
TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN




NO. 03-98-00166-CV


Summit Machine Tool Manufacturing Corp., Appellant

v.


Great Northern Insurance Company and Chubb & Son, Inc., Appellees





FROM THE DISTRICT COURT OF TRAVIS COUNTY, 261ST JUDICIAL DISTRICT

NO. 95-13343, HONORABLE PETER M. LOWRY, JUDGE PRESIDING 






	Appellant Summit Machine Tool Manufacturing Corporation ("Summit") sued its
insurance carriers, appellees Great Northern Insurance Company and Chubb & Son, Inc. (together
"Chubb"), (1) for various causes of action relating to Chubb's failure to pay Summit's claim under
an insurance policy covering the shipment of manufacturing machines.  The jury awarded Summit
compensatory and exemplary damages; however, it also found that Summit willfully concealed or
misrepresented material facts relating to the claim and that Chubb had not waived this policy
defense.  Based on the jury's answer to this question, the trial court rendered a take-nothing
judgment in Chubb's favor.  Summit raises five issues on appeal.  We will affirm the trial court's
judgment.

FACTUAL AND PROCEDURAL BACKGROUND
	Summit manufactures and sells industrial machinery.  In 1987, it arranged to sell
to various Mexican entities several hundred machines for making precision automotive bearings. 
The sale was never consummated, however, and Summit sued the Mexican entities.  As part of
a settlement, Summit received $13 million and retained ownership of the machines, which it stored
in a warehouse in Puebla, Mexico for several years.  In 1991, Summit arranged to sell the
machines to a Slovakian company.  To prepare for the transatlantic shipment, Summit began to
transport seventy-two truckloads of machinery from Puebla to Oklahoma City in mid-1992.
	Prior to shipment, Summit purchased primary insurance from the Mexican insurer
Asegudora Mexicana, S.A. ("Asemex") to cover transit-related property damage en route from
Puebla to Oklahoma City.  Summit also bought Differences in Conditions, Differences in Limits,
and Excess coverage ("DIC/DIL/Excess coverage") from Chubb as secondary coverage against
damage occurring in transit between Puebla and the United States unloading point in Laredo,
Texas. (2)  The DIC/DIL/Excess policy would pay only if the primary policy did not pay, or, if after
exhaustion of the Asemex policy limits, the full amount of the claim had not been paid.  Under
the terms of the policy, Chubb had the option to pay Summit either the value of the damaged
property or the cost to repair or replace the machinery.  The policy also contained a "concealment
or misrepresentation" clause stating:  "This insurance is void as to all insureds if, whether before
or after loss, you willfully conceal or misrepresent any material fact or circumstance relating to
this insurance."
	When truckloads of damaged machinery began to arrive in Oklahoma City in July
1992, Summit notified Asemex and Chubb of a potential claim.  Summit, which valued the
machinery at $20,035,347.86 at the time of loss, made a formal demand to Asemex, the primary
carrier, for $16,674,694.16 in transit damages.  Asemex refused to pay this amount, and Summit
initiated arbitration proceedings in 1993 against Asemex before the Comisión Nacional de Seguros
y Finanzas, in effect the Mexican Insurance Commission.  Asemex did not deny coverage, but
stated that Summit had not complied with the terms of the policy by failing to substantiate its
claimed damages to the machines.
	During this period, Summit expressed to Chubb that it was anxious to begin repairs
on the machines so that it could sell them to the Slovakians with a warranty.  After Chubb
representatives inspected the damaged machinery, Summit began repairing the machinery in
December 1992.  Summit kept records of the hours and costs it incurred, and later submitted these
records to Chubb.
	In June 1993, Summit sent Chubb a letter demanding payment of $16,674,694.16. 
Summit informed Chubb that Asemex had effectively denied its claim by thus far refusing to pay: 
"Accordingly, Summit now looks to Chubb and Arkwright for coverage under the applicable
policies." Summit asked Chubb to "concede coverage and admit liability" on Summit's claim. 
Chubb responded that Summit had not filed a sworn statement of loss as required under the policy. 
In July, Summit requested a statement-of-loss form, and Summit's counsel stated in a letter to
Chubb that he would assist in preparing it.  In August, Summit sent Chubb the loss statement, in
which Summit's vice president Dale Redman swore under oath that Summit's loss under the Chubb
policy was $16,674,694.16, the same amount it had claimed under the Asemex policy.  Chubb
rejected the loss statement, asserting that Summit did not provide credible documentation to
substantiate a loss in that amount.
	In March 1994, Summit and Asemex entered into a settlement agreement under the
following terms:  Asemex would pay Summit $3.6 million, in exchange for which Summit would
release its claim against Asemex and terminate the Mexican Insurance Commission proceedings. 
The agreement defined Summit's claim against Asemex as one for "alleged damage to certain
machinery and equipment, occurring on various dates . . . ."  Summit's general counsel David
Shear signed the settlement agreement on behalf of Summit, and Asemex paid Summit the agreed
amount.
	Summit filed suit against Chubb, Great Northern, and Arkwright in 1995.  Chubb
moved for summary judgment, arguing that because Asemex paid Summit $3.6 million to settle
its claim, the limits of Summit's primary insurance had not been exhausted; therefore, Chubb
argued, its secondary coverage was not triggered as a matter of law.  The trial court denied
Chubb's motion, and the case was tried to a jury under Oklahoma law.
	At trial, Summit took the position that the Asemex settlement did not constitute a
payment by the primary carrier on Summit's insurance claim.  Jack Golsen, the board chairman
and president of Summit's parent company, was one of Summit's primary witnesses.  Golsen
testified that the $3.6 million settlement with Asemex was not paid on Summit's claim for transit
damages under the policy; instead, he claimed that the payment was solely in settlement of tort
claims against Asemex for defamation and threats of arrest and extradition allegedly made against
Golsen and other Summit officials.  However, Golsen acknowledged that the settlement was not
paid out to himself or any other executives personally, but was placed on Summit's general ledger
as a receipt for equipment costs.
	David Shear, Summit's general counsel, gave similar testimony in his deposition,
which was read to the jury at trial.  Shear testified:  "We were paid strictly on our tort claims and
not on our cargo claim.  We were required to sign this agreement in order to get the money for
that."  When asked if the Asemex agreement settled Summit's claims for transit damages, Shear
stated:  "When you say settled it, we didn't get any money for that, [but] were we required to give
a general release, the answer is yes."
	Other evidence contradicted Golsen's and Shear's testimony about the nature of the
Asemex settlement.  The settlement agreement nowhere stated that the $3.6 million payment was
solely for the alleged tortious conduct of Asemex.  Summit's expert on Mexican law testified--and
Shear acknowledged--that the Mexican Insurance Commission did not have jurisdiction over tort
claims.  Jim Jones, the treasurer and corporate controller of Summit's parent company, testified
that the $3.6 million Asemex settlement was posted as a credit to reduce Summit's "unrecovered
costs."  Jones defined these costs as "the carrying value that we had on our books when the
inventory was in Mexico; all the costs that had to be incurred to return that equipment to the U.S.,
the costs that we have incurred to repair the damages; the costs to ship the product to Slovakia." 
He confirmed that none of the settlement money was given to any individual executives at Summit.
	Golsen testified that he did not speak with Summit's or its parent company's
accounting departments prior to making the claim for $16,674,694.16.  Instead, Golsen arrived
at that number by taking 85% (3) of the total value of the machinery in brand-new condition, a
percentage that "was kind of what I thought in talking to other people in the industry was about
a ball-park number" to have machines repaired and remanufactured, including two-way shipping
costs.  When asked why Summit used the $150 per hour labor rate in spreadsheets it sent to
Asemex and Chubb, Golsen testified:

