70 Ind. App. 266 | Ind. Ct. App. | 1917
Lead Opinion
This is a suit by Sylvester A. Maxam against Federal Life" Insurance Company and Mary A. Maxam, for the damages alleged to have been sustained by Sylvester A. Maxam, hereinafter referred to as appellee, because of the wrongful cancellation or lapsing of a policy of life insurance issued upon his life in the sum of $2,500, payable to his wife, Mary A. Maxam, who filed an answer showing an assignment and transfer to appellee of whatever interest she had in the policy, or rights growing out of its cancellation.
The complaint was in one paragraph to which an answer in three paragraphs was filed by the insurance company. The first was a general denial, the second a plea of the six-yeárs ’ statute of limitations, and the third set up matter in bar of the action. A demurrer for insufficiency of facts was sustained to the third paragraph.
The case was tried by the court and upon due request the facts were found specially on which the court stated its conclusions of law which were in favor of appellee.
Appellant’s motion for a new trial was overruled, and judgment rendered on the conclusions of law for
Appellee contends that neither the complaint copied into the transcript, nor the memoranda accompanying the demurrer, is sufficiently identified by the record to enable the court to consider and pass upon any questions depending upon a consideration of these instruments.
The identification is not free from doubt, but the court is warranted in treating the instruments copied into the transcript as the pleadings on which the case was tried, and, inasmuch as practically the same questions arise on the exceptions to the conclusions of law as are attempted to be presented in relation to the complaint and answer, we believe the substantial rights of the parties may be determined by considering the questions raised by the exceptions to the conclusions of law and the assignments of errors based thereon. Bright Nat. Bank v. Hartman (1916), 61 Ind. App. 440, 109 N. E. 846, and cases cited; Evansville Furn. Co. v. Freeman (1915), 57 Ind. App. 576, 581, 105 N. E. 258, 107 N. E. 27; Judy v. Jester (1913), 53 Ind. App. 74, 84, 100 N. E. 15.
The finding of facts states in substance that appellant is a corporation organized under the laws of the State of Illinois and authorized to transact the business of life insurance on the legal reserve plan; that the Model Life Insurance Company is a 'corporation organized under the act of March 9, 1897, Acts 1897 p. 318, §4739 Burns 1914, passed by the general as
That appellant did not inform appellee of the provisions of said reinsurance contract in reference to liens until about April 1, 1910; that appellee made no inquiry of appellant, and did not attempt to ascertain the terms and conditions of the contract between said companies, but could have obtained full information in regard thereto had he made request therefor ;• that when appellant issued to appellee the aforesaid reinsurance policy for the purpose of inducing him to accept and retain the same and continue to pay premiums thereon, it represented to appellee, with intent to have him rely thereon, that appellant had reinsured and assumed the policies of the Model, including that of appellee, subject to the terms of the aforesaid contract, and that in accordance therewith it would continue appellee’s policy in force by his “paying to it the premiums as and when required by the terms of ■said Model policy”; that appellee relied upon the aforesaid representations as true, and did not know the aforesaid contract purported to authorize the charging of the aforesaid liens against his policy; that he relied on the statements and representations
On the foregoing finding of facts the court stated conclusions of law,- in substance, as follows: (1) That the acts of appellant in charging the aforesaid liens against appellee’s contract of insurance was a wrongful and unlawful violation of appellee’s rights, and an unwarranted breach of the policy of- reinsurance issued to appellee., (2) That the act of appellee in increasing the annual premium on appellee’s policy from $58.82 to $80.50 was wrongful and an unlawful vi elation of the reinsurance policy issued to appellee.
The contract between the two insurance companies, the reinsurance policies or contract issued to policyholders of thé Model Life Insurance Company, and the rights of the persons holding policies issued by that company and outstanding when appellant took over the business of the Model, have been considered by the Supreme Court and by this court in several cases, and many of the questions involved in this appeal are fully' settled by the decisions in those cases. Federal Life Ins. Co. v. Kerr, supra; Federal Life Ins. Co. v. Arnold (1910), 46 Ind. App. 114, 90 N. E. 493, 91 N. E. 357; Federal Life Ins. Co. v. Risinger (1910), 46 Ind. App. 146, 91 N. E. 533; Federal Life Ins. Co. v. Petty (1912), 177 Ind. 256, 97 N. E. 1011; Federal Life Ins. Co. v. Lillibridge (1912), 51 Ind. App. 704, 98 N. E. 1015.
