Jenkins v. International Life Insurance Co.

• Decision Date: 20 June 1921
• Docket Number: 55
• Citation: 232 S.W. 3,149 Ark. 257
• Parties: JENKINS v. INTERNATIONAL LIFE INSURANCE COMPANY
• Court: Arkansas Supreme Court

232 S.W. 3

149 Ark. 257

JENKINS v. INTERNATIONAL LIFE INSURANCE COMPANY

No. 55

Supreme Court of Arkansas

June 20, 1921

Appeal from Clay Circuit Court, Eastern District; R. H. Dudley Judge; affirmed.

Judgment affirmed.

W E. Spence and Oliver & Oliver, for appellant.

1. The contract of insurance, according to its express terms, was complete and in force from the date of its approval by the company's medical director and binding, and the company was without power or right to modify, change or attach further conditions to the contract or to the delivery of the policy. The contract was consummated. 66 Ark. 612; 40 N.J.L 103; 1 Bacon on Ben. Soc., § 272, p. 538; Cooley's Briefs on Ins., p. 442 (a) and cases cited; Ib. 451 (f), 453 (g).

2. The issuance of a policy of insurance is acceptance and an approval of the application for insurance. 44 S.E. 28.

3. If policies of insurance contain inconsistent provisions or are so framed as to be fairly open to construction, that view should be adopted, if possible, which would sustain rather than forfeit the contract. 102 Ark. 1. It should be most strongly construed against the insurance company. 113 Ark, 174; 58 Id. 528, The acceptance by an insurer of the insured's note for the first premium binds the company. Cooley's Briefs on Ins., p. 586 (e); 94 Ark. 578.

A contract of insurance may be by parol. 25 Cyc. 716 A; Cooley's Briefs on Ins. 395 (d)-396-7; 124 Ark. 505; 49 U. S. App. 548; 23 C. C. A. 365; 83 F. 631. Signature is not always essential to bind an agreement. 13 C. J., § 128.

4. Where correct answers are given by an applicant for insurance and the agent, through fraud, mistake or negligence, writes them incorrectly, the company is estopped to take advantage of the wrongful act of its agent. Cooley's Briefs on Ins. 2555 et seq.; 81 Ark. 205. The authority of the agent to take and fill out applications for insurance requires him to do everything needed to perfect the policy. A practical construction given to the construction of a contract by an insurer in his dealings with the insured will be accepted by the courts. Cooley's Briefs on Ins. 643 (k); 109 Ark. 17-23.

The application, receipt and note for the first premium make a complete contract. Cooley's Briefs on Ins. 413 (c); 115 F. 81. See, also, 90 U.S. 85; 41 S.W. 319; 72 Am. Dec. 379; 94 N.W. 211; 99 Id. 130; 115 P. 779; Cooley's Briefs on Ins., p. 428 (i).

Here the terms of the proposition expressly provide that the insurance shall be in force from the date of the approval of the application. The judgment should be reversed, and, as the case is fully developed, judgment should be entered here for appellant. 116 Ark. 420.

M. P. Huddleston and Chas. G. Revelle, for appellee.

It is permissible and perfectly lawful for parties to agree to the payment of the first premium and delivery and acceptance of the policy conditions of the contract. Until this is done, there is no contract. 66 Ark. 612; Cooley's Briefs on Ins. 2555, 643 (k), 413 (c). Without assent or mutual meeting of minds, there can be no contract. 90 U.S. 85; 129 Ark. 137; 187 S.W. 265. A note is not cash, and the first payment was not made. 46 C. C. A. 393; 92 U.S. 161; 104 Id. 18; 59 N.H. 298; 158 Mass. 132; 140 N.Y. 79; 67 N.W. 876; 48 Neb. 870; 8 N. J. L. (3 Halst.) 172; 30 P. 1064; 136 U.S. 257; 36 Pa. (12 Casey) 204. See, also, 8 Vt. 252. See, also, 46 C. C. A. 393; 103 Mass. 78; 30 F. 545; 28 Id. 705; 51 Iowa 679; 18 Minn. 448; 140 Mo. 599; 50 S.W. 519; 151 Mo. 620; 52 S.W. 356.

To be effective, an acceptance of an application for insurance must be in the very terms offered. 14 R. C. L., p. 71; 44 S.W. 28. Under the evidence there was no approved of the application, and the policy was not binding on appellee.

OPINION

WOOD, J.

