Bank v. Ætna Life Ins. Co, (No. 17643.)

• Citation: 36 Ga.App. 703,137 S.E. 848
• Decision Date: 16 April 1927
• Docket Number: (No. 17643.)
• Parties: WINDER NAT BANK. v. ÆTNA LIFE INS. CO.
• Court: United States Court of Appeals (Georgia)

36 Ga.App. 703

137 S.E. 848

WINDER NAT BANK.

v.ÆTNA LIFE INS. CO.

(No. 17643.)

Court of Appeals of Georgia. Division No. 2.

April 16, 1927.

(Syllabus by the Court.)

ness of health arising between the date of the application for reinstatement and the acceptance of such application (National Life, etc., Ins. Co. v. Martin, 35 Ga. App. 1, 2, 132 S. B. 120; Modern Woodmen of America v. Atkinson, 153 Ky. 527, 155 S. W. 1135; Priest v. Kansas City Life Ins. Co., 116 Kan. 421, 227 P. 538; Fairfield v. Union Life Ins. Co., 196 Ill. App. 7, 15), the fact that the insured did not, of his own volition, inform the company of a change in his health between the date of the application for reinstatement and the acceptance of the application and of the arrears was not a fraud upon the company which would vitiate the reinstatement; nor would such a change in health ipso facto avoid the policy or render the reinstatement ineffectual (New York Life Ins. Co. v. Moats [C. C. A.] 207 F. 481; Insurance Co. v. Higginbotham, 95 U. S. 380, 383, 24 L. Ed. 499). The rule is that, where the intention of the parties is that the contract of insurance, or the contract for reinstatement of insurance, shall relate back to the date of the application, or to the date of default, a change in the insurable status of the applicant after the application for insurance, or for reinstatement of insurance, cannot vitiate the contract when actually consummated. In such cases the doctrine of continuing representation is eliminated by the intention of the parties as expressed by their contract. Joyce on Insurance, vol. 1, § 97c. In the instant case, since the evidence of insurability as furnished by the applicant for reinstatement was satisfactory to the company, its acceptance of the application for reinstatement and its acceptance of the arrears of premiums and loans caused the original contract of insurance to become reinstated from the date of default. It follows that the court erred in directing a verdict for the defendant on the theory that the contract for reinstatement had never become effective.

3. Questions not considered.

The above ruling being controlling upon the question of reinstatement, it is unnecessary to deal with the various exceptions relating to that proposition. No adjudication having been made with reference to attorney's fees or upon the question of double indemnity under the terms of the policy, the issues relating to these questions are not here considered.

Error from Superior Court, Barrow County; W. L. Hodges, Judge.

Suit by the Winder National Bank, administrator, against the Ætna Life Insurance Company. Judgment for defendant, and plaintiff brings error. Reversed.

Oscar L. Casey held three policies of life insurance in the Ætna Life Insurance Company, all of which had lapsed for nonpayment of premiums, and each of which contained the following provision:

"Within five years after default in any premium payment, if this policy has not been surrendered it may be reinstated upon evidence of insurability satisfactory to the company, and by payment of arrears of premiums with interest at the rate of 6 per cent, per annum, and by payment or reinstatement of whatever indebtedness to the company existed hereon at the date of default with interest from that date."

On May 31, 1922, Casey applied for reinstatement of these policies, signing an application for reinstatement which contained the following provision:

"I further agree that said contract shall not be considered reinstated by reason of any cash paid or settlement made in connection with this...