Howard v. Aetna Life Ins. Co.

• Decision Date: 03 June 1942
• Docket Number: 37854
• Citation: 164 S.W.2d 360,350 Mo. 17
• Parties: Harry B. Howard, Appellant, v. Aetna Life Insurance Company
• Court: Missouri Supreme Court

164 S.W.2d 360

350 Mo. 17

Harry B. Howard, Appellant, v. Aetna Life Insurance Company

No. 37854

Supreme Court of Missouri

June 3, 1942

Rehearing Denied July 28, 1942. Motion to Transfer to Banc Overruled September 8, 1942.

Appeal from Jasper Circuit Court; Hon. Chas. M. Grayston Special Judge.

Reversed and remanded (with directions).

Butler Howard & Campbell, Haywood Scott and John W. Scott for appellant.

(1) Where the terms of the contract are express and plain, and its language is not ambiguous, and its provisions are not conflicting, the court in construing it is not permitted to go outside the contract and look into the situation of the parties, their needs served by the contract, the circumstances under which it was made, or the construction given it by the parties. Illinois Fuel Co. v. Mobile & O. R. Co., 319 Mo. 899, 8 S.W.2d 834; certiorari denied; Mobile & O. R. Co. v. Illinois Fuel Co., 49 S.Ct. 34, 278 U.S. 640, 73 L.Ed. 555; Anchor Serum Co. v. Rea, 326 Mo. 811, 32 S.W.2d 587; Meissner v. Standard Ry. Equipment Co., 211 Mo. 112, 109 S.W. 730; Wetmore v. Crouch, 150 Mo. 671, 51 S.W. 738. (2) The intention of the parties to, and the meaning of, a contract are deduced from the language and contents of the contract, and, where the terms are plain and unambiguous, the contract is conclusive; the question being, not what intention may have existed in the minds of the parties, but what intention is expressed by the language used. When a written contract is clear and unequivocal, its meaning must be determined by its contents alone; and a meaning cannot be given it other than that expressed. 17 C. J. S., Contracts, sec. 296, p. 695; 13 C. J., Contracts, sec. 485, p. 524; Holland Land & Loan Co. v. Holland, 298 S.W. 39, 317 Mo. 951; Martin v. Travelers' Ins. Co., 276 S.W. 380, 310 Mo. 411; St. Louis v. St. Louis, etc., R. Co., 129 S.W. 691, 228 Mo. 712; 12 Am. Jur., Contracts, sec. 227, p. 747; 20 Am. Jur., Evidence, sec. 1143, p. 996. (3) Construction placed upon contract by parties as evidenced by acts, conduct, or declarations indicating mutual intent and understanding will be adopted by courts, where language is ambiguous or there is reasonable doubt as to its meaning, but not where it is plain and unambiguous. Scotten v. Met. Life Ins. Co., 81 S.W.2d 313, 336 Mo. 724. (4) Where, as in this case, the application and the policy, which constitute the written contract of life insurance made by the parties, does not contain any agreement that the policy should be dated prior to July 1, the date the insurance age of the insured changed, and does not contain any agreement that the policy was issued and the amount of the premium determined as of the insured's age prior to July 1, but does contain a provision that in case the insured misstated his age then the policy would be in force for the amount of insurance the premium paid would buy at the correct age and does by its express terms provide that the parties intended the contract to become effective upon only one certain date, then the intended effective date, as stated by the express terms and unambiguous language of the contract, governs and controls the due dates of premiums and running of grace period, notwithstanding the provisions stated in the policy as to the due dates of premiums. Howard v. Aetna Life Ins. Co., 145 S.W.2d 113, 346 Mo. 1062; Halsey v. American Central Life Ins. Co., 258 Mo. 659, 167 S.W. 951; Chestnut v. Security Mut. Life Ins. Co., 208 Mo.App. 130, 232 S.W. 203; State ex rel. Mo. State Life Ins. Co. v. Allen, 295 Mo. 307, 243 S.W. 839; Landrigan v. Mo. State Life Ins. Co., 211 Mo.App. 89, 245 S.W. 382; Johnson v. American Central Life Ins. Co., 212 Mo.App. 290, 249 S.W. 115; Newman v. John Hancock Mut. Life Ins. Co., 7 S.W.2d 1015; Hampe v. Met. Life Ins. Co., 21 S.W. 926; Bigalke v. Mut. Life Ins. Co., 34 S.W.2d 1019; Klinkhardt v. Crescent Ins. Co., 47 S.W.2d 210; McDonnell v. Hawkeye Life Ins. Co. of Des Moines, 64 S.W.2d 748; Kennedy v. National Accident & Health Ins. Co., 76 S.W.2d 748; Scotten v. Met. Life Ins. Co., 336 Mo. 724, 81 S.W.2d 313; Eyring v. Kansas City Life Ins. Co., 129 S.W.2d 1086. (5) Evidence as to the construction by the parties should have been excluded.