We couldn't really get them into a dialogue on the claim.  It was to try to show
them--try to get them to the table to sit down and discuss, you know, what would
be reasonable for this claim, and to reach some kind of agreement with them so that
we could go ahead and fix those machines.


Golsen defended using the $16,674,694.16 figure as merely an estimate to negotiate with its
insurers because Summit was "cash-poor" and needed money to get the machines fixed so that
they could be shipped to Slovakia with a warranty.  However, he could not point to any
correspondence in which Summit expressed to Chubb that the figure was only an estimate rather
than a firm claim.  He also acknowledged that Summit had received $12,310,000 in advance
payments from the Slovakian purchasers in 1992, and had received $13 million in settlement of
the suit that arose after the thwarted sale of the machines to the Mexican entities.
	Much of the evidence at trial related to the condition of the machinery before and
after shipment, as Chubb attempted to discredit Summit's $16,674,694.16 claim by showing that
the machines had not been remanufactured before they left Puebla.  The machines were "decades
old," some from the 1940s and 1950s.  Summit purchased some of them used, and some were
used machines from Summit's plant.  After the sale to the Mexican entities fell through, the
machines sat in a warehouse in Puebla for four years unconnected to any power source.  Before
they were shipped to Mexico, Summit cleaned and painted the machines, "fixed the obvious," and
filled them with lubricating fluid.  Summit's engineering expert, Scott Gregory, examined some
of the machines in Puebla in 1991 and testified that they were "old machines, freshly painted" that
did not look like they had been remanufactured.
	Jim Rose, one of Chubb's experts, examined the machines after they arrived in
Oklahoma City.  Some had been painted over without being repaired, old motors and wires had
not been replaced, and he saw sludge in hydraulic lines and rusted components.  Rose testified that
the machines had not been rebuilt or remanufactured prior to shipping.  Eugene Keith, an expert
originally employed by Arkwright to investigate the damage to the machines in connection with
the Asemex claim, first examined the machines in July 1992.  Keith testified that the transit
damage was minimal compared to the damage from wear and tear.  He estimated the transit
damage to be $550,000, whereas his estimate of the total cost to repair the machines, including
damages for wear and tear, was $3,196,000.
	Chubb's accounting expert, Robert Matthews, reviewed Summit's repair log
reflecting the time and money Summit expended repairing the machines.  Summit marked up the
cost of its parts 100%, according to Westerman.  While Summit claimed to have paid a labor rate
of $150 per hour for machine repair, Matthews calculated from the records that Summit actually
paid an average wage of $8.76 for the repair work.  He estimated the transit damage to the
machines at $1,968,781.  Using three different methodologies, Matthews estimated an average cost
to repair all damage, including non-transit damage, at $2,416,972.
	The jury found (1) that the defendants breached the insurance contract, (2) that the
defendants committed constructive fraud in selling the policy, and (3) that Chubb's refusal to pay
Summit was a breach of Chubb's duty of good faith and fair dealing.  The jury determined that
$6,750,000 would compensate Summit for the damage in transit between Puebla and Laredo, and
it awarded Summit $1,743,050 in punitive damages against Chubb.  However, the jury also found
that Summit willfully concealed or misrepresented material facts or circumstances relating to its
policy claim, and that Chubb had not waived its right to assert this as a defense to its non-performance of the insurance contract.  The trial court concluded that "false swearing" constitutes
a complete policy defense under Oklahoma law.  Therefore, the trial court disregarded the jury's
answers except for its findings that Summit had made misrepresentations and that Chubb had not
waived that defense, and rendered a take-nothing judgment in Chubb's favor.
	Summit raises five issues on appeal.  First, it argues that the evidence is factually
and legally insufficient to support the jury's finding, in response to Question Four, that Summit
breached the misrepresentation clause of the insurance policy.  In its second and third issues,
Summit asserts that Question Four was fatally defective "because it omitted the 'intent to deceive'
element of the misrepresentation defense," and because "it was not limited to matters presented
in the pleadings and evidence."  Fourth, Summit urges that the evidence conclusively established
that Chubb waived the misrepresentation defense, or in the alternative, that the jury's failure to
find waiver was against the great weight and preponderance of the evidence.  Finally, Summit
argues that the trial court abused its discretion by excusing a juror for insufficient cause.

