Benefit Assoc. Railway Employees v. Hancock

• Decision Date: 21 March 1933
• Citation: 248 Ky. 315
• Parties: Benefit Association of Railway Employees v. Hancock.
• Court: Supreme Court of Kentucky

248 Ky. 315

Benefit Association of Railway Employees v. Hancock.

Court of Appeals of Kentucky.

Decided March 21, 1933.

1. Evidence. — Presumption that post card was received by addressee, arising from testimony that post card notification of default in life policy payment was mailed, held overcome by testimony of insured's widow that post card was not received.

2. Evidence. — Burden of showing that letter was received is not sustained by evidence that it was mailed, where receipt thereof is denied.

3. Insurance. — Delivery of deduction list carrying insured's correct name to insured's employer, in accordance with custom and contract for payment of premiums from insured's wages, held condition precedent to life insurer's right to claim forfeiture on ground of nonpayment of premiums.

Insurer, a benefit association of railway employees, had duty to make demand for premiums in accordance with its contractual obligations to do so, and with the custom of the insurer and insured's employer, by remitting to the employer monthly deduction lists showing insured's correct name, and the manner agreed upon for payment of the premiums.

4. Insurance. — Where life policy provided for deduction of premiums from insured's wages, insurer, furnishing insured's employer with deduction list showing insured's name incorrectly and not notifying insured of consequential nonpayment of premiums held estopped to assert forfeiture therefor.

5. Insurance. — Parties to life insurance contract had right to provide that pay order on insured's wages be accepted as provision for payment of premiums.

6. Insurance. — Insured's duty, as regards life policy providing for and authorizing deduction of monthly premiums from insured's wages, is satisfied by insured's leaving sufficient amount in hands of employer to meet installments.

7. Insurance. — Under provision for payment of premiums from insured's wages, life insurer had duty to present pay order as installments fell due, and, in case of nonpayment, to notify insured thereof, as prerequisite to right to claim forfeiture therefor.

8. Appeal and Error. — Alleged errors in instructions held not prejudicial to defendant, where plaintiff was entitled to peremptory instruction.

9. Witnesses. — Admission of competent testimony, although elicited by leading questions, held not error, where leading questions were not so persistently indulged in as to manifest disregard of law by counsel and abuse of court's discretion.

Appeal from Pulaski Circuit Court.

H.H. DENTON, PAUL E. KELLER and J.S. COOPER for appellant.

B.J. BETHURUM and VIRGIL P. SMITH for appellee.

OPINION OF THE COURT BY JUDGE RICHARDSON.

Affirming.

George Dewey Brassfield resided at Somerset, Pulaski county, Ky., and was a section foreman in the employment of the Cincinnati, New Orleans & Texas Pacific Railway Company. The Benefit Association of Railway Employees, prior to the 1st day of October, 1929, issued and delivered to him a policy insuring his life. On the 1st day of October, 1929, there was due the company on an old policy $1.10, the balance of a premium. It took up this policy and issued to him another, for the agreed premium of $3.65, payable monthly, insuring him in the sum of $2,000 against accidental death. His wife, Ella Brassfield, was the designated beneficiary in the latter policy. On the 10th day of April, 1931, through accidental, external, and violent means, he was killed while in the line of duty as an employee of the railway company. Notice of his death was furnished to the insurance company, and it promptly denied its liability. He procured the policy on a written application. His signature to the application was "Dewey Brassfield," but it was given in the policy, as George Dewey Brassfield, Elihu, Ky. Simultaneously with his signing of the application, he executed and delivered to the company an instrument commonly known as a "pay order," in this language:

"Dewey Brassfield No. 629512

"For value received, I hereby authorize my employer, C.N.O. & T.P. Ry. to deduct from my wages and pay to Benefit Association of Railway Employees the following sums: First deduction to be made from October 1929 earnings.

                    Membership Fee Bal. Oct.    $2.55    Regular monthly deduction
                    Per Capita Tax                       to be made from
                    Premium No. Nov.            $3.65    each months earnings —
                                               ______    to be made during my
                    Total First Deduction       $6.20    employment by said employer
                      Beginning Nov. 1929 Earning
                    One months premium                                    $3.55
                    One month's per capita Tax                              .10
                                                                         ______
                    Total Regular monthly deduction                       $3.65"
                

Neither the $1.10 which was the balance of the premium due and unpaid at the time the policy was issued, nor the first premium on the present policy, was paid upon the delivery of the policy. Both were taken care of by the pay order retained by it. It was the custom of the employees, the railway company, and the Benefit Association of Railway Employees, for the railway company to retain the possession of the pay order, deduct from the wages of the employee the premuim, and remit it to the insurer. Section G of the policy and the pay order embraced the agreement between the insured employee and the Benefit Association of Railway Employees for the payment of the monthly premium by the employee of the railway company. Section G of the policy is in this language:

"Sec. G. Premiums on this policy may be paid either in cash or through paymaster's orders when authorized by the Insured. The payments specified in the order for the payment of moneys on this policy are premiums for consecutive months and each shall apply only to its corresponding insurance period. No claim during any period for which its respective premium has not been actually paid in full shall be valid under this policy except such claims as may arise during the period of grace and except in case of a just claim originating before the end of the month from the wages of which the first premium is to be dedicated, as provided in the order; but no claim shall be valid in any such case if the insured shall have left the employment of the employer named in the order without having earned in the month designated therein wages to pay said first premium nor if the Insured shall have collected or disposed of the wages earned in said month, so that there shall not remain sufficient wages for the payment of said premium, unless the payment then due shall have been otherwise paid in cash.

"The insured may terminate this policy contract and revoke his pay order at the expiration of thirty (30) days from 12 o'clock noon of the date of written notice delivered at or mailed to the Home Office of the Association, and the Association may terminate this policy contract at the expiration of thirty days (30) from 12 o'clock noon of the date of written notice delivered to the Insured or mailed to his last known address, but such termination by the Association shall be without prejudice to any claim accrued or existing at date of termination. In the event this policy contract is terminated by either party hereto, the Association shall pay the insured by cash or check the prorata unearned portion if any, on the date of termination, of the premiums actually paid by the Insured."

In accordance with an existing custom, the Benefit Association of Railway Employees monthly furnished the railway company a list of its employees who had signed and delivered to it pay orders, giving their names, occupations, locations, and order numbers, from whose wages the railroad company would deduct the monthly premiums due the insurer, charge them to the employees, and remit same to the Benefit Association of Railway Employees, Chicago, Ill. It delivered to the railway company a deduction list for the month of September, 1929, containing the names of twenty-four employees, giving their occupations, location, and order numbers, which included "4 Brassfield D 163, Occupation Sec. Foreman, Location, Cedar Grove, Order No. 308,184, amount $1.10." The October list contained the names of twenty-three employees, including "4 G. E. Brassfield 163, Occupation, Sec. Foreman, Location, Cedar Grove, Order No. 629,512, amount due $6.20." This list was marked, as to Brassfield, "No time," and returned by the railway company to the Benefit Association of Railway Employees. The November list contained the names of twenty-two employees, including "3 G.D. Brassfield 163," with his occupation, location, and order number, identical with those of the list submitted for the month of October, excepting his name thereon was G.D. Brassfield, the amount to be deducted was $7.30, which was returned to the Benefit Association of Railway Employees with the remark, "No time." From the date of the issuance of the last policy, Brassfield continued in the employment of the railroad company as a section foreman, with the location designated "Cedar Grove" and "Order No. 629,512."

The deduction list for September, 1929, was for $1.10, being the balance due under the old policy. The deduction list for October was for $6.20, which is made...