McLaughlin v. Equitable Life Assur Soc. of the U.S.
| Decision Date | 04 January 1894 |
| Citation | 38 Neb. 725,57 N.W. 557 |
| Parties | MCLAUGHLIN v. EQUITABLE LIFE ASSUR SOC. OF THE UNITED STATES. |
| Court | Nebraska Supreme Court |
1. In the absence of fraud or mistake, all previous verbal understandings are merged in the written contract of insurance, which is conclusively presumed to contain the entire engagements of the parties, with all the conditions of their fulfillment.
2. It was stipulated in a life insurance policy that in case of default of payment of the annual premium therein named, after the payment in full of three of such premiums, the insurance company would issue in favor of the beneficiary therein a paid-up policy for as many parts of the amount insured as equaled the number of premiums paid, provided such policy should be surrendered, duly receipted, within six months from the date of such default. Held, that the surrender of the receipted policy within six months after default is a condition precedent to the right to demand paid-up insurance.
3. The insured, having failed to surrender the policy until more than 11 months after default, is not entitled to paid-up insurance. And an action by the beneficiary to compel specific performance of the contract therefor by the insurance company was rightly dismissed for want of equity, although the insured had paid three of the annual premiums previous to the default.
Appeal from district court, Douglas county; C. R. Scott, Judge.
Action by Elma R. McLaughlin against the Equitable Life Assurance Society of the United States for specific performance of a contract to issue to plaintiff a certain policy of insurance. From a decree for defendant, plaintiff appeals. Affirmed.Isaac Adams, for appellant.
Congdon & Clarkson, for appellee.
This was an action by the plaintiff, in the district court of Douglas county, to enforce the specific performance of an agreement by the defendant to issue a paid-up policy of insurance. There was a finding for the defendant, and a decree dismissing the petition, from which the plaintiff has prosecuted an appeal to this court. There is no controversy with respect to the material facts, which are as follows: In the year 1884, the defendant company issued a policy of insurance on the life of Andrew W. McLaughlin, in favor of his wife, the plaintiff herein. Said policy was for $5,000 current insurance, upon the payment of an annual premium of $314.90 on the 26th day of August of each year, to be fully paid up after 15 of such payments. It was stipulated in said policy that, in case of default by the insured after the payment of not less than three of such annual premiums, the defendant company would issue a paid-up policy in favor of the plaintiff for as many fifteenth parts of the sum of $5,000 as equaled the number of premiums so paid, provided said policy should be surrendered, duly receipted, within six months from the date of such default. The provisions of the policy with respect to paid-up insurance are as follows: “And, further, that if premiums upon this policy for not less than three complete years of assurance shall have been duly received by said society, and this policy should thereafter become void in consequence of default in payment of a subsequent premium, said society will issue in lieu of such policy a new paid-up policy, without participation in profits, in favor of said Elma R. McLaughlin, if living, and, if not living, to the children of said Andrew W. McLaughlin, or their guardian for their use, or, if there be no children surviving, then to the executors, administrators, or assigns of said Andrew W. McLaughlin, for as many fifteenth parts of the original amount hereby assured as there shall have been complete annual premiums received in cash by said society upon this policy at the date when such default shall first be made: provided, however, that this policy shall be surrendered, duly receipted, within six months of the date of default in payment of premium as mentioned above.” In case of default in payments of premiums by the assured, the contract contained the following provision: It is conceded that three of the annual payments were made by Mr. McLaughlin, to wit, those for the years 1884, 1885, and 1886, but that he failed to make the payment due in August, 1887. It is further admitted that said policy was not surrendered within six months thereafter, nor was a demand made for paid-up insurance until the month of July, 1888, when the insured addressed a communication to the defendant company, in which he inquired what steps were necessary in order to preserve his rights under the contract. In reply to that inquiry, he received a communication from the defendant, informing him that his policy had been forfeited for the nonpayment of the premium, and had then no surrender value. It is shown by the testimony of Mr. McLaughlin that he was, at the dates of both the applications and the policy, cashier of the First National Bank of Plattsmouth, and that Mr. Guyon, the agent who wrote his application, has his headquarters in the same bank. He testified that he was informed by Guyon, in whom he had great confidence, that after the payment of three premiums his policy would be absolutely nonforfeitable, and that he could not lose the money thus paid. It also appears that he held a second policy for a like amount issued by the defendant company; that, being pressed for money to pay the premiums as they matured, he requested an extension of payments on the last-named policy, which request was granted, but, after making one or two payments thereon, it was suffered to lapse. This witness, in answer to questions by counsel for the plaintiff and the court, testified as follows:
And on cross-examination he testified: ...
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