective to June changed 1948,was types from Robert D. written various Marshall and John Shuler to Frank Defendant Wilburns. Henry any Wilburn. prior This indorse- to June never at time ment was McKinney transmitted the De- authorized to solicit Agency fendant who, Cleaveland or write insurance kind turn, forwarded At or about the time the Wil- same it. McKinney Denison, mail to purchased Texas. the Wanderer burns Frank Kinney R. Mc- Wilburn contacted L. coverage premium for “The Denison, Texas, and re- the Wilburns on the Wan- extended quested McKinney to him- obtain for derer, aforesaid, was the- sum *5 self and brothers insurance cov- his paid Wilburns The $419.56. erage McKinney, on the Wanderer. by issuing premium their check who was not authorized to write Denison, Texas, on a drawn bank companies of he behalf represented of the Agency, payable to the Cleaveland marine insurance the they, turn, check in which delivered desired on the the Wilburns Wan- McKinney who, turn, in trans- to derer, rep- telephone a made call to Agency. it to the mitted Cleaveland Agen- of resentative the Cleaveland Agency The Cleaveland then caused cy Island, in In this Rock Illinois. presented pay- the check to be ment, McKinney telephone conversation by paid same and Agency rep- advised the Cleaveland Denison, Texas, upon bank which it namely, White, resentative, one J. B. By August letter was drawn. dated he, McKinney, that agent was an insurance McKinney 6, 1948, requested the Denison, Texas, in and was Agency Cleaveland to indorse the acting agent Henry for Frank as policy question insurance in of so as purchased had who Wilburn Wanderer; Henry Glenn, Frank and show to he, McKinney, had Wilburn, Wilburn’s Boat d/b/a writing the hull cov- facilities By Company in- as assured. erage requested desired White August 6, 1948, dated dorsement arrange with the Defendant to to policy Defendant so indorsed the coverage of its the Wan- continue indorsement and such was forward- being while the boat was derer McKinney Denison, ed to at Texas. Greenville, Mississippi, moved 4,1948, again Defendant On October Representatives Lake Texoma. to policy because of the indorsed Agency of the Cleaveland then con- that the Wilburns had installed fact Chicago of office the De- tacted engine marine diesel the Wan- and made known to fendant the De- as a result of that derer request by made McKin- fendant portion a return of a entitled coverage ney charged for the transfer previously by premium 14, to the On the Wanderer Wilburns. Defendant. December through Chicago McKinney Defendant, 1948, addressed a letter The Agency agreed office, to transfer the cover- the Cleaveland advised, effect, policy question age to the Wil- he Wilburns, 8, 1948, Brothers then an and on June invest- burn McKinney $40,000.00 Wanderer, Agency wired ment Cleaveland Denison, Texas, and that would like to know the effect at charged completed, furnished. tions should be would be what rate By January 25,1949, letter ad- question to dated insurance in crease the 1948, 20, McKinney, Cleave- $40,000.00. dressed On December Agency McKinney Agency Mc- land advised wired the Cleaveland request Kinney $30,000.00 Defendant’s the amount By competent marine Wilburns have a would cost. additional insurance surveyor inspect 21, 1948, and for- Mc- the vessel letter dated December McKinney application Kinney ward to requested the Cleaveland making coverage Agency form or blank to be used to increase the report surveyor’s inspec- by $30,000.00. question McKinney survey Defendant, being upon tion. The made the advised Agency application of such Cleaveland the Wanderer and insurance, survey request furnished McKin- for additional form Agency, ney by caused such additional the Cleaveland completed by aforesaid, McKin- be issued indorsement ney, signed (Frank) question F. Wil- Decem- J. effective McKinney burn, ber and transmitted result [sic] coverage Agency. which the to the Cleaveland question February 9, $40,000.00. Agency was increased to Cleaveland ap- completed This indorsement was forwarded said forwarded Agency survey report plication Cleaveland to McKin- ney Denison, Texas, Chicago letter office. Defendant’s pol- survey report plication dated December 1949. The showed icy of insurance in and each to be owners of the Wanderer *6 every Denison, thereto, and indorsement and of the Wilburn brothers mentioned, by Texas; above was delivered vessel to the cost of the that through Agency $30,000.00 the Cleaveland the the Wilburn was brothers McKinney lighting plus $10,000.00 engine, United States mails to at for Denison, Texas, and, turn, fighting equipment; in deliv- that the and fire by McKinney ered to the Wilburns vessel market value of the estimated Denison, Texas, prior February $40,000.00; was the vessel was 25, mortgage subject any other At the time the Defend- not encumbrance; agreed the to be water ant to transfer the of navigated by Lake the vessel was insurance in to the Wil- Texas; Denison, Texoma, north subsequent burns and at all times used commer- the vessel is for Glenn, thereto it knew that Frank purposes; char- that the vessel is cial Henry Wilburn, and and each tered; summer location of them, Denison, resided in Texas. Resort, is Bums Run Lake the vessel 28, 1948, De- “On December Texoma; the winter loca- and Chicago office wrote the fendant’s vessel is Lake Texoma tion Agency stated, Cleaveland and Company. appli- The Boat & Dock effect, that in view of the substan- survey report and contained cation coverage they tial increase descriptive information additional Wanderer, the Wil- had extended engines rigging. vessel, its competent have a burns should survey application this Neither surveyor inspect marine the Wan- copy any report nor thereof nor a furnish the derer and Defendant copy nor statement thereof other surveyor’s estimate of its with by made the Wilburns connection day or, present event a value obtaining of the insurance with available, surveyor was not new coverage question was ever at- yacht application, completed to- question. gether tached for bills and invoices with Defendant, receiving The after the work and for the new installa- survey Burns Texoma report on or Resort. Run Lake application and Company Boat fur- Dock is located February 9, took about Lake on the shore of Texas reference action ther policy with boat Texoma. From the prior time destruction damaged by January excep- was by storm in with the fire the Wanderer up fire on receiving to its Cleave- destruction from the tion 25, 1949, February not used Agency copy indorse- it was of an land any purposes commercial October ment to dated any pur- nature signed by and was not used Wilburns pose gas- being except showing to Burns replacement returned days Run engine Resort a few before Feb- oline of Wanderer ruary 25, 1949, engine, as aforesaid. which indorsement diesel Chi- to Defendant’s was forwarded July “In Glenn, Frank and cago letter Cleave- office Henry corporation, Wilburn caused a February Agency land dated Compa- known as the Wilburn Boat ny, to be formed under and virtue of the laws of the 25, 1949, Wan- State of Oklahoma. February “On capital destroyed corporation stock of completely derer was buoy $40,000.00 was shown to be and the to a moored was fire while it sole corporation asset approximately in Lake Texoma ever Wanderer, had was the vicin- title to shore feet which Resort, was transferred here- ity Run of Burns pointed inafter Oklahoma out. All of resort is located stock of Company the Wilburn Boat Lake Texoma. line shore was owned Glenn, at all times place Wanderer where Henry Frank and destruc- Wilburn. The of its cor- time at the moored poration, Company Wilburn Boat in the State located tion fire never permit time had a to do Oklahoma. business in the State of Texas. sole- used “The Wanderer Plaintiffs, “In dur- June 1948 purposes pleasure private ly for *7 Plaintiffs, Glenn, Henry by Wilburn, Frank and ownership ing its $10,000.00 contrary was borrowed from the boat Cit- said on the but purchased Denison, izens Texas, National by Bank of with Wilburns August 1948, being 4, and and on chartered Wil- of intention Company, acting re- burn by Boat hire, and remodeled Brothers was for used through Henry purposes, and and Frank and equipped for such Wilburn, patronage avail- borrowed an was additional the extent $10,000.00 from used said bank. On able, and chartered was acquisition last mentioned of its date said Wilburn time from the hire by acting Company, by Brothers Boat until its destruction Wilburns through Henry However, during and by time Frank and Wil- fire. burn, mortgage executed a hire three chattel used for the boat January covering During the Wanderer in favor of four times. or damaged payment the bank to secure as the the boat was of $20,000.00 taken borrowed from It was then of a storm. result 24, mooring September 1948, regular by bank. Burns On at date, Glenn, bill of Boat of sale Lake Texoma Resort to Run Henry repairs Frank Company for and and Wilburn trans- Dock and Plaintiff, ferred and the Wanderer to the Lake Texoma Boat remained at corpora- undergoing repairs Company, a Company Wilburn Boat Dock reciting days tion, $9,- a of Feb- consideration until three or four before 25, 1948, ruary 25, it was 000.00. On October at which time Wil- regular mooring Company, corporation, burn Boat a returned to its Glenn, sale in favor of the Wanderer promissory note executed Henry Henry Frank and to Wil- Wilburn and Wilburn of Frank Company; (b) burn Boat of $8,000.00, and amount of mortgaging pledging said boat corporation or executed said same date covering Plaintiffs; (c) Plain- mortgage a chattel payment of tiffs did $40,000.00 not have investment to secure Wanderer boat; (d) boat and $8,000.00. of the The sale said boat Company, a cor- had been used for commercial Boat to the Wilburn purposes mortgaging used of said had not been poration, and the without the boat. ant. At the time the Wanderer Agency, tiffs tional Agency of Denison and Wilburn, boat to the Citizens the ums covering by cept tion. promptly destroyed by dated leased. debtedness of ney, above being destroyed ted the bility to the Plaintiffs for the loss Company, a unpaid to Plaintiffs sworn statement Chicago said letter On denying liability “Immediately, $8,000.00, letter to effect, $20,000.00 Defendant Defendant proof of loss fire. returned May 12, Henry notified the Plaintiffs of the destruction March Bank of Denison mentioned, The Plaintiffs refused to the Plaintiffs turn, the consent forwarded office premium the advised the that telegram The Cleaveland Wilburn the the the chattel McKinney above to Plaintiffs corporation, to advised the loss of the Wanderer. aforesaid, May fire the of the destruction and to the Cleaveland had the Defendant the Wilburn plaintiffs, upon because: sworn statement Plaintiffs, previously