113 So. 314 | Ala. | 1927
In Penn Mut. Life Ins. Co. v. Bancroft,
"If at any time the entire indebtedness evidenced by this certificate, together with any other indebtedness to the company on said policy, shall equal or exceed its loan value the company's liability under said policy shall terminate upon compliance by the company with the requirements of the policy, if any, respecting notice."
After several renewals of the loan, and after the last premium had been paid and the policy had become a "paid-up" policy, the principal and accumulated interest exceeded the loan value of the policy; and, after due notice to the insured, the company canceled the policy in accordance with the terms of the contract. It was held that the provision for cancellation was valid, and that the company's cancellation of the policy in accordance with its terms, prior to the death of the insured, terminated its liability thereunder and defeated the beneficiary's right of recovery.
So far as concerns the principles involved, there is no material difference between that case and the case now before us. In the Bancroft Case the loan was originally made before the policy had become a "paid-up" policy, but it was allowed to run for two years beyond that period, at which time the condition for cancellation occurred. But, as a matter of law, we do not think the validity of the cancellation agreement would be in any wise affected by the fact that the policy was or was not in the "paid-up" class.
But it is insisted that in the Bancroft Case the policy was "assigned, transferred, and delivered" to the insurance company, thereby vesting in the company the legal title, and removing it from the doctrine of Travelers' Ins. Co. v. Lazenby,
In the well-considered case of Palmer v. Mutual Life Ins. Co.,
In so far as the case of Travelers' Ins. Co. v. Lazenby,
The identical contract here in question, and substantially the facts of this case, were before the Court of Appeals of New York in Stevens v. Mut. Life Ins. Co.,
"The contract is clear. Its terms are not ambiguous. On default, the company may cancel the policy without further notice or further demand. This cancellation is the basis for further action. After it, but necessarily only after it has been effected, the company applies the surrender value of the policy to the payment of the note. If any balance remains it will pay it to the borrower on demand. The provisions are independent. They do not resemble those in fire policies where the manner in which cancellation may be effected is prescribed. Here the borrower expressly agrees that the cancellation may be made without notice by the action of the company. Such an agreement is not illegal. Clare v. Mut. Life Ins. Co.,
Under the foregoing authorities, we hold that the general affirmative charge was properly given for the defendant, and the judgment will be affirmed.
Affirmed.
All the Justices concur.