Travelers Insurance v. Brown, 138 Ala. 526

Travelers Insurance v. Brown

138 Ala. 526 | Ala. | 1903

TYSON, J.

The purpose of the bill in this cause is to have declared in force, valid and binding a policy of insurance issued by the respondent on the 7th day of August, 1897. The policy contains the following stipulations : “AH premiums are payable at the home office *529in Hartford, Connecticut, but will be accepted if paid to any agent in exchange for a receipt signed by the president and secretary and countersigned by the agent designated thereon. This policy shall not take effect unless the first premium is paid while the insured is in good health, and if the second and third annual premiums be not fully paid when due, this policy and all claims under it shall be Amid and the premiums, already paid shall be forfeited to the company. In case of default in the payment of premiums after the third, this policy null remain in force for the time specified in the table of ‘paid up term insurance,’ endorsed hereon; provided, hoAvever, that in case of the death of the insured within three years from the date of such default, the unpaid premium with interest shall be deducted from the amount insured, or in lieu of such term insurance a paid up policy will be granted for the amount specified in the table of paid up policy values,” etc. Under this clause the time fixed for the payment of the premium is of the essence of the contract, and non-payment at the appointed time involves the release of the company from its obligations under the policy unless waived. — Imperial Life Ins. Co. v. Glass, 96 Ala. 568.

But “forfeitures are not favored in the laAv and courts are always prompt to seize hold of any circumstance that indicates an election to Avaive a forfeiture or an agreement to do so on which the party has relied and acted. Any agreement, declaration or course of action on the part of the insurance company, which leads a party insured honestly to believe that by conforming thereto a forfeiture of his policy will not be incurred, followed by due conformity on his part; will and ought to estop the company from insisting upon the forfeiture, though it might be claimed under the express letter of the contract.” — Insurance Co. v. Eggleston, 96 U. S. 572.

The fifth annual premium (tenth semi-annual premium) upon the policy in controversy matured on the 7th day of August, 1901. The complainant, in ample time to have reached them before the date of maturity, mailed to the respondent’s agent a check for the amount of this *530premium. The check it appeared did not reach them. Subsequently, after being informed by the agents, that the check had not been received and that they had, on the next day after the premium fell due, returned the premium receipt to the company, on, to-wit, the 12th day of September, 1901, the complainant sent by mail to the respondent, Neiv York exchange for the amount of the premium. This draft was returned to him by the company in a letter in which it in part said: “We are advised by Messrs. Weil & Co., State agents, at Montgomery, Alabama, to whom you were permitted to make payments of premium under policy No. 93,375 on or before maturity of the premium, that payment of the premium due August 7, 1901, ivas not made to them on or before that date, and that the check which you say you mailed to them on July 29th was not received.” Here is an admission by respondent that the agents were authorized to receive checks in payments of premiums. It is apparent from this letter that it had not occurred to it at that time that its agents were only authorized to receive money in payment of premiums. The context of the letter clearly shows that it based its claim of forfeiture of the policy solely upon the ground that the payment had not been made on or before August 7th, and not upon the fact that the medium of payment attempted to be made was not of the kind authorized to be received by its agents. This circumstance when taken in consideration with other facts shown by the evidence, such as the intrusting of premium receipts to Weil & Co., with the authority to collect them, coupled with their authority over other important matters relating to the business of the company in this State, lead -us to the conclusion that Weil & Co. were authorized to receive checks, in lieu of money, in payments of premiums. U. S. Life Ins. Co. v. Lesser, 126 Ala. 568, 583. This being true, the case stands upon the same footing as if the complainant had mailed the check directly to the respondent and had had his former dealings with it in the matter of paying premiums, instead of with the authorized agents. All prior premiums, at least eight in number, had been paid by complainant by means of checks *531sent through the mails, as this one was. This had been the uniform course of dealing between the parties. He, therefore, had the right to believe that by conforming to it, in this instance, it would he effectual to protect him against a forfeiture. — Kenyon v. Knight Templars, et al., 122 N. Y. 247, 262, and authorities there cited.

Having done, as he honestly believed, all that was required of him, and relying, as he had a right to do, upon their previous course of dealing in sending the checks, the respondent cannot now claim a forfeiture of the policy. — Kenyon v. Knight Templars, et al., supra.

The decree appealed from must he affirmed.