Loftis v. Pacific Mut. Life Ins. Co. of California

Decision Date18 January 1911
Docket Number2126
Citation114 P. 134,38 Utah 532
CourtUtah Supreme Court
PartiesLOFTIS v. PACIFIC MUTUAL LIFE INSURANCE COMPANY OF CALIFORNIA

On Application for Rehearing March 8, 1911.

Action by Addie B. Loftis, administratrix of Thomas J. Loftis deceased, against the Pacific Mutual Life Insurance Company of California.

Judgment for plaintiff. Defendant appeals.

AFFIRMED.

C. S Varian for appellant.

APPELLANT'S POINTS.

The rule is that when a party relies upon a waiver of the performance of an act upon which his right of action depends such waiver must be specially pleaded. (Aronson v Frankfurt Accident P. G. Co. [Cal.], 99 P. 539; McCormack v. Insurance Co., 78 Cal. 468; German Insurance Co. v. Shader [Neb.], 96 N.W. 604; German Ins. Co. v. Daniels [Tex.], 33 S.W. 550; Insurance Co. v. Capehart, 108 Ind. 278; Cont'l. Ins. Co. v. Vanlue [Ind.], 26 N.E. 119-122; Cyc. of Law, 923; Parsons v. Grand Lodge, etc. [Ia.], 78 N.W. 676; Knapp v. Brotherhood, etc., 117 N.W. 298; Neuberger v. Robbins [Utah], 106 P. 933; Shawnee Ins. Co. v. Knerr [Kan.], 83 P. 612; Insurance Co. v. Dyches, 56 Tex. 565; Cooley Briefs on Ins. Law, vol. 3, p. 2768; 11 Ency. Pl. & Pr., 422.)

The plaintiff in this case was bound to show by sufficient evidence that the defendant not only dispensed with the limitation of the contract as to the manner in which a waiver should be evidenced, but that in fact the company did waive a compliance with the policy conditions as claimed. And further, where, as in this case, the acts or omissions relied upon to establish a waiver were those of a company agent who was by the insurance contract expressly denied the power to waive any of its provisions, it must be shown, that such agent had subsequently express authority to make the waiver, or that the defendant, with knowledge of the facts, ratified his action. Authority to an agent, general or special, in the presence of such a provision as is found in this contract may not be imputed because of the fact that he is authorized to solicit, write, and deliver policies. (Northern Assurance Co. v. Grand View Building Ass'n., 183 U.S. 308-361; Cooley's Briefs on Ins., vol. 3, 2499; p. 502-503; Bank of Commerce v. N.Y. Life Ins. Co. [Ga.], 54 S.E. 643; Collins v. Metropolitan Life Ins. Co. [Mont.], 80 P. 609; Cayford v. Metropolitan Life Ins. Co. [Cal.], 91 P. 266; McElroy v. Metropolitan Life Ins. Co. of N.Y. [Neb.], 122 N.W. 27, L. R. A. N. S. 968.

It is purely a question of estoppel which is the basis of waiver--another name for estoppel. If there is no estoppel there can be no waiver in a case of this kind. And further, it must be shown, that the company intentionally made the waiver with knowledge of the circumstances. (Bigelow on Estoppel [4th Ed.], 633; Equit. Life Assurance Society v. McElroy, 83 F. 638 [C. C. A]; Bennecke v. Ins. Co., 105 U.S. 359; Thompson v. Ins. Co., 104 U.S. 252; Joyce on Insurance, secs. 1356-1360; Insurance Company v. Doster, 106 U.S. 30; Smoot v. Banker's Life Association [Mo.], 120 S.W. 719; Schmertz v. U. S. Life Ins. Co., 118 F. 256 [C. C. A.]; 19 Am. & Eng. Ency. Law [2d Ed.], p. 56, par. bb.; Ia. Life Ins. Company v. Lewis, 187 U.S. 335; James v. Reserve Fund Co., 49 S.W. 978; Lebanon Mut. Ins. Co. v. Hoover, 113 Pa. State 591.)

Where a member of a benevolent society is in default for non-payment of an assessment, which by the rules of the society forfeits his rights, the forfeiture is not waived by the society sending a notice of the next assessment, and calling attention therein that the prior assessment remained unpaid. (Schmidt v. Mod. Woodmen of Am. [Wis.], 54 N.W. 264. See, also, Rice v. G. L. A. O. U. W. [Ia.], 72 N.W. 770; Rice v. G. L. A. O. U. W. [Ia.], 60 N.W. 726; Koehler v. Modern Brotherhood of America [Mich.], 125 N.W. 49.)

Upon all the circumstances, from the most favorable point of view for the plaintiff, if Loftis knew of the listing of his name on September list, it can only be fairly said that the local agent, (assuming for the present his authority) had offered to extend the time of payment of the August premium upon assumption that the September premium would be paid in time, and that Loftis had declined to accept the offer. Such an offer is, of course, made upon the condition that it is accepted and that the money is paid. (Sullivan v. Conn. Indemnity Association [Ga.], 29 S.E. 41; Union Central Life Ins. Co. v. Berlin, 101 F. 673 [C. C. A.].)

It has been held that placing a premium note in the hands of an attorney for collection, after the policy has become void according to its terms for failure to pay the note, will not revive the policy if the collection is not made, especially where the policy provides that no waiver shall be valid unless in writing. (Iles v. Mut. Reserve Life Ins. Co., 50 Wash. 49, 96 P. 522; Lynn v. N.Y. Life Ins. Co., 78 Mo.App. 192; Ware v. Millville Mut. M. & F. Ins. Co., 45 N. J. Law 177; Cohen v. Cont'l F. Ins. Co., 67 Tex. 325, 3 S.W. 296; Laughlin v. Fid. Mut. Life Ass'n., 8 Tex., Civ. App. 446, 28 S.W. 411; Union Cent'l Life Ins. Co. v. Chowning, 28 S.W. 117; Mageachie v. N. Am. Life Ins. Co., 23 Canada [S. C.], 148.)

