Mid-Continent Life Ins. Co. v. Christian

• Court: Oklahoma Supreme Court
• Writing for the Court: CULLISON, J.
• Citation: Mid-Continent Life Ins. Co. v. Christian, 23 P.2d 672, 164 Okla. 161, 1932 OK 280 (Okla. 1932)
• Decision Date: 12 April 1932
• Docket Number: Case Number: 21252
• Parties: MID-CONTINENT LIFE INSURANCE CO. v. CHRISTIAN.

1932 OK 280

23 P.2d 672

164 Okla. 161

MID-CONTINENT LIFE INSURANCE CO. v. CHRISTIAN.

Case Number: 21252

Supreme Court of Oklahoma

Decided: April 12, 1932

Syllabus

¶0 1. Insurance--Health and Accident Policy--Amount of Weekly Payments for Disability.

Where plaintiff secures a health and accident policy from defendant under the terms of which defendant agrees to pay plaintiff weekly payments for disability, the amount to be recovered under said policy is determined by the terms of said policy.

2. Same--Amount Recoverable for Loss of Health Where Policy Breached by Insurer--Reversible Error in Instruction.

The amount to be recovered for the breach of a health and accident policy is not to be determined under the same rule as a recovery upon the breach of a life insurance policy, and where the trial court instructs the jury upon principles of law applicable to the recovery under life insurance policy, but not applicable to the recovery under a health and accident policy, the same is reversible error and will be reversed upon appeal.

3. Same--Accrued Liability not Affected by Cancellation of Policy.

Where defendant issues an insurance policy to plaintiff under the terms of which said policy may be canceled at any premium paying time, but said policy has a proviso therein that said termination shall be "without prejudice to any claim then existing and for which due notice has been filed at the home office of the company," the termination of the said policy by the insurance company does not in any way affect a claim that had accrued prior thereto.

4. Same--Cause Reversed on Account of Erroneous Instructions.

Record examined in the case at bar, and held: That the trial court committed reversible error in its instructions to the jury and that the judgment of the trial court should be reversed and said cause remanded for a new trial.

Appeal from District Court, Kiowa County; E. L. Mitchell, Judge.

Action by Cleve Christian against the Mid-Continent Life Insurance Company. Judgment for plaintiff, and defendant appeals. Reversed and remanded for new trial.

Rittenhouse, Lee, Webster & Rittenhouse, for plaintiff in error.

James R. Tolbert, Richmond Duvall, Miles G. Tolbert, and George L. Zink, for defendant in error.

CULLISON, J.

¶1 Plaintiff instituted suit seeking to recover on a health and accident policy issued by defendant. The cause was tried to a jury and resulted in a verdict for plaintiff, from which judgment of the court defendant appeals.

¶2 The parties will be referred to as they appear in the trial court. The record discloses that plaintiff made application to defendant for a health and accident policy and that as a result of said application defendant issued to plaintiff its health and accident policy, providing for an annual premium of $ 94 per year.

¶3 Said amount accompanied the application. The policy was dated October 14, 1927. In August, 1928, plaintiff suffered a severe attack of kidney trouble, completely incapacitating him for any work and necessitating continuous medical attention.

¶4 Plaintiff filed a claim with defendant for payments under the terms of his health and accident policy, but defendant refused to honor said claim.

¶5 Defendant also attempted to terminate the policy and tendered back to plaintiff the amount of premium paid at the time said policy was issued.

¶6 Thereupon, plaintiff filed this suit, seeking to recover the value of the health and accident policy. He asks for damages in an amount to be computed upon the period of time covered by plaintiