Plaintiff Stamateo Kazanteno sued herein to establish his right to receive from defendant California-Western States Life Insurance Company, disability payments at the rate of $300 a month under certain accident insurance. He relied upon an oral agreement which the court found to be established, rendering judgment in his favor. Defendant appeals, urging two major propositions: (1) That the agent, William Economidis, who was found to have made the oral agreement, had no actual or ostensible authority so to do and (2) that the evidence is insufficient to support the finding that such agreement was made. As each of these contentions is a challenge to the sufficiency of the evidence, this court must accept as established all facts and all inferences favorable to respondent which find substantial support in the evidence. “And where appellant urges the insufficiency of the evidence to sustain the findings . . . the rule is that, ‘Such contention
requires defendants to demonstrate
that there is no substantial evidence to support the challenged findings. ’
(Nichols
v.
Mitchell,
On July 18, 1946, defendant insurance company issued to plaintiff a $10,000 life insurance policy (No. 564765) and two “Good Will Builder” policies, one an accident monthly income policy, and the other a health income policy. Each bore the same number as the life policy, 564765. Counsel refer to them as “rider” policies. The monthly payments were to be $200 under each income policy. In 1949 the company demanded return of the accident policy for the purpose of reducing the agreed payments to $100 a month and reclassifying plaintiff as a C risk, rather than A. These things were done. In August, 1951, plaintiff permitted thе life policy *364 to lapse and conversations began shortly looking to reinstatement of the policy and increase of the accident benefits from $100 to $300 per month. The immediate participants were the plaintiff and William Bconomidis, who concededly was a company agent. The conversations also included a proposal for plaintiff to take out a policy upon his son’s life, with himself as beneficiary. Plaintiff refused to reinstate the existing policy or to buy one on his son’s life unless the benefits on the two “Good Will Builder” policies were increased to $300 a month. Of course, the agent was interested. He testified: “I always keep after him.” The home office of the company (which wаs in Sacramento) had expressed its approval of the increase in August, 1951. The vice president had written the Hawaiian agent (plaintiff was a resident of Honolulu) on August 21, 1951, that: “Subject to evidence of insurability satisfactory to the Company, we will now be prepared to consider increasing the Accident Income for Life and Health Income Benefits to $300.00 each. We will need the enclosed Form 10 and Non-Medical properly completed and returned to the Home Office together with the old Good Will Builder Policies. ...” A copy was sent to Bconomidis, who in turn forwarded a copy to plaintiff, saying, with reference to the proposed increase of payments under the accident and health policies, “I would be more than glad to take care of this matter for you from here when you come back to Los Angeles again. I think I can give you something better.” On September 24th, 1951, the vice president of the company sent a memorandum to the Hawaiian agency referring to the lapse of the life policy and saying: “We will, however, be prepared to consider reinstatement and increasing the Accident Income for Life and Health Income Policies to $300.00 a month each provided we receive a completed reinstatement Form 75 and a payment of $751.54 by October 18, 1951. For your convenience in discussing this case with Mr. Kazanteno, we have prepared the following figures: ...” Coрy of this communication was likewise sent to Mr. Bconomidis and its text shows that the .letter was intended for discussion with plaintiff. The matter finally crystallized on June 25, 1952, after plaintiff had returned to Los Angeles from Hawaii. He told Bconomidis that he was ready to effect the $200 increase in the accident and health benefits and the agent said it would be necessary to reinstate the life policy No. 564765 and pass a physical examination. Plaintiff said that unless he got the $200 a month *365 increase he would not buy a policy on his son’s life or reinstate his own life policy No. 564765 but would look elsewhere for his insurance. Eeonomidis assured him that “if you have it in writing you will get it’’and also that “I did have it in writing, he did write to me that he was going to get it for me, the company aрproved.” Plaintiff understood this language to refer to the letters of August 21 and September 24, 1951 from the home office, and Eeonomidis himself testified to the same effect; also, that he told Kazanteno that the letter was sufficient to be binding when he paid the premiums (amounting to $620.70). The letter of August 21, 1951, said that the company would require “the enclosed Form 10 and Non-Medical properly completed.” Form 10 is a request for change in policy, but Eeonomidis told plaintiff that Form 10 was no good because he had to pass a medical examination, being over 49 years of age; so on June 25, 1952 he had plaintiff sign an application for reinstatement of life policy Number 564765, using for that purpose company’s Form 75. Plaintiff alsо had in force another life policy, Number 564934, and a policy loan agreement was executed by him in order to effect a loan upon that policy in the sum of $1,281.33 to provide the funds for the pending deal. At the same time he made an application for a policy upon his son’s life, which carried a premium of $372.50. Eeonomidis of his own volition, required the medical examination; it was had, probably on June 24th; it must have been successful or the policy on the son would not have been writtten as it was on July 16, 1952. Eeonomidis said he would have plaintiff sign a Form 10, to keep it in case the company should inquire for it. He told plaintiff he wanted his cheek for $120 to cover additional premium for changing his classification, and thаt plaintiff should have it in before August 18; also, that he had plenty of reserve and his policy would automatically cover the $200 increase. The signing of Form 10 occurred a day or two after June 25. Kazanteno was leaving hurriedly for Honolulu because of a strike in Hawaii and Eeonomidis sent the form to his hotel for signature. Plaintiff there signed it in blank and the agent later picked it up at the hotel, dated and signed it and held it until October 6, when he forwarded it to the home office. 1