DISCUSSION
I.	Sufficiency of the Evidence of Summit's False Swearing
	In reviewing a no-evidence challenge, we consider all the evidence in the light most
favorable to the prevailing party, indulging every reasonable inference in that party's favor.  See
Associated Indem. Corp. v. CAT Contracting, 964 S.W.2d 276, 285-86 (Tex. 1998).  We will
uphold the finding if more than a scintilla of evidence supports it.  See Burroughs Wellcome Co.
v. Crye, 907 S.W.2d 497, 499 (Tex. 1995); Seideneck v. Cal Bayreuther Assocs., 451 S.W.2d
752, 755 (Tex. 1970); In re King's Estate, 244 S.W.2d 660, 661 (Tex. 1951).  The evidence
supporting a finding amounts to more than a scintilla if reasonable minds could arrive at the
finding given the facts proved in the particular case.  See Crye, 907 S.W.2d at 499; Transportation
Ins. Co. v. Moriel, 879 S.W.2d 10, 25 (Tex. 1994); see also William Powers, Jr. & Jack Ratliff,
Another Look at "No Evidence" and "Insufficient Evidence," 69 Tex. L. Rev. 515, 522 (1991). 
In reviewing a jury verdict to determine the factual sufficiency of the evidence, we consider and
weigh all the evidence and set aside the judgment only if the evidence is factually so weak, or the
verdict so contrary to the overwhelming weight of the evidence, as to make the judgment clearly
wrong and unjust.  See Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986); Garza v. Alviar, 395
S.W.2d 821, 823 (Tex. 1965); King's Estate, 244 S.W.2d at 661; see also Pool v. Ford Motor
Co., 715 S.W.2d 629 (Tex. 1986); see generally Powers & Ratliff, 69 Tex. L. Rev. 515.
	We first consider Summit's argument that there is insufficient evidence to support
the jury's affirmative answer to Question Four, which asked:  "Did Summit, its employees or
authorized agents, wilfully conceal or misrepresent any material fact or circumstance relating to
Summit's claim under the Great Northern policy?"  Summit argues that this case is a dispute about
an honest difference in valuation, which does not permit the jury to consider false swearing under
Oklahoma law.  Chubb responds that the issue of false swearing was properly submitted to the jury
upon sufficient evidence.  We agree.
	Oklahoma law recognizes false swearing as a complete policy defense.  See Long
v. Insurance Co. of N. Am., 670 F.2d 930, 933 (10th Cir. 1982); Transportation Ins. Co. v.
Hamilton, 316 F.2d 294, 296 (10th Cir. 1963); Buffalo Ins. Co. v. Amyx, 262 F.2d 898, 899 (10th
Cir. 1958); Goodwin v. Maryland Cas. Co., 233 F. Supp. 81, 83 (E.D. Okla. 1964); Short v.
Oklahoma Farmers Union Ins. Co., 619 P.2d 588, 590 (Okla. 1980) (husband and wife joint
insureds; false swearing defense applied against wife even though she did not know about or assist
husband in committing arson); Royal Ins. Co. v. Scritchfield, 152 P. 97, 98 (Okla. 1915); Orient
Ins. Co. v. Van Zandt-Bruce Drug Co., 151 P. 323, 325 (Okla. 1915).  Where an insured
knowingly and willfully overestimates the value of property destroyed or damaged, the policy is
voided and the insured's right to recover is defeated.  See Hamilton, 316 F.2d at 296.  However,
mere mistake, inadvertence, or a good-faith belief as to the value of insured property will not
sustain a charge of false swearing.  See id. (citing Jose Rivera Soler & Co. v. United Firemen's
Ins. Co., 299 U.S. 45, 50 (1936)).  The falsity and materiality of the statement and the intent of
the insured in making it are questions of fact for the jury.  See Hamilton, 316 F.2d at 297; Amyx,
262 F.2d at 900; Scritchfield, 152 P. at 98; Orient Ins. Co., 151 P. at 325.
	Summit submitted a sworn statement of loss claiming that the machinery had a value
of $20,035,347.86 at the time of loss and that the "whole loss and damage" incurred was
$16,674,694.16.  The jury found the amount of Summit's loss to be $6,750,000.  While this
number is higher than the various estimates given by Chubb's experts, it is only approximately
40% of the amount Summit claimed.  The wide discrepancy between the claimed damage to the
machinery and the actual transit damage was a factual circumstance the jury was entitled to
consider in deciding whether Summit swore falsely.  See Amyx, 262 F.2d at 900-01.  In this case,
the jury found that Summit willfully concealed or misrepresented material facts or circumstances
relating to its policy claim.
	Summit argues that this case is about an "honest difference in opinion" and claims
"[t]here was no evidence, either direct or circumstantial, from which the jury could properly infer
that Summit intended to deceive Chubb in filing the Proof of Loss."  We disagree for several
reasons.  As noted above, an extreme difference between value claimed and actual value can create
an issue of fact on the insured's intention.  Chubb presented overwhelming evidence that the
machines had not been damaged nearly to the extent Summit claimed; the jury's finding of only
$6,750,000 in transit damages is amply supported by the evidence.  While Summit's witnesses
testified that the sworn claim of more than $16 million in damages was based on the value of
remanufactured machinery, numerous witnesses testified that the machines had never been
remanufactured.  Further evidence supports the jury's finding of willful misrepresentation.
Golsen's and Shear's Testimony Regarding the Asemex Settlement
	The jury was entitled to disbelieve the testimony of Jack Golsen and David Shear,
who claimed that the Asemex settlement was only for Summit's tort claims and not on its policy
claim for transit damage.  Likewise, it was entitled to believe that this testimony was given falsely
in an attempt to trigger coverage under Chubb's secondary policy, since Chubb took the position
that its coverage was not triggered if Asemex paid the $3.6 million for transit damage.  Golsen's
and Shear's testimony was contradicted by that of Summit's treasurer, Jim Jones, as well as by
the language of the settlement agreement itself, in which Asemex paid $3.6 million in settlement
of Summit's claim "for alleged damage to certain machinery and equipment."  The jury was
entitled to view Golsen's and Shear's misrepresentation as material because it was relevant to the
existence and extent of coverage under Summit's secondary coverage with Chubb.
	Summit argues that Shear's testimony was not false because he simply gave his
opinion about what motivated Asemex to settle.  While Shear did make other statements of this
nature, the jury was entitled to believe that these were in addition to his unequivocal testimony
about the nature of the payment.  Next, Summit argues that even if there is evidence that Shear
was deceitful, his statements were solely about the legal effect of the settlement and are thus not
actionable under Oklahoma law.  We disagree; Shear stated as a fact that Summit was paid only
on its tort claims and not on its transit claims.  Finally, Summit argues that there is no evidence
that Chubb was misled by Shear's statements because Chubb received a copy of the proposed
settlement before Shear testified in his deposition.  However, it is not necessary that the insurance
company actually be deceived by the false swearing to avoid the policy.  See Goodwin, 233 F.
Supp. at 84.  We agree with the trial court's conclusion that Golsen's and Shear's testimony about
the Asemex claim is evidence that supports the jury's finding of willful misrepresentation.

