Field v. Missouri Life Ins. Co.

• Decision Date: 26 August 1930
• Docket Number: 4940
• Citation: 290 P. 979,77 Utah 45
• Court: Utah Supreme Court
• Parties: FIELD v. MISSOURI LIFE INS. CO

290 P. 979

77 Utah 45

FIELD v. MISSOURI LIFE INS. CO

No. 4940

Supreme Court of Utah

August 26, 1930

Appeal from District Court, Third District, Salt Lake County; W. H Bramel, Judge.

Action by Mary S. Field against the Missouri State Life Insurance Company. Judgment for defendant, and plaintiff appeals.

AFFIRMED.

H. A Smith, E. E. Randall, and P. G. Ellis, all of Salt Lake City for appellant.

Critchlow & Critchlow and A. W. Watson, of Salt Lake City, for respondent.

ELIAS HANSEN, J. CHERRY, C. J., and STRAUP, EPHRAIM HANSON, and FOLLAND, JJ., concur.

OPINION

ELIAS HANSEN, J.

The plaintiff is the surviving widow of Burr D. Field, deceased. In this action she seeks to recover a judgment against the defendant for the sum of $ 1,000. She sues as sole beneficiary of an alleged contract of insurance claimed to have been entered into by Mr. Field and defendant. In her complaint plaintiff alleges three causes of action. The first cause of action is founded upon a written life insurance policy on the life of Burr D. Field. The second cause of action is founded upon an alleged breach of contract whereby, for a valuable consideration, the defendant agreed to issue a life insurance policy to Burr D. Field. The third cause of action is founded upon an alleged contract partly oral and partly written, whereby the defendant, acting through its agent, S. A. Cotterell, insured the life of Burr D. Field, the insurance to begin at once, the policy to be issued at some future date. The defendant by its answer denies that it insured or agreed to insure the life of Burr D. Field. Upon issues joined a trial was had before the court sitting with a jury. At the conclusion of the evidence the learned trial judge directed the jury to find the issues in favor of the defendant and against the plaintiff, no cause of action. A verdict was rendered as directed and judgment entered thereon. Plaintiff appeals. She seeks a reversal of the judgment primarily because the trial court directed a verdict against her. There is no substantial conflict in the evidence. The facts established by the record brought here for review are these:

The defendant is a corporation of the state of Missouri authorized to do business in this state. At the time complained of, defendant was engaged in the life insurance business in this state. One S. A. Cotterell, as general agent of the defendant, had charge of its business here in Utah. He maintained an office in the Ness building at Salt Lake City, Utah. The following sign was printed on the door and on a window of his office: "Missouri State Life Insurance Company, S. A. Cotterell, General Agent." In the letters which he wrote concerning the business of the defendant he signed his name as general agent, and his letterheads designated him as a general agent. Defendant offered testimony tending to show that Mr. Cotterell did not have authority to bind the defendant on life insurance policies or contracts for life insurance. Prior to May 5, 1928, Mr. Cotterell solicited Burr D. Field for life insurance. The plaintiff and one other witness were permitted to testify, over timely objection and exception by defendant, that Mr. Cotterell at the time of such solicitations stated to Mr. Field that upon the payment of the first premium the life of Mr. Field would be insured and that the annual premium on an ordinary life policy would be $ 22.82. On May 5, 1928, Mr. Field signed an application for life insurance with the defendant. The application contains, among others, these provisions:

"I agree on behalf of myself and any person or persons, firm or corporation, who may have or claim any interest in any insurance issued on this application as follows:

"(1) If the first premium is paid in cash at the time this application is made and this application is thereafter approved by the Company for the amount, on the plan, and in accordance with the terms of this application, the insurance will be in force from the date of such approval; and the first policy year shall, unless otherwise requested, begin with the date of such approval. (2) If the first premium is not paid in cash at the time the application is made, or if a policy different from the one described in this application is issued, the insurance shall not take effect until the first premium thereon has actually been paid to and accepted by the Company, or its duly authorized agent, and the policy delivered to and accepted by me during my life and good health; but in that event the policy shall bear the date of its issuance and all future premiums shall become due on such policy date and all policy values and extended insurance shall be computed therefrom."

