Coleman v. Nationwide Life Ins. Co.
| Citation | 179 S.E.2d 466,211 Va. 579 |
| Parties | Nancy C. COLEMAN v. NATIONWIDE LIFE INSURANCE COMPANY. |
| Decision Date | 08 March 1971 |
| Court | Virginia Supreme Court |
L. Garland Wells, Portsmouth, for plaintiff in error.
James N. Garrett, Jr., Portsmouth (Garrett, Garrett & Garrett, Portsmouth, on brief), for defendant in error.
Before SNEAD, C.J., and I'ANSON, CARRICO, GORDON, HARRISON, COCHRAN and HARMAN, JJ.
Nancy C. Coleman, widow of Ray E. Coleman, instituted an action against Nationwide Life Insurance Company to recover a judgment for money due her as named beneficiary under a certain life insurance policy issued to her husband. Nationwide defended on the ground that the policy had lapsed before Coleman's death. Mrs. Coleman contended, among other things that the company, by its conduct, was estopped to assert the policy had lapsed, and that it had waived certain requirements for reinstatement of the policy. The jury returned a verdict for Mrs. Coleman in the sum of $6,378.80. Upon motion of Nationwide the trial court set aside the verdict as being contrary to the law and evidence and entered summary judgment for Nationwide. We granted Mrs. Coleman a writ of error.
The dominant issue for our determination is whether the evidence was sufficient to support a finding that Nationwide was either estopped to assert the lapse of the policy or that it had waived certain requirements for reinstatement of the lapsed policy.
Ray E. Coleman was an insured under two life insurance policies issued to him by Nationwide. On was a family policy (#522391) that was in force and paid by the company upon his death, and the other was a decreasing term policy (#522392) which was issued on September 12, 1958. The monthly premium on the term policy was $5.60 and payment was due on the twelfth day of each month. The term policy is the subject of controversy in this appeal.
On November 15, 1967 Coleman wrote a letter to Nationwide at its home office in Columbus, Ohio about his term policy. In it he stated, 'I would like very much to cash it in for its surrender value at this time.' Before writing the letter Coleman had talked on the telephone with Frank Parks, a Nationwide agent, concerning the proposed transaction. The following day Parks came to the Colemans' home, but only Coleman's wife and daughter were there. According to Vivian Gregory, the Colemans' daughter, Parks told her mother that cashing the policy would not mean it would be canceled. 'Mr. Parker (Parks) said that when my father got the money that if he wanted to start his premiums (sic) right back up again he could and the policy wouldn't be cancelled.'
Nationwide answered Coleman's letter on November 30, 1967. It informed Coleman that there was no cash surrender value on his term policy, but that if the policy were surrendered the accumulated dividends of $134.72 would be sent to him. The accumulated dividends were the only monetary value the term policy had. The letter stated that since Coleman also owned a family policy which did have a cash value Nationwide questioned whether this was the policy Coleman desired to surrender. However, Nationwide expressly stated it was not suggesting that either policy should be surrendered, but Coleman was requested to inform Nationwide which policy he intended to surrender. The letter also told Coleman that his term policy would lapse automatically on December 12, 1967 if no more premiums were paid.
Upon receipt of the November 30th letter from Nationwide, Coleman wrote on the face of the letter, 'I want to keep my family policy' and then returned it by mail to Nationwide. Again, on January 26, 1968 Coleman wrote Nationwide. He stated that he had been sick in the hospital and wanted to 'cash in' his term policy but keep the family policy. He also stated that he did not need the term policy 'at this time'. Following receipt of this letter Nationwide issued a check, dated February 9, 1968, payable to Coleman in the sum of $134.72 for the accumulated dividends on the term policy. Both Coleman and Mrs. Coleman endorsed the check and it was cashed.
According to Ralph Yoder, manager of Nationwide's underwriting department, the company received early in March, 1968 four checks payable to its order drawn by Mrs. Coleman numbered 309, 310, 312 and 325. Checks Nos. 309 and 310 were dated January 1, 1968 and February 1, 1968 respectively. Check No. 325 was dated March 3, 1968 and bore the notation, 'For Dec. payment'. Each of these checks was for the sum of $5.60. Check No. 312 was dated March 3, 1968 and in the amount of $31.13. (This check was for the March premium of $25.53 on the family policy and $5.60 on the term policy). All of these checks were deposited to Nationwide's credit. However, the proceeds were not entered as premium receipts but were held as 'suspense' items.
On March 15, 1968 Nationwide wrote Coleman acknowledging receipt of the back premiums of $22.40 on the term policy. The letter also stated that the term policy had lapsed because the payments were received too late to be applied, and that the payments would be held until he had an opportunity to comply with the reinstatement requirements of the company. 1 An application for reinstatement was enclosed with this letter. Coleman answered the questions 2 contained in the application, but he failed to date, sign and secure the signature of a witness. He wrote on the back of Nationwide's letter to him that he was 'very sorry this have (sic) happened'; that he did not want to lose his policy, and that he would forward at least $30 on April 12. (According to Mrs. Coleman, he intended to repay the dividends on the policy received from the company in February).
Nationwide, on March 25, 1968, returned the incompleted reinstatement form to Coleman for it to be dated and signed, and his signature witnessed. He was also requested to delete from the application certain information he had given concerning his wife and children since the policy did not cover them. Coleman completed the application which he dated March 30, 1968, and it was received by Nationwide along with a payment of $50 on April 9, 1968. Above his signature, the application stated in bold print, 'IT IS UNDERSTOOD AND AGREED THAT: * * * (3) Any payment of premium made...
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