Seidel v. Equitable Life Assurance Society of the United States

138 Wis. 66 | Wis. | 1909

Siebecker, J.

The litigated question is whether or not the acts and conduct of the defendant society, as to payment of the lapsed instalments due from the deceased, Goes, were such as to furnish him a reasonable and sufficient ground to believe that the society would not exact strict performance of the contract respecting the payments of instalments, and that a modified performance of this stipulation would be accepted as a compliance with the terms of the agreement. The defendant alleges a forfeiture of the contract by the failure of the insured to pay the quarterly premium at the time stipulated in the contract. As set forth in the foregoing statement of facts, the insured was in default in payment of all of the 'quarterly premiums due under the contract from November 27, 1902, to the date of his death, June 29, 1905, excepting the instalment paid March 30, 1904, the last day of grace. Payment was made by the insured and accepted by the society after such default on all of them. The trial court held that this course of dealing of the parties, respecting payment and acceptance of all such premiums after default under the terms of the contract, showed a waiver of the strict stipulation of the contract respecting forfeiture for default in payment of the premiums and established a modification of such stipulation in accord with this course and custom of dealing, and that the society is now estopped from insisting on forfeiture under the strict terms of the contract. It is a recognized rule of law, under the decisions of this court,

“that where, by failure of some exact performance, a forfeiture is imposed on one party by the strict terms of an agreement, conduct of the other sufficient to induce a belief that such strict performance is not insisted on, but that a modified performance is satisfactory and will be accepted as equivalent, will justify a conclusion that the parties have assented to a modification of the original terms, and that their minds have met upon the new understanding that a different mode of performance shall have the same effect, or, as it is often expressed, that the obligee has waived strict performance.” Reisz v. Supreme Council A. L. of H. 103 Wis. 427, 79 N. W. 430, and cases there cited; Knoebel v. North Am. Acc. Ins. Co. 135 Wis. 424, 115 N. W. 1094.

It is not disputed that the representatives of the society had full knowledge of the fact that the deceased had failed to pay at the time called for by the terms of the policy, and that a forfeiture of it had been incurred if its terms wore enforced. Nor is there dispute as to the authority of Whit-lock, the agent, to act for the society in collecting the premiums from the deceased and to execute renewals by delivering them to the deceased. The evidence established that the quarterly instalments due respectively on the 27th of February, May, August, and November in each year, with thirty days of grace for paying them with interest, were not, excepting one, paid within this period, but were in fact paid from one to sixteen days thereafter. It does not appear that the insured, after these lapses, took any steps to be reinstated under the fourth condition attached to the contract, providing tliat, if the contract should lapse for nonpayment of any instalment, reinstatement of it might he had if the purchaser furnished satisfactory evidence of good health to the defendant and paid all arrears of indebtedness with interest from the time of such lapse. The facts are undisputed that the society, after default in payment of these instalments according to the strict terms of the contract, accepted payment of them without demanding of the insured that he furnish evidence of his good health. The unvarying course of conduct, it appears, was to send a representative to the insured, who, if satisfied from observation or otherwise that the insured was in good health, demanded payment of the defaulted instalment and then reported to the person authorized to receive payment and to deliver renewals. This representative thereupon accepted payment of the defaulted instalment and delivered the renewal to the assured, or, if the reneAval had been delivered by the person sent to collect the unpaid instalment, he accepted payment on the report made to him. There is nothing in this course of dealing suggesting that the contract had been terminated and that there had been a reinstatement after a lapse in the manner specified in the contract. It indicates an understanding that this transaction constituted compliance with and satisfaction of the terms of the contract for the payment of instalments and that no default existed. In the light of such conduct and dealing between the company and the deceased throughout the period shown, it is manifest that the insured had the right to believe that strict performance had been waived, and that he made, and the society received, these defaulted payments on the understanding that the contract had not lapsed and that such modified performance would be accepted by the company in lieu of the obligations imposed by its strict terms.

The force of the claim that the defendant in its correspondence and written notices insisted that no stipulation had been waived or modified is fully overcome by its acts and conduct, which were naturally calculated to lead any reasonably prudent person to infer that it treated the contract as still in force after such defaults, which under its strict terms constituted a forfeiture and nullification of the obligation. We are persuaded that the deceased and the defendant did not treat the contract as terminated before the insured died, and that tire defendant is therefore estopped from insisting on a forfeiture on account of the lapse in the payment of the last instalment, three days before the insured’s death. Under such circumstances the personal representative is entitled to enforce the contract against the society. Reisz v. Supreme Council A. L. of H. 103 Wis. 427, 79 N. W. 430; 3 Cooley, Briefs on Insurance, 2707.

By the Court. — Judgment affirmed.

Kerwin, J., took no part.