This is an action brought by the appellant as administrator of the estate of M. E. Jenkins against the appellee on a contract of insurance on the life of M. E. Jenkins made payable to his estate. The appellant set up the policy and alleged that it insured the life of M. E. Jenkins for the sum of $ 3,000. He alleged the death of M. E. Jenkins, the compliance with the terms of the policy on his part, the refusal of the appellee to pay, and prayed judgment for the sum mentioned, and for penalty, attorneys' fees and costs.

The appellee answered, denying all the material allegations of the complaint. It tendered to appellant a note executed by M. E. Jenkins and the cash paid by him. The policy and application were introduced in evidence by the appellant. The application signed by appellant was dated February 21, 1920. It contained among others the following provisions: "(3) The insurance herein applied for shall not be in effect until the premium has been paid in full in cash and the policy delivered to me during my good health. (4) If the premium be paid with this application, such payment is made subject to the conditions in the receipt hereto attached." The receipt attached to the application is as follows:

"RECEIPT.

"This receipt not valid for more than first year's premium, nor in excess of a premium on $ 50,000 insurance.

__, 19__

"Received from __ an application for insurance on h__ life for $__ on the __ plan; also __ dollars in cash, and note for $__ due __ to be applied in payment of premium on said insurance, provided a policy of insurance upon such application is issued by the company. If full cash settlement required has been made with the application, the insurance will be in force from date of approval of the completed application by the company's medical director. If said application is not approved by the company, the settlement herein acknowledged will be returned by me forthwith, upon surrender of this receipt.

"No conditions or agreements other than those printed herein and in the application shall be binding. Conditions on back of this receipt a part thereof same as if printed herein.

"__ 51829."

On the back of the receipt is the following: "The agent is not authorized to give this receipt to persons exceeding the limits of height and weight indicated in the table below, or to those who have been rejected by another company, or who are not in good health."

The application contained blanks to be filled out by the soliciting agent of the appellee, one of which required him to show how, if at all, the first premium had been settled. This was filled out, and showed that the premium had been settled by note. The application was approved by the appellee's medical director on March 4.

Among the provisions of the policy are the following: "After the delivery of this policy to the insured, it takes effect as of the 4th day of March, 1920. This contract of insurance shall not be deemed to have been made until the first premium is paid, and the policy delivered during the lifetime and good health of the insured."

E. R. Winton testified that he was the soliciting agent of the appellee, and took the application of M. E. Jenkins. When an applicant made settlement of the premium, witness signed the receipt and gave it to the applicant. In this case Jenkins made settlement by paying seventy-one cents in cash and executing his note payable to witness for the sum of $ 100. Witness accepted that in full settlement. Witness did not detach the receipt from the application and give it to Jenkins because they were in a hurry. The witness accepted the note unconditionally, just like he would have accepted the cash. After witness received the policy, he did not see Jenkins again before his death. When witness received the policy for delivery, it was accompanied by a letter which instructed witness to deliver the policy only during the lifetime and continued good health of the applicant, and that the signature of the applicant must be obtained showing that he was in good health. Witness never delivered the policy nor collected the note. Witness offered to return the note and the seventy-one cents to the administrator, and he refused it. Witness returned the policy to the company on March 19. The policy sent witness for delivery was the kind of policy applied for by Jenkins.

On behalf of the appellee, Anthony Gazert testified that he was the manager of the policy department which has jurisdiction over applications and the writing of policies. Appellee had a form letter, "7-B," one of which was sent to appellee's agent, Winton, on or about the 6th of March, 1920, together with the policy on the life of Jenkins. The records would usually show if this letter had been returned. Witness had made a careful search for it and could not find it. Winton was recalled by the appellant, and stated in addition to his former testimony that form "B" referred to and which he received with the policy was a kind or receipt showing that the applicant for insurance had received the policy, and that he was in good health and had had no sickness since his examination. The applicant had to state in this form letter that neither he, nor any of his family, had had influenza since his examination. It instructed witness not to deliver the policy unless witness first obtained the signature of Jenkins to the receipt form 7-B.

At the conclusion of the testimony the court, at the request of the appellee, instructed a verdict in its favor. Judgment was rendered in favor of the appellee dismissing appellant's complaint, and for costs, and from that judgment is this appeal.

The appellant contends that the contract of insurance upon which he bases his action was consummated upon the approval of the application by the company's medical director and became a complete and binding contract without the issuance and delivery of the policy. As there was no objection on the part of the appellee to the testimony adduced by the appellant, we will...