*366 Before signing the various documents plaintiff said to the agent that if he did not get his increase in accident and health benefits he would not want the insurance, and Economidis said that the minute the 65 (meaning life policy No. 564765) was reinstated, the increase would go with it. Plаintiff was leaving for Honolulu and testified: “He told me as soon as they know the doctor’s findings that he would notify me, that is all I had to do-” Also, “I said, ‘Is there anything else you want with me?’ He said, ‘No, everything is all right, as soon as we hear from the doctor, he is the main thing, if he passes you everything is all right, and if the doctor don’t pass you there is nothing I can do.’ ” Economidis testified that he told plaintiff the increase would be effective at the time he paid the premium for the basic policy. Plaintiff believed these statements and relied upon them. On July 31, 1952, Economidis sent plaintiff a copy of a letter of July 30 from the manager of the premium collection department to himself, saying: “Our records show that Policy #564765 was reinstated July 10, 1952, and premiums and loan interest paid to July 18, 1952. ’ ’ Having made a package deal whereby reinstatement of the life policy was conditioned upon increase in the benefits of the accident and health policies, plaintiff was justified in believing that the increase had likewise been effectuated. At that time he had received no new policy, his old ones were in the hands of the company.
On August 25, 1952, while supervising the harvesting of pineapples, plaintiff suffered an accident which caused hospitalization for 60 days or more, and caused total disability which continued to the time of trial.
Economidis, the agent, had advised the company, through the Los Angeles office, of Kazanteno’s desire for the $200 increase, and on June 25th he fоrwarded the life policy to the home office for reinstatement, which was actually effected on July 2d. On July 7th the company sent plaintiff notice of *367 reinstatement with premiums paid to July 18, 1952; also, notice of premium due on July 18, 1952. The premium thus billed on the reinstated life policy, No. 564765, $620.70, included the two Good Will policies for the period of July, 1951 to July, 1952. The $120 was to cover increase in benefits on the Good Will policies. Under date of August 14, 1952, plaintiff forwarded four cheeks in the amounts of $620.70, $535.70, $372.50 and $120. The two first mentioned were received in the Los Angeles office by August 15th and were cashed by the company on August 25, 1952. They covered the premiums on the two life policies, Numbers 564765 and 564934. The check for $372.50 represented the premium on the sоn’s policy; it was payable to Bconomidis and appears to have been cashed by the company on September 22, 1952. The $120 check, payable also to Economidis was cashed by the company on September 22, 1952. (These two checks had been sent to one Chumas in Los Angeles, a friend of both plaintiff and the agent, and he had delayed delivery, and for some reason they had to be put through the bank twice, once on September 10th and again on September 22d.) The policy on the son’s life was issued on July 16, 1952. On September 4, 1952, defendant company sent to plaintiff a notice that “Tour request for change has been put into effect” and the notice refers to policies Numbers 564765 and 564934.
B conomidis and the Honolulu agent both learned promptly of plaintiff’s accident. Though the company denied liability for increased benefits, it retained the moneys, issued the son’s policy, and reinstated the life policy, Number 564765, regardless of delay in payment of premium. On October 17, 1952, after knowledge of plaintiff’s accident, it issued new “Good Will Builder” accident and health policies, carrying benefits of $300 a month, dated July 18, 1953 but effective October 18, 1952. On November 11, 1952, Bconomidis wrote plaintiff that there was no company liability in excess of $100 a month and explained the reason as it had been stated to him by the company: “As you will recall, when you were here last July we decided to increase the benefits on this portiоn of your policy from $100.00 a month to $300.00 a month. The effective date of the policy was to have been July 18, 1952. Our trouble started when your check was missent to the Choumas Produce Company. We of course, in turn, were then late in forwarding the money on to the company. Our next problem arose when we failed to get *368 the yellow Form 10 signed, which was sent to you for your signature. The end result was that the company did not have all of the facts before them that they requested until early in October, and final approval was given for the increase, effective October 18,1952.” Economidis had explained on or before June 25th, that if necessary the reserve on the existing policy would take care of an automаtic loan in the event the $120 premium was not paid. Concerning the alleged failure to get Form 10 signed, he testified that he sent two of them to plaintiff in Honolulu for signature but they were never received by plaintiff; that this was done because the one which had been signed in June had expired; that that one was in his own possession until October 6, 1952, when he transmitted it to the home office.
