Harden v. Occidental Life Ins. Co

• Decision Date: 21 March 1934
• Docket Number: No. 374.,374.
• Parties: HARDEN . v. OCCIDENTAL LIFE INS. CO.
• Court: North Carolina Supreme Court

173 S.E. 617

206 N.C. 230

HARDEN .

v.OCCIDENTAL LIFE INS. CO.

No. 374.

Supreme Court of North Carolina.

March 21, 1934.

Appeal from Superior Court, Wake County; Harris, Judge.

Action by Kathleen W. Harden against Occidental Life Insurance Company. From an. adverse judgment, plaintiff appeals.

Affirmed.

Controversy without action upon an agreed statement of facts which is substantially as follows:

1. On May 13, 1931, the Colonial Life Insurance Company executed and delivered unto James Henry Harden, the insured, a "Participating Modified Whole Life" contract of insurance, No. C-5839, under the terms of which it agreed to pay $2,500, the face amount of the policy, to Kathleen W. Harden, as beneficiary, the plaintiff herein, immediately upon receipt of due proof of the death of the insured.

2. Subsequent to the execution and deliverer of the aforesaid policy of insurance to James Henry Harden, the Occidental Life Insurance Company, a corporation existing under the laws of New Mexico and domesticated in this state with its principal place of business at Raleigh, defendant herein, succeeded to the rights and obligations of the said Colonial Life Insurance Company, under said contract of insurance.

3. Monthly premiums in the sum of $2.88 were paid by the insured through and including the premium which became due and payable on June 13, 1933. Subsequent to the payment of the June 13, 1933, premium, the insured, James Henry Harden, paid no further premium to the defendant herein.

4. More than five days prior to April 13;. 1933, the defendant mailed to the insured, James Henry Harden, at his Greenville, N. C, address, the following notice of accrued dividend on said policy, which was received by insured: "Accounting Department Home Office Stub * * * Premium $2.88, No, C-5839 P 13 day of April, 1933. Interest dividend, $4.02. Mr. James H. Harden, 1208 Chestnut Street, Greenville, N. C." Said notice was accompanied by an envelope addressed to Occidental Life Insurance Company for reply.

5. The insured, James Henry Harden, died on August 17, 1933, leaving the plaintiff, Kathleen W. Harden, beneficiary named in the policy, surviving him. The insured's death occurred four days after the expiration of the period of grace as to the premium due and payable on July 13, 1933.

6. On September 6, 1933, the defendant, Occidental Life Insurance Company, mailed its check in the sum of $4.07, payable to Kathleen W. Harden, beneficiary, in payment of accrued dividends apportioned to the policy and interest on the said dividends from date of declaration or apportionment thereof. The check was refused by the payee. Said check, marked "Exhibit B, " attached hereto, is made a part of this statement of facts.

7. The policy of insurance referred to in paragraph 1 above, together with the application of the insured, is attached hereto, marked "Exhibit A, " and made a part of this statement of facts.

8. At the time of the death of James Henry Harden, the insured, the policy involved herein had no cash or loan value.

9. No option was ever elected by the insured as to the disposition of the accrued dividends apportioned to the said policy.

Upon these facts it was adjudged that the policy had lapsed for nonpayment of premium and was void and that the plaintiff was not entitled to recover of the defendant. The plaintiff excepted and appealed.

Shaw & Jones, of Kinston, for appellant.

Willis Smith and John H. Anderson, Jr., both of Raleigh, for appellee.

ADAMS, Justice.

The policy of insurance was issued on May 13, 1931, in consideration of the application and the payment of premiums. The insured, James Henry Harden, contracted to pay a premium of $2.88 on or before the 13th day of every month, and in this respect complied with his obligation up to June 13, 1933, paying the premium which then became due. He failed to remit the premium which was payable on July 13, 1933, and died on August 17, 1933, a few days after the period of grace had expired.

The policy and the attached rider contain the following clauses:

(a) "Except as herein expressly provided the payment of any premium or installment thereof shall not maintain the policy in force beyond the date when the next premium or installment thereof is payable."

(b) "Non-payment of any installment when due, or within one month (not less than thirty-one days) thereafter, automatically voids this policy, except as provided by the policy or by law."

In regard to the payment of accruing dividends the policy has this provision: "Beginning at the end of the first insurance year and each year thereafter the Company shall annually apportion from the divisible profits the dividend payable to this policy and such apportioned amount upon payment of the succeeding premium shall, at the option of the insured, be either (1) paid in cash; or (2) applied toward payment of premiums; or (3) applied toward the purchase of participating paid up additions to the policy; or (4) left to accumulate as an interest bearing fund withdrawable at...