Deskin v. United States Reserve Ins. Corporation

• Decision Date: 27 June 1927
• Docket Number: No. 16023.,16023.
• Citation: 298 S.W. 103
• Parties: DESKIN v. UNITED STATES RESERVE INS. CORPORATION.
• Court: Missouri Court of Appeals

298 S.W. 103

DESKIN v. UNITED STATES RESERVE INS. CORPORATION.

No. 16023.

Kansas City Court of Appeals, Missouri.

June 27, 1927.

Rehearing Denied July 11, 1927.

Certiorari denied by Supreme Court September 27, 1927.

Appeal from Circuit Court, Jackson County; Allen C. Southern, Judge.

Suit by Nannie Marvin Deskin against the United States Reserve Insurance Corporation. Judgment for plaintiff, and defendant appeals. Affirmed in part, and reversed in part.

Ernest D. Martin and J. H. Newman, both of Kansas City, for appellant.

E. H. McVey and Samuel R. Freet, both of Kansas City, for respondent.

WILLIAMS, C.

This is a suit on two life insurance policies, issued November 6, 1923, to John C. Deskin, payable to Nannie Deskin, deceased's wife, as beneficiary. Petition was in usual form pleading the policies, the death, etc. The answer was a general denial, and the answer further averred that the assured executed a note to cover the first annual premium on the policies; that the note was not paid, therefore the policies were canceled and lapsed for failure to pay the premium note when due. The reply denied the provision authorizing the cancellation or providing for lapse, forfeiture, or cancellation by reason of the nonpayment of note or notes for the first year's premium. The reply further pleads a waiver in the following terms;

"If there was any forfeiture or lapse or right of cancellation of said policies or insurance or either of them by reason of the nonpayment of any premium note or notes executed by the assured, John Cyrus Deskin, that then such lapse or forfeiture or cancellation or right of cancellation was waived by the defendant by giving and sending notice to the assured on each of the policies in suit; giving notice of the maturity of the two annual premiums on each of said policies maturing November 6, 1924, and demanding payment, whereby defendant elected to and did treat and continue said policies and each of them in full force and effect and did waive any default, lapse, or forfeiture by reason of the failure or alleged failure to pay any premium note."

The policies insured the life of John C. Deskin. The assured died October 15, 1924. Notice of death was given and a request for forms upon which to make proof of death. The company denied liability. Proof of death was duly furnished. There seems to be no difference in the forms of the policies in the two counts. The policies provide:

"United States Reserve Insurance Corporation, Kansas City, Missouri, hereby insures John Cyrus Deskin of Kansas City, state of Missouri (herein called the insured), for the maximum sum of $5,000.00, and immediately upon receipt and approval of due proofs of the death of the insured while this policy is in full force, will pay to Nannie Marvin Deskin, wife, if living, otherwise to the executors, administrators or assigns of the insured, $1,000.00, if death occurs during the first year, and, in addition thereto, eighty per cent. of the premium paid hereon. * * *

"This insurance is granted in consideration of the application herefor and of the annual premium of $188.60 and of the payment of a like amount on or before the 6th day of November in each of the succeeding nineteen years, or until prior death of the insured. * * *

"The provision and benefits stated on the succeeding pages hereof are made a part of this contract as fully as if recited at length over the signature hereto."

The material part of the policy conditions read as follows:

"Payment of Premiums and Grace Period.

"Premiums are payable annually in advance. * * *

"Except as herein provided, the payment of a premium or installment thereof shall not maintain the policy in force beyond the age when the next premium or installment thereof is payable. If any note shall be given for any premium, this policy, except as to guaranteed values, shall not be in force when said note is past due and not fully paid.

"All premiums are payable in advance at the home office or to an agent of the corporation signed by one or more of the following officers, viz., president, vice president or secretary, and countersigned by said agent

"If any premium is not paid on the date when due, or within the month of grace, and this policy has not been surrendered, the corporation will reinstate the policy as of said due date at any time thereafter, upon evidence of insurability satisfactory to the corporation and payment of all arrears of premiums with six per cent compound interest, together with the payment, or reinstatement, of any indebtedness on this policy on said due date, with interest."

"Entire Contract.

"This policy and the application herefor taken together, constitute the entire contract."

"General Provisions.

" * * * (3) This policy takes effect and becomes binding upon the corporation only upon actual delivery thereof to the applicant while in life and good health and the payment in cash to the corporation of the first annual premium while in good health."

The application, which is attached, is as follows:

" * * * I hereby agree that the corporation shall incur no liability until the first premium has been paid and until this application has been approved and policy issued thereon by the corporation during my lifetime.

"I understand that the corporation will not consider any application unless a deposit equal to the full amount of the first premium be made contemporaneously with the signing of the application. It is the purpose of the applicant to complete the foregoing application now by (a) making the said deposit and (b) having the medical examination made today, and accordingly, I hereby declare that I have this day paid to * * * $188.60 as follows: A note, purporting to be the first annual premium for the proposed insurance on my life. I hold binding receipt therefor made up without alteration on the receipt form, detached from, and corresponding in date with this declaration. I have carefully read said binding receipt and agree to its terms and condition.

                "Dated at Kansas City, Missouri, this 6th day
                of November, 1923.     John C. Deskin
                

"Signature of agents as witness: Smith & Watson."

It will be noted that there is no provision for cancellation.

The president of the company testified that a receipt given was on the regular form when the premium was paid.

A receipt upon the regular form was issued to deceased. The receipt was as follows:

"Received of John C. Deskin a note for the sum of $188.60, purporting to be the first annual premium under application * * * this day made to the United States Reserve Insurance Corporation.

"This receipt is issued upon the following terms, to wit: * * * (b) The payment hereunder shall be held by the corporation as a deposit merely and not as premium payment until the application and examination shall have been approved or disapproved by the corporation at its home office. (c) The corporation shall incur no liability under the application unless nor until said application and the examination shall have been received by the corporation at its home office, nor unless nor until the said application and examination shall have been approved by the corporation at its home office for the amount of the premium stated in said application.

"(d) If the application be approved by the corporation and the policy be issued for the amount of the premium as aforesaid, then said policy shall be in force from date of application.

"(e) If the application be disapproved by the corporation, payment hereunder will be returned to the applicant upon the surrender of this receipt to the corporation at its home office. * * *

"Dated this 6th day of November, 1923.

                                      "C. A. Smith, Agent."
                

The evidence shows that when the application was made a promissory note for $188.-60 was given. The note was signed by John C. Deskin, payable to the order of "himself." The note was indorsed on the back "John C. Deskin." Thus the note was made payable to bearer. These notes were renewed on January 23, 1924, and on April 22, 1924, the two notes were made into one note which was given for $380.20. J. B. Rutherford, superintendent of agencies, was instrumental in having the loan renewed. This last note was not paid.

When the notes were received they were entered upon the records under the heading, "Policy Loans." At the bottom of the record is a memorandum, "Canceled on July 25, 1924, for nonpayment of note." In the same record the following appears: "Premium paid 11-6-23, note $188.60."

On July 15, 1924, a letter was written to deceased as follows:

"We desire to call your attention to the fact that your note for $380.20 representing the first premium on your two policies of insurance has not been paid, which no doubt has escaped your notice. This premium should be paid on or before July 22,...