Permission to pay a premium after due date during the life and good health of the insured is not equivalent to the permission to pay after his death. It is well settled that a course of dealing between the parties under which the insurer accepted overdue premium when the insured was in good health, will not give his representative or himself the right to pay or tender his premiums after maturity, and he is in a bad state of health or had died. (Thompson v. Insurance Co., [Tenn.], 6 L. R. A. [N. S.] 1042; Carlson v. Supreme Council, etc., 115 Cal. 466, 47 P. 375; Bliss Life Insurance, sec. 316-355; Bacon on B. & L. Insurance, sec. 370; Cooley's Briefs, etc., vol. 3, p. 2709; Richards on Ins. Law [3d Ed.], sec. 139, p. 174.)

So indulgence on three occasions are not sufficient. (Frazer v. Home Life Ins. Co., 45 A. 1047; Lantz v. Vermont Life Ins. Co., 21 A. 80; Haupt v. Phoenix Mut. Life Ins. Co., 35 S.E. 342.) Moreover, a custom to waive in favor of persons in good health, does not tend to prove a custom to waive in favor of those who are sick. And by the same token, there could be no custom of waiver of such conditions to be given effect after death, when the contract had terminated. (Smith v. Sovereign Camp. W. & W., 77 S.W. 862; Lewis v. Phoenix Life Ins. Co., 44 Conn. 72; Nat'l Mut. Benefit Asso. v. Miller, 85 Kentucky 82, 2 S.W. 900; Richardson v. Mut. Ins. Co., 18 S.W. 164; Richenbach v. Ellerbe, 22 S.W. 573; Elder v. A. O. U. W., 82 N.W. 988.)

Notice could serve no useful purpose because the assured has actual knowledge that he has not made the payment and that his policy is no longer in existence. (Roberts v. Aetna Life Ins. Co., 212 Ill. 382, 72 N.E. 363; McHahon v. Travelers Ins. Co., 77 Ia. 229, 42 N.W. 179-181; 19 Am. & Eng. Ency. of Law [2d Ed.], 47.)

The order in this case provides that the failure by the employer from any cause to make the required deductions and that if they are not made the policy shall without notice of any kind be void as respects the corresponding and all subsequent insurance periods. (Cooley's Briefs on Law of Ins., vol. 3, p. 2285; Walker v. Pac. Mut. Life Ins. Co., 67 Ark. 147, 53 S.W. 675, 83 S.W. 1132; Landis v. Standard L., etc., Co., 6 Ind.App. 502; 33 N.E. 989; Bane v. Trav. Ins. Co., 85 Ky. 677, 4 S.W. 787; Hagins v. Aetna Life Ins. Co., S. C. 51; S.W. E. 683-4; Employers' Liability, etc., Co., v. Rochelle, 13 Tex. Civ. App. 35 S.W. 869; McMahon v. Trav. Ins. Co., 77 [Ia.], 229, 42 N.W. 179; Lyon v. Trav. Ins. Co., 55 Mich. 141, 20 N.W. 829; York v. Ry. O. & E. H. Assn. [West Va.], 41 S.E. 227; Reid v. Trav. Ins. Co. [Ga.], 43 S.E. 433; Brown v. Pac. Mut. Ins. Co. [Mo.], 82 S.W. 1122; Aetna Life Ins. Co. v. Ricks [Ark.], 94 S.W. 923; Sewell v. Cont. Cas. Co. [Miss.], 46 So. 714; Cyc., vol. 1, p. 242.)

A written and express contract cannot be controlled or varied or contradicted by a usage or custom. (The Reeside, Fed. Cases No. 11657; De Witt v. Berry, 134 U.S. 312; Union Cen'l Life Ins. Co. v. Chaowning [Tex.], 28 S.W. 119; 19 Am. & Eng. Ency. of Law, 56.)

E. O. Leatherwood and E. A. Walton for respondent.

RESPONDENT'S POINTS.

There is a clear conflict among the authorities as to whether in insurance cases waiver may be proved under a plea of performance. Our own court has settled the matter for this jurisdiction to the effect that it is not necessary. (West v. Insurance Co., 10 Utah 442; Stephens v. Union Assurance Co., 16 Utah 22.) California has repeatedly held our way upon the question. (Berliner v. Travelers' Ins. Co., 53 P. 922, 924; Richards v. Ins. Co., 89 Cal. 170, 26 P. 762.) Missouri and Virginia also hold with us. (James v. Ins. Co., 49 S.W. 978; West Rockingham Ins. Co. v. Sheets, 26 Gratt, 854.)

Moreover, the defendant produced the very evidence which established the waiver. Plaintiff was thus entitled to avail himself of the same without a plea. (Grand Lodge, etc., v. Bunkers, 23 Ohio Circuit Court Reports 487; 3 Cooley Ins. Briefs, 2770.)

Again where the real question in controversy has been fully and fairly tried the court will not reverse for such an objection which may be avoided by amendment of pleadings, but will exercise itself the power of amendment if necessary. (Ware v. Millville, etc., Co., 45 N. J. Law 177; See, also, sec. 3002, Compiled Laws of Utah 1907.)

Persons can no more make binding provisions in a written contract which will preclude them from altering them by parol than can a legislature enact an irrepealable statute, and this provision itself may be waived by parol. (Lamberton v Connecticut Fire Ins. Co., 39 Minn. 129; Renier v. Dwelling-House Ins. Co., 74 Wis. 79; Wilcotts v....

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