197 Ky. 430 | Ky. Ct. App. | 1923
OpinioN op the Court by
Affirming.
This is an appeal from the judgment of the Laurel circuit court dismissing the petition of appellant, Grace H. Brown, in an equitable action filed by her to recover two thousand dollars on an insurance policy issued December 31, 1903, by the Fidelity Mutual Life Insurance Company on the life of her husband, W. L. Brown.
On May 11, 1886, the predecessor of appellee issued its policy No. 9673 for $2,000.00 on the life of W. L. Brown for an annual premium of $5.00, plus the payment of such assessments as might be required by the company to pay the death claims of its policyholders. That policy was carried for sixteen years at a total cost to the insured of $864.05. In 1903 it was surrendered and appellee issued in the place of it a $2,000.00 yearly renewable term policy. The latter policy, No. 146439, contained a graduated scale of annual premiums ranging from $89.50 at sixty-three years of age to $318.58 at eighty years of age. Neither policy had any loan or cash surrender value or paid-up benefits, the purpose of both policies being to provide protection for the insured at the lowest possible premium rate. The second policy, which is the one involved here, contained the provision, “If any
Brown paid the premiums on this policy, generally in quarterly installments, from 1903 to November 1, 1912, the total amount paid being $1,092.73. He failed to pay the quarterly installment due February 1, 1913, and on March 4th, thirty-one days thereafter, the policy was forfeited. No effort was made by Mr. Brown to obtain a reinstatement of the policy. After his death on June 7, 1917, this action was instituted by his wife, the beneficiary, to recover the full amount of the insurance.
The pleadings show the issuance of the two policies, the aggregate payments made by Brown on each of them, and the cancellation of policy 146439 on March 4, 1913, for failure to pay the quarterly premium due February 1, 1913. They present issues of fact (1) as to whether by its course of dealings with the insured the defendant had established a custom of accepting premiums after their due dates without requiring a health certificate or a revival of the contract, whereby the insured was induced to believe, as a reasonable man, that the installment due February 1, 1913, would not be demanded on that date, but that he might pay it within a reasonable time thereafter; and (2) whether defendant had waived the right to collect the premium due February 1, 1913, on or before the last day of grace — March 4, 1913 — because the insured had lost his policy and had requested that defendant furnish him a copy of it, and also whether, by reason of that fact, defendant had caused the insured, as a reasonable man, to believe that no payment of pre
It is the contention of plaintiff that the trial court erred in refusing to submit to the jury the twenty-one separate issues of fact embraced in her motion made after she had introduced her evidence and the court had indicated that defendant’s motion for a peremptory instruction would be sustained; and also that it was error to direct a verdict for defendant on the two issues on trial before the jury. The first suggestion may be disposed of by saying that the twenty-one minor questions of fact upon which the plaintiff asked a jury trial were included in the two issues on wMch a jury trial was granted; and that being true, it was manifestly proper to refuse separate hearings on the included questions. The second contention involves a question of fact. If sustainable at all, it is on the theory that the issues were exclusively legal, and there was sufficient evidence on behalf of plaintiff to submit them to the jury. Assuming, therefore, without deciding, that the questions were purely legal and not cognizable concurrently in law or equity, we come to a oonsideration of the evidence with the view of ascertaining whether it was such as to require a submission of the issues to a jury.
The proof shows that the insured, on a number of occasions after taking out the second policy, did not pay the premium within the tMrty-one days of grace allowed; and it also shows a similar practice on Ms part with reference to the first policy. We do not, however, regard the conduct of the parties in respect to the first policy as having any evidential effect on the custom or practice in regard to the second policy, since the latter policy was a separate contract and the custom as to extending the time of payments of premiums thereon, if one existed, must be determined from the conduct of the parties in reference to that contract and none other. As to that policy, it is in evidence, as we have observed, that the insured frequently did not pay the premiums witMn the thirty-one days of grace allowed, but it appears that in such instances it was exceptional when he was not required to apply for a reinstatement of the policy and to execute a health certificate. It is shown that on one occasion a
It is said for plaintiff that forfeitures are odious to the law and that an insurance company may, by its course of dealing with the insured, waive its right to forfeit a policy for the nonpayment of dues within the time stipulated in the policy. We do not dissent from this statement; it is the law. But the difficulty that the courts find is in applying it to the facts at hand. The rules for
‘ ‘ To warrant a recovery where a premium is not paid when due, it is necessary to prove (1) the course of dealing between the insured and the insurer in reference to the acceptance of overdue payments amounting to a custom or habit; (2) that by reason of this course of dealing, the insured was justified in -believing that the insurer would not insist on a forfeiture for failing to pay subsequent premiums; (3) that the insured believed he could postpone the payment of premiums without risking a forfeiture; and (4) that he acted on this belief, and therefore did not pay the premium at its maturity.”
The question therefore is, did the insurer by its course of dealing with the insured establish a custom of accepting payments of premiums after the expiration of the thirty-one days of grace and thereby induce the insured to believe that it would not forfeit the policy upon his failure to pay the premium within that time? The evidence on that subject shows, as we have pointed out, that only on a few, occasions did the insurer accept the payment of overdue premiums without requiring a certificate of health and a revival of the contract of insurance; and furthermore, that the circumstances of those acceptances were exceptional in that in every instance the insured, beforé the expiration of the thirty-one days of grace, had taken steps to pay the premium. It is in proof that every time there was a forfeiture of the policy for the nonpayment of a premium, as on March 4, 1913, the insured applied for a reinstatement of the policy and furnished a health certificate. No such application was made after March 4th. Hence there is not only' no custom supporting his position in reference to the effect of the forfeiture of March 4th, but there is in fact mo single precedent to sustain it. Besides, an occasional indulgence under exceptional conditions cannot effect the establishment of a custom or abrogate the plain provisions of a contract. It therefore seems, to us, under this view of the evidence, that the insurer had not established a custom of accepting premiums after maturity dates without requiring health certificates and a revival of the contract ; and accordingly on that issue the trial court properly directed the jury to find for the defendant.
But it is said that for a number of years the company permitted the insured to revive his policy, after it had lapsed for nonpayment of premiums, by permitting him
In discussing the question just disposed of, we have-said there is nothing in the correspondence between the parties to the contract from which the insured could reasonably infer that, pending the negotiations for a copy of the policy, the payment of premiums would be suspended. We may add there is no evidence in the record from which the inference could he reasonably drawn. It follows that there was no evidence for the jury on the second issue, and the directed verdict on that issue was also proper, The judgment is affirmed.