Gibson v. Metropolitan Life Ins. Co.

• Decision Date: 04 February 1941
• Docket Number: No. 25552.,25552.
• Citation: Gibson v. Metropolitan Life Ins. Co., 147 S.W.2d 193 (Mo. App. 1941)
• Parties: GIBSON v. METROPOLITAN LIFE INS. CO.
• Court: Missouri Court of Appeals

147 S.W.2d 193

GIBSON v. METROPOLITAN LIFE INS. CO.

No. 25552.

St. Louis Court of Appeals. Missouri.

February 4, 1941.

Appeal from St. Louis Circuit Court; William B. Flynn, Judge.

"Not to be reported in State Reports."

Action by Mary Gibson against the Metropolitan Life Insurance Company on a life policy issued by the defendant company upon the life of Charles Gibson, deceased. From a judgment for plaintiff, the defendant appeals.

Reversed and remanded.

R. E. LaDriere and Fordyce, White, Mayne, Williams & Hartman, all of St. Louis, for appellant.

S. E. Garner, of St. Louis, for respondent.

ANDERSON, Judge.

This is an action upon a policy of life insurance, which was issued by the defendant, Metropolitan Life Insurance Company, upon the life of Charles Gibson, deceased. Plaintiff, Mary Gibson, the widow of insured, sued as beneficiary named in the policy.

The petition alleged the issuance of the policy on the 10th day of April, 1920; the death of insured on or about the 9th day of March, 1938, while said policy was in full force and effect; demand by plaintiff for the proceeds of said policy; and defendant's vexatious refusal to pay. The prayer of the petition was for judgment in the sum of $1,500, with interest, together with an attorney's fee, and 10% penalty under the vexatious refusal to pay statute.

In its answer defendant, after admitting the issuance of the policy, alleged that same lapsed for nonpayment of the quarterly premium of $11.94, due April 10, 1933; that at said time the cash value of said policy amounted to $405, against which a loan existed, amounting to $404.15, leaving an equity in said policy of 85¢. It was further alleged that under the Missouri statute, there was no extended insurance at the date of lapse, and that under a combination of the policy provisions and the nonforfeiture statutes of Missouri there was not to exceed ten days of extended insurance. It was alleged, however, that the equity of 85¢ would purchase $3 of paid-up insurance, which defandant, by said answer, tendered to the plaintiff. The answer pleads a general denial.

In her reply plaintiff denied that the policy lapsed on April 10, 1933, but alleged that on said date defendant owed the insured the sum of $9.81 as and for an annual dividend on said policy, and that on April 16, 1933, and May 13, 1933, the insured tendered to defendant the sum of $2.13, being the difference between the amount of the premium due and said dividend, which defendant refused to accept, said refusal on the latter date being placed on the ground that insured would have to be examined for reinstatement by a physician. By said reply plaintiff admitted the indebtedness on said policy of $404.15 as of March 1, 1933, but alleged that the policy was wrongfully cancelled, and that she was entitled to an accounting of what was owed defendant, including the past due premiums with interest.

The evidence disclosed that the policy, numbered 3113319-21-C, was dated April 10, 1920, and by its terms insured the life of Charles Gibson in the sum of $1,500. The plaintiff, Mary Gibson, wife of the insured, and now his widow, was the beneficiary named therein. The premium payments, according to the policy terms, were due and payable in quarterly annual installments of $11.94 each, payable on the 10th days of April, July, October, and January of each year, until twenty full years' premiums were paid. The quarterly premium due April 10, 1933, was not paid on or before said date by the insured or by anyone for him, or at any time thereafter, and defendant denied liability for that reason, contending that the policy lapsed on said date and was consequently out of benefit when insured died March 9, 1938. The plaintiff, however, contends that during the grace period provided by the terms of the policy, there was tendered to the defendant's agent the sum of $2.13, being the difference between the premium of $11.94 due and $9.81, the amount of an annual dividend due and payable on said policy at that time.

The plaintiff testified that on April 10, 1933, defendant's agent, one Bierman, called at the insured's home to collect the premium then due. Plaintiff stated to him at the time that she was unable to pay the premium, but requested him to return on April 15th, at which time she expected to have the money necessary to pay this premium. She further testified that Bierman failed to call as requested on April 15th, and that on April 16th she went to see him and offered him the $2.13 at that time. She stated that he refused to take the money, saying that he did not have the necessary receipt, but promised to call upon her and collect the money some day during that week. She further testified that he never called as promised, and on April 30th she again went to see him, and again offered him the $2.13, but that he refused to accept it, stating that it was necessary for the insured to be examined by a physician. She stated that she had the dividend notice with her at the time she tendered the $2.13. It further appears from the evidence that the dividend check above mentioned was delivered to the insured and cashed by him in July, 1933.

