Kukuruza v. John Hancock Mut. Life Ins. Co.
| Decision Date | 24 June 1931 |
| Parties | NIKOLAS KUKURUZA v. JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
November 12, 1930.
Present: RUGG, C.
J., CROSBY, PIERCE & FIELD, JJ.
Insurance, Life lapse, reinstatement. Waiver. Estoppel.
Under a policy of life insurance providing that the payment of any premium should not continue the policy in force beyond the date when the next premium became due, except for a period of grace the continuance of the company's obligation under the policy was conditional upon the payment of premiums as provided therein, and no affirmative action by the company was necessary to terminate the corresponding rights of the insured under the policy upon default in the payment of a premium beyond the period of grace.
No duty on the part of the insurance company to notify the insured of a lapse of the policy above described could be inferred from its provisions or from the circumstances.
The circumstance that an agent of the insurance company above described called at the home of the insured to collect the premiums as they became due did not warrant an inference that the company was required to send an agent for that purpose.
The policy above described provided that it might be reinstated after default "upon production of evidence of insurability satisfactory" to the company and payment of premiums in arrears. The insured was a woman, and the beneficiary was her husband. In an action upon the policy after her death, there was evidence that the policy was reinstated on a certificate of insurability, purporting to be signed by the insured, wherein it was stated that she requested the defendant
"to reinstate said policy . . . upon condition of the truth of the following statements and agreements," and certified that she was "in good health" and "during the time . . . since the premium . . . in default became due" she had "had no injury, ailment, illness or disease, nor symptoms of such" nor had she "consulted a physician."
The plaintiff admitted that he took his wife to a hospital for mental trouble before the premium in default was paid. There was no affirmative evidence of the truth of the statements in the certificate. There also was evidence that the defendant knew of the woman's having gone to the hospital when it accepted said premiums.
Held, that (1) The provision in the policy for reinstatement contemplated a contract to that effect between the insured and the defendant;
(2) If the certificate of insurability was not signed by authority of the insured, there was no contract to reinstate the policy;
(3) If it was signed by her authority, she was bound by its terms, the truth of the facts therein certified was a condition precedent to reinstatement of the policy, and the burden of proving that such facts were true was on the plaintiff;
(4) The plaintiff had not sustained that burden; (5) Knowledge by the defendant of the insured's illness and of the falsity of the statements in the certificate of insurability did not establish a waiver by the defendant of the express condition upon which the policy was reinstated nor estop the defendant to rely upon a breach thereof;
(6) The acceptance of premiums by the defendant, in accordance with the contract of reinstatement, with such knowledge did not amount to a waiver or estoppel;
(7) The plaintiff could not recover on the basis that the policy had been reinstated.
The mere acceptance by the insurance company, after default in the payment of a premium under the policy and in the circumstances of the certificate of insurability above described, of payment of that premium and also of the next as it became due, did not warrant a finding that, before the earlier of such premiums was paid, the condition of the policy as to the payment of premiums was waived by the company by any course of dealing between the insured and the company previous to that time; nor was a finding warranted that the acceptance of the two premiums continued the policy in force after the default when it appeared that the certificate of insurability under its terms had been given thereafter and it did not appear that the premiums were not accepted by the defendant in accordance with the terms of such certificate and subject to its conditions, nor that the acceptance was unconditional.
CONTRACT. Writ dated July 27, 1927. The action was tried in the Superior Court before Keating, J. The plaintiff's wife died on June 2, 1927. Other material evidence is stated in the opinion. The judge ordered a verdict for the defendant and reported the action for determination by this court.
W.J. Barry, for the plaintiff. W.P. Kelley, for the defendant.
This is an action of contract to recover $5,000 on an insurance policy issued by the defendant on the life of Awdokia Kukuruza, the wife of the plaintiff, and payable to the plaintiff as beneficiary upon her death. On motion of the defendant a verdict for it was directed, and the plaintiff excepted. The case is reported on the agreement that "if the trial judge was right in allowing the defendant's motion and directing a verdict for the defendant, judgment is to be entered for the defendant, otherwise judgment is to be entered for the plaintiff in the sum of $5,000 and interest from June 6, 1927."
The verdict was directed rightly. According to the terms of the policy the defendant insured the life of the insured in consideration of the payment of premiums. The policy provided for the payment of premiums in quarterly instalments and provided further that except as therein "expressly provided, the payment of any premium or instalment thereof shall not maintain this policy in force beyond the date when the succeeding premium or instalment becomes payable." It was provided also that a "grace of thirty-one days . . . during which the policy shall remain in force, will be granted for the payment of premiums or regular instalments thereof," and, with limitations not now material, that the policy might be reinstated "after default in payment of premium" "upon production of evidence of insurability satisfactory to the Company and approved at its Home Office . . . and payment of arrears of premiums." No modification of the policy was to be valid "unless made by the President, a Vice President, the Secretary or an Assistant Secretary, and no other person . . . [was] authorized to modify or waive any of the terms and conditions of this policy, nor to extend the time for payment of premiums or other moneys due to the Company, or to bind the Company by making any promise or by accepting any representation or information not contained in the application for this policy." Premiums were payable "at the Home Office of the Company, or to a duly authorized agent presenting the official receipt signed by the President or Secretary, and countersigned by the agent designated on such receipt."
It is not disputed that the quarterly instalment due January 19, 1927, which could have been paid without lapse of the policy on or before February 20, 1927, was not paid until February 28. The plaintiff's testimony, binding upon him, was that a "bill" for this instalment of premium was received "seven or ten" days before January 19, 1927 that he paid this instalment to one Morris on February 28, on his personal receipt, that Morris called at the plaintiff's house on January 17, 1927, and again on February 28, when this payment was made, that later the receipt of the defendant for this instalment was received, that previous instalments were paid to Morris on his personal receipt, and subsequently receipts therefor came from the defendant's main office, and that the plaintiff "knew no mail came to the house that the policy had lapsed" and "didn't...
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