Amorig"tjM4propositions determined by the forego
Appellant contends that the facts found fail to' show such a breach of the contract of insurance as warranted appellee in instituting a suit for damages for its breach or repudiation; that before instituting such suit appellee was required by the law to notify appellant of his election to treat the contract as breached and at an end, except for the purpose of maintaining an action for damages for such breach; that a prerequisite to the maintenance of such suit is the establishment of the fact, that appellee was able, ready and willing to carry out his part of the contract and the court has wholly failed to find such fact, which under the issues is a finding against appellee upon the issuable fact of his ability and willingness to pay the premium due under his contract.
The finding of facts also shows that after appellee was apprised of the increase of his premium and required to pay the same, in response to his inquiry for an explanation, he was informed by appellant that his policy would not be continued in force unless he recognized and acknowledged the existence and validity of
Appellee had the right to stand on his contract for insurance as evidenced by his original policy.
In the latter instance the injured party is not bound to give further notice to the defaulting party of such election before bringing suit, and is not bound to show as a condition precedent to a recovery that he had been at all times ready, willing and able to perform his part of the contract, after the time at which the other party repudiated the contract. If he was not in default at the time of such repudiation, and was adhering to and honoring the contract when repudiated by the other contracting party, he has discharged the obligations imposed upon him, and upon his election to treat the renunciation, whether by declaration or by acts and conduct, as a breach of the contract, the rights of the parties are fixed and the contract is at an end except for the purposes it may serve in such suit for damages for its breach. Anvil Mining Co. v. Humble (1894), 153 U. S. 540, 14 Sup. Ct. 876, 38 L. Ed. 814; Roehm v. Horst (1900), 178 U. S. 1, 20 Sup. Ct. 780, 44 L. Ed. 953, 957; Lake Shore, etc., R. Co. v. Richards (1894), 152 Ill. 59, 38 N. E. 773, 30 L. R. A. 33, and notes; Bond v. Carpenter (1887), 15 R. I. 440, 441, 8 Atl. 539; People, etc. v. Empire, etc., Ins. Co. (1883), 92 N. Y. 105; Mutual Reserve, etc.,
In United States v. Behan (1884), 110 U. S. 338; 4 Sup. Ct. 81, 28 L. Ed. 168, the Supreme Court of the United States, in distinguishing between suits upon contract or upon the quantum meruit where one party had put an end to the contract, and actions for damages occasioned by the breach or repudiation of an executory contract, said: “But surely, the wilful and wrongful putting an end to a contract, and preventing the other party from carrying it out, is itself a breach of the contract for which an ajytion will lie for the recovery of all damage which the injured party has sustained.”
In Roehm v. Horst, supra, the Supreme Court of the United States quoted with approval from an English decision the following: “On the other hand, the promisee may, if he thinks proper, treat the repudiation of the other party as a wrongful putting an end to the contract, and may at once bring his action as on a breach of it; *. * * It would seem on principle that the declaration of such intention by the promisor is not in itself and unless acted on by the
“ ‘But he had the right to elect'to treat the contract as absolutely and finally broken by the defendant; to maintain this action, once for all, as for a total breach of the entire contract. ’ * * *
“ ‘It seems to me that it is the better rule to-hold that the party who has refused to perform his contract is liable at once to an action, and that whatever arises afterwards, or may arise in consequence of the time not having come or not having expired, should be considered in estimating the damages.’ ”
In the case of Lake Shore, etc., R. Co. v. Richards, supra, the subject under consideration was treated in an exhaustive opinion which reviews many of the decided cases in England and America. Lawyers’ Reports Annotated gives extensive notes and cites numerous decisions bearing on the general subject.
In the course of the opinion the court said: “It is well settled that where one party repudiates the contract and refuses longer to be bound by it, the
In the same opinion the court also said: “Without further quotation from cases, it séems clear, both upon principle and by authority, that where one party to an executory contract refuses to treat it as subsisting and binding upon him, or by his acts and conduct shows that he has renounced it and no longer considers himself bound by.it, there is, in legal effect, a prevention of performance by the other party, and it can make no difference whether the contract had been partially performed or the time for performance has not yet arrived; nor is it important whether the renunciation be by declaration of the party that he will be no longer bound, or by acts and conduct which clearly evince that that determination has been reached and is being acted upon. * * *
In the case of Anvil Mining Co. v. Humble, supra, the court said: “Generally speaking, it is true that when a contract is not performed the party who is guilty of the first breach is the one upon whom rests all the liability for the nonperformance. A party who engages to do work has a right to proceed free from any let or hindrance, of the other party, and if such other party interferes, hinders, and prevents the doing of the work to such an extent as to render its performance difficult and largely diminish the profits, the first may treat the contract as broken, and is not. bound to proceed under the added burdens and increased expense. It may stop and sue for the damages which it has sustained by reason of the nonperformance which the other has caused.”