the had not of Frank and so 12 it the Defendant mentioned, were previously paid the fire the and denied lia- National proof of loss returned. Citizens addressed February 25, indebtedness Defendant’s was mortgages, Defendant, Cleaveland the Wanderer (a) of said boat returned been Defend- submit- amount Agency McKin- the in- premi- stated, Henry Frank Plain- letter Bank ques- Boat done Na- was the ac- re- In of defenses first following boat. pleasure purposes. destruction from the fair cash market the Wanderer a sum less than Wanderer the last trial as it was to determine first the brothers in modeling case *8 the insurance in the of the derer the Wilburns had 21.02 of the Texas Insurance Code less than sions of Art. tablishes, effort statute Plaintiffs. Under the facts in this destruction was such from the as to out McKinney did Statutes 000.00, I find from the evidence that resentative of the Defendant but It [V.A.T.S.]) made him such. Said [*] “ * “It money must be of these consists of three representative of placing not make agent degree trial. McKinney the Wilburns had his spent by ** Wanderer at the time Defendant fall into two Notwithstanding discussion that the **(cid:127)>:-* dealings the Wilburns had invested $40,000.00 and I so was not the difficult determine immediately prior construed borne mind However, connection with the Texas, rebuilding I find and conclude that value on the time representative accuracy McKinney record would be the $40,000.00. the three Wilburn the record with reference to find, the Defendant.” invested in categories. Revised Civil agent value made at the if substantially invested the Courts that with- the (now the record es- the fact during appellant’s made at amount of the breaches provi- to its of its agent agent Wan- $40,- rep- Sec. was [*] re- the trary upon warranty. to their that based The second is statement (6) $40,000.00 Wanderer; misrepresen- eight invested the concealments and/or eight engine that was the of the Wanderer tations of Three of fact. appellees a rebuilt breach one and that it cost that also constituted facts only $2,700.00, contrary state- express remain- to their of the ing warranties. engine ment cost misrepresentations, that the new and concealments and $5,000.00; pro- (7) express material, location that the winter also violated Resort, against of the conceal- Wanderer Run vision of Burns the contract contrary misrepresentation mate- to their statement that win- ment or ter location was Lake Boat rial fact or circumstance. Texoma Company; (8) Dock that the Wan- part of As to the breach of warranties damaged derer was at Burns Run Resort defense, that contends its policy January, 1949, contrary their state- Wil- was avoided because damaged. ment that it had not been carry (1) burns used the Wanderer passengers for hire in violation DEFENSES BASED ON BREACH warranty so not be that the vessel would OF WARRANTIES previous used without the appellant; (2) consent Court, applying The District mortgaged the Wanderer law, (A) held that the use of warranty that violation of the carry passengers Wanderer to hire mortgaged without vessel would not be was no defense based on breach previous appellant; and consent against warranty use because (3) to the Wilburn sold the Wanderer against breach warranted did not con corporation, Company, in viola- Boat bring tribute to about destruction warranty tion the vessel meaning of the vessel within Ar previous would not be sold without the Code;1 ticle 6.14 of the Texas Insurance appellant. consent of (B) mortgaging of the Wan misrepresentation In and conceal- derer was no defense based on breach defense, part appellant claims ment of its warranty against mortgaging be policy’s express provision cause Article 5.37 of the Texas Insur against misrepresentation and conceal- ance Code invalidates anti-encumbrance appellees’ con- ment was violated provisions (C) policy;2 in an insurance misrepresentation of the cealment and corporation that the sale to the was no 3) (numbered 1, 2 and above warranty defense based breach of the facts misrepresenta- their concealment because sale not in did sale (4) following tion of the destroy appellees crease the motive of facts: purchased with the inten- Wanderer was the boat nor decrease their motive to using carry passengers for tion of it to preserve it. contrary warranty hire language In view of the clear of used; (5) that the not be so would recognizing statutes, and the undoubted considerably $40,- than pellees had less application uniform of the law Wanderer, given invested 000.0.0 Texas courts to the effect to be Property. Breach Insured “Art. 6.14. 2. “Art. 5.37. Lien on Insured *9 by “Any provision any policy or violation the insured “No breach in of insur- warranty, provision subject any any company condition or of issued ance to policy, any provisions subchapter fire insurance contract of of insurance, of this applications therefor, upon property or that effect said is encum- property, any personal shall render void the a lien of character or bered shall contract, policy or constitute a de- or issuance of after such become thereon, any character, loss a suit unless a lien of fense encumbered or violation contributed such breach then such encumbrance shall render such prop- bring policy void, about the destruction of the of no shall be force and ef- Any erty.” provision placed such within fect. or upon any shall be null and void.”