The letter of November 11th also said: “There is one bit of good news: The company, when approving your request for increased benefits, also reclassified you from Class ‘C’ to Class ‘A’, which will materially reduce your premium in the future. I am enclosing the refunded portion of your premium.” This seems to refer to company’s check of October 21, 1952, for $63.75, whiсh plaintiff cashed in March, 1953, believing it to be a refund because of change in his classification. Actually, it was a refund due to issuance of the policy as of October 18, 1952, instead of July 18, 1952, as agreed; but the attached voucher meant nothing to plaintiff, especially in the face of Economidis’ explanation of a different reason for the cheek.
So the company retained all of the premiums except the $63.75—a net amount of $1,049.45 (exclusive of the premium on Number 564934), issued the policies per application and undertook to make the new “Good Will” policies effective after the date of the accident instead of the date which its agent had represented and agreed upon, July 18, 1952.
The trial judge found, in paragraph IV: “It is true that on or about the first day of July, 1952 plaintiff and defendant entered into an oral agreement whereby defendant agreed to extend the Good Will Builder Accident Monthly Income for Life and the Good Will Builder Health Monthly Income for Life policy . . . for a period of one year commencing July 18, 1952 and ending July 18, 1953, and that the monthly benefits payable to plaintiff pursuant to the terms and conditions of said policies would be the sum of $300.00 per month, and that defendant, in consideration for plaintiff reinstating the Life Insurance policy . . . agreed to *369 issue its written policies containing the terms and conditions set forth in Exhibits L and M providing for $300.00 per month monthly benefits and providing for a term beginning July 18, 1952 and ending July 18, 1953 evidеncing the oral agreement entered into by the parties on July 1, 1952.” Also, that the new accident and health policies “were issued with an effective date of October 18, 1952 without the knowledge and consent of plaintiff and without the payment of consideration by defendant, and contrary to the agreement of defendant to issue said policies with an effective date of July 18, 1952, pursuant to the agreement mentioned in Paragraph IV above.” Paragraph XVII: “It is true that defendant by its duly authorized agent on or about the first day of July 1952, represented and warranted to plaintiff that plaintiff had done everything necessary in order to extend the terms and provisions of said Good Will Builder Accident Monthly Income for Life policy for a period of one year commencing July 18, 1952 and ending July 18, 1953, and increasing the monthly benefits payable thereunder in the event of accident as therein defined from $100.00 per month to $300.00 per month and double that amount in the event of hospitalization during said period due to accident. ’ ’ Paragraph XVI: “It is true that defendant accepted the benefits of the contract between the parties set forth in Paragraph IV above with knowledge of the terms and conditions of the oral contract made by its agent, William Economidis.” Paragraph XIX: “It is true that plaintiff relied on said representations and warranties by defendant’s agent and refrained from procuring other accident monthly income for life insurancе and traveled to the Territory of Hawaii in reliance thereon.” Paragraph XX: “It is true that defendant’s agent failed and neglected to forward the necessary forms to effectuate the increased benefits under the Good Will Builder Accident Monthly Income for Life policy to defendant’s home office within a reasonable period of time.” The court rendered judgment reforming the accident and health policies to make the effective dates thereof July 18, 1952, instead of October 17, 1952, awarding $8,100, with interest, as total of amounts due from August 25, 1952 to September 25, 1954, and declaring plaintiff’s right to receive $300 a month “for so long as plaintiff shall be wholly and continuously disabled as a result of the injuries incurred on August 25, 1952.”
First, as to the sufficiency of the evidence of the making
*370
of the oral agreement. Both sides assert that California recognizes as valid oral agreements for insurance.
(Toth
v.
