Farmers' And Merchants' Mutual Life Association v. Mason
| Decision Date | 21 June 1917 |
| Docket Number | 9,264 |
| Citation | 116 N.E. 852,65 Ind.App. 66 |
| Parties | FARMERS' AND MERCHANTS' MUTUAL LIFE ASSOCIATION v. MASON |
| Court | Indiana Appellate Court |
From Pike Circuit Court; John L. Bretz, Judge.
Action by Elizabeth Mason against the Farmers' and Merchants' Mutual Life Association. From a judgment for plaintiff, the defendant appeals.
Reversed.
Lucius C. Embree and Morton C. Embree, for appellant.
John R Brill, Frank H. Hatfield and John W. Brady, for appellee.
On May 30, 1910, appellant issued a certificate on the life of Ulysses G. Mason in the sum of $ 1,000, in consideration of the payment of quarterly premiums of $ 4.91 on the first days of January, April, July, and October in each year, in which appellee, the wife of the insured, was named as the beneficiary. The insured died on April 28 1913, and appellee filed her complaint in the court below in three paragraphs, to recover on said certificate. The first paragraph was dismissed, and trial was had on issues formed on the second and third paragraphs. As no question is presented in this court on the sufficiency of the pleadings, we will only briefly indicate their contents. The first paragraph of the complaint alleges in substance, among other things, the issuance of the certificate, the death of the insured, and the performance on the part of appellee and the insured of all the conditions of said policy on their part to be performed, while the second paragraph excepts from such performance the payment of a portion of such premiums in cash, alleges the execution of promissory notes in payment of such portions, that such promissory notes were accepted by appellant in lieu of cash, and that it thereby waived the requirement of said certificate in that regard. A copy of the certificate was filed with each of said paragraphs of complaint and made a part thereof.
Appellant filed its answer in one paragraph in which it admitted the execution of the certificate of insurance mentioned in the complaint, and that at its inception it constituted a valid contract, but alleged facts to show that such certificate had lapsed, prior to the death of the insured, by reason of the nonpayment of a note given for premiums.
Appellee filed a reply in two paragraphs. The first was a general denial. The second alleges facts on which it bases a claim that all premiums on such certificate had been fully paid, except the quarterly premium due April 1, 1913, and that the insured died within the thirty days of grace allowed for its payment. It also alleges that at the time of the insured's death appellant owed him a sufficient amount of commissions to pay all premiums on said certificate, which should have been credited thereon, and that appellant had theretofore accepted from the insured other notes for various quarterly premiums.
There was trial by jury, resulting in a verdict for appellee for $ 1,078, and judgment was rendered accordingly. Appellant filed a motion for a new trial, which was overruled. This action of the court below is the only assigned error presented by appellant in its brief as cause for reversal. Appellant alleges as reasons for a new trial that the verdict of the jury is contrary to law; that it is not sustained by sufficient evidence; that the amount of recovery is too large; that the court erred in the admission of certain evidence, and in giving and refusing certain instructions.
The undisputed evidence shows the following facts: The certificate in suit was issued by appellant on May 30, 1910. Quarterly premiums thereon in the sum of $ 4.91 were to be paid in advance on the first days of January, April, July, and October of each year. All premiums were paid to and including September 30, 1912. Default was made in the payment of the quarterly premium which fell due on October 1, 1912. Said premium was still in default on December 14, 1912, when appellant accepted the promissory note of the insured for $ 4.91, due thirty days after said date for the amount of the same. Default was also made in the payment of the quarterly premium which fell due on January 1, 1913, and also in the payment of said note at its maturity. Both remaining unpaid on February 4, 1913, appellant surrendered said note, and accepted another promissory note of the insured for the amount of said first note, and said premium which fell due on January 1, 1913, as follows:
At the time appellant accepted said note it delivered to the insured a receipt as follows:
No part of said note has been paid, and no offer was made to pay the same prior to the insured's death, but the same is still retained by appellant. The quarterly premium of $ 4.91, which fell due on April 1, 1913, has never been paid. The insured departed this life on April 28, 1913, from a cause covered by such certificate. The certificate in suit contains, among other things, the following provisions:
Endorsed on the back of such certificate is the following:
The application made by the insured for such certificate, and which by its terms became a part thereof, contained the following:
"That if any of the conditions of the by-laws of the association are violated the applicant or his beneficiary surrenders all right of recovery under this certificate of membership."
That at the time of the execution of said certificate, and continuously to the death of the insured, there was in full force and effect a certain by-law of appellant, with reference to the lapsing of such certificate on the nonpayment of a note, given in payment of money due it, of like tenor as the one contained in such certificate, as set out above.
Appellant contends that the failure of the insured to pay the said note of $ 9.82 given for the two quarterly premiums, either at its maturity, or within the thirty days of grace allowed therefor, caused such certificate to lapse, and hence appellee cannot recover. This contention requires a determination of the effect of the acceptance of such note by appellant. The payment of a premium by note may be either absolute or conditional. If absolute, the insurer accepts the liability of the party executing the note in satisfaction of the premium, but if conditional, its nonpayment remits the insurer to its original right to demand payment of the premium. Vance, Ins. 209. Whether such payment is absolute or conditional depends on the intention of the parties at the time of the execution of such note. Such intention must be determined as any other fact, and may be expressed in the policy providing for such premium, or in the note itself. 25 Cyc 826; 3 Cooley, Briefs on Ins. 2269; 2 Bacon, Life and Acc. Ins. (4th ed.) § 475; Thompson v. Insurance Co. (1881), 104 U.S. 252, 26 L.Ed. 765; Forbes v. Union, etc., Ins. Co. (1898), 151 Ind. 89, 51 N.E. 84; Union, etc., Ins. Co. v. Adler (1906), 38 Ind.App. 530, 73 N.E. 835, 75 N.E. 1088.
This rule does not seem to be controverted, but different contentions are made as to its application to the facts of this case. One contention is that the...
To continue reading
Request your trial