640 analyzing appellant’s contentions warranties, that neither find we re- part is vital warranty this of its defense it can of first two breaches therefore, a con- are based on member find, urged We defense. provision, not on the common tractual of finding against defenses misrepresenta- parts arising law of concealment warranty from of breach significance, we of its tion. Because quote above, court trial 1 and numbered again: provision law. followed the Texas Policy trial Be Void regards of “This Entire Shall conclusion As warranty mis- has concealed or breach of if the assured represented third as to the court any boat agreement material fact or cir- not to sell —the concerning the' permission of this insurance thereof, or, express cumstance without Since, subject matter not so clear. or the law is suror —the swearing disposition any fraud or false case of the basis our view of touching to resolve on matter not have the Assured we do merely the case relating appellant’s conten- sub- insurance state to this issue we warranty thereof; con- ject of a before whether that a breach matter tion per- policy on fire or after loss.” tained in a good if the property defense is sonal then, it, appellant’s defense As we see nature, con- very not breach, could raises two issues decision. here bring destruction about the tribute to They (1) are: whether facts g., McPher- property. See e. insured misrepresented were material cealed and Co., 222 Fire Insurance son Camden (2) is risk, and whether there (Tex.Com.App.) it Since :S.W. anything in Texas statutes which vessel apparent sale of the that the relying appellant prevent from would have corporation not of itself could misrepresentation the concealment bring about the vessel’s (cid:127)contributed facts a defense. material fire, appellant con- destruction appellees is clear that the con It not bar Article 6.14 does tends misrepresented the facts cealed relying on the breach and/or question, initial out above.3 The set warranty as a defense. sale therefore, whether these facts were ON MISREP- DEFENSES BASED connection, In to the risk. material AND RESENTATIONS virtually authorities unanimous CONCEALMENT holding material fact is that “a knowledge ignorance fact, ‘the held that the trial court further naturally influence in misrepresentation would of which concealment and making all, the contract at or in eight above surer facts all of the numbered degree estimating and character of provision did not violate fixing risk, misrepre- the rate of insur relating or in to concealment ” Indiana Ohio Livestock Ins. did not ance.’ these facts sentation because (Tex. Smith, bring 157 S.W. destruction Co. v. about the contribute to meaning Civ.App.1913). 24B Tex.Jur. See Insur within the of the Wanderer (1956) Jur., ance, further, and 29 A. 6.14, and, these Section because Article Insurance, If this is the Section immaterial to the risk and facts were they materiality, impossible intentionally concealed or test District Court could how the con see misrepresented the intent to deceive than that some of otherwise appellant. clude appellees affirmatively erage December, Appellees 1948. The concealed *10 affirmatively misrepresented misrepresented true and the intended actual carry passengers Wander- had invested for amount of the vessel use they applied mortgaging hire, for the increased when sale er along coverage. with the facts This fact These facts not disclosed vessel. mortgaging use, relating appellees appellant sale to the re- when the to the above, set out were af- $30,000.00 other facts quested and the in cov- increase
641 misrepresented facts concealed and were the vessel operation. is not in In our view, material to the risk. appellees fact that the intended actually to and did use the Wanderer to deal now with each them We carry passengers hire, for was as “ma separately. terial” to the risk as other fact that imagined. could Any finding by the contemplated ac As to trial court contrary clearly as an excursion tual use of the Wanderer erroneous. McKinney, boat, simple fact agent appellees procure ins In view this determination that place urance,4 attempted the risk representation there was a false as to numerous marine underwriters in the intent of the prospec- owners without ex but was turned down tive use of the boat which was material ception these underwriters con because risk, to the we do undertake to de- To sidered the risk to be too hazardous. cide whether the trial court’s decision as McKinney rejection, preclude another did materiality of the other conceal- appellant not disclose misrepresentations ments or other would carry pas would be used to Wanderer support judgment. a reversal of its We sengers Moreover, accepted for hire. he nevertheless appro- consider that appellees policy for which contained priate briefly to comment on each of warranty used, that it would not be so misrepresentations these other admitted at a time when it was their intention to or concealments. warranty. Further, breach the he de mortgaging As to the of the Wan liberately falsified his reason for seek derer, appellant contends that the law ing from the stat is clear that the existence of a chat ing writing that “he had facilities mortgage, tel whether unfiled, filed or being coverage, located where he hull taking material to the per of a risk on undisputed was.” The evidence in the property. sonal See Franklin Fire Ins. policies shows that insurance record Philadelphia Fullen, ofCo. 139 S.W. higher command a boats much excursion (Tex.Civ.App.1940).5 2d 370 Couch, policies private pleas premium than Insurance, Sec. 784. policies and that the former ure craft customarily provision requir contain a Likewise, as to the sale of the boat to ing attendance a watchman corporation wholly when owned firmatively misrepresented “applica- (a) Company, A. Wilburn Boat Inc. completed by appellees. (b) chartering form tion” A. Excursion and busi- “application” form contained This the fol- ness. questions lowing (c) $25,000. answers: A. About “(a) (d) of vessel? Owner Wilburn A. A. Yes. (e) carrying brothers. A. Charted used for (b) Occupation passengers of owner? A. Meat for hire. (f) Packers. A. Moored off Burns Bun Besort. present (c) (g) of vessel Cost owner? A. Yes. $40,000.00. (h) A. A. Used. Any mortgages (d) (i) or encumbrances on $2700. A. None. A.. vessel? let, (e) chartered, course, Is vessel ever 4. Of can there be no doubt carrying passengers appellees used for hire? are bound the conduct agent, McKinney. Chartered. A. their Interstate (f) Sorrells, Winter location of vessel? A. Fire Ins. Co. v. S.W. Company. (Tex.Civ.App.1927); & Lake Texoma Boat Dock St. Paul & Fire Any (g) prior damage Garnier, vessel? Ins. A. Marine Co. v. 196 S.W. (Tex.Civ.App.1917). None. Engine (h) new or used? A. New. engine (i) purchased sepa- despite Cost 5. The Texas courts so hold rately. $5,000.” provisions A. fact anti-encumbrance appellees telling truth,
