Hills' Adm'r v. Penn Mut. Life Ins. Co.

• Decision Date: 24 January 1906
• Parties: HILLS' ADM'R v. PENN MUT. LIFE INS. CO.
• Court: Kentucky Court of Appeals

90 S.W. 544

HILLS' ADM'R v. PENN MUT. LIFE INS. CO.

Court of Appeals of Kentucky.

January 24, 1906

Appeal from Circuit Court, Warren County.

"Not to be officially reported."

Action by Elisha Hills' administrator against the Penn Mutual Life Insurance Company. From a judgment in favor of defendant, plaintiff appeals. Affirmed.

See 85 S.W. 759.

Sims &amp Grider, G. H. Galloway, and S.D. Hines, for appellant.

Thos W. Bullitt and W. M. Bullitt, for appellee.

HOBSON C.J.

On September 23, 1903, Elisha Hills, of Bowling Green, applied for $5,000 insurance on his life in the Equitable Assurance Society, and he then executed to L. R. Porter, who was the agent of the Equitable Assurance Society at Bowling Green his note for $369.15, payable six months after the date, with the understanding that the note was to be accepted as the payment of the first premium on the policy if the application was approved by the company. The Equitable declined to take the insurance. Porter then made an arrangement with George H Galloway, who was the agent of the Penn Mutual Life Insurance Company, by which it was arranged that application for the insurance desired by Hills should be made to that company. Galloway gave Porter two blank applications. Porter went to see Hills, and wrote down in pencil his answers to the questions on one of the blanks, and then had Hills to sign the other blank, with the view of having Galloway, who understood the company's way of doing business better than Porter, to fill the blanks in the application above Hills' signature from Hills' answers on the other blank, which Hills had not signed. Galloway did this but with one exception. Hills had applied to the Equitable for a 20-year accumulation dividend policy, and in the paper which Porter had filled out the application read the same way, but when Galloway came to fill out the other paper he changed this answer so as to read that an annual dividend policy was applied for; that is, that the dividends were to be applied annually to reduce the premium. The paper as thus filled out by Galloway was forwarded to the company. Galloway and Porter assumed that it would make no difference with Hills and that the company would be more likely to accept the application in this form. The company acted upon the application on December 12th, declining to issue the annual dividend policy, but issuing a 20-year accumulation policy, which it forwarded to its agent, Galloway, at Bowling Green, with an amended application to be signed by Hills if he was willing to accept the policy. When the arrangement was made between Galloway and Porter, Porter told Galloway of the note which Hills had executed to him, and which he still held, and assured Galloway that the note was good. When Porter went to see Hills, he arranged with Hills that he should retain the note and that it should be considered a payment on the Penn Mutual policy, if it was issued by the company, and when Porter returned with the application to Galloway he told Galloway the arrangement he had made with Hills. Galloway said they would have no trouble in using the note. When Galloway received the policy from the company, he handed it to Porter and Porter then gave Galloway the note, which he had held until that time. Galloway then went out in town to see about discounting the note, and while he was out Hills' son came in and told Porter that his father was very sick. Galloway and Porter then consulted attorneys, and after consultation Galloway returned to Porter the note, and...