Inflated Costs for Parts and Labor
	There is further evidence supporting the jury's finding of willful concealment or
misrepresentation.  Summit admitted to a 100% markup on the parts used to repair equipment.
Robert Matthews testified that Summit inflated its labor rates from an actual hourly average of
$8.76 to a claimed rate of $150 per hour.  Summit does not dispute these inflations, but argues that
they were not dishonest in the context of Summit's attempt to make Chubb negotiate.  We believe
that these are precisely the sort of circumstances that a jury is entitled to consider in determining
whether an insured made a willful misrepresentation.  See Scritchfield, 152 P. at 98 ("whether
such [proof of loss] statement was willfully made with intent to defraud is a question of fact to be
determined by the jury under proper instructions, upon consideration of all the facts and
circumstances in evidence surrounding the making of same.").  Summit argued to the jury that it
was cash-poor and simply trying to force Chubb to negotiate; by its answer to Question Four, the
jury did not find these explanations to be legitimate excuses for Summit's misrepresentations.  We
cannot say the jury's decision in this regard was wrong, unjust, or unsupported by the evidence.
	Summit repeatedly urges that there is no evidence that it made willful
misrepresentations.  It cites Goodwin v. Maryland Casualty Co., 233 F. Supp. 81 (E.D. Okla.
1964), in support of its argument that inaccurate proof of loss does not show an intent to deceive
under Oklahoma caselaw.  In Goodwin, the insured claimed that the value of his house destroyed
by fire was $30,000, the policy limit.  See id. at 83.  Although the trial court found the value of
the house to be $15,000, it rejected the insurer's defense of false swearing.  See id. at 85.
 Goodwin is distinguishable for several reasons.  First, in Goodwin there was expert
testimony that the house was worth $34,000. The trial court thus attributed the fact that the value
as claimed was only half of the value it determined to the normal disparity among expert opinions
on real property values, rather than to fraudulent intent of the insured.  See id.  In the present
case, the discrepancy in values, both in dollars and as a percentage, is larger than in Goodwin, and
resulted not from competing expert valuations but from Summit's admitted attempt to "bring
Chubb to the table."  There was also evidence that Summit made other willful misrepresentations
about the nature of the Asemex settlement and about its repair costs.  But most importantly, in
both cases the question of intent was one for the jury.  The trier of fact in Goodwin was simply
not persuaded that willful misrepresentation was shown by the evidence in that case; its failure to
find false swearing, however, does not make the jury's affirmative finding in the present case
erroneous as a matter of law.
	We find Amyx and several other cases cited by Summit distinguishable for the same
reason.  In Amyx, the jury found the value of the insured's inventory destroyed by fire to be about
half of the amount of the insured's sworn loss claim, and about four times what the insured's
records showed.  See Amyx, 262 F.2d at 900.  There was testimony from a former employee that
items reflected in the inventory were not on hand while he was employed there, and evidence that
the insured's brother burned junk and added it to the debris after the fire to make the lost inventory
appear greater than it was.  See id.  After the jury failed to find false swearing by the insured, the
insurer appealed.  The Tenth Circuit affirmed, concluding:  "In sum, there was evidence from
which the jury might very well have concluded that the inventory was grossly exaggerated, and
in fact materially and even fraudulently misrepresented.  But we think the issue was clearly one
of fact for the jury."  Id.  (emphasis added).  See also Hamilton, 316 F.2d at 297-98 (where
insured claimed $29,277 loss and special master found loss of $21,286, special master's failure
to find false swearing not clearly erroneous).  Amyx and Hamilton provide little support for
Summit's insufficiency argument.
	Finally, we address Summit's argument that Chubb's evidence of false swearing
is insufficient because the $16,674,694.16 claim was only an estimate designed to "bring Chubb
to the table."  To counter this proposition, Chubb cites Lykos v. American Home Insurance Co.,
609 F.2d 314 (7th Cir. 1979), a case decided under Illinois law.  In Lykos, the insured property
was a restaurant owned by Lykos that was destroyed by arson.  Lykos submitted a sworn statement
of loss that was later shown to be grossly overvalued; Lykos did not consult his records or
suppliers to determine values but based his estimate on memory, and it was uncontradicted that
the values claimed for many items were inflated.  After the jury returned a verdict in Lykos's
favor, the trial court granted the insurer's motion for judgment n.o.v. on the ground that the
insurer had established false swearing as a matter of law.  Id. at 315-16.
	The Seventh Circuit affirmed, writing:

