Equitable Life Assurance Society of United States v. Campbell

• Decision Date: 19 December 1925
• Docket Number: 12,402
• Parties: EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES v. CAMPBELL
• Court: Indiana Appellate Court

150 N.E. 31

85 Ind.App. 450

EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES v. CAMPBELL

No. 12,402

Court of Appeals of Indiana

December 19, 1925

Rehearing denied April 27, 1926, Reported at: 85 Ind.App. 450 at 465.

Transfer denied December 14, 1926.

From Posey Circuit Court; Herdis F. Clements, Judge.

Action by Mary L. Campbell and others against the Equitable Life Assurance Society of the United States. From a judgment for the plaintiff, the defendant appeals.

Reversed.

John D Welman, Phelps F. Darby, Morton C. Embree and Lucius C. Embree, for appellant.

George K. Denton, Lane B. Osborne, J. Wheeler Campbell and Winfield K. Denton, for appellees.

OPINION

NICHOLS, J.

This was an action by appellees against appellant upon a policy of life insurance upon the life of one Simeon N. Leonard.

The issues were joined upon an amended complaint in two paragraphs, an answer in three paragraphs and a reply to the second and third paragraphs of the answer.

There was a trial by jury, a verdict for appellees in the sum of $ 20,085 and, after appellees had remitted $ 100, judgment was rendered upon the verdict.

The only error assigned is that the court erred in overruling the appellant's motion for a new trial.

The first paragraph of the amended complaint was dismissed at the time of the trial.

It is averred in the second paragraph that on June 30, 1903, appellant issued to Leonard, a policy of insurance on his life, bearing date of said day, for $ 10,000, on the death of the said assured to be paid to his five children therein named as beneficiaries, being appellees and two others who died after the assured, unmarried, leaving no child or children and no father and no mother, but leaving appellees surviving them, the said surviving brother and sisters being their only heirs and being entitled to their estates.

That said assured and the beneficiaries have performed all the conditions of said policy and contract of insurance on their part to be performed.

Appellant answered in general denial, and by a second and a third paragraph of answer averring forfeiture of the policy for failure to pay the second annual premium.

The first paragraph of complaint contained an averment of waiver of proofs by a denial of liability because of forfeiture, and competent evidence to that effect was heard; but thereafter the first paragraph was dismissed. The second paragraph contained no such specific averment, but only the general averment that the assured and the beneficiaries had performed all of the conditions of the policy and contract of insurance on their part to be performed. Appellant contends that after the dismissal of the first paragraph of complaint, there was no issue of waiver, that the evidence thereof was incompetent and could not be considered, and that the court erred in instructing the jury that a denial of liability on a policy of insurance by an insurance company on ground other than want of proofs or insufficiency thereof is a waiver of proofs, and excuses the beneficiaries from making the same. It does not appear by the record that there was any withdrawal of the evidence of waiver, or any motion to that effect.

It has been held by the Supreme Court of this state that where there is a general allegation of performance of the conditions of the insurance contract, as in this case, under such plea, proof of waiver of conditions may be made. Union Fraternal League v. Sweeney, 184 Ind. 378, 111 N.E. 305. The same authority holds that where an insurance company denied all liability on the ground of fraud, it waived the right to insist on proofs of death in accordance with the policy. The principle is applicable here. To the same effect see, Travelers Ins. Co. v. Fletcher, etc., Nat. Bank (1925), 84 Ind.App. 563, 150 N.E. 825, and authorities there cited.

Instruction No. 1, given by the court on its own motion, instructed the jury that, before appellees could recover, they must prove by a fair preponderance of the evidence all the material allegations of their complaint. This is a correct statement of the law so far as it goes. If appellant desired an instruction covering the issues more completely, it should have tendered such a one. Newcastle Bridge Co. v. Doty (1906), 168 Ind. 259, 79 N.E. 485; Indianapolis, etc., Traction Co. v. Newby (1909), 45 Ind.App. 540, 90 N.E. 29.

Appellant complains of instructions Nos. 5 and 6 given by the court at the request of appellees. These instructions told the jury that the burden was upon appellant to prove by a fair preponderance of the evidence the nonpayment of the second annual premium, the alleged failure to pay which caused the forfeiture of the policy. It is the law that the burden is on the insurance company to prove the nonpayment of any premium after the first. Supreme Lodge, etc., v. Johnson (1881), 78 Ind. 110; Sovereign Camp, etc., v. Cox (1906), 40 Ind.App. 266, 78 N.E. 683; New York Life Ins. Co. v. Lahr (1922), 192 Ind. 613, 137 N.E. 673; New York Life Ins. Co. v. Statham (1876), 93 U.S. 24, 23 L.Ed. 789.