If been invalid under Article 5.37 of the Texas Code, quoted supra. answers would have been as follows: Insurance in note . *11 ly influencing material the insuror’s brothers, appellant points to to the Wilburn judgment own- take as to whether to significant the that one of fact most corpora- the risk. crease the the sale to that ers testified safe- purpose the primary as its Although tion the true cost nature and guarding as individuals the Wilburns engine, compared the facts stat- to the liability which claims any personal relatively insured, represent ed the be to passenger might was if a arise money, appellant small amount of insists This, injured the Wanderer. aboard that the insured the bald statement the says appellant, would diminish the engine $5,000, that the was new and cost keep the boat of the Wilburns motive engine whereas it was a reconditioned Appellant contends condition. safe in sufficiently $2,700, cost material is naturally influ- “would factor that representation false the avoid making contract an insurer ence rep- warranty under the false estimating degree char- all, inor resentations. fixing risk, rate of of the acter Finally, that the insists Livestock and Ohio Indiana insurance.” stating false answer the Wilburns supra. Smith, v. Ins. Co. damage previous that there had been no appellees’ urging the amount of In boat, to the it had been dam- whereas (“cost in the Wanderer actual investment aged repaired in a storm and had been owner”) material, the in- present was cost, at some considerable was likewise a points company fact that surance warranty against breach of the false “application” form representation constituting good de- appellees “esti- both for the asked against recovery policy. fense on the of the vessel market value” mated Because the fact that we have found present owner.” “cost of vessel represen- that there a false was material argued since extent “the It is tation at the time the was ob- property assured interest insured, tained do not we hazard, the moral measures insured necessary pass upon sider it these sev- always risk of material to the is hence eral based contentions on other mis- insurance,” Ins. Co. Connecticut Fire representations. This also makes it un- Manning, Cir., 160 the fact F. necessary for us to decide whether the may market have had a the vessel representa- fact that some of these false $40,000 at the of the loss time value were tions contained the form submit- materiality not affect does company ted the insurance after the pellees’ investment the vessel. actual coverage destroy increase of the would response ques- Touching on availability their as defenses on the application form as to the tion ground on that the form which vessel, appel- location of the winter normally is written what called an points to the fact lant Lake “application” form.6 Co., & Dock where Boat Texoma appellees’ We next come said the vessel located con owners great large tention fact winter, that a cannot be material is a concern where a expressly relates to a risk many which main- boats are stored warranty. times; covered a contractual service at all In a watchman tains words, they Resort, other claim that Run Burns where the false
whereas touching representation actually the use of in the winter moored vessel carrying passengers destroyed by fire, for the Wanderer it was is a and where pleasure purposes relatively Ap- instead was im secluded section of beach. simply says spe- because patent- material there was a pellant that this answer was misrep- point the Texas Insurance Code such is hero made is that Tlie resentation cannot raised if contained contained this form can statements “application” applica- in an unless the as a to a suit on be considered defense actually policy. attached 21.35 of tion because under Article *12 643 warranty relating to this use. cific fact that Texas Article 21.16 of the elsewhere, may expressly provides be the Insurance Code Whatever law that: however, this is it clear that “Any provision any seems or contract Ins. Fire policy the law in Texas. In Franklin insurance issued or supra, Fullen, defend- v. insuror Co. pro- tracted for in this State which claiming policy by suit ed a on the vides the answers or statements represented falsely the insured had application made such con- property unencumbered. the insured Although or tract in the contract insur- policy an anti- contained ance, false, if untrue or render shall course, which, of encumbrance clause policy the contract or void or voida- ble, invalid under Article 5.37 effect, shall be of no and shall Code, the held that the Insurance Court any any not constitute to defense al- was a fact and brought encumbrance material contract, upon suit un- lowed the insuror to raise defense upon less it be shown the trial there- misrepresentation of fact. thing of that the matter or mis- represented was material risk further The District Court erred actually or contributed to contin- assuming of the Tex that Article 6.14 gency or event on which said applies policy pro to a as Insurance Code payable, became due and and wheth- against vision representation. concealment and mis er it was material and so contribu- 6.14, Article as noted question ted in case shall be a above, effect, provides, in that no breach fact to be determined the court any provision of an insurance trying jury or such case.” shall constitute defense a suit on to If this clause of the insurance contract the breach to contributed unless purview 6.14, were within the of Article bring prop about the destruction of the virtually then Article 21.16 would be erty. But, already as we have noted meaningless, and the enactment above, long the Texas courts held have super latter erogation article would be “a work apply 6.14 that Article does not to legislature.” not to be attributed to the which, very nature, breach could McPh erson Fire v. Camden bring not contribute to about the de Co., supra, Ins. at 215. property. g., struction Mc See e. The to reference Article 21.16 Co., Pherson v. Camden Ins. Fire 222 poses is, question, next what (Tex.Com.App.1920). S.W. It ob effect, any, does that article have misrepresen vious that a concealment or respect appellant’s defense of conceal tation the assured could con never misrepresentation? Appellees ment and tribute to the destruction property. the insured that, 21.16, contend under Article con might, concealed facts misrepresentation cealment is no de bring cases, some about the destruction fense the matter unless concealed mis misrepresentation but not conceal represented was risk material policy provision them. ment of contributed the loss. This contention misrepresenta concealment or is based the last of the stat sentence designed prevent fires; was not tion ute, provides was meant assure the in (not questions) materiality and con company surance that it would have all jury, should left for tribution necessary the information to the han supported it is a dictum in one Texas dling of the insurance. Trinity Reserve Ins. case. See Life Co. applica Article 6.14 Hicks, That is not Tex.Civ.App., S.W.2d is, to the clause under ble consideration There are numerous cases conclusively think, by contrary,7 and, judg- demonstrated however, we in our g., Fidelity White, (Tex. See e. Union Fire Ins. Co. Co. v. 177 S.W. Pruitt, (Tex.Com. Civ.App.1915); 23 S.W.2d v. App.1930); Indiana & Ohio Live Liability Smith, Aetna Accident & stock Ins. Co. v. 157 S.W. *13 644 tentionally misrepresented adopt the concealed and ment, much these latter cases deceive material intent to facts with the sounder view. by inducing the the it issue to material can be that fact It is a obvious policy on concealments the basis these contributing to its to the risk without words, misrepresentations. In other