D. P. Cavanaugh, Ray Bond and John S. Bond for respondent.

(1) Where a policy of life insurance provides for the payment of periodical premiums at certain dates specified in the policy, and beginning with the date of the policy, and the policy further provides that it shall not become effective until the first premium upon the policy has been paid, or until the policy is delivered and the first premium is paid, and where, under such policy, the first premium is actually paid at a date subsequent to the date of the policy, then, in the absence of evidence showing the real intention of the parties or the construction placed upon the contract by the parties, the court will construe the policy in favor of the insured as against the insurer, and will hold that the first payment of premium maintains the policy in effect for the full period from the date of payment of same paid for by such premium. If, however, as in this case, the parties to the contract, by their conduct in carrying out the contract, or by the circumstances surrounding the issuance of the policy, have placed a different construction upon the contract, then the court will adopt the construction placed upon the contract by the parties themselves. Prange v. International Life Ins. Co., 329 Mo. 652, 80 A. L. R. 950, 46 S.W.2d 523; National City Bank v. Mo. State Life Ins. Co., 332 Mo. 182, 57 S.W.2d 1066; Scotten v. Met. Life Ins. Co., 336 Mo. 724, 81 S.W.2d 313; Tabler v. General American Life Ins. Co., 342 Mo. 726, 117 S.W.2d 278; Howard v. Aetna Life Ins. Co., 145 S.W.2d 113; Equitable Life Assur. Society v. Tucker, 7 Life Cases 60, 61, 63 (Commerce Clearing House Insurance Law Reporting Service); Evans v. Equitable Life Assur. Society, 109 S.W.2d 380; Medlin v. American Bankers' Ins. Co., 227 Mo.App. 705, 59 S.W.2d 738; Winters v. Reserve Loan Life Ins. Co., 221 Mo.App. 519, 290 S.W. 109. (2) Where a change of insured's age, for premium rate purposes, intervenes between the date of the application for the insurance and the payment of the first premium thereon, so that, for insurance purposes, the insured is one year older when he pays the premium than when he applied for the policy; and where the premium rate charged in the policy is the proper rate for the type of insurance applied for at the age of the insured at the date he made the application; and the policy bears a date of issuance prior to the change of the insured's age for premium rate purposes and provides for payments of premiums beginning prior to said date; and the circumstances surrounding the issuance of the policy, and the conduct of the parties, in carrying out the contract, shows that it was their intention that the first payment of premium should apply as of the date specified in the policy; then, the payment of the first premium pays for life insurance for the length of time paid for by such premium and beginning as of the premium due date specified in the policy; and to hold otherwise would be to hold that the contract is in violation of the anti-discrimination statute of this State. Sec. 5840, R. S. 1939; Tabler v. General American Life Ins. Co., 342 Mo. 726, 117 S.W.2d 278; Prange v. International Life Ins. Co., 329 Mo. 659, 80 A. L. R. 950, 46 S.W.2d 523; Howard v. Aetna Life Ins. Co., 145 S.W.2d 113.

Bradley, C. Hyde and Dalton, CC., concur.

OPINION

BRADLEY

Action on a life insurance policy for $ 10,000, with a double indemnity provision covering accidental death, and for penalty and attorney's fee because of alleged vexatious refusal to pay. What we may term a demurrer to the evidence was sustained at the close of the case; a directed verdict returned for defendant; judgment for defendant entered thereon, and plaintiff appealed.

We might state here that this is the second appeal in this case. When first up the trial court sustained a demurrer to the petition and plaintiff appealed. It was held that the petition stated a cause of action, and the judgment was reversed and the cause remanded. See Howard v. Aetna Life Ins. Co., 346 Mo. 1062, 145 S.W.2d 113.

The insured was Henry Erle Wise, the beneficiary, his wife, Chloe T. Wise. Application for the policy was made June 29, 1932, and the policy was dated June 28, 1932, but was actually written July 23, 1932, and the first quarterly premium paid September 10, 1932, and a second quarterly premium paid October 28, 1932. The insured died April 5, 1933, and the policy was assigned to plaintiff. The sole question is whether the policy was in force at the time of the death of the insured. Plaintiff contends that the policy did not become in effect until the first quarterly premium was paid on September 10, 1932, and that the first quarterly premium carried the policy from September 10 to December 10, 1932, and that the second quarterly premium carried the policy from December 10, 1932, to March 10, 1933, and that by reason of the 31 days grace provision the policy was in force at the time of the insured's death on April 5, 1933.

On the other hand, defendant contends that the insured, for premium paying purposes, was bound by the date of the policy and that the first quarterly premium carried the policy from June 28, 1932, to September 28, 1932, and that the grace provision kept the policy alive from September 28, to October 28, 1932, and that the payment of the second quarterly premium carried the policy from September 28, 1932 to December 28, 1932, and that the policy lapsed 31 days after December 28, 1932.

Defendant in the brief, says: "Where a policy of life insurance...