Erwin v. United Ben. Life Ins. Co.

• Decision Date: 22 May 1962
• Docket Number: No. 6865,6865
• Citation: 1962 NMSC 67,371 P.2d 791,70 N.M. 138
• Parties: David W. ERWIN, Plaintiff-Appellant, v. UNITED BENEFIT LIFE INSURANCE COMPANY, Defendant-Appellee.
• Court: New Mexico Supreme Court

Page 791

371 P.2d 791

70 N.M. 138

David W. ERWIN, Plaintiff-Appellant, v. UNITED BENEFIT LIFE INSURANCE COMPANY, Defendant-Appellee.

No. 6865.

Supreme Court of New Mexico.

May 22, 1962.

Robert W. Ward, Lovington, for appellant.

Schauer & Stiff, Roswell, for appellee.

CHAVEZ, Justice.

This is an appeal by David W. Erwin, plaintiff in the court below, from a summary judgment in favor of defendant-appellee, United Benefit Life Insurance Company.

Appellant's complaint filed November 12, 1959, alleged that appellee had issued its insurance policy on November 17, 1949, insuring appellant or any dependent named in the schedule, if they became afflicted with definitely diagnosed poliomyelitis and other diseases set out in the policy. Appellant further alleged: (1) That appellant's dependent contracted poliomyelitis in August, 1950, at a time when the policy was in force with all premiums paid; (2) that prompt notice of such sickness was given to appellee in compliance with the terms of the policy, and that appellee has recognized and admitted its liability thereunder and has paid medical expenses under the policy in the amount of $2,518.36; (3) that appellant has incurred medical expenses in the sum of $654.70, and that appellee refuses to pay said medical expenses. Appellant prayed judgment for $654.70.

Appellee, by answer, admitted the issuance of the policy but denied that it recognized or admitted its liability under the policy in excess of $2,518.36. By separate defenses, appellee alleged: (a) That its liability was limited to expenses while the policy was in force and that the policy lapsed on November 1, 1954, due to nonpayment of renewal premium; (b) that the first six charges reflected by Exhibit 'B' between June 11 and August 17, 1953, were paid by appellee; (c) that the first sixteen charges reflected in Exhibit 'B' totaling $105 were barred for failure of appellant to furnish proof of loss as required by paragraph 7 of the policy, and that all charges reflected in Exhibit 'B' incurred prior to February 18, 1957, totaling $65 were barred due to the provision in the policy which required that the suit be brought within two years from the expiration of the time within which proof of loss be furnished as required by the policy.

Appellee then filed its motion for summary judgment, which was granted by the trial court. The parties stipulated to the following facts:

1. That appellant paid the initial premium and all renewal premiums payable under the insurance policy to and including the payment payable on November 1, 1953, but that appellant has not paid any renewal premium payable on said policy on November 1, 1954, or at any other time thereafter.

2. That the first six charges reflected on Exhibit 'B' between June 11 and August 17, 1953, totaling $30 were paid by appellee by draft dated September 11, 1953.

3. That appellant did not at any time furnish appellee with affirmative proof of loss for medical expenses incurred by him as reflected by the first sixteen charges set forth on Exhibit 'B' between June 11, 1953, and August 11, 1958, totaling $105, as required by the provisions of said insurance policy.

4. That no action at law or in equity was brought within two years from the expiration of the time within which proof of loss is required by the terms of said policy with respect to all charges reflected on Exhibit 'B' on or prior to February 18, 1957, totaling $65.

5. That subject to the defenses raised by appellee's amended ahswer, appellant incurred medical expenses in the sum of $654.70 in accordance with Exhibit 'B' and that appellant shall be entitled to recover the full amount of such sum, except as such recovery may be barred by the defenses raised in appellee's said amended answer. The expenses incurred in this claim by appellant on account of the defendant's poliomyelitis were incurred after November 1, 1954, and up to and including 1959

The pertinent provisions of the insurance policy are:

'Hereby insures the person whose name is shown in the Schedule on the last page hereof (herein called the Insured) against loss because of expense incurred by the Insured for himself or any Dependent named in said Schedule while this policy is in force resulting exclusively from any disease, specifically named in Part A of this policy, and against loss of life, limb, or sight resulting from accidental bodily injuries received while this policy is in force; and promises to pay benefits to the Insured to the extent herein provided.

'SECTION I SPECIFIED DISEASES BENEFIT PART A.

'If the Insured, or any Dependent named in the Schedule on the last page hereof, shall become afflicted with definitely diagnosed Poliomyelitis, Leukemia, Scarlet Fever, Diphtheria, Smallpox, Spinal or Cerebral Meningitis, Encephalitis, Tetanus, or Rabies (including inoculations for suspected Rabies), the cause of which originates while this policy is in force and more than fifteen days after the Policy date, the Company will pay benefits as outlined in Part B of this policy, but not to exceed an aggregate sum of Five Thousand ($5,000.00) Dollars for each person for each such disease.'

Part B sets out the schedule of benefits such as doctor's bills, hospital bills, special nurse, ambulance, x ray, blood transfusions, drugs and medicines, iron lung, braces and crutches, and transportation.

'Additional Provisions' set out in the policy provide:

'(d) The Schedule, appearing on the last page of this policy and showing Policy Date, Renewal Date, Initial Premium, Renewal Premium and all other data, shall be considered a part of this contract as fully as though it preceded the execution clause hereof.

'(e) The term of this policy begins on the Policy Date at 12 o'clock noon, Standard Time of the place where the Insured then resides and ends at 12 o'clock noon, the same Standard Time, on the renewal Date. Each renewal term ends at 12 o'clock noon, the same Standard Time, on the date the next renewal is due.

'(f) This policy is issued in consideration of the payment in advance of the Initial Premium for the initial term ending on the Renewal Date.

'(g) Prior to the expiration of the initial term, or any subsequent term for which this policy may have been renewed, the payment of the Renewal Premium is required to keep this policy in effect. The acceptance of any premium shall be optional with the Company.'

Under 'General Provisions' of the policy, paragraph 3 provides:

'If default be made in the payment of the agreed premium for this policy, the subsequent acceptance of a premium by the Company or by any of its duly authorized agents shall reinstate the policy but only to cover accidental injury thereafter sustained and such sickness as may begin more than ten days after the date of such acceptance.'

The parties by the pleadings and stipulation acknowledge the following facts: (a) That the policy was in force in August, 1950,...