Leonard v. Prudential Ins. Co. of Am.

• Court: Wisconsin Supreme Court
• Writing for the Court: MARSHALL
• Citation: Leonard v. Prudential Ins. Co. of Am., 128 Wis. 348, 107 N.W. 646 (Wis. 1906)
• Decision Date: 08 May 1906
• Parties: LEONARD v. PRUDENTIAL INS. CO. OF AMERICA.

128 Wis. 348

107 N.W. 646

LEONARD

v.PRUDENTIAL INS. CO. OF AMERICA.

Supreme Court of Wisconsin.

May 8, 1906.

Appeal from Circuit Court, Chippewa County; A. J. Vinje, Judge.

Action by Thomas Bernard Leonard, an infant, by Laura Leonard, his guardian ad litem, against the Prudential Insurance Company of America. Judgment for plaintiff. Defendant appeals. Affirmed.

Action to recover on a policy of life insurance.

The complaint contained a statement of facts necessary to recover on a $1,000 policy issued by the defendant on the life of Thomas Bertram Leonard, for the benefit of the plaintiff. These facts, among others, were alleged: The policy was issued July 8, 1902. The annual agreed payment was $26.55. It was required to be paid on the 8th day of July in each year, till the contract matured. The assured died January 28, 1905. He failed to make the payment for 1904 till October 26, of that year. On that date he made his payment, together with $1.40, being the interest and charges required under the contract to secure a continuance of the policy, notwithstanding the default, in case of his furnishing satisfactory proof of his being an insurable risk. He furnished such proof. The payment was made and received unconditionally. The money was retained by defendant without notice to the assured of any decision not to restore his policy. No offer to return the money or such notice occurred till after the assured died. There was ample time for the defendant to have made such offer, and given such notice prior to such death, subsequent to its obtaining full knowledge of all facts material for it to know in passing on the question of whether the policy should be continued notwithstanding the default. By reason of such failure such default was waived, and the policy in accordance with the contract of insurance, revived and continued. The provisions in the contract in that regard were as follows:

“If this policy be lapsed by nonpayment, it will be revived any time within two years after the due date of such premium, as specified on the first page hereof, upon written application and payment of arrears of premium, with interest at the rate of five per cent per annum, provided evidence of insurability of the insured, satisfactory to the company, be furnished. Application for revival after two years from such date will receive equitable consideration.”

“If any premium be not paid when due, this policy shall be void, and all premiums forfeited to the company, except as herein provided.”

“If this policy, after being in force two full years, shall lapse for the nonpayment of premiums, the company will continue in force the insurance under the policy for 120 days from the date of such premium.”

The defendant answered, defensively, as follows: The assured failed to pay the premium due on his policy for 1904, when the same fell due, July 8th of that year, or thereafter though he survived such due date over six months, whereby the policy became forfeited by its terms. After the forfeiture it was not revived or continued. October 2, 1904, the assured applied for a revival of his policy, depositing with the defendant's duly authorized local agent the sum of money alleged in the complaint as having been paid.

The money was received upon condition that the application should not be granted until the defendant should formally approve it, in the lifetime and during the good health of the assured, which condition he understood and agreed to. Evidence satisfactory to the defendant, of the insurability of the assured, was not furnished it, and upon due consideration of the matter, the application was rejected and the deposit returned.

Upon the trial, proof was made as follows: The assured made application in the form required by the defendant for a continuation of his policy, paying defendant the full amount of money required for that purpose, the same being received by defendant's duly authorized agent, and kept by the agent as a special deposit. The application was, in part, in these words:

“I, the undersigned, hereby declare and warrant that I am of sober and temperate habits and that I am in good health, and have been in good health since the date of the issue of my policy. I hereby request the policy, which was lapsed for the nonpayment of the premiums, to be reinstated, and to that end tender the arrears to the company, with interest at five per cent. per annum, with the understanding that the policy, to the conditions of which I hereby agree, will not be enforced until the company has, during my lifetime and good health, approved this application. I agree to accept a return of said arrears and interest, should the company decline, for any reason, to approve this application.”

For proof of his insurability, assured was required to submit to an examination by the defendant's medical examiner, and show thereby that he was insurable. He did in the early part of November, 1904. The examiner, neglected, without reasonable excuse, to make his report, which it was his duty to do, to the defendant, for a period of some 30 days. He then re-examined the assured, and made his report in the form required by the company, which was to the effect that the assured was in good health and safely insurable. The report, application and agent's certificate of payment of arrears were sent to the defendant's head office, and brought to the attention of its medical director early in December aforesaid. Thereafter no notice of any action on the application was given to the assured. It was not finally acted upon till about January 11, 1905. Immediately thereafter notice that it had been denied was given to the local agent, but he did not give notice thereof to the assured, or to any one representing him till some days after the death occurred. The rejection of the application was not based on any defect in the evidence furnished by the...