Kendrick v. Mutual Ben. Life Ins. Co.
| Decision Date | 04 April 1899 |
| Parties | KENDRICK v. MUTUAL BEN. LIFE INS. CO. |
| Court | North Carolina Supreme Court |
Appeal from superior court, Mecklenburg county; Starbuck, Judge.
Action by Mattie A. Kendrick against the Mutual Benefit Life Insurance Company. From a judgment in favor of plaintiff defendant appeals. Affirmed.
Where an agent of a life insurance company received a check in payment of a premium, and directed it to be mailed to the company, the time of mailing was the time of payment, the check being honored on presentation.
Burwell Walker & Cansler, for appellant.
Jones & Tillett, for appellee.
John F Kendrick applied for insurance on his life in the defendant company for the benefit of his wife, the plaintiff, and on the 15th of July, 1897, the defendant issued its policy in accordance with the terms of the application, which was delivered by its agent to him a few days thereafter. He was afterwards taken ill with typhoid fever, and died on the 15th of September, 1897. The policy recited the payment of the premium, though in fact it was not paid until a few hours before and in fact on the same day on which the insured died the payment being then made for him by a friend, and accepted by the local agent with full knowledge of Kendrick's critical condition. This agent had theretofore indulged the payment, stating that it would be sufficient if the payment was made during Kendrick's life. The policy contained a provision: "This policy does not take effect until the first premium shall have been actually paid during the lifetime of the assured." There was in the instructions of the company, in the hands of its agents, a further provision that "when a premium is paid more than thirty, and within sixty, days after due, a certificate of good health, signed by the applicant, will be required." It was not shown that John F. Kendrick had notice of this instruction.
These, in substance, were the facts: The plaintiff, to whom the policy was payable, was in possession of the policy, and, the death of the insured being admitted, this made out a prima facie case. In the absence of evidence, the policy is presumed to have been delivered at the time it bears date. Meadows v. Cozart, 76 N.C. 450; Lyerly v. Wheeler, 34 N.C. 290. The authorities are numerous and quite uniform that the acknowledgment in the policy of the receipt of the premium estops the company to contest the validity of the policy on the ground of nonpayment of the premium. In so far as it is a mere receipt for money, it is only prima facie like other receipts, and will not prevent an action to recover the money if not in truth paid; but, in so far as it is a part of the contract of insurance, it cannot be contradicted by parol to invalidate the contract, in the absence of fraud in procuring the delivery of the policy. The rule is thus stated in 2 Bid. Ins. § 1128: "As a general rule, it has been held in the United States that, while such a receipt will prevent the insurer from proving the premium was unpaid in order to show the policy was void from its inception, it may be contradicted in order to show, on a suit for premium, that no payment had been made,"--citing numerous cases in the note. To same effect, the law is summed up and stated in 19 Am. & Eng. Enc. Law, 1126; and in Basch v. Insurance Co., 35 N. J. Law, 429, in a very clear statement by Beasley, C.J., citing Insurance Co. v. Fennell, 49 Ill. 180; New York Cent. Ins. Co. v. National Protection Ins. Co., 20 Barb. 471. Chancellor Kent says (3 Comm. 260): "The receipt of the premium in the policy is conclusive of payment, and binds the insurer, unless there is fraud on the part of the insured." To like purport, Insurance Co. v. Gilman, 112 Ind. 7, 13 N.E. 118; Golt v. Insurance Co., 25 Barb. 189, 192; Insurance Co. v. Booker, 9 Heisk. 606; Insurance Co. v. Wolf, 37 Ill. 354, 356; Insurance Co. v. Mueller, 77 Ill. 22, 24; Phil. Ins. §§ 514, 515; Farnum v. Insurance Co., 83 Cal. 246, 23 P. 869; Michael v. Insurance Co., 10 La. Ann. 737; Insurance Co. v. Cashow, 41 Md. 60, 76. In striking analogy is the same rule as to receipts in deeds. In 3 Washb. Real Prop. 614, the fourth rule applying to receipts in deeds is as follows: "Although it is always competent to contradict the recital in the deed as to the amount paid, in an action involving the recovery of the purchase money, or as to the measure of damages, in an action upon the covenants in the deed, it is not competent to contradict the acknowledgment of a consideration paid, in order to affect the validity of the deed in creating or passing a title to the estate thereby granted." This is quoted and approved in Barbee v. Barbee, 108 N. C., at page 584, and 13 S.E. 216; and it may be said, in passing, that the difficulty in reconciling opinions expressed in that case was due to the failure to note the double aspect of a recital in a deed of payment as being a mere receipt for money, and therefore only prima facie, in an action to recover the money, and as being sometimes also a part of the contract, and therefore not to be impeached, except for fraud, etc., when the validity or effect of the contract depends on prepayment,--a distinction which is clearly pointed out by Ashe, J., in Harper v. Dail, 92 N.C. 394, citing Wilson v. Derr, 69 N.C. 137.
The above proposition being true, even when the policy is made payable to the estate of the insured, a fortiori the defendant company is estopped when the beneficiary is a third party. Kline v. Association, 111 Ind. 462, 11 N.E 620. Certainly, it is not the defendant who can except, because the court charged the jury: ...
To continue reading
Request your trial