Jennings v. National American

• Decision Date: 02 July 1915
• Docket Number: No. 11603.,11603.
• Citation: 179 S.W. 789
• Parties: JENNINGS et al. v. NATIONAL AMERICAN.
• Court: Missouri Court of Appeals

179 S.W. 789

JENNINGS et al. v. NATIONAL AMERICAN.

No. 11603.

Kansas City Court of Appeals. Missouri.

July 2, 1915.

Rehearing Denied October 4, 1915.

Appeal from Circuit Court, Jackson County; O. A. Lucas, Judge.

"Not to be officially published."

Action by Allie Jennings and Albert P. Jennings against the National American. Judgment for plaintiffs, and defendant appeals. Affirmed.

D. C. Finley, of Kansas City, for appellant. G. W. Duvall and Fyke & Snider, all of Kansas City, for respondents.

TRIMBLE, J.

This is a suit upon a policy of insurance issued upon the life of W. R. Jennings. The beneficiaries recovered in the trial court, and the company appealed.

The answer admitted that the policy was issued, that plaintiffs are the beneficiaries, and that the insured died. Unless, therefore, the answer contained allegations legally sufficient to constitute a defense, plaintiffs were entitled to recover.

No doubt, the answer sought to set up the defense of forfeiture because of certain alleged misstatements in the application. If, however, the answer failed to plead a forfeiture so as to enable the alleged misstatements to relieve defendant of liability, there was no error committed by the trial court in refusing to hold that the insurance was forfeited, nor in excluding evidence of facts sought to be introduced by defendant to prove that forfeiture.

The policy provides that it is issued subject to the statements made in the application, and that said statements are warranted to be true, and are made a part of the insurance contract, together with the by-laws of the company then or thereafter in force, whether by amendment or adoption. The policy then provided that it should be "liable to forfeiture" if said statements were not true. Now, while the by-laws provide that, upon the happening of certain things and the commission of certain offenses against the society, the policy should be "void ab initio" and should become "null and void," yet the making of misstatements in the application is not one of them. The making of false statements in the application appears in a list of offenses upon which, before any effect is produced upon the insurance, a proceeding must be had by the company "under such rules as may from time to time be formulated by the board of directors." So that there is nothing in the contract of insurance providing that misstatements in the application shall automatically work a forfeiture, but only that the insurance was liable to forfeiture therefor. Black's Law Dictionary, p. 713, gives the second definition of the word "liable" as "exposed or subject to a given contingency, risk, or casualty, which is more or less probable." And the provision in section 81 of the company's by-laws for a proceeding and action on the part of the company as to the offense of which the one in question forms a part shows that the word "liable" is used in this very sense. The New Standard Dictionary defines the word as meaning "exposed, or contingently subject to." And both Anderson's and Bouvier's Law Dictionaries define "liability" as something which must "be enforced by action."

In the case of The Kate Heron, 14 Fed. Cas. 139, the words "liable to forfeiture" were held not to effect a present absolute forfeiture, but only gave a right to have a forfeiture thereafter declared. The same idea of liability is expressed in Haywood v. Shreve, 44 N. J. Law, 94, loc. cit. 104. In Lobee v. Standard Ins. Co., 12 Misc. Rep. 499, 33 N. Y. Supp. 657, it was held that, where the insurance contract provided that misrepresenting and mortgaging the insured property "shall cause a forfeiture of the certificate," those acts did not ipso facto annul it, but merely authorized the company to elect to declare it void.

In Beasley v. Linehan Transfer Co., 148 Mo. 413, loc. cit. 421, 50 S. W. 87, the discussion as to the word "liable" shows that the court regards it as meaning that the result or consequence following the act is something which may happen but is not certain to happen.

Now, the rule of law is strict as to forfeitures. If the contract provides that in a certain contingency a forfeiture may be declared, then such forfeiture cannot come into existence until it is declared. Keeton v. National Union, 178 Mo. App. 301, loc. cit. 307, 165 S. W. 1107. In Dixie Fire Ins. Co. v. American Bonding Co., 162 N. C. 384, 78 S. E. 430, a failure to comply with some of its regulations rendered the bond void, but the failure complained of was not among them. It was held that, as the omission was not expressly made a ground of forfeiture, the same could not be declared nor relied upon.

In Selby v. Mutual Life Ins. Co. (C. C.) 67 Fed. 490, it is held that, if the contract does not provide that the act complained of shall ipso facto avoid the insurance, such act merely renders the policy voidable, and the insurer is not entitled to defeat recovery thereon unless it has seasonably taken action thereon and has taken such steps as will call the forfeiture into existence.

Now, the answer in this case does not show that the company took any steps necessary to enforce the forfeiture. The amendment to the answer, sought at the close of the case, whether asked before defendant had rested or afterwards (as to which defendant and the trial court did not agree), stated a mere...