In this case, the issues were formed upon that theory, appellant having, by its second and third paragraphs of answer, pleaded nonpayment of the second annual premium. Even if the burden were not with appellant, the court instructed the jury according to the pleadings, and appellant having thereby invited the alleged error, cannot be heard to complain thereof. Akron Milling Co. v. Leiter (1914), 57 Ind.App. 394, 107 N.E. 99; Louisville, etc., R. Co. v. Miller (1894), 141 Ind. 533, 37 N.E. 343; Zeller, McClellan & Co. v. Vinardi (1908), 42 Ind.App. 232, 85 N.E. 378; Chicago, etc., R. Co. v. Coon (1911), 48 Ind.App. 675, 93 N.E. 561; 4 C. J. 700 et seq.; Ewbank's Manual § 255.

At the trial of the case, appellees introduced in evidence the policy, the application, proof of death of the insured, and proof of appellant's denial of liability. Appellant introduced evidence, which it says was wholly undisputed, showing that the second annual premium had not been paid, and, claiming that such evidence made prima facie a complete defense, tendered a peremptory instruction that the jury find for appellant. This the court refused to give, and appellant complains that the court's action was reversible error. But, appellant's evidence of nonpayment was all in parol, and involves the credibility of witnesses which is for the jury. In Haughton v. Aetna Life Ins. Co. (1905), 165 Ind. 32, 73 N.E. 592, the court, in reversing a judgment because the trial court gave a peremptory instruction, says: "But where a determination of the issue involves the credibility of witnesses, and rests upon inferences and deductions to be drawn from facts proved, it will be an invasion of the province of the jury for the court to direct a verdict." To the same effect, see New York, etc., R. Co. v. Callahan (1907), 40 Ind.App. 223, 81 N.E. 670; Hall v. Terre Haute Electric Co. (1905), 38 Ind.App. 43, 76 N.E. 334.

It is not claimed by appellant that appellees failed to establish their case as made by their complaint, but that appellant by uncontradicted evidence has established an affirmative defense. Of course, the burden was with appellant to establish such a defense. The Supreme Court, in Talge Mahogany Co. v. Burrows (1921), 191 Ind. 167, 179, 130 N.E. 865, makes the following forceful answer to appellant's contention: "But the evidence cannot be held insufficient to sustain a verdict for the plaintiff by reason of affirmative oral testimony of facts pleaded as a defense of which the appellant had the burden of proof. The jury may have found that such defense was not established because they did not believe appellant's witnesses who gave that testimony." The same principle is forcefully announced in National City Bank v. Kirk (1922), ante 120, 134 N.E. 772, 776.

It appears by the evidence that the gross amount of the first premium was $ 776.90. Of this sum, the insured paid to Mr. Ferguson, the agent through whom the policy was issued, $ 155.38. This amount was twenty per cent. of the gross premium. The eighty per cent. of the first premium represented the agent's commission. It does not appear by the evidence as to whether the eighty per cent. was paid. It does appear, however, that the $ 155.38 was paid to the insurance company by the check of the insured.

Mrs Grace Porter, who was the wife of the insured at the time of his death, testified that, a few weeks before his death, Mr. Ferguson, the agent to whom the policy was issued, came to the insured's home, "came to our home and he and Mr. Leonard were sitting on the porch and I was sitting in the reception hall, and I heard them discussing a policy, talking in rather loud tones. I thought they were quarreling at first, and I heard Mr. Ferguson say, 'I will take your note for sixty days' and Mr. Leonard said 'all right' and Mr. Leonard came in and asked me for a little note-book he kept upstairs in a wash-stand drawer and I got it for him and he sat down at the table in the hall pretty close to me and wrote the note--I knew it was a note because it was a note-book--and he took it out and gave it to Mr. Ferguson, and I heard him saying something about having gotten a receipt from a Paducah bank." There was no other evidence with reference to this transaction, and no other evidence of the payment of the second annual premium. To say that the jury could, from such evidence, draw an inference that the second annual premium was paid by such a transaction would be to base such inference upon the merest conjecture. There is nothing that indicates to whom such a note, if such it was, was made payable, the amount of the same, when it was payable, at what place it was payable, or the consideration for the same. The witness...