Equitable Life Assur. Soc. of U.S. v. Yates

• Decision Date: 14 November 1941
• Parties: EQUITABLE LIFE ASSUR. SOC. OF UNITED STATES v. YATES.
• Court: Kentucky Court of Appeals

156 S.W.2d 128

288 Ky. 309

EQUITABLE LIFE ASSUR. SOC. OF UNITED STATES v. YATES.

Court of Appeals of Kentucky

November 14, 1941

Appeal from Circuit Court, Floyd County; John W. Caudill, Judge.

Action by Edda Yates against the Equitable Life Assurance Society of the United States to recover on a certificate of life insurance issued under a group policy. From a judgment for plaintiff, defendant appeals.

Reversed.

William Marshall Bullitt, Eugene B. Cochran, and Bruce & Bullitt, all of Louisville, for appellant.

Z Wells, of Paintsville, for appellee.

SIMS Commissioner.

Mrs Edda Yates instituted this action as beneficiary to recover $2,000 on a certificate of life insurance issued to her husband, Gradie Yates, under a group policy insuring the employees of the Inland Steel Company. From the judgment entered in her favor on a verdict for the full amount of the certificate the insurance company appeals, insisting that the trial judge should have peremptorily instructed the jury to find for it.

The appellant issued a group policy to the steel company covering such of its employees as elected to take the insurance and each employee was issued a certificate under the master policy. The premium on the master policy was paid by the employer monthly in advance, and near the end of every month it deducted from each employee's wages his part of the premium due the succeeding month. The master policy, also the certificate issued each employee, provided that the insurance automatically ceased upon the termination of employment regardless of the causes of such termination; that if the employment terminated for any reason, the employee was entitled to receive a converted policy of life insurance in any one of the forms customarily issued by the insurance company (except term insurance) in an amount equal to his protection under the group insurance without further evidence of insurability upon application and the payment of the premium for such insurance within 31 days after the termination of the policy. The master policy under which the certificate was issued further provided the employer may elect that all employees temporarily laid off or given leave of absence or disabled or retired on pension shall be considered to be in the employment of the employer during such period.

Gradie Yates had been in the employment of the steel company since 1932 as a miner and had been insured under this group policy since Aug. 1, 1932. On May 6, 1936, he suffered a severe accident in the mine which resulted in the loss of an eye and a fractured skull. He returned to work on July 12, but was unable to operate his machine and was given lighter work at which he continued until July 25.

On account of his injuries Yates was receiving compensation under the Workmen's Compensation Act, Ky.St. § 4880 et seq., and he made a request of his employer about the first of August for a lump sum settlement, telling E. R. Price, the superintendent, that he was quitting the mine and desired to buy a small farm. His request was granted and he was paid $1,139.28 in full settlement of his compensation claim either on Aug. 6th or Aug. 15th, the record not being clear as to which date. On Aug. 8th, he surrendered possession of the house to the company which he had been renting from it and paid his rent, also, his electric bill to the Company up to that date. Soon thereafter he bought a farm in Lawrence County to which he moved. On Sept. 22nd, Yates died and it appears his death was due to injuries he received on May 6th.

Not realizing Yates intended to terminate his employment the first of August, the employer deducted from Yates' wages his part of the August premium during the latter part of July and forwarded it to the insurance company. It was the custom of the employer to furnish the insurance company near the end of each month the names of the men whose employment had been terminated, and the list it furnished to the insurance company on Aug. 28th showed Yates' employment had terminated July 27th. When it developed the insurance company had received a monthly premium from a man whose employment had been terminated such unearned premium was returned to the employer. In this instance the insurance company subsequently returned to the employer the August premium paid for Yates but the record shows the employer never returned it to Yates.

Yates' brother-in-law, Rufus Berry, testified that Yates told him after leaving the mine, "he was figuring on working back at the same place (the mine), *** and I believe he told me that he still had his job." This testimony is self-serving hearsay, and the court erred in not sustaining appellant's objection thereto. Appellee argues, as we understand it, that such testimony is competent as being part of the res gestae of Yates' intention to resume work at the mine, citing Steele's Heirs v. James Logan, 3 A.K. Marsh 394, 10 Ky. 394; Mutual Life Ins. Co. v. Louisville Trust Co., 207 Ky. 654, 269 S.W. 1014; 1 Jones on Evidence, 4th Ed., §§ 347 and 350, pages 639 and 645.

Neither of these authorities support such argument. The Mutual case holds that where the fact of a person's death has been established from absence, a letter written by him when he disappeared evidencing the intention of immediate suicide is admissible as part of the res gestae to fix the time of his death. The Logan case holds that in dispossessing a tenant the declarations of the party at the time of doing the act are admissible as part of the act. The notes to the text in Jones on Evidence cite the Mutual case, and in § 344, page 633 and 634, it is said that the declarations of conclusions or opinions, even...