Metropolitan Life Ins. Co.,
The facts above recited clearly constitute substantial support for the court’s finding of the making of the oral agreement. “ Where a valid parol contract of insurance has been entered into, the policy to be issued thereon is simply the memorial of the prior parol contract, and even though the policy be not delivered until after the loss occurs, the insurance is deemed effective from the time agreed upon in the parol agreement,- irrespective of any delivery of the policy
(Crawford
v.
Transatlantic Fire Ins. Co.,
Next arises the question of whether Economidis had actual or ostensible authority to make such an agreement. If ostensible agency be found that is enough to support the judgment. Section 2300, Civil Code, provides: ‘ ‘ An agency is ostensible when the principal intentionally, or by want of ordinary care, causes a third person to believe another *371 to be Ms agent who is not really employed by him.” Section 2317: ‘ ‘ Ostensible authority is such as a principal, intentionally or by want of ordinary care, causes or allows a third person to believe the agent to possess.” Bconomidis had a written agency contract which, standing alone, restricted his activities considerably, but plаintiff never saw it or knew its contents, and so it becomes immaterial to the consideration of the question of the existence of ostensible authority. Bconomidis had no connection with any other insurance company, for years he had handled Kazanteno’s insurance with defendant and conducted the company correspondence with him, using company stationery for that purpose. Letters were actually written by Miss Hubbard, who was secretary and cashier of the Los Angeles agency, but she was told by Bconomidis the substance of what should be said; he signed the letters; following his signature were the typed words “Los Angeles Agency.” He had had a desk in the company office, then moved into his son’s office which wаs on the same floor as the company, but, speaking of June and July, 1952, he said: “I always get any desk there when I go in there.” He had the run of the office. When the home office became interested in having Kazanteno reinstate his policy Number 564765 after its lapse in 1951, the information was sent to Bconomidis with the expectation that he would follow the matter with plaintiff and that he did do. Kazanteno had no contacts with the home office and practically none with other persons in the Los Angeles office. He would leave his policies with Bconomidis for safekeeping and they would repose in the company safe and were there when he left Los Angeles in June 1952. In 1951 plaintiff was late in forwarding his premium and Bcоnomidis advanced his own funds to cover the same; this was done with the assistance of Miss Hubbard and was known to the company, which later made a refund to him. Bconomidis undertook to overrule the home office on the need of a form 10 and insisted on a medical examination in connection with reinstatement. He undertook to make a package deal with plaintiff, reported it to the Los Angeles office and the home office, and the company took full advantage of it, received and kept the premiums, issued the son’s policy promptly on July 16, 1952, reinstated Number 564765 on July 2, 1952, and gave notice of the fact to plaintiff. It aeeeptéd the $120 extra premium for increase of benefits on the Good Will policies and Bconomidis testified that he did not know of plaintiff’s accident when those checks *372 were received. It developed that the company did insist upon a form 10, that Eeonomidis had it in his possession but did not forward it until after the accident. This doubtless was primarily responsible for delay in formal action on increase of benefits under the accident policy. In letter of March 10, 1953, from the manager of the Los Angeles agency to the superintendent of the policy payment department it is said: “At that time he requested Bill Eeonomidis, the agent in this case, to increase the Health and Accident Income benefits from $100.00 a month to $300.00 a month. Bill neglected to have a Form 10 signed, but did notify the Company of the intended change. By the time Bill had been informed that a Form 10 .was required, Mr. Kazanteno had gone to Hawaii for what was intended to be a short business trip to look after his interests there. By the time Bill Eeonomidis was able to communicate with Mr. Kazanteno and inform him that a Form 10 was required, Mr. Kazanteno had been injured, which was the injury for which the present claim has been made.” Never, until after the accident, did the company do or say anything which smacked of rejecting any part of the package deal which Eeonomidis had made for them. Plaintiff had every reason, after years of dealing with Eeonomidis as the representative of the company, to believe and he did believe that that agent had authority to make the agreement which they reached on or about June 25, 1952. Cogent proof of this lies in the fact that plaintiff returned to Honolulu without trying to get the desired insurance elsewhere as he had threatened to do if the transaction was not consummated.
In attacking the finding of ostensible agency appellant quotes standard provision Number 2 of the outstanding accident policy, viz.: “No statement made by the applicant for insurance not included herein shall avoid the policy or be used in any legal proceeding hereunder. No agent has authority to change this policy or to waive any of its provisions. No change in this policy shall be valid unless approved by an executive officer of thе Company and such approval be endorsed hereon.” Counsel argue that plaintiff was thus charged with notice of limitation upon the authority of Eeonomidis which precludes any finding of ostensible authority. In support of this contention counsel cite
Sharman
v.
