Gaines v. Berkshire Life Ins. Co.

• Decision Date: 04 December 1933
• Docket Number: No. 17888.,17888.
• Parties: MARY E. GAINES, RESPONDENT, v. THE BERKSHIRE LIFE INSURANCE COMPANY, APPELLANT.
• Court: Missouri Court of Appeals

68 S.W.2d 905

MARY E. GAINES, RESPONDENT, v. THE BERKSHIRE LIFE INSURANCE COMPANY, APPELLANT.

No. 17888.

Kansas City Court of Appeals. Missouri.

December 4, 1933.

Appeal from Circuit Court of Ray County. — Hon. Ralph Hughes, Judge.

REVERSED AND REMANDED.

Calvin, Vandeventer & Kimbrell for respondent.

D.A. Thompson and Beardsley & Beardsley for appellant.

BLAND, J.

This is an action on a life insurance policy. There was a verdict and judgment in favor of plaintiff in the sum of $2304, and defendant has appealed.

The facts show that on May 6, 1930, one James W. Gaines, who was then, and who had been for a short time, engaged in soliciting life insurance business for the defendant, made a written application to it for a policy of life insurance upon his own life in the sum of $10,000, naming his wife, the plaintiff herein, as beneficiary. The application was taken by one Thomas J. Opie, defendant's "general agent" for western Missouri and Kansas, whose office was in Kansas City, and forwarded by Opie to the home office of the company at Pittsfield, Massachusetts. The application was approved and the policy, dated May 20, 1930, was forwarded to Opie, together with a receipt for the first premium, to be delivered to the insured upon the payment of that premium. The premiums of $50.50 each were payable quarterly in advance on the 20th day of May, August, etc. The policy provided that in case of the death of Gaines, the proceeds of the insurance should be payable to the beneficiary in monthly installments. The foregoing facts are undisputed.

However, there is a dispute as to whether the policy was ever delivered to Gaines. The evidence on the part of the plaintiff tends to show that Gaines was in possession of a policy, similar to the one executed by the defendant, between the months of May and October, 1930. Plaintiff testified that she saw a policy in Gaines' possession and her description of the same, in a general way, meets that of the one in controversy; that she last saw the policy in his possession three or four days before his death. He died on October 2, 1930, after a brief illness of less than two days.

The evidence on the part of the defendant shows that the policy and the receipt for the first premium were returned to the home office by Opie for the reason that the premium was not paid and the policy was not delivered to insured. These facts were testified to by Opie and were shown by the records in Opie's office. However, the records at the home office of the defendant did not show the return of the policy but merely the receipt for the first premium. The policy was not found among deceased's effects at his death and no one who testified at the trial knew where it was. A "reconstructed" policy furnished by the defendant to plaintiff was introduced in evidence by plaintiff.

The petition pleads that "immediately upon the death of the said James W. Gaines, defendant wrongfully obtained and, at all times since, has wrongfully retained and still wrongfully retains possession" of the policy. Plaintiff introduced no evidence tending to support this allegation of the petition.

The application for the policy recites:

"I agree that the insurance hereby applied for shall not be in force until the acceptance and approval of this application by the company at its home office, the delivery of the policy to me or my agent, and the payment of the first premium as required therein during condition of my health described and certified to in this application."

.......

"I hereby agree that no agent or other person except the president, a vice-president, the secretary or an assistant secretary, has power to make or modify this or any contract of insurance, to extend the time for paying a premium, or any of the company's rights or requirements."

It is insisted by the defendant that its instruction in the nature of a demurrer to the evidence should have been given. In support of this contention it is first claimed that there is not proof of the delivery of the policy or even that the insured had the same in his possession and the burden was upon the plaintiff to show an unconditional delivery of the policy to the insured and the payment of the premium.

We think there is sufficient evidence from which the jury might infer that the policy was in the possession of the insured during the time mentioned by plaintiff's witnesses. A policy similar to the one made out by the defendant and sent to Opie by it was used by Gaines in soliciting insurance for the defendant. The policy in the possession of the insured was in all material respects similar to the one made out by the defendant, and there is no evidence or claim that Gaines had any other insurance policy with the defendant.

