66 Neb. 395 | Neb. | 1902
This is a suit on a policy of life insurance, heard by the district court upon an agreed statement of facts. From the judgment for plaintiff, the defendant company brings error, and relies upon turn grounds of defense: (1) That it does not appear from the evidence that the first premium was ever paid, and among the provisions of the policy is one that it shall not take effect until the first premium shall have been paid during the life and good health of the insured; (2) it is claimed, perhaps with a little inconsistency, that a note was given for a part of the first premium and that when the insured died, the note was past due and unpaid, and the policy contained a stipulation that any note given for premiums should be made a part of the contract, and a failure to pay it or any interest when due, should suspend the policy and it should continue suspended during the default without action on the company’s part, or notice to the insured or beneficiary.
So far as the first defense is concerned, it is contended by the defendant in error that it is not pleaded. The petition contained a general allegation under section 128 of the Code of Civil Procedure, that plaintiff and the assured had complied with, all the conditions required by them to
The second objection to plaintiff’s right of recovery has caused more trouble. It is among the agreed facts in the record that E. V. M. Powell was defendant’s manager at its St. Louis office, under a contract of agency which is set forth, and through a subagent he took the application for the policy sued on; that defendant sent to Powell this policy with a receipt for the first premium for delivery to the insured under the terms of the policy and application (the receipt to be valid only when countersigned by Powell); that Powell delivered the policy to the insured, and took the latter’s promissory note for $100.93 as part-payment of the first premium. • The note bore interest at 8 per cent, per annum and was for 90 days from July 18, 1899. No part of it was ever paid. It was payable to the order of E. Y. M. Powell. In June, 1899, defendant obtained it by purchase from a third party to whom Powell had sold it. Powell, in September, 1898, reported to defendant that the premium was paid and the policy delivered; and defendant knew nothing to the contrary until
The real question presented by this case is whether or not, under these circumstances, the company can avail itself of the default in the payment of the insured’s note to Powell for |100.93, to avoid its liability under this policy. . It will be observed that under Powell’s contract with defendant he was entitled to receive 100 per cent, of this premium. It will be observed that he had reported the premium paid and the policy delivered. It will be observed that the note was drawn to his order and had been sold by him. It was obtained by the defendant by purchase from a third party in June, 1899, and the insured died February 16, 1899, in Ottumwa, Iowa. Plaintiff in error relies upon the various cases decided by this court upholding and sustaining contract provisions between insurance companies and insured that policies shall be avoided by defaults upon notes given for premiums, or suspended during the continuance of such defaults. We are of the opinion that under the issues and agreed facts in this case, this note was not of that character. The district court was undoubtedly warranted in finding that this note was accepted and received by the agent, Powell, as his own note, under his agreement for a commission of 100 per cent, of the first premium. His sale 'of the note would alone be sufficient to warrant the trial court in such a holding. It seems clear that while such note was in the •hands of a third party, there 'would be no right on the part of either Powell or the defendant to avoid or suspend this policy for its non-payment. As above indicated, it is clear that the note was purchased after the insured’s death from a third party to whom Powell had sold it. In the case of Pythian Life Ass’n v. Preston, 47 Nebr., 374, 390, it is held that where a similar note for a part of the first premium was given to an agent, who by his contract with his company was entitled to retain that premium as his commission, the whole transaction was between the agent and
Under the agreed statement of facts the trial court in this case seems to us to have been entirely Avarranted in holding that this note was a personal transaction between Powell and the insured, that it was not one of the notes for premiums covered by the agreement in the policy, and that the defendant could no more avoid the policy by buying this note, after the insured’s death, than it could by the buying of any other. As counsel suggests, the agreement in the policy can not be held to have been meant to protect Powell’s indorsee, who held the note at the time of insured’s death.
It is recommended that the judgment of the district court be affirmed.
By the Court: For the reasons stated in the foregoing opinion, the judgment of the district court is
Affirmed.