The defendant offered evidence contradictory to plaintiff's testimony with respect to the tendering of the $2.13. It placed on the stand the agent Nathan Bierman. The substance of his testimony was that he was unable to collect the premium due on April 10, 1933, and that plaintiff did not at any time offer or tender to him the sum of $2.13; that after the expiration of the grace period, he called upon her on two occasions in an effort to induce her to reinstate the policy.

Defendant's assistant manager, Sidney Altman, also testified on behalf of the defendant. He stated that it was his duty to try to conserve the business, and when a policy of insurance lapsed in his district, he called upon the people in an attempt to secure reinstatement thereof. He further testified that he called upon Mrs. Gibson on three occasions, in an effort to secure reinstatement of the policy in suit, and on one of these occasions he asked her if she had ever offered the amount of the premium to the agent Bierman, and she replied that she never had. He further stated that on none of these visits was there any claim made by her that she had offered Bierman the amount of the premium.

From the foregoing it will be observed that the issue of fact presented at the trial below was whether or not plaintiff had made a tender of an amount of money sufficient, with the dividend then due, to pay the April 10th premium. Defendant, in further support of its contention that no such tender was ever made, offered a letter which was received at the home office of the defendant company on August 24, 1938, written by plaintiff's counsel, Mr. S. E. Garner, reading as follows: "I have yours of the 18th Inst. relative to this matter and after a careful investigation have reached the conclusion that there is nothing due my client on policy #5849515-C but feel that there is something due on the other policy. In other words I am of the opinion that under the terms of the policy the loan was not deductable until time of payment and then from the face of the policy. At the date of lapse the policy had a life of 22 years and 8 months as extended insurance. But in as much as you elected to handle it under the Missouri law by deducting the loan from the cash value then you were bound to follow the Missouri Statutes which I claim you did not do. If you think there is merit in my contention I shall be pleased to adjust the matter with you."

This letter was excluded from the evidence, and the action of the Court in so excluding it forms the basis of defendant's first assignment of error.

It is insisted by the appellant that the trial court erred in refusing to admit the foregoing letter in evidence for the reason that it was entitled by this letter to impeach or contradict the plaintiff or to attack her credibility.

It will be observed that the theory of liability presented by said letter is entirely different from the theory presented by plaintiff at the trial, and if said letter is admissible, it is so on the theory that it was an admission by plaintiff that no other basis for her claim existed except the theory set out in the letter.

There is conflict in the authorities as to the power of an attorney to bind his principal by admissions, except when made for the purpose of dispensing with a rule of practice, or with proof of any fact in the trial of an action pending, and the question is not free from difficulty. However, the trend of the modern decisions seems to be that an attorney employed prior to the institution of litigation is but an agent, and that his authority to make admissions for his principal is not affected by the fact that he is an attorney-at-law, and that if the admission is within the scope of his employment, he has the same authority to bind his client as any other agent. Consequently, if the admissions are relevant to the purpose for which he was employed, and made while actually engaged in his client's cause, they may be shown in evidence against the client. Brown v. Hebb, 167 Md. 535, 175 A. 602, 97 A.L.R. 366; Mercantile Trust & D. Co. v. Rode, 137 Md. 362, 112 A. 574; Meginnes v. McChesney, 179 Iowa 563, 160 N.W. 50, L.R. A.1917E, 1060; Scholes v. Silvius, 57 Cal. App. 395, 207 P. 291; McNamara v. Douglas, 78 Conn. 219, 61 A. 368; In re Reinhardt's Estate, 95 Misc. 413, 160 N.Y.S. 828; Sanders Eng. Co. v. Small, 115 Me. 52, 97 A. 218; Richardson v. Satterwhite, 203 N.C. 113, 164 S.E. 825; Parker v. Louisville, etc., R. Co., 230 Ill.App. 259; James v. Boston Elev. R. Co., 201 Mass. 263, 87 N.E. 474; Winborne v. McMahan, 206 N.C. 30, 173 S.E. 278; Cox v. Cline, 147 Iowa 353, 126 N.W. 330; Loomis v. New York, etc. R. R. Co., 159 Mass. 39, 34 N.E. 82.

There have been no cases cited from this state, which discuss the admissibility of letters...