	The plaintiffs attempt to dismiss some of the misrepresentations as mere
estimates for purposes of negotiation, and they suggest that the exaggerated claims
would have been ironed out had the insurance company been willing to negotiate. 
They contend that the evidence, therefore, does not establish the requisite intent to
defraud.  Even assuming that the plaintiffs did not intend to recover more than their
actual losses and merely exaggerated the extent of loss with an eye to settling, we
think the proper rule is that a design on the part of the insured to gain a position of
advantage in the settlement of the loss through false representations is a fraudulent
design and the making of such representations knowingly for that purpose is an
attempt to defraud . . . , even though the insured may not have expected or
intended ultimately to obtain more than compensation for the actual loss.


Id. at 316 (citing 14 Couch on Insurance 2d § 49:556 (1965)).  Summit's argument is strikingly
similar to the claim the Seventh Circuit rejected in Lykos.  While Summit urges that Lykos is
distinguishable because in that case (1) the evidence indicated that the insured set the fire, and (2)
the evidence of overinflated values was uncontradicted, we do not find these to be meaningful
distinctions.  If anything, the present case is more persuasive because the jury found as a question
of fact that Summit committed false swearing, whereas the Seventh Circuit in Lykos could only
affirm the judgment n.o.v. for the insured if it agreed that Lykos had falsely sworn as a matter of
law.  Although Lykos was decided under Illinois law, we find nothing in the Oklahoma caselaw
that compels a different result under the law of that state.
	Given the discrepancy between the value of Summit's loss as claimed and its value
as determined by the jury, plus the questionable testimony of Summit's officers that the Asemex
settlement was only for tort claims, and the evidence that Summit grossly inflated its actual costs
of parts and labor to repair the machinery, reasonable minds could conclude that Summit willfully
made material misrepresentations pertaining to its insurance claim with the intent to defraud
Chubb.  Nor has Summit shown that the judgment was clearly wrong and unjust.  We find the
evidence of false swearing factually and legally sufficient and overrule Summit's first issue.