Continental Ins. Co.,
*374
But if the matter were to be tested by reference to the terms of said standard provision Number 2, it would not follow that plaintiff was charged with notice of its terms when dealing with the agеnt in 1952. “It must be presumed, ordinarily, that persons are familiar with the terms of written contracts to which they are parties, and in the absence of fraud they are justly bound by the provisions therein, but the rule should not be strictly applied to insurance policies. It is a matter almost of common knowledge that a very small percentage of policyholders are actually cognizant of the provisions of their policies and many of them are ignorant of the names of the companies issuing the said policies. The policies are prepared by the experts of the companies, they are highly technical in their phraseology, they are complicated and voluminous—the one before us сovering thirteen pages of the transcript—and in their numerous conditions and stipulations furnishing what sometimes may be veritable traps for the unwary. The insured usually confides implicitly in the agent securing the insurance, and it is only just and equitable that the company should be required to call specifically to the attention of the policy-holder such provisions as the one before us. The courts, while zealous to uphold legal contracts, should not sacrifice the spirit to the letter nor should they be slow to aid the confiding and innocent.”
(Raulet
v.
Northwestern etc. Ins. Co.,
That the rule applicable to waivers attempted at the time of making the contract does not apply to subsequent waivers made by agents having actual or ostensible аuthority is well established.
Farnum
v.
Phoenix Ins. Co., supra,
Appellant’s counsel also argue that plaintiff’s signing of form 10, the application for change in his policy, precludes his relying on Economidis’ assurances. Reliance is placed on this language: “That the changed or added insurance hereby requested shall not be in effect unless and, until the new policy or policies and/or supplemental agreement or supplemental agreements are delivered to and received by the Insured during his lifetime and good health. ...” However, this provision falls within the rationale of the Parnum and other cases just cited. It relates to a change in an existing policy, not necessarily the issuance of a new one. In 1949 the change had been made on the face of the existing policy. Moreover, Economidis asserted to plaintiff that form 10 would not enter into the new deal, that a medical examination was necessary and form 75 required; also that plaintiff’s signing of form 10 was but a formality, the document to be
*376
hеld for use only in the event that the company persisted in its error as to the applicability of form 10. Economidis’ ostensible authority covered this phase of the transaction as well as the others. We again quote the Farnum opinion,
The accident occurred on August 25, 1952, and the action was filed on October 6, 1953. The trial ended July 20, 1954, and the judgment was filed on October 5, 1954. The court awarded plaintiff $8,100, plus interest, as the aggregate of payments due at the rate of $300 a month from August 25, 1952 to September 25, 1954. Plaintiff filed an amended complaint on June 23, 1954, but no supplemental complaint. Appellant argues that in the absence of a supplemental pleading plaintiff was entitled to recover only the amounts which had accrued at the date of filing the complaint. The amended complaint at bar has five causes of action, two of which sound at law, and three in equity, the first being an action for declaratory relief. In the prayer addressed to each of the five counts the plaintiff seeks relief for “such period of time as plaintiff is permanently disabled due to said injuries sustained by plaintiff on or about August 25, 1952, and double such amount for such period of hospitalization of plaintiff due to such injuries.”
Respondent correctly asserts that a court of equity will make a final disposition of the litigation governed by the circumstances as shown to exist at the time the decree is made rather than at the inception of the litigation, and a supplemental pleading is not necessary to that' end. In
Del Riccio
v.
Photochart,
124 Cal.App-2d 301, 316 [
Having considered all the arguments presented by appellant, we find no error in the judgment.
The judgment is affirmed.
White, P. J., and Doran, J., concurred.
Notes
Assigned by Chairman of Judicial Council. .
The instrument bears date August 14, 1952, in typewriting. Also, under the caption “Additions or Amendments (For Home Office use only)” the following typewritten matter: “AIL and HI increased from $100 monthly to $300 monthly as of 10-18-52. Glassification of AIL & *366 HI is ‘A’.” There was evidence to the effect that the date was placed in the document by plaintiff after his return to Honolulu, but the testimony did not cover the quoted insertion concerning the AIL and HI increases. Kazanteno denied that he dated the document or returned it from Honolulu. This conflict bears only upon the credibility of plaintiff as a witness and was undoubtedly resolved in his favor by the trial judge, who was perhaps assisted to that end by a letter from the manager of the Los Angeles agency to the superintendent of the policy payment department, dated March 18, 1953, which says that Mr. Kazanteno “is a very high-class business man, not the type that is trying to take advantage of an insurance company or to distort the picture in any way.”