Bay Trust Co. v. Agric. Life Ins. Co.

• Decision Date: 02 March 1937
• Docket Number: No. 57.,57.
• Citation: 279 Mich. 248,271 N.W. 749
• Parties: BAY TRUST CO. v. AGRICULTURAL LIFE INS. CO.
• Court: Michigan Supreme Court

279 Mich. 248

271 N.W. 749

BAY TRUST CO.

v.AGRICULTURAL LIFE INS. CO.

No. 57.

Supreme Court of Michigan.

March 2, 1937.

Action by the Bay Trust Company, guardian of the estate of Arthur J. Tennant, minor, against the Agricultural Life Insurance Company. From a judgment for plaintiff, defendant appeals.

Reversed without a new trial.

Appeal from Circuit Court, Bay County; James L. McCormick, Judge.

Argued before the Entire Bench.

Wilkinson, Lowther & O'Connell, of Detroit (Donald B. Smith, of Detroit, of counsel), for appellant.

Emil Anneke, of Bay City, for appellee.

BUSHNELL, Justice.

The sole question involved in this appeal as stated by appellant is: ‘Was an assured, who was at the time of his death sixty (60) years, two (2) months, and ten (10) days old, over the age of sixty (60) years at the time of his death within the meaning of a clause in a double indemnity rider attached to an insurance policy, providing: ‘the insurance under this double indemnity rider shall not cover any person under the age of eighteen years nor over the age of sixty (60) years,’ the language of the policy being prescribed by section 12442, Compiled Laws of the State of Michigan, 1929, section 5?'

The circuit judge heard the matter without a jury and found that:

‘The statute prescribing the form of the rider, and the rider itself, speaks in terms of years, and there is nothing in either the statute or the policy to indicate that fractions of a year were to be considered. Speaking in terms of years, the insured was only 60 years of age and would not be ‘more years' of age until he had arrived at his 61st birthday. In every day life we speak of a person's age in terms of years, not years, months, weeks and days. A person on being asked his age states the number of years, disregarding fractions.

‘The provision of the statute and the policy is construed by the court as meaning that the double indemnity feature of the policy shall not apply when the insured has attained more years in age than 60 years, but does apply where the insured has attained the age of 60 years and only a fraction of another year, especially where the additional fraction consists of less than half a year.’

Defendant appeals from a judgment in favor of plaintiff for $2,000, plus interest and costs.

The opinion of the trial court cites Watson v. Life Association, 143 Okl. 4, 286 P. 888, and Wilson v. Mid-Continent Life Ins. Co., 159 Okl. 191, 14 P.(2d) 945, 84 A.L.R. 386.

The trial judge said:

‘The Oklahoma court decided in both of these cases that under similar provisions in the policies under consideration, and similar, if not exactly the same as in the policy in the case at bar, that the insured did not become over the age limit as fixed in the policy until he reached his next birthday. That is, that under the policy fixing the maximum age at 55 years the insured was covered until he or she arrived at the age of 56 years; and that under a policy fixing the maximum age at 65 years the insured was covered by the policy until he or she arrived at the age of 66 years.

‘Counsel for both parties cite Krmicek v. Federal Life Insurance Co., 252 Ill.App. 232, not a court of last resort. In this case the court seems to hold that in a policy fixing the maximum years of insurability at 70 the policy terminated upon the insured reaching his 70th birthday. However, the court not being a court of last resort, and the question involved not being exactly the one here involved, it cannot be seriously considered as authority.’

The reasoning of the Oklahoma cases includes an application of the statute of that state, § 3557, C.O.S. 1921, which is comparable to our own.

‘In the construction of the statutes of this state, the following reles shall be observed, unless such construction would be inconsistent with the manifest intent of the legislature, that is to say: * * * The word ‘month,’ shall be construed to mean a calendar month; and the word ‘year,’ a calendar year; and the word ‘year’ alone shall be equivalent to the words ‘year of our Lord,” etc. Comp.Laws 1929, § 76.

The provision of the policy is optional, but if included therein ‘shall be in the words and in the order in which they are hereinafter set forth,’ as follows:

‘An optional standard provision relative to the age limits of the policy shall be in the following form and in the blank spaces of which the insurer shall insert such number of years as it may elect.

‘20. The insurance under this policy shall not cover any person under the age of __ years nor over the age of __ years. Any premium paid to the insurer for any period not covered by this policy will be returned upon request.’ Section 12442, par. (5), Comp.Laws 1929.

‘There are exceptions to the rule that the wording of an insurance policy will be construed most strongly in favor of the insured. The rule does not apply when the wording is not that of the insurer, but is taken from a statute or from some source that the assured is responsible for.’ Sturgis National Bank v. Casualty Co., 252 Mich. 426, 233 N.W. 367, 369.

The language under consideration is required by statute in the event that the provision is embodied in the policy and appellee's...