II.	Summit's Objections to Question Four
	Question Four asked:  "Did Summit, its employees or authorized agents, wilfully
conceal or misrepresent any material fact or circumstance relating to Summit's claim under the
Great Northern insurance policy?"  In its second issue, Summit argues that Question Four was
fatally defective because it did not contain an instruction that in order to answer "yes," the jury
had to find that Summit intended to deceive Chubb.  In its third issue, Summit urges that the
question was defective because it was not limited to matters presented in the pleadings and
evidence.  Chubb responds that Summit waived both issues by failing to make a proper objection
on each basis, and that in any event the question submitted was proper.
	To preserve error, parties must make all objections to the jury charge before the
charge is read to the jury; all objections not so presented are waived.  See Tex. R. Civ. P. 272. 
An objecting party must point out distinctly the objectionable matter and the grounds of the
objection.  See Tex. R. Civ. P. 274.  For an objection to be valid, the party must make the court
aware of the complaint, timely and plainly, and obtain a ruling.  See State Dep't of Highways &
Pub. Transp. v. Payne, 838 S.W.2d 235, 241 (Tex. 1992).  Summit's objections to Question Four
were that (1) the question was general and not tied to any specific misrepresentation; (2) there was
no evidence of concealment or misrepresentation; (3) there was no evidence that any
misrepresentation was material; (4) Chubb had waived the policy defense; and (5) statements made
in litigation should not be used to void policies.  Because Summit's objections on appeal do not
comport with any of the objections it raised at trial, Summit has waived the objections raised in
its second and third issues.  See Tex. R. Civ. P. 272, 274; Payne, 838 S.W.2d 241.
	Summit argues that even in the absence of an objection, the jury's answer cannot
stand because it was not supported by sufficient evidence of intent.  We have already addressed
this contention and concluded that there is sufficient evidence in the record on which the jury could
have found that Summit intentionally and willfully misrepresented material facts with the intent
to defraud Chubb.  Summit's second and third issues are overruled.

III.	Waiver of the Misrepresentation Defense
	In its fourth issue, Summit argues:  "The evidence at trial conclusively established
that Chubb waived the misrepresentation defense; alternatively, the great weight and
preponderance of the evidence established this fact."  The jury found that Chubb did not waive
the misrepresentation defense.  Summit argues that the jury's finding should be disregarded and
that the judgment should be reversed and rendered in its favor.
	Summit's argument is based on a March 31, 1993 message written by Frank
Burans, the Chubb agent responsible for handling Summit's policy claim.  In an e-mail message
to his supervisor, Burans wrote:

Don:  Asemex still has not responded.  Insured is considering suit.  They are
considering filing a Proof of Loss with us even though we have told them that we
will have nothing to do with the claim and their claim has to be filed with Asemex. 
Have okayed assigning to Morris, Mahoney & Miller if and when proof is filed for
interpretation and rejection of proof.  Hold this open.  We'll keep you posted. 
Frank.


Summit argues that Burans's e-mail message, along with testimony from Summit's expert on
claims handling, conclusively establishes that Chubb made the decision to deny Summit's claim
well before Summit filed its statement of loss and thus waived its policy defense.
	Contrary to Summit's assertion, Burans's e-mail message does not state that Chubb
was planning to deny any claim made by Summit; it only discusses the anticipated proof-of-loss
statement.  Burans testified that he instructed Summit's file to be held open, as the e-mail
indicates.  He also testified that when he wrote the message, Chubb had received no substantiation
of the claim.  Because Summit was threatening to file a multi-million dollar lawsuit based on its
claim, which involved complex issues and a lengthy factual history, Burans referred the claim to
Chubb's attorneys for a coverage opinion.  Burans explicitly denied that Chubb had decided to
deny the claim at that point; instead, he was merely anticipating that the proof of loss would be
rejected unless Summit substantiated its claims.  Subsequent e-mail messages indicate that the file
remained open for further consideration of the claim.  We disagree that Summit conclusively
established waiver or that the jury's finding was contrary to the great weight and preponderance
of the evidence.
	Chubb counters that Summit has confused denial of an insured's claim with
rejection of its proof of loss.  While the former may cause an insurer to waive policy defenses,
Chubb urges, the latter does not.  In Great American Insurance Co. v. Harrington, (4) the Oklahoma
Supreme Court announced that state's rule about when an insurer waives its right to require
compliance with policy requirements:
Broadly stated, the rule is that, if the company denies liability for a loss, and
refuses to pay it either for that or other reason, placing its refusal on a definite
ground other than want of proofs of loss or a defect in their form or substance, it
waives the right to insist on the failure to make requisite proofs as a defense to an
action on the policy.


Harrington, 259 P. at 586; see also Western Cas. & Sur. Co. v. Lund, 132 F. Supp. 867, 870-71
(W.D. Okla. 1955) (insurer's denial of liability constitutes waiver of insured's failure to give
prompt notice of claim), aff'd, 234 F.2d 916 (10th Cir. 1956); Springfield Fire & Marine Ins. Co.
v. Oliphant, 300 P. 711, 712 (Okla. 1931) (formal proof of loss waived when insurer denied
liability under policy).  Chubb argues that it never denied Summit's claim prior to litigation;
Summit alleges that Chubb's actions constitute waiver of the misrepresentation defense.  Both
sides cite Harrington as primary authority for their position.
 Harrington states that the insured waives its misrepresentation defense if it denies
liability and refuses to pay its insured when its refusal is based "on a definite ground other than
want of proofs of loss or a defect in their form or substance . . . ."  Harrington, 259 P. at 586
(emphasis added).  As Burans and other witnesses testified, Chubb did not deny Summit's claim;
it merely rejected the statement of loss because it lacked adequate substantiation.  Under the facts
the jury evidently chose to believe, this situation falls under the waiver exception noted in
Harrington rather than the general rule.  We have reviewed the evidence and reject Summit's
argument that either waiver was conclusively established or the jury's failure to find waiver was
against the great weight and preponderance of the evidence.  We overrule Summit's fourth issue.
IV.	Dismissal of Juror Wygant
	Summit's fifth and final issue on appeal complains that the trial court erred in
dismissing juror Sherry Wygant when her son was hospitalized with a serious illness.  On the
morning of September 16, 1997, the trial judge made the following announcement:

[T]he jury in this case was deliberating when juror Sherry Wygant received notice
that her son was ill and was being taken to the hospital.  She was excused by the
Court to go to the hospital.  She has since called in and said that her son seems to
be seriously ill and vomiting blood and that she would not be able to return today
and didn't know if she could come tomorrow or not.

