Ferguson v. Penn Mut. Life Ins. Co. of Philadelphia

• Decision Date: 28 May 1940
• Docket Number: Gen. No. 40548.
• Citation: 305 Ill.App. 537,27 N.E.2d 548
• Parties: FERGUSON v. PENN MUT. LIFE INS. CO. OF PHILADELPHIA.
• Court: United States Appellate Court of Illinois

305 Ill.App. 537

27 N.E.2d 548

FERGUSON

v.PENN MUT. LIFE INS. CO. OF PHILADELPHIA.

Gen. No. 40548.

Appellate Court of Illinois, First District, Second Division.

May 28, 1940.

Appeal from Municipal Court of Chicago; Edward S. Scheffler, Judge.

Action by Mabel M. Ferguson, individually and as administratrix of the estate of Peter Ferguson, deceased, against the Penn Mutual Life Insurance Company of Philadelphia, a corporation, to recover disability benefits and premiums. From an order sustaining defendant's motion to dismiss plaintiff's statement of claim, plaintiff appeals.

Order affirmed.

Richard W. Proctor, of Chicago, for appellant.

Poppenhusen, Johnston, Thompson & Raymond and Robert Z. Hickman, all of Chicago, for appellee.

JOHN J. SULLIVAN, Presiding Justice.

This appeal seeks to reverse the order of the trial court which sustained defendant's motion to dismiss plaintiff's statement of claim.

Plaintiff, Mabel M. Ferguson, individually and as administratrix of the estate of Peter Ferguson, deceased, brought this action against defendant, The Penn Mutual Life Insurance Company of Philadelphia, to recover disability benefits and premiums claimed to be due and owing under the terms of two policies of insurance issued by defendant to the decedent.

The statement of claim alleged substantially that the decedent during his lifetime was insured by defendant under two policies, each in the sum of $5,000 copies of which were attached to and made a part of the statement of claim and that the policies contained the following, among other, provisions:

“Monthly Income. The company will pay to the insured or, if the insured be insane, then to his or her legal guardian or committee if any such has been appointed, or in the absence of any such appointment then to the wife of the insured if a beneficiary of record under this Policy, a monthly income of Fifty & 00/100 Dollars for each completed month of insured's Total and permanent disability as herein defined; such income to continue only during the period of disability prior to the termination of this Policy by maturity or otherwise. Interest on any indebtedness under this Policy may be deducted from the monthly income payments hereunder.

“Waiver of Premium. The Company will waive the payment of premiums falling due under this policy during the insured's total and permanent disability, as herein defined. The premiums waived shall be the annual, semiannual or quarterly premiums, according to the method of premium payments in effect when disability occurred.

“Premiums. The extra quarter annual premium for the Total and Permanent Disability Benefits, which is additional to the quarter annual premium stated on the first page of the Policy, is Six & 40/100 Dollars.”

It was then alleged that “during the month of July, 1936, Peter Ferguson become so ill that he was incapacitated and could not carry on any work of any description and that from then until the time of his death on February 8, 1937, Peter Ferguson was totally and permanently disabled;” and that “on February 8, 1937, Peter Ferguson departed this life, never having recovered his ability to enter gainful employment and that immediately thereafter this plaintiff furnished proof of the permanent and total disability to the Penn Mutual Life Insurance Company of Philadelphia, and the company failed and refused under these policies to pay total and permanent disability for the period for six months prior to February 8, 1937, and as a sole basis for said refusal stated that there was a provision in said contract that the disability payments were to be made only if the company were notified during the pendency of the illness, and that for that reason the proofs of total and permanent disability could not be accepted.”

Plaintiff asked for judgment for $700.90, which amount included premiums of $100.90 claimed to have been wrongfully received by defendant during the period of decedent's disability, and disability benefit payments of $50 a month on each policy for a period of six months, aggregating $600.

The pertinent averments of defendant's motion to dismiss the statement of claim are as follows: “That one term of the supplemental agreement for payment of total and permanent disability benefits is that: ‘The company will pay to the insured--a monthly income of Fifty and no/100 ($50.00)--;’ that the plaintiff herein represents herself to be the Administratrix of the estate of the insured, and that it appears upon the face of said statement of claim that the insured is dead, and that the obligation, if any, of the defendant does not run to the plaintiff and that she is not a proper party to assert the same.”

It was further averred that “it appears upon the face of said statement of claim that one term and condition of the supplemental agreement referred to in the paragraph above provided: ‘Disability benefits shall become effective as of the date of commencement of total and permanent disability of the insured, as herein defined, if due proof of such disability is received by the company at its home office within six months from said date of commencement, otherwise disability benefits shall become effective as of the date six months prior to the receipt of such proof; provided in either event that on such effective date the first premium on this policy had been paid and no subsequent premium was then in default, and further provided such proof is received by the company during the continuance of said disability.’ ” (Italics ours.)

It was then averred “that...