However, the mere possession of the policy by Gaines, under the circumstances, did not make out a prima facie case for the plaintiff, as she claims. It has been held that where plaintiff is in possession of the policy at the time of the trial, or it is shown to have been in the possession of the insured at the time of his death, a prima facie case is made for the plaintiff in a suit of this kind. This is on the theory that the possession of the policy raises the presumption that it had been delivered and paid for or that credit had been given for the premium. [Lafferty v. K.C. Cas. Co., 287 Mo. 555, 564.] But in this case there was no such proof and, in fact, the petition admits that the policy was in the possession of the defendant at the time of the suit and plaintiff is conclusively bound by this admission. [Knoop v. Kelsey, 102 Mo. 291.] Under such circumstances plaintiff did not make out a prima facie case by showing the execution and delivery of the policy and the death of Gaines (McCormick v. The Travelers Ins. Co., 215 Mo. App. 258, 271; Acuff v. N.Y. Life Ins. Co., 239 S.W. 551, 553), and the burden was upon plaintiff to show that the policy was in force at the time of his death.

However, it is insisted that, notwithstanding the clause in the application that Opie had no right to waive any of the provisions of the contract, including the matter of paying the premiums, he was the general agent of the defendant and as such, was authorized to, and did, waive the payment of the premiums. If Opie was such an agent then, we think there is no question but that he had such authority. [National City Bank of St. Louis v. Mo. State Life Ins. Co., 57 S.W. (2d) 1066, 1077; Springfield Steam Laundry Co. v. Ins. Co., 151 Mo. 90; Thompson v. Traders Ins. Co., 169 Mo. 12; Block v. U.S. Fid. & Guar. Co., 290 S.W. 429, 435.]

However, defendant earnestly contends that Opie was not the general agent of the defendant, notwithstanding the fact that he was so designated by it. Plaintiff introduced the agency contract between defendant and Opie. This refers to the latter a great number of times as the general agent of the defendant. It appoints him "General Agent" for "Western Missouri and Kansas," but provides:

"The said general agent is hereby authorized to procure applications for insurance, to be forwarded to the home office of said company for consideration, to deliver policies and premium receipts upon the payment of the amount stated therein, when the terms, conditions and provisions in such policies and receipts contained have been strictly complied with.

"The authority of the said general agent shall extend no further than is stated in this agreement; and he shall not, in the name or behalf of said company, make, alter or discharge any contract, nor waive any forfeiture, nor incur any debt or liability against said company."

There are other restrictions on Opie's authority contained in the agency contract. There is also a clause which empowers him to collect premiums and deposit the same in a bank chosen by the company in his name.

A general agent of an insurance company is defined as "generally one who is authorized to accept risks, agree upon and settle the terms of the insurance contracts, issue policies by filling out blank instruments which are furnished him for that purpose, and to renew policies already issued." [32 C.J., p. 1065.] In this State it is held that if the agent has authority to sign, countersign or issue policies, he is a general agent. [Rhodus v. Life Ins. Co., 156 Mo. App. 281, 285.]

If the agency contract is to govern in this case Opie was certainly not the general agent of the defendant. However, there is no evidence that the insured knew at any time about the contents of the agency contract and the application that he signed is indorsed, "Thomas J. Opie, General Agent, 309-10 Victor Building, Kansas City, Missouri." It would appear that if the defendant held out Opie as its general agent and the insured did not know of the restrictions on his powers then, so far as the insured was concerned, the authority of Opie was as broad as his title would indicate. [See 4 Cooley's Briefs on Ins. (2 Ed.), p. 3635; 32 C.J. 1066; Whipple v. The Prudential Ins. Co., 222 N.Y. 39, 46; Saunders v. U.S. Marble Co., 25 Wash. 475; Nichols v. Ins. Co., 170 Mo. App. 437.]

We fail to find any evidence of waiver by Opie of the payment of the premiums. No doubt, had plaintiff shown an unexplained delivery of the policy to Gaines, the presumption would arise that the payment of, at least, the first premium was waived or credit therefor extended on...