Lyon v. Travelers' Ins. Co.

• Decision Date: 15 October 1884
• Citation: 55 Mich. 141,20 N.W. 829
• Parties: LYON v. TRAVELERS' INS. CO.
• Court: Michigan Supreme Court

20 N.W. 829

55 Mich. 141

LYON v. TRAVELERS' INS. CO.

Supreme Court of Michigan

October 15, 1884

Error to Clinton.

Spaulding & Barker, for plaintiff and appellant.

Wilkinson & Post, for defendant.

SHERWOOD J.

This is an action upon a policy of insurance issued by the defendant to Mark Lyon, March 3, 1883, insuring him for one year against bodily injuries received through external and accidental violence, and made payable, in case of accidental death, to his mother, the plaintiff. The policy was based upon a written application and an order upon the Detroit Grand Haven & Milwaukee Railroad Company, both executed by the insured and bearing even date with the policy. These three instruments, taken together, constitute the policy of insurance upon which the rights and obligations of the parties depend. Mark Lyon, at the time the policy was issued and thereafter until the time of his death, except when sick from May 17th to August 20th, was in the employ of the above-mentioned railway company. The premium upon said policy was $27 for the year, and its payment was provided for by Lyon in the following order:

"PAYMASTER'S ORDER FOR $27. NO. 92,746.

"To the Detroit, Grand Haven & Milwaukee Railroad Company: Please pay to the Travelers' Insurance Company, of Hartford, Conn., or its authorized agent, the sum of twenty-seven dollars, by installments, as follows: First installment, 6.75 dollars to be paid and deducted from my wages for the month of March, 1883; second installment, 6.75 dollars to be paid and deducted from my wages for the month of April, 1883; third installment, 6.75 dollars to be paid and deducted from my wages for the month of May, 1883; fourth installment, 6.75 dollars to be paid and deducted from my wages for the month of June, 1883.

"The first installment being the premium for two months, the first insurance period under a policy of insurance issued to me by said company, and bearing even date and number herewith; the second installment being the premium for two months, the second insurance period under said policy; the third installment being the premium for three months, the third insurance period under said policy; and the fourth installment being the premium for five months, the fourth insurance period under said policy,--all in accordance with the provisions and conditions of said policy, and my application for the same.

"Occupation, brakeman, mixed train."

It was also stipulated by the policy that there should "be no liability under this policy for any claim by reason of personal injuries, as aforesaid, occurring in either of the said insurance periods for which the respective installments of premium shall not have been actually paid." The defendant, after receiving the order, and soon after its date, deposited the same with the railway company in accordance with a custom existing in such cases between them; and it was the practice of the defendant, early in each month, to send to the railway company a statement of the amount due from the employes of such company by reason of insurance, which the said railway company stopped against the pay of such employes about the middle of the month and paid it over to the defendant. Mark Lyon had money due him from the railway company for wages in each of the months of March, April, and May, in excess of the amount falling due on said order. The defendant rendered its statement of the amount due on the order to the railway company on the first of April, May, June, July, and August, and the first two payments were made by the railway company to the defendant, being from the March and April wages of Mark Lyon. These sums paid for insurance to July 3d, at noon. The railway company did not pay the third installment from the May wages, though it had money in its hands, subject to said order, to the amount of $23.42.

Mark Lyon was accidently killed September 26th, seven days before the expiration of the third insurance period, while at work for the railway company, on a freight and logging train, as a brakeman. He had no wages due him for June, and was paid his May wages by the station agent at St. Johns, July 6th, according to his time kept by the railway company, three days after the commencement of the third insurance period. The defendant did not notify Mark Lyon of the non-payment of the third installment; did not cancel the policy, nor return the order to him; but rendered statement of back premiums to the railway company in July and August, and that at the time of his death the railway company owed Lyon for wages $40.

One of the clauses of the contract contained in the application is to the effect that, "for any injury received by exposure to accidents, risks, or occupation classified as more hazardous than the occupation or hazards against which the insurance is taken, the insured shall be entitled to recover only such amount as the premium paid by the insured would purchase, at the rates fixed by the company for such increased hazard." So far as the finding or record shows, the first information the plaintiff received after the death of the insured, that the insurance company claimed that they were not liable under the policy, was on...