In Bond v. Carpenter, supra, the court considered-a case for damages for breach of an executory contract, involving the question of the plaintiff’s readiness and willingness to perform after breach of the defendant, and said: “We think, if this was so, that the plaintiff was entitled to treat the contract as terminated by the defendant, and if it was wrongfully terminated that he was entitled to recover for the breach thereof, without showing that he continued to be ready and willing to perform his part after such termination. The defendant’s request to the court to. charge that it was incumbent on the plaintiff to show
It follows from the foregoing that the court did not err in its conclusions of law.
While we have not considered the case from the standpoint of the complaint, our examination of the briefs convinces us that the points relied on, if duly presented, fail to show reversible error under the law as above stated and the decisions cited. This is also true for another reason as applied to two of the principal points in appellant’s contention, viz.: .(1) That appellee failed to notify appellant of his election to treat the contract as breached, and of his intention to seek to recover the damages caused by such breach; (2) that it does not appear either in the complaint or finding that appellee was ready, willing and able to pay the premium due under his original policy.
The views of appellant seem to result from its failure to accept the law as announced in former decisions dealing with the same reinsurance contract, and questions analogous to most of those presented by this appeal, and also by a failure to distinguish between the law applicable to a suit for damages for the breach of an executory contract like the one at bar, and those which seek a recovery upon the contract, or some theory other than that of damages for a wrongful breach or repudiation of such contract.
The propositions above announced also show that the court did not err in sustaining the demurrer to the third paragraph of answer, which set up the details of the transactions and the reinsurance contract, and sought to show that appellee was bound by all of its provisions and that the liens charged against his policy and the increase in his premium Avere binding on him, and that his failure to pay such premium is a bar to his recovery in this.suit. Wagner v. Supreme Lodge, etc., supra; Willcuts v. Northwestern, etc., Ins. Co., supra.
There is an attempt in the motion for a new trial to challenge the sufficiency of the evidence and to assert that the decision is contrary to law. •
Appellant stated as one of the grounds of its motion for a new trial that “the assessment of the amount of the recovery is .erroneous in this, that said amount of recovery is too large.” .. ..
Appellee contends that.no question is presented as to the amount of the judgment, and that in any event it cannot be disturbed on appeal because there is evidence tending to -sustain the .amount of damages found to be due appellee.. ,
In a certain sense a wrong is involved in every breach of a contract. Bnt snch wrong may be distinguished from the wrong which constitutes a tort.
The case at bar is founded on the breach of a contract and not upon the violation of any duty imposed by law independent of the contractual relations of the parties. It is an action ex' contractu, though not a suit upon'the contract as in cases where a recovery is sought according to the terms'of the contract.
erroneous, being too large. American Quarries Co. v. Lay (1906), 37 Ind. App. 386, 391, 73 N. E. 608; Boggs v. Toney (1912), 50 Ind. App. 289, 290, 98 N. E. 306, and cases cited; Smith v. Barber (1899), 153 Ind. 322, 332, 53 F. E. 1014; Lake Erie, etc., R. Co. v. Acres, supra; Conner v. Andrews Land, etc., Co., supra; Brown v. Guyer (1917), 64 Ind. App. 356, 115 N. E. 947, 948.
The facts bring the case within the rule applicable for the measure of damages in such cases.
There is evidence tending to sustain the finding and the amount is not shown to be so large as to warrant the reversal of the judgment oh that account. Blair v. Blair (1892), 131 Ind. 194, 30 N. E. 1076; Conner v. Andrews Land, etc., Co., supra; Mutual Reserve, etc., Assn. v. Ferrenbach (1906), 144 Fed. 342, 75 C. C. A. 304, 309, 7 L. R. A. (N. S.) 1163; Keyser v. Mutual Reserve, etc., Assn. (1901), 70 N. Y. Supp. 32; Ebert v. Mutual Reserve, etc., Assn. (1900), 81 Minn. 116, 83 N. W. 506, 509, 510, 834, 84 N. W. 457; Merrick v. Northwestern, etc., Ins. Co. (1905), 124 Wis. 221, 102 N. W. 593, 595, 109 Am. St. 931.
Judgment affirmed.
Rehearing
On Petition for Rehearing.
Appellant’s learned counsel insist that the court erred in the original opinion in failing to consider the tenth ground of its motion for a new trial, which alleges that certain enumerated special findings “are not nor are either of them sustained by sufficient evidence.”
On re-examination of the briefs wo find that .all material questions duly presented were considered and decided. We are content with the decision, and the petition for a rehearing is overruled.