Brown v. Fidelity Mut. Life Ins. Co.

• Decision Date: 26 January 1923
• Citation: 197 Ky. 430,247 S.W. 47
• Parties: BROWN v. FIDELITY MUT. LIFE INS. CO.
• Court: Kentucky Court of Appeals

247 S.W. 47

197 Ky. 430

BROWN v. FIDELITY MUT. LIFE INS. CO.

Court of Appeals of Kentucky.

January 26, 1923

Appeal from Circuit Court, Laurel County.

Action by Grace H. Brown against the Fidelity Mutual Life Insurance Company. From a judgment for defendant, plaintiff appeals. Affirmed.

George G. Brock, of London, and Henry P. Brown, of Boston, Mass for appellant.

William Marshall Bullitt, Bruce & Bullitt, and Grover G. Sales, all of Louisville, and Hazelwood & Johnson, of London, for appellee.

MOORMAN J.

This is an appeal from the judgment of the Laurel circuit court dismissing the petition of appellant, Grace H. Brown, in an equitable action filed by her to recover $2,000 on an insurance policy issued December 31, 1903, by the Fidelity Mutual Life Insurance Company, on the life of her husband, W L. Brown.

On May 11, 1886, the predecessor of appellee issued its policy No. 9673 for $2,000 on the life of W. L. Brown, for an annual premium of $5, plus the payment of such assessments as might be required by the company to pay the death claims of its policy holders. That policy was carried for 16 years at a total cost to the insured of $864.05. In 1903 it was surrendered, and appellee issued in the place of it a $2,000 yearly renewable term policy. The latter policy, 146439, contained a graduated scale of annual premiums ranging from $89.50 at 63 years of age to $318.58 at 80 years of age. Neither policy had any loan or cash surrender value or paid-up benefits, the purpose of both policies being to provide protection for the insured at the lowest possible premium rate. The second policy, which is the one involved here, contained the provisions:

"If any premium be not paid when due, this policy shall be extended and remain in force for thirty days from due date, and if not then be paid with interest for the time taken at the rate of five per cent. per annum, or if any obligation given for premium be dishonored or not paid when due without grace this policy shall be absolutely void, and all moneys paid hereon shall be forfeited to the company, and after said period of thirty days or nonpayment of such obligation, it can only be revived if the insured be in good health upon presentation of a reinstatement certificate signed by said insured, and upon the approval of the same by the president or the vice president and medical director, but not otherwise."

The days of grace were later extended by the company to 31.

Brown paid the premiums on this policy, generally in quarterly installments, from 1903 to November 1, 1912, the total amount paid being $1,092.73. He failed to pay the quarterly installment due February 1, 1913, and on March 4th, 31 days thereafter, the policy was forfeited. No effort was made by Mr. Brown to obtain a reinstatement of the policy. After his death on June 7, 1917, this action was instituted by his wife, the beneficiary, to recover the full amount of the insurance.

The pleadings show the issuance of the two policies, the aggregate payments made by Brown on each of them, and the cancellation of policy 146439 on March 4, 1913, for failure to pay the quarterly premium due February 1, 1913. They present issues of fact (1) as to whether by its course of dealings with the insured the defendant had established a custom of accepting premiums after their due dates without requiring a health certificate or a revival of the contract, whereby the insured was induced to believe, as a reasonable man, that the installment due February 1, 1913, would not be demanded on that date, but that he might pay it within a reasonable time thereafter; and (2) whether defendant had waived the right to collect the premium due February 1, 1913, on or before the last day of grace, March 4, 1913, because the insured had lost his policy and had requested that defendant furnish him a copy of it, and also whether, by reason of that fact, defendant had caused the insured, as a reasonable man, to believe that no payment of premiums would be required pending his effort to procure a copy of the policy. On motion of plaintiff, a jury trial was allowed on these issues; and at the conclusion of the plaintiff's evidence the jury was directed to return a verdict for the defendant, and a judgment was rendered dismissing the petition.

It is the contention of plaintiff that the trial court erred in refusing to submit to the jury the 21 separate issues of fact embraced in her motion, made after she had introduced her evidence and the court had indicated that defendant's motion for a peremptory instruction would be sustained; and also that it was error to direct a verdict for defendant on the two issues on trial before the jury. The first suggestion may be disposed of by saying that the 21 minor questions of fact upon which the plaintiff asked a jury trial were included in the two issues on which a jury trial was granted; and, that being true, it was manifestly proper to refuse separate hearings on the included questions. The second contention involves a question of fact. If sustainable at all, it is on the theory that the issues were exclusively legal, and there was sufficient evidence on behalf of plaintiff to submit them to the jury. Assuming therefore, without deciding, that the questions were purely legal and not cognizable concurrently in law or equity, we come to a consideration of the evidence with the view of ascertaining whether it was such as to require a submission of the issues to a jury.

The proof shows that the insured, on a number of occasions after taking out the second policy, did not pay the premium within the 31 days of grace allowed; and it also shows a similar practice on his part with reference to the first policy. We do not, however, regard the...