38 Neb. 725 | Neb. | 1894
This was an action by the plaintiff in the district court of Douglas county to enforce the specific performance of an agreement by the defendant to issue a paid up policy of insurance. . There was a finding for the defendant, and a decree dismissing the petition, from which the plaintiff has prosecuted an appeal to this court. There is no controversy with respect to the material facts, which are as follows:
In the year 1884 the defendant company issued a policy of insurance on the life of Andrew W. McLaughlin in favor of his wife, the plaintiff herein. Said policy was for $5,000 current insurance, upon the payment of an annual premium of $314.90 on the 26th day of August of each .year, to be fully paid up after fifteen of such payments. It was stipulated in said policy that in case of default by the insured after the payment of not léss than three of such annual premiums, the defendant company would” issue a paid up policy in favor of the plaintiff for as many fifteenth parts of the sum of $5,000 as equaled the number of premiums so paid, provided said policy should be surrendered duly receipted within six months from the date of
“And further, that if premiums upon this policy, for not less than three complete years, of assurance shall have been duly received by said society, and this policy should thereafter become void in consequence of default in payment of a subsequent premium, said society will issue, in lieu of such policy, a néw paid up policy, without participation in profits, in favor of said Elma R. McLaughlin, if living, and if not living to the children of said Andrew W. McLaughlin or their guardian for their use, or if there be no children surviving, then to the executors, administrators, or assigns of said Andrew W. McLaughlin, for as many fifteenth parts of the original amount hereby assured as there shall have been complete annual premiums received in cash by said society upon this policy at the date when such default shall first be made; provided, however, that this policy shall be surrendered duly receipted within six months of the date of default in payment of premium as mentioned above.”
In case of default in payments of premiums by the assured the contract contained the following provision:
“And if any premium or installment of a premium on this policy shall not be paid when due, this policy shall be void; and no credit for surplus accumulated on this policy shall be deemed applicable to the payment of any premiüm; nevertheless, nothing herein contained shall be construed to deprive the holder of this policy of the privilege to demand and receive paid up insurance in accordance with the agreement contained in this policy.”
It is conceded that three of the annual payments were made by Mr. McLaughlin, to-wit, those for thé years 1884, 1885, and 1886, but that he failed to make the payment due in August, 1887. It is further admitted that said policy was not surrendered within six months thereafter, nor was a demand made for paid up insurance until the month
Q,. If I understand you, the payment that lapsed was due in August, 1887?
A. Yes, sir.
Q. You wrote them in July, 1888.
A. Yes.
Q,. And they answered saying that your policies had lapsed ?
A. Yes, sir.
Q. That they had no surrender value and were forfeited ?
A. Yes, sir; that is what they said.
Q. You may state, Mr. McLaughlin, if you have not already, whether you knew of the clause, the proviso, in
A. Well, I suppose because I hadn’t read it is the only particular reason. I took the word of the agent. I know I made a pretty strong effort to raise the third annual premium.
Q. Did you make any effort to raise this money within six months?
A. Yes, sir.
Q. Why didn’t you present your policy within six months ?
A. The reason why I didn’t present it was because I kept thinking all the time I would raise the money and pay it and keep the policy alive; that was the reason. When I found I couldn’t do it I wrote to the company.
Q. And the reason you didn’t present and surrender the policy within the time provided by the policy was in the hopes that you could raise the money ?
A. Yes, sir.
And on cross-examination he testified :
Q. When did you first read the policy?
A. When I wrote the company and got their reply that my policies were lapsed and no good, I then put it in the hands .of my attorney. As near as I can remember, I believe it was in August, 1888.
Q. After you had written to the company ?
A. Yes.
Q,. And the first that you knew of the six months clause was when you read the policy, which reading was brought about through the receipt of this letter that you have spoken of as having received from the company ?
A. Yes, sir.
Q. Did you ever offer to surrender the policy to them ?
A. I don’t know that I made a formal offer to surrender it. I only wrote them asking what was necessary for me to do.
A. No, sir.
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Q,. When you read this policy, as you say you did, a little before you wrote to the company, after you got an answer from the company, you then read the policy ?
A. Yes, sir.
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Q. You have had a good deal to do as a business man witli different kinds of transactions?
A. Yes, sir.
Q. Especially contracts that you signed?
A. Yes, sir.
Q,. Being cashier of a company you were pretty careful about these matters?
A. Yes, sir.
The contract contemplates two conditions precedent to the right of the insured to demand a paid up policy in favor of the beneficiary, viz.: Eirst, the payment of three of the annual premiums; and second, the surrender of the policy, duly receipted, within six months after the default of further payments. Those conditions are not unreasonable, nor do they conflict with any provision of statute or principle of public policy; and courts cannot, without the most flagrant usurpation of legislative powers, refuse to give effect to such engagements where not tainted with fraud, unless the conditions thereof are waived by the act of the party entitled to insist upon their performance. The surrender, of the receipted policy within six months after default cannot, on principle, be said to be less essential than the payment of the three yearly premiums. Both are necessary in order to entitle the holder to the paid-up insurance. He might elect,. as he apparently did, to take the chances of raising the money to keep this policy alive, trusting to the leniency shown him in the other case; but in doing
It is not necessary, however, to invoke the rule above stated in this case, for the reason that the representation of the agent upon which reliance is placed does not relate to the existence of any fact or include even a definite promise for the future. It is at most the statement of an opinion, a mere conclusion that the policy was non-forfeitable, and that the insured could not lose the money invested, in case hé made three annual payments. ~We would feel constrained to hold from the evidence in the record, if that question was essential to the present inquiry, that in the making of the contract in question there was no disparity between the parties. The occupation and experience of the insured certainly rendered him as capable of interpreting and understanding the condition of the policy as Guyon, the agent of the company. It cannot be said that the condition under consideration was not discoverable by the exercise of reasonable care, since it appears in bold type upon
We come now to an examination of authorities which, have a direct application to the condition relied upon by the defendant. Of the reported cases which have a bearing-upon the subject, a decided majority sustain the proposition, that where provision is made in the policy for paid up insurance for part of the amount named, upon the surrender thereof within a given time after default, such right must-be exercised within the time named. (See Hudson v. Knickerbocker Life Ins. Co., 28 N. J. Eq., 167; Attorney General v. Continental Life Ins. Co., 93 N. Y., 74; Bussing’s Executors v. Union Mutual Life Ins. Co., 34 O. St., 222; Coffey v. Universal Life Ins. Co., 10 Ins. L. J. [Wis.], 525; Smith v. National Life Ins. Co., 13 Ins. L. J. [Pa.], 330; Sheerer v. Manhattan Life Ins. Co., 20 Fed. Rep. 886; Universal Life Ins Co. v. Devore, 14 S. E. Rep. [Va.], 532; Hexter v. United States Life Ins. Co., 15 S. W. Rep. [Ky.], 863; Northwestern Mutual Life Ins. Co. v. Barbour, 17 S. W. Rep. [Ky.], 796; Cooke, Life Ins., sec. 84 and note on page 152.) We have been referred as authority for the opposing view to Chase v. Phœnix Mutual Life Ins. Co., 67 Me., 85, Montgomery v. Phœnix Mutual Life Ins. Co., 14 Bush [Ky.], 51, and Southern Mutual Life Ins. Co. v. Montague, 84 Ky., 653. Of the above cases, Chase v.
Affirmed.