The application and two checks for the total sum of $ 22.82 were delivered to Mr. Cotterell on the date the application was signed by Mr. Field. Mr. Cotterell issued to Mr. Field a receipt which reads as follows:

"Advance Premium Receipt

"(This receipt is only valid when given in exchange for a full first annual, semi-annual, or quarterly premium, paid in cash, with the application.)

"Received of Burr Dewaine Field, the sum of $ 22.82 No. 166019A the first annual semi-annual quarterly premium on proposed life insurance for $ 1,000 on the life of Burr D. Field for which an application bearing a corresponding number; as above, is this day made to the Missouri State Life Insurance Company. Insurance subject to the terms and conditions of the policy contract issued shall take effect as of the date of approval of above application by the Company, at its Home Office in Saint Louis, Missouri. Otherwise the payment evidenced by this receipt shall be returned.

"Dated at Salt Lake City, Utah, May 5th, 1928.

"S. A. Cotterell, Agent."

The plaintiff testified that the foregoing receipt was delivered to her and that Mr. Cotterell stated that the receipt was important, that it was the equivalent of a life insurance policy. On May 7, 1928, Burr D. Field was examined for life insurance. The doctor who examined him pronounced him a first-class risk. Both the application for insurance and a written report of the medical examination were mailed to the defendant at its home office at St. Louis, Mo. The application was received at the home office of the defendant on May 10, 1928; the report of the medical examiner was received at the home office of the defendant on May 11, 1928. In the application of Burr D. Field his occupation was given as that of "Mining and Livestock." On May 12th, May 23d, and June 4th, 1928, the home office of the defendant wrote for further information as to the nature of the work of Mr. Field in connection with his mining activities. On June 11, 1928, Mr. Field died as a result of asphyxiation from poisonous gas encountered in a mine. On June 15, 1928, the defendant issued a life insurance policy for the sum of $ 1,000 on the life of Mr. Field. The policy so issued provides for an annual premium of $ 45.30. The policy also provides that the first annual premium shall pay for insurance from May 24, 1928, to May 24, 1929. The policy was sent to S. A. Cotterell, the general agent of the company, at Salt Lake City, Utah. The company did not know of the death of Mr. Field at the time it executed and mailed the policy. The policy was not delivered. It was rather returned to the home office of the defendant. The amount of annual premium was placed at $ 45.30, according to the testimony of an officer of the defendant, because of the extra hazard in the risk on Mr. Field's life on account of his being engaged in working underground in mines. Were it not for the hazardous occupation of Mr. Field, the annual premium would have been $ 22.82, the amount paid by Mr. Field. The date for the payment of annual premium was fixed as of May 24th instead of June 15th, according to the testimony of the officer of the defendant company who issued the policy, so that the premiums would be based upon the age of Mr. Field at the time he made application. With the advance of age the defendant charges a higher premium for insurance. The age of applicant for the purpose of fixing the premium is his nearest birthday. Mr. Field was born November 25, 1876, and thus he was 51 years of age, computed from his nearest birthday, on May 24, 1928, while he would have been rated as 52 years of age on June 15, 1928. On June 26, 1928, the plaintiff prepared and forwarded to the defendant a claim for the death of her husband. The defendant rejected the claim and sent to the plaintiff the money paid as the first annual premium by Mr. Field. The plaintiff refused to accept the money so returned to her. There is some evidence which tends to show that Mr. Field did not read the application before he signed and delivered the same.

The foregoing is in substance, the evidence upon which plaintiff seeks to recover a judgment against the defendant for the sum of $ 1,000, the face of the insurance policy.

The action of the trial court in directing a verdict for the defendant presents three questions of law for determination (1) Is a parol contract for life insurance enforceable or is such a contract within the statute of frauds? (2) Is there evidence in this case which would support a finding by the jury that S. A. Cotterell had authority to bind the defendant on a life insurance contract? (3) Was oral testimony admissible to show that S. A. Cotterell agreed that the life of Burr D. Field would be insured as soon as he paid the first annual premium on the proposed life insurance policy? The plaintiff contends that a contract of life insurance is not within the statute of frauds; that the evidence adduced at the trial is sufficient to support a finding by the jury that S. A. Cotterell had either actual or apparent authority to bind the defendant...