bring the destruction about ap- the the District Court assumed that property. As the Court stated sured pellant required prove the all to Ross, 315 S.W.2d Ins. Co. Inter-Ocean of de- elements of a action common law does (Tex.Civ.App.1958), “it 71, 73-74 ceit, being (a) factor the fraudu- above may been have disprove a fact not that being motive, (b) the lent and factor no it had risk because material to the element reliance. man- subsequent actual relation insured ner the event which holding, In so District Court the hand, is vir- it the did occur.” On other appreciate appel failed to fact that im- tually of an impossible to conceive been lant’s defense that it was not had bring contributing about to material fact ap appellees, deceived that the but property. destruction the insured pellees specific provision had a breached being apparent so, This it becomes provi of the insurance That contract. appellees’ the statute construction unambiguously policy sion states materiality require- would render is to become conceals if the insured void absolutely useless. ment in the statute misrepresents or a material fact “wheth must, Assuming, the reference as we er or no re before after loss.” There is materiality was intend- to statute quirement in that the insured an have meaning, impos- it is ed to have some appellant, tent to deceive the or that interpretation justify sible to appellant rely on the concealments deprive ef- it of all statute which would issuing misrepresentations policy. appellees precisely fect. what This Indeed, language provision urge tous do. plainly provides policy that the shall be or rendered void the insured conceals 21.16, by Moreover, Article misrepresents a material fact “in case or (a) terms, apply con to does not even swearing by or false fraud (b) misrepresentations cealments or Assured.” If mis the concealment and application in not for contained representation pol will void Thus, it surance itself. or icy fraud, must amount to common law apply, example, to McKin would ney’s not express separate then the reference use concealment of the intended meaningless. provision in the fraud applying Wanderer when misrepresenta insurance or to the oral rely solely need But we not on this McKinney December, tion made reasoning support this view of this applied for the increase when he In Chaachou v. American case. Central coverage, appellees as to the amount Co., Cir., F.2d Ins. this had invested Wanderer. policy provision had a Court before it under There remains for consideration to the one similar considera- insured, District Court’s conclusion pellant tion here.8 The who had made proof loss, could not in its succeed defense in his con- false statements misrepresentation un- statements concealment and tended that false (a) appellees proved it m- less that the his unless the defense to suit insuror [Emphasis (Tex.Civ.App.1913). In 24B to the loss. add- contributed page 417, Jurisprudence, Insurance, ed]. is said: interesting 21.16], note that the statute It [Article “Under representation warranty, though provision in Cha- under consideration or even provision here, achou, false, referred or unlike the does avoid afford misrepre- .misrepresent- “wilful” concealment unless the matter a.defense actually ed material the risk sentation. relied on attempted could it had demonstrate that been and declined to rejected pay, these statements. We rule would mean and, tention, doing, the fol- made so assured’s then claim would stand lowing though remarks: no dishonest acts whatso- *14 practiced. ever had been The men- against that, this “We think as surveying assured, pos- dacious the prospec- attack, charge emi- Court’s contemplating sibilities and nently start, first, with correct. We strategy tive tactics and han- in the terms, a which, plain contract in its dling claim, of his sense im- would ignored invoking by cannot be mediately that and vis-a-vis himself forfeitures, principle deplores which underwriter, no there would be Fidelity-Phenix Co. Insurance Fire risk at all in his If deceit. it work- of New York Cor- v. Benedict Coal ed, money and, he would have his poration, Cir., 347, 64 F.2d certio- worst, compelled could be dis- rari denied 289 53 S.Ct. U.S. gorge only by by affirmative suit pol- 77 L.Ed. construes or insurer the fraud were discov- against strongly in- icies most ered legally prac- in time to be or assured, surer favor ticably If it effective. didn’t work Whitfield, Palatine Insurance Co. v. —if, consummation, before fraud Fla. Thus So. 869. was detected—he would agreement suffer pre- parties called disadvantage whatsoever. It would dealing cisely honesty fair nothing-to- be everything-to-win, by a the assured and there unless proposition. lose public people con- refraining tracting to be honest “Additionally, such a rule would swearing from wilful and mis- false cast the underwriter in a role representation, is it a contract which process it is unsuited and in a ought which, any other, en- to be general long good, which the out of * * * forced. experience, performed best considers by government machinery. Con- spell “The contract not out does vinced, investiga- as here own its only swearing, that it mis- is false claim, tion of the of dishonest acts representation, or fraud concealment assured, it would then have which is successful that avoids segregat- to ing undertake policy. why [task] any Nor is there reason untruth, ferreting truth from such condition should be read out dishonest, the honest from the Clearly, to it. absence choosing right amongst from statute, law, is which founded wrong all or much of regard the factu- justice, truth and will not it coming al material now one person unsound that a has lost morally considered to be by wilful, unreliable. the benefit of the contract immoral, dishonest acts which the public “The interest is fur- not contract itself condemns. likely consequences thered these “Moreover, reading if the law out of some of guage into the contractual lan- misgivings forfeitures, about burden express- nowhere require judge-made that the insurer demon- ed. A which thus gives advantage strate had been misled dishonesty to its will prejudice fraud, retard, accelerate, orderly provision virtually adjustment would both be of insurance losses. If put premium insurer, worthless and strong on dis- from lan- dealings guage honest the assured. For interpreted of the contract if, by investigation, inspired equally plain law, own terms is perhaps by suspicions of the as- entitled to assume that the assured dealing misrepresent, honestly sured’s efforts to fairly, is as- only serting good insurer satisfied itself that a fraud faith decision, not see have made this canwe substantial to be the believed why them. matter, how make it for can we should the claim