	For that reason the Court instructed the jurors to proceed with 11 jurors and
we'll dismiss Ms. Wygant when she calls today or tomorrow.


When the court asked if the plaintiff had any objections, Otto Good, counsel for Summit, stated: 
"Yeah for the record, Your Honor.  Officially I object."  Defense counsel then made a lengthy
and substantial objection.  The judge stated that another juror would be leaving on vacation the
next day.  At that point, the bailiff apparently spoke to the members of the jury and found out that
some jurors would be willing to continue deliberations that evening but had to attend to various
personal situations first.  When the judge asked plaintiff's counsel if he had any suggestions, Good
replied:  "Not anything good, Judge.  Again, if I knew we could agree to go on with ten jurors,
that's--if that solves the problem."  Defense counsel refused this suggestion.  The judge then
called in the eleven-member jury and asked them to continue deliberating that evening after a
recess, which they agreed to do.

	While the jury was deliberating later that evening, the trial judge announced:

Earlier today I made a statement concerning a juror, Ms. Wygant, who left to go
to the hospital because her son was going to the hospital.  And I did not mention
it, but it is clear that she was sobbing when she left and did not appear to be able
to continue to play any part in the deliberations.  That's all.


Summit argues that the trial court abused its discretion in dismissing juror Wygant "because a
sitting juror may only be excused for actual physical or mental incapacity."  Chubb responds that
Summit waived any objection to Wygant's dismissal because it did not obtain a ruling on its
objection, see Tex. R. App. P. 33.1(a), or because plaintiff's counsel stated that Summit did not
want a mistrial and suggested that deliberations proceed with fewer than twelve jurors.
	We first consider Chubb's waiver argument.  It is clear from the record that the trial
judge had already excused juror Wygant and determined that she would be dismissed when he
asked if counsel for either side had any objections.  Appellate Rule 33.1 states that error is
preserved if the trial court implicitly overrules a party's objection.  Tex. R. App. P. 33.1(a)(2)(A). 
We do not believe that Summit was required to obtain a ruling on its objection when the
circumstances clearly indicated that the trial court's decision was already made and the judge was
apparently soliciting objections "for the record."  And although Summit's objection was voiced
with less vigor than the objection made by defense counsel, Chubb cites no authority for the
proposition that Summit's failure to request a mistrial renders its objection ineffective.  We will
address the merits of Summit's fifth issue.
	The Texas Constitution and the Texas Rules of Civil Procedure require a district-court jury to consist of twelve original jurors, but as few as nine may return a verdict if the others
die or become "disabled from sitting."  Tex. Const. art. V, § 13; Tex. R. Civ. P. 292.  The
supreme court has equated being "disabled from sitting" with "an actual physical or mental
capacity."  See McDaniel v. Yarbrough, 898 S.W.2d 251, 253 (Tex. 1995) (citing Houston & Tex.
Cent. Ry. Co. v. Waller, 56 Tex. 331, 337-38 (1882)).  Not just any inconvenience or delay is a
disability.  See Yanes v. Sowards, 42 Tex. Sup. Ct. J. 570 (Tex. Apr. 22, 1999).  However, trial
courts have broad discretion in determining whether a juror is "disabled from sitting."  See
McDaniel, 898 S.W.2d at 253.  Thus, the test is whether the trial court acted without reference
to guiding rules and principles or whether the act was arbitrary and unreasonable.  See id.
	In Waller, juror Thomas Bradbury's wife informed him by letter that one of their
children was sick and asked him "to come home if he could."  Waller, 56 Tex. at 337 (emphasis
added).  After reading the letter, the trial court asked Bradbury if the letter "satisfied him that it
was necessary for him to be at home to attend his sick child"; Bradbury answered that it did.  Id. 
Over the objection of defense counsel the trial court dismissed Bradbury and continued the trial
with the remaining eleven jurors.  The supreme court reversed, stating:

[W]ithout deeming it proper to attempt to define fully the meaning of the
expression used in the constitution, we are satisfied that the causes which disable
the juror from sitting, and justify the extreme course of allowing, over a party's
objection, a verdict to be rendered by the remainder of the jury, must be of a nature
more directly showing his physical or mental incapacity than mere mental distress
occasioned by the sickness of others, and the feeling that duty to the sick demanded
his presence elsewhere.  Extreme cases of the kind, however strongly they may
appear to the court to release the juror, do not belong to the class provided for by
the constitution or statute.  


