Hinkson v. Kansas City Life Ins. Co.

• Decision Date: 29 July 1919
• Citation: 183 P. 24,93 Or. 473
• Parties: HINKSON v. KANSAS CITY LIFE INS. CO. [a1]
• Court: Oregon Supreme Court

183 P. 24

93 Or. 473

HINKSON v. KANSAS CITY LIFE INS. CO. ^[a1]

Supreme Court of Oregon

July 29, 1919

In Banc.

Appeal from Circuit Court, Lane County; G. F. Skipworth, Judge.

Consolidated actions by Andrew H. Hinkson against the Kansas City Life Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

In April, 1917, plaintiff filed his complaint in case No. 10810 alleging that the defendant is a Missouri life insurance corporation, duly licensed to transact business in this state; that on March 31, 1914, plaintiff made application for a $10,000 policy with an annual premium of $400; that at the time of the application he paid the first premium, in consideration of which the defendant agreed that, if it did not deliver the policy, it would return the money; that defendant has never delivered the policy, but has retained the payment; and that at the time of the application the defendant, through L. V. Rawlings, its agent, executed its receipt for the payment, a copy of which is attached to the complaint as Exhibit A.

The defendant admits its corporate nature and the application for the policy, that it has never delivered the policy, and that Rawlings was its duly authorized agent, but denies the $400 payment or that it agreed to return the money. As a further and separate answer it alleges that at the time the application was made the plaintiff delivered to Rawlings his promissory note for $400, which was held by Rawlings until final action should be taken on the application; that, after the application was made, the plaintiff, without any valid excuse or reason, did not present himself for medical or physical examination; and that no part of the note has ever been paid. In his reply the plaintiff specifically denies all of the new matter in the answer.

On August 24, 1917, the plaintiff commenced action No. 10811, in which he alleges that at his request the defendant issued its $5,000 policy No. 45,064 payable to the wife of plaintiff, by the terms of which the plaintiff should pay the annual premium of $184.10 in advance on December 8th of each year with one month's grace. The complaint states that:

"The first year's premium only may be paid to the agent. All subsequent premiums are due and payable in advance at the home office of the company without notice. However, they may be paid to an authorized agent of the company on or before the date when due, but only in exchange for a receipt signed by the president, vice president, secretary or assistant secretary and countersigned by such agent. Upon failure to pay any premium on or before the date when due, or upon failure to pay any premium note when due, this policy will become null and void without any action or notice by the company, and all rights shall be forfeited to the company, except as hereinafter provided. No agent has power on behalf of the company to modify this contract, to extend the time of payment of the premiums, to waive any forfeiture, to bind the company by making any promise or representation, or to deliver any policy contrary to the provisions of section 1 hereof. These powers can be executed only by the president, vice president, secretary or assistant secretary of the company, and will not be delegated."

It is further averred that:

"L V. Rawlings was the general agent of the defendant corporation in Oregon and had charge of all of its business in Oregon, and as such general agent had the power from the defendant corporation to waive and modify each and all of the foregoing quoted conditions of the said policy, and the said defendant corporation, through its said general agent, did waive or modify all of the said stated conditions of the said policy, except as herein expressed."

It is then alleged that the plaintiff paid the defendant the annual premium of $184.10 on December 8th of the years 1909, 1910, and 1911; that on December 8, 1912, he executed to the defendant his note for $184.10, with interest at 6 per cent., for an extension of time to June 8th following within which to pay the premium which became due on December 8, 1912; that before the maturity of the note the defendant granted a further extension and on July 2, 1913, the plaintiff paid the note with accrued interest, amounting to $190.18; that on December 12, 1913, he paid the yearly premium which became due on December 8th of that year; and that by the terms of the policy no further premium would be due until December 8, 1914. The plaintiff says that he has paid to the defendant the sum of $920.50 in premiums on the said policy, all of which the defendant accepted through its general agent, Rawlings, and still holds and retains.