truth of the spirit atmos- be handled formu But even if we were If, phere the oth- confidence. judge-made the face late law hand, realize must er insurer appellees, provision, the contractual significant if it that fraud is opinion, off. our Nothing be no better would finally successful, the slate law is better established investiga- wiped if its clean own mis of marine that “a insurance than cozening, tion the assured’s uncovers take or a marine commission material to setting may one of then become accidental, risk, whether it be wilful or antagonism, hostile reluctance *15 negligence mistake, or vol result from less, forcing apprehension more, not untary ignorance, policy. And the avoids litigation." though obtains, the the same rule even 241 suppose F.2d 892-893.9 be at insured the fact to did not Insurance, page at material.” 3 Couch nothing Texas is There requiring 2568. And is in 29 American it stated deceive to intent an statutes page Jurisprudence, Insurance, 956: misrep if concealments and reliance 690.—IN MARINE CASE OP “§ policy under a avoid are to resentations ‘Concealment,’ INSURANCE.— stipulation.10 express contractual an insurance, is the the law of marine legislature affirma Rather, the Texas fact to material failure disclose respect tively position with indicated or to the circumstance in relation by providing provisions to these contract subject matter of the contract which unless claim bar a that shall not loss, may liability to increase the re misrepresentation or the concealment obligation as- or affect the risk or sumed, a fact which or lates a material fact to law, is, or and which fact bring loss.11 the about to contributes within, ought within, or to insurance applies of deceit to The law knowledge party, and of of one contracts, all other as it to contracts does party no actual which the other has stipulate contracting parties if but knowledge. presumptive In the or unnecessary put con to that deceit is marine the insured case of the courts end, is not tract at an it must all facts material to disclose decision. of their the wisdom to duty risk, and in default regarded stipulations con If such may be avoided the contract legislature or trary policy, public to words, appli- In other an insurer. Since, however, say so. courts can for marine insurance must state cant legislature courts Texas or neither all material facts which are known County Saratoga bring Burritt v. also about is See tribute to It loss. Co., (N.Y.) clear, therefore, Hill 5 Ins. Mut. Fire that under Texas law 345; against provision v. Thomaston Dennison 40 Am.Dec. contractual breach misrepresentation Co., good Me. 37 Am.Dec. Ins. 20 should be defense Mut. misrepresentation 42; (a) America v. At was fraudu- Modern Woodmen if (Tex.Civ.App. lently made, (b) cheson, misrepre- 537 or fact 219 S.W. 1920). material, (c) fact mis- sented represented bring contributed to about the extremely significant that Article 10. It is loss. apply to to non- 21.16 has been held misrepresentations. Paul Article 21.19 of St. Note that fraudulent Garnier, Code, applies 196 Marine Co. v. to false Fire & Ins. Insurance proofs provides (Tex.Civ.App.1917). loss, In statements S.W. misrepresentation words, statement is made no such shall con- other false insuror, to a suit on a defense the intent deceive the with stitute fraudulently made, it was void a contrac unless related is rendered provision misrepresentation fact and misled the insuror. tual material Reynolds, misrepresentation Fund Fireman’s Ins. Co. even if relates to See (Tex.Civ.App.1935). immaterial fact which did S.W.2d strictly but insurer. surance 'it is him to the much more unknown * * applied marine risks It the insured has said been every material bound to communicate This statement then refers the reader knowledge fact not known within his Jurisprudence section of American presumed un- to be known quoted rule, above. Under there- derwriter, inquired for or whether fore, the absence of an intent to defraud not; par- either that a failure ap- help insuror would be of no although may ticular, arise pellees. forgetfulness, mistake, accident, or furthermore, contends, rigorous conse- attended though company that even the insurance quences at- never required to demonstrate that reason, void, taches pellee had a fraudulent and that motive risk the one is not assumed company the insurance was induced par- intended be assumed take action the concealments mis- ties. representations, com- these elements of regarding special dis- “The rules proved mon law fraud case in this insurance do closure as to marine as a matter of here set law. We do not *16 apply by ap- insur- pointed marine out the to ‘inland circumstances to pellant support argument covering transporta- this policies because ance’ firmly we are convinced ele- that these goods tion of on land.” required ments are not un- to be shown Although no case we have found der inappropri- the Texas Law. It is not rule, expressly applying is there this say, however, many ate to that mis- the have courts indication that the Texas representations already related other and firmly departed established from this circumstances not do heretofore detailed Indeed, strong principle constitute of marine insurance.12 evidence fraud. contrary. only the indication is conclusion, In because of clear the Insurance, Jurisprudence, In 24B Texas warranty against breach false (1960), page said 391: it is misrepresentations concealments, we and conclude that the trial court committed when “It a concealment is entering judgment error in for the knowledge of a fact ma- sured has pellee. honesty, to the risk terial which dealing good require judgment faith and fair is, therefore, REVERS- that he communicate should ED and the case is REMANDED to the insurer, but which he withholds. district court with directions it en- that judgment ter a for the defendant. respect “With to concealment applies all kinds of in- doctrine Reversed and remanded. merely assuming placed here are that We for the Second has Circuit on that applicable to a is defense of Texas law decision. See Kossick v. Fruit United 731, 742, Co., 886, in raised connection with a concealment 365 U.S. 81 6 S.Ct. policy. good There is marine L.Ed.2d and Purofied Down Products argument appellant’s Corp. Cir., Co., that reason behind Fire 2 Travelers Ins. law, 439, 441, maritime rather than federal state 278 F.2d n. Since above Appellant law, governs that con issue. rule stated of concealment in marine agree, tends, solidly body we that and Fireman’s Fund is surance entrenched in our Co., (see g., Wilburn Boat Co. v. 348 U.S. Ins. of federal maritime law .e. Mc- 337, merely Co., 99 L.Ed. 75 S.Ct. Lanahan v. Universal Insurance applied 98, 185), state law is to be held that 7 L.Ed. U.S. it would apply marine insurance field of where “en seem that this rule should precedent lacking” Because, however, federal trenched instant case. be we respect specific to a issue. This with that rule lieve same obtains in Tex interpretation Supreme point as, significance is the this of minimal Appeals and Court of Court itself a decision here. Judge judgments (Dis- “The the Court of
HUTCHESON, Circuit
Appeals
Court are
and the District
senting).
