65 N.Y.S. 330 | N.Y. App. Div. | 1900
The facts in this case are not seriously disputed. The court having dismissed the complaint, the only question is whether upon the facts proved the plaintiff was entitled to any relief. It appeared that on or about the 6th of September, 1895, the Equitable Life Assurance Society had issued a paid-up policy of insurance' upon the life of one Charles G. Gordon for $4,400, wherein the plaintiff’s intestate, the wife of the said Gordon, was named as beneficiary. It appears that on or about September 11,1897, the said Charles G. Gordon and Parthenia Elizabeth Gordon, his wife (plaintiff’s intestate), borrowed from the defendant the sum of $1,716, and gave to it their promissory note by which the obligors agreed to' pay to the defendant the sum of $1,826 on September 11, 1898, and as collateral security for the said indebtedness they assigned this policy of insurance to the defendant. This promissory note gave to the defendant authority “ to surrender said policy to the Equitable Life Assurance Society of the United States and receive the surrender value thereof (said value to be determined by said society), on the non-performance of any of the promises herein contained, without notice of amount claimed to be due, without demand of payment, without advertisement, and without notice of the time and place of said surrender, each, and every of which is hereby expressly waived.” On September 19,1898, after the note had become due, Hr. Gordon wrote to the defendant: “ I have just returned home. Found your letter of the 9th inst. If you will kindly extend the time to Sept. 80th. It is almost possible to say that I can pay the interest & also the interest due since Sept. 11th. Please ans. me at once, as a few hours would make a great difference to me.”
In reply to that letter, on September 22, 1898, the defendant wrote to Gordon as follows: “We beg to advise you that if you wish to continue this loan for another year, you must remit to us promptly the interest ($109.94) according to the notice which we
On October 4, 1898, Alfred D. Bailey, a son-in-law of Mr. Gordon, wrote to the defendant as follows : “ Yours of some days ago to Capt. C. G. Gordon handed me 'to-day. In reply would say that Capt. Gordon is at present quite ill and unable to attend to any business; as soon as he is able he will communicate with you.” No further communication was received from the defendant. Capt Gordon died on the 26th of October, 1898, having been taken ill on the thirtieth of September, when lie became delirious, and 'remained so until the time of his death; and without notice of any kind to the makers of the note, or those interested in the policy, the defendant, on the 14th day of October, 1898,, surrendered the policy to the Equitable Life Assurance Society, and received from them $1,843.60 in full of all claims under the policy, and subsequently tendered to the maker of the note a check for $'1.87, being the cash surrender value of the policy less the amount due to the defendant. The court below dismissed the complaint upon the ground that there was no evidence of a waiver by the defendant of the right to surrender the policy on the non-payment of the note.
There can he no doubt that upon the failure of the obligors to pay to the defendant the amount due on the' 11th of September, 1898, the defendant ivas authorized to surrender the policy to the assurance society and receive the surrender value thereof without notice of any kind to the obligors; The question is, whether anything that the defendant did waived this right to surrender the policy to the assurance society without notice.
A¥hen the note became due on the eleventh of September, the defendant did not enforce this, right. What it did was to enter into negotiations for the extension of the loan. Mr. Gordon requested an extension of time to the thirtieth of September to pay the interest for another year, which would entitle the obligors to a renewal of the loan ; and no doubt if the defendant had accepted that proposition, with the statement that the obligors would be in default unless the arrangements for the new loan were completed by that day, the plaintiff could not have complained if the defendant, at the time
We think that the plaintiff was entitled to recover as damages the difference between the amount due to the defendant and the amount due from the insurance company. In Toplitz v. Bauer (supra) it was said : “ It is obvious that the surrender value, or what the company, was willing to pay for it, based upon tables of mortality applied to a sound risk, would be no indemnity for the loss-. The reasonable and just -rule of damages in such cases would seem to be the cost of replacing the policy on the same terms in a perfectly sound company at the time of the surrender, but the pledgor had then ceased to be an insurable risk Under any circumstances existing in the business of insurance; so that the real loss was the face of the policy less whát it would cost to carry it by payment of another premium which fell due before the death of the insured.” Here the defendant had notice given that the
Patterson, Rumsey and McLaughlin, JJ., concurred.
Judgment reversed, new trial ordered, costs to appellant to abide event.