Id. at 337-38.
	The supreme court recently distinguished Waller in Yanes v. Sowards, 42 Tex. Sup.
Ct. J. 570 (Tex. Apr. 22, 1999).  In that case, during the second day of testimony juror
Christopher Obregon notified the trial court that his grandfather was in the hospital dying from
an E-coli infection.  In response to questioning from the court, Obregon stated that the situation
would interfere with his ability to listen to and understand the trial evidence and that he did not
think he could pay attention.  Based on Obregon's answers, the trial court found that Obregon was
disabled under Rule 292 and dismissed him.  The case proceeded with the remaining eleven jurors,
who found unanimously for the defendant Yanes.  See id. at 570-71.
	The court of appeals reversed, holding that under Waller, an illness in a juror's
family is not a sufficient constitutional disqualification.  See Sowards v. Yanes, 955 S.W.2d 456,
459 (Tex. App.--Fort Worth 1997).  Summit relied on the court of appeals' opinion in its
appellant's brief and reply brief filed in this Court, arguing that the trial court in the present case
erred for the same reason.  While the present appeal was pending, however, the supreme court
granted Yanes' petition for certiorari and reversed.  See Yanes, 42 Tex. Sup. Ct. J. at 572.
	In a per curiam opinion, the supreme court distinguished Waller on the ground that
there was no evidence in that case that juror Bradbury's mental distress would prevent him from
discharging his duties as a juror.  In Yanes, however, juror Obregon testified that he would be
distracted and unable to pay attention due to his grandfather's condition.  The court held that the
trial court's finding of disability was supported by Obregon's testimony showing that he was
emotionally and psychologically disabled from sitting.  See id.
	In post-submission briefing, Summit now seeks to distinguish Yanes on the ground
that the trial court's dismissal of juror Wygant "was entirely unsupported by any record
evidence."  While it is true that the testimony of Ms. Wygant herself is not in the record, the trial
court stated on the record that she was sobbing when she was excused to attend to her son at the
hospital.  She later telephoned the court to report that he was "seriously ill and vomiting blood." 
We think the trial court properly exercised its discretion by ordering the dismissal of juror Wygant
without requiring her to abandon her son at the hospital and return to the courthouse to repeat what
the trial judge had already stated to the parties on the record.  The record adequately supports the
trial court's conclusion that juror Wygant was "disabled from sitting" because she was "sobbing
when she left and did not appear to be able to continue to play any part in the deliberations."  The
evidence of her disability is at least as strong as that of juror Obregon in Yanes.  Under Yanes and
other Texas authority, (5) no abuse of discretion has been shown.  Summit's fifth point of error is
overruled.

CONCLUSION
 The evidence is factually and legally sufficient to support the jury's finding that
Summit made material misrepresentations of fact pertaining to its insurance policy with Chubb. 
Summit did not conclusively establish that Chubb waived its "false swearing" defense, and the
jury's failure to so find was not contrary to the great weight of the evidence.  Finally, Summit's
claims of error in the jury charge and in the dismissal of juror Wygant are without merit.  We
therefore affirm the trial-court judgment.


  
 Bea Ann Smith, Justice
Before Justices Jones, B. A. Smith and Yeakel
Affirmed
Filed:   July 29, 1999
Publish
1.        At the time of the claims, Chubb & Son, Inc. was the claims manager for Great Northern. 
Great Northern is also a member of the group of insurance companies The Chubb Group.  Unless
the context indicates otherwise, we will use "Chubb" to include Great Northern.
2.        Summit also obtained excess coverage between Laredo and Oklahoma City from the
Arkwright Mutual Insurance Company.  That coverage is not at issue, since Arkwright was
dismissed from the lawsuit and is not a party to this appeal.
3.        Summit's claim amount of $16,674,694.16 is actually 83.23% of the $20,035,347.86 figure
Summit claimed as the machinery's value at the time it was damaged.  We have found nothing in
the record that explains this discrepancy.
4.       259 P. 582 (Okla. 1927).
5.       See Southern Pac. Transp. Co. v. Peralez, 546 S.W.2d 88, 97 (Tex. Civ. App.--Corpus
Christi 1976, writ ref'd n.r.e.) (no abuse of discretion in discharging juror who became disturbed
and unable to serve as a juror because of family member's illness); Schebesta v. Stewart, 37
S.W.2d 781, 783 (Tex. Civ. App.--Fort Worth 1930, writ dism'd w.o.j.) (juror advised to "come
at once if he wished to see his father alive" was "physically ill, trembling, eyes and nose running,
pulling his hair, his voice hoarse, and thereby rendered physically unable to sit further as a
juror"); Barker v. Ash, 194 S.W. 465, 466-67 (Tex. Civ. App.--Dallas 1917, writ ref'd) (news
that juror's child dangerously ill and about to die sufficient to disable juror from fair consideration
of case); see also Allen v. State, 867 S.W.2d 427, 429-30 (Tex. App.--Beaumont 1993, no pet.)
(juror whose aunt and brother-in-law both died within twenty-four hour period found emotionally
disabled); Wells v. State, 762 S.W.2d 673, 674-75 (Tex. App.--Texarkana 1988, pet. ref'd) (juror
who suffered death in family found too distraught to continue); Mills v. State, 747 S.W.2d 818,
819-20 (Tex. App.--Dallas 1987, no pet.) (juror whose grandfather died and who testified he
could not keep his mind on case found emotionally disabled).

d to the parties on the record.  The record adequately supports the
trial court's conclusion that juror Wygant was "disabled from sitting" because she was "sobbing
when she left and did not appear to be able to continue to play any part in the deliberations."  The
evidence of her disability is at least as strong as that of juror Obregon in Y