reversed and
cause is remanded
here
first
parties
were
When
un-
Court for a trial
the District
before
were
when
later
1953 and
appropriate state law.”
der
certiorari,2 the is-
on
Supreme Court
find-
light
defined
opinion,
on review
In
sues
ings
district
this
Bryant
Judge
heard
who
judge
complete
of the late
new trial on
conducted
originally. These were
law, and,
the cause
plaintiffs
find-
the
ings
and the
facts
specified warran-
law,
had violated
set
of fact
conclusions
sued
opinion,3
the marine
ties of
dealt
out in his memorandum
fully
pri-
sale,
Concluding
than for
pledge,
other use
all
issues.
insurer’s
unless, with
pleasure
vate
that the contract was a Texas contract
pol-
permission,
on the
special
endorsed
controlled,
found
and that Texas law
he
Judge Bryant
icy.
“I don’t
ruled:
gave judgment
plaintiff, and
for the
necessary”,
findings
judgment.
think
other
appeal is
from that
held
then understood
he
inasmuch
taking
same
here
per-
requires literal
the rule
position
prior
taken
has
was a rule
of warranties
formance
hearings
pol-
appeals,
since
general
where a marine
maritime law
gen-
icy
policy,
was a marine
could not be
was concerned which
controlled, a
maritime law
strict and
eral
court,
statutes, and this
affected
state
compliance
required,
Tex-
literal
833, supra,
principle
af-
F.2d
rig-
mitigate
statutes,
enacted
*17
ruling.
this
firmed
hardships
pol-
ors and the
of
strict
appeal
On
to the United States Su-
by introducing
icy construction,
issues
preme
310,
368,
Court, 348
75
U.S.
S.Ct.
fact,4
had been
is-
of
where there
337, supra,
99 L.Ed.
the decision of this
law,
application.
without
of
were
sues
Judge Bryant,
court and that of
to the Attacking
judge’s
each
district
performance
effect that literal
as matter
findings
and conclusions of law
of fact
governed
rights
irrevocably
of law
favor, therefore,
plaintiffs’
as
with-
parties
to marine
law, appellant
and in
fact
out basis
on that
state statutes could have
law,
effect
judgment
must
re-
insists that
be
cause was
reversed
majority
completely
opinion
versed.
espouses
remanded
United
District
States
appellant’s
I
ac-
views.
cannot
appropriate
trial under
state
Court
cept them.
majority opinion
law. The
of the Su-
contrary, I
On the
am
the clear
preme
concluded
follows:
Court
as
controlling
opinion: that under the
deci-
system
present
“Under our
of di-
including
Supreme
sions,
that of
regulations,
verse State
which is
judge
case, the
cor-
district
Court in this
Union,
old
applied
rectly
the Texas
construed
business has become one
findings
statutes;
are
that his
fact
great enterprises
Nation.
record;
supported
evidence
well
Congress
exceedingly
been
cau-
has
legal
his
conclusions are in ac-
and that
disturbing
system,
tious about
controlling law.
cord
marine
even as to
Congressional
insurance where
large one,
power
is a
facts and
record
undoubted.
Because,
We,
Congress,
regula-
how-
voluminous.
like
leave the
issues
thorough,
full,
ever,
and accurate
tion of marine insurance
where
judge
way
has
district
in which
has been—with
States.
Fireman’s Fund Ins.
Boat Co. v.
1.
Boat
v.
Ins.
Wilburn
Wilburn
Fireman’s Fund
3.
Co.
F.Supp.
D.C.,
Co.,
(1953).
Co.,
199
784.
NATIONAL Petitioner, BOARD, JOURNEY OF ASSOCIATION
UNITED OF the APPRENTICES AND MEN IN PIPE FITTING AND PLUMBING STATES UNITED OF DUSTRY CANADA, NO. AFL- LOCAL AND Carpenters CIO; Brotherhood United America, No. Local and Joiners AFL-CIO; Hod Car and International *18 Building Laborers’ riers’, and Common America, No. AFL- Local Union Respondents. CIO,
No. Appeals States Court of
United
Ninth Circuit.
March Rothman, Counsel,
Stuart Gen. Domi- Manoli, Counsel, L. Gen. nick Asso. Mar- Mallet-Prevost, Counsel, Asst. cel Gen. Welles, William Avrutis, Melvin J. J. At- NLRB., torneys, Washington, C.,D. petitioner. Sorenson, A. Ward, & Minnie D. Phoe- Ariz., respondent.
nix, JERTBERG, Before BROWNING and Judges. DUNIWAY, Circuit