Corley v. Coastal States Life Ins. Co.
| Decision Date | 10 March 1964 |
| Docket Number | No. 18179,18179 |
| Citation | 244 S.C. 1,135 S.E.2d 316 |
| Court | South Carolina Supreme Court |
| Parties | Tessie J. CORLEY, Respondent, v. COASTAL STATES LIFE INSURANCE COMPANY, Appellant. |
Lumpkin, Kemmerlin & Medlock, Columbia, for appellant.
Seigler & Seigler, Columbia, for respondent.
In this action Respondent, Tessie J. Corley, alleges that Appellant, Coastal States Life Insurance Company, breached an insurance contract and that such breach was accomplished with a fraudulent intention accompanied by fraudulent acts. The Insurance Company denied that it had breached the contract and denied any fraudulent act or intent on its part. The Appellant paid into Court the sum of $7,296.75 together with $60.00 interest, the amount it claimed due Respondent under the terms of the life policy. The jury returned a verdict in favor of Respondent of $144.65 actual damages and $10,000.00 punitive damages in addition to the verdict of $7,356.75 actual damages directed in favor of Respondent by the trial Judge.
At appropriate stages of the trial, the Insurance Company made motions, which were denied, for nonsuit and for directed verdict as to actual damages on the grounds that there was no additional amount due Respondent as actual damages and that there was no evidence of an act of fraud or of fraudulent intent on the part of the Insurance Company. After the jury's verdict, the Insurance Company also moved for judgment n. o. v. or alternatively for a new trial, which the Court also denied.
The policy in question was issued October 27, 1950, on the life of Respondent's husband, naming Respondent as beneficiary. The insured died July 1, 1961, while the policy was in force. The face value of the policy was for $5,000.00 and provided for two additional death benefits, the first of which was denominated Bonus Participation Fund and the other death benefit provided for a full return of premium. $925.50 had been contributed to the Bonus Participation Fund and credited to the policy. $825.75 had previously been paid the insured, leaving a balance of $96.75 in the fund due as an additional death benefit. The return of premium rider provided '* * * the Company will add to the death benefits otherwise payable an amount sufficient to give a full return of premium on the policy and this rider, ($200.00 per annum) * * *'. The above quoted portion of the policy is ambiguous when considered with the fact that the policy on the first page thereof indicates that the annual premium is $213.15. Premiums had been paid on the policy for 11 years. Appellant contends that the annual basic premium for the face amount of the policy is $185.10 and that amount together with the $14.90 premium for the return of premium rider, a total of $200.00, is all that was intended to be returned. Under this construction, the Waiver of Premium for Disability in the amount of $3.15 and the Double Indemnity premium of $10.00 were not included. Although Appellant's contention is reasonable, it is not the only reasonable construction to be placed on the language used and the jury's verdict of $144.65 additional actual damages (a return of $13.15 for 11 years) has not been questioned as to its accuracy by the exceptions.
The Insurance Company's motions for nonsuit, directed verdict, judgment n. o. v and alternatively for a new trial in regard to punitive damages were based on the contention that there was no evidence of fraudulent intent or of an act of fraud on its part which would warrant the recovery of punitive damages.
It is well settled that in an action for breach of an insurance contract, proof of fraudulent intent accompanied by a fraudulent act is necessary to support a verdict for punitive damages. Blackmon v. United Insurance Co., 235 S.C. 335, 111 S.E.2d 552.
In response to a request for proof of loss forms, Respondent was advised by the Insurance Company by letter dated July 6, 1961, to its manager...
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