It is contended in the complaint that the plaintiff had fully kept and performed all of the terms and conditions of the policy except those which were waived or modified, until March 20, 1914, when the defendant notified him that it had rescinded and canceled the policy, at which time the plaintiff asked for a return of the premiums which he had paid, and the defendant refused to make payment. The plaintiff alleges that he is the owner and holder of the policy, and offers to return it to the defendant.

For a further and separate cause of action the plaintiff alleges that on December 8, 1909, on like terms and conditions, the defendant issued to him its certain other policy, No. 45,065, for $5,000, upon which he paid like annual premiums of $184.10 for the years 1909, 1910, 1911; that on December 8, 1912, to procure an extension to June 8, 1913, he executed his premium note bearing 6 per cent. interest; that before the maturity thereof he obtained a further extension to July 2, 1913, when he paid the principal and interest, amounting to $190.18; that on December 8, 1913, another premium became due, and he paid it four days later; and that no further premium fell due until December 8, 1914. It is further alleged that on March 20, 1914, this policy was wrongfully canceled; that the defendant accepted through its agent, and now retains, all of the payments made on account of annual premiums, amounting to $926.68; and that the plaintiff has tendered the policy and demanded a return of his premiums.

The defendant admits the execution of policy No. 45,064 and the terms and conditions therein stated, as alleged. "Defendant further admits that L. V. Rawlings was the general agent of the defendant corporation in Oregon;" that "premiums were paid on said policy, carrying the same until December 8, 1912"; and that plaintiff "executed notes to this defendant becoming due December 8, 1913." All other material allegations of the complaint are denied, and as a further and separate answer the defendant alleges that, among other things, the policy provides that, if the annual premiums were not promptly paid when due, the policy should lapse, and "the premium payments made thereon should be forfeited to the company," without any further right on the part of the insured, the beneficiary, or their assigns, against the corporation; that all premiums should be payable in advance at the home office, although they might be paid to an authorized agent before maturity, but only in exchange "for a receipt signed by the president, vice president, secretary, or assistant secretary and countersigned by such agent"; that "the plaintiff paid premiums on said policy and kept the same in force until the 8th day of December, 1912"; that thereafter the plaintiff executed his note payable June 8, 1913, for the amount of the premium due on December 8, 1913; that no part of said note has ever been paid; that since December 8, 1912, the plaintiff has not made any payments on the policy; and that by reason thereof it has lapsed, and all payments made thereon have been declared forfeited to the company.

A similar answer was made to the plaintiff's second cause of action, on policy No. 45,065, and to each answer he filed a general denial.

On August 24, 1917, the plaintiff commenced another action, No. 10,812, in which it is alleged that on February 14, 1911, the defendant issued to him its certain other $5,000 policy, No. 51,753, by the terms of which the annual premium of $192.65 was to be paid in advance on February 14th of each year. It is averred that this policy also contained the same terms and provisions set forth and alleged by the plaintiff in his complaint in case No. 10811; that L. V. Rawlings was the general agent of the defendant; and that as such he had power to waive or modify and did waive and modify all of the provisions above quoted. It is then alleged that the plaintiff paid the premium of $192.65 on February 14, 1911; that on February 14th of the year following, when the second premium was due, he was granted an extension of time to March 20, 1912, when he made the payment, and it was accepted by the defendant as of February 14, 1912; that, when the premium of February 14, 1913, became due, the plaintiff was granted another extension within which to make payment; that he paid the same on July 2, 1913, with interest, amounting to $120.49; that on January 13, 1914, he paid the defendant $69.02, which discharged the premium in full to that date and was so accepted by the defendant; that on the latter date he made a further payment of $192.65 for the premium falling due on February 14th of that year; that by the terms of the policy no further premium became due until February 14, 1915; and that the plaintiff paid to the defendant $766.66 in premiums upon the said policy, all of which the latter accepted through its general agent and now holds and retains.

It is next alleged that the plaintiff performed his part of the contract except as to the said conditions which were waived or modified as stated; that on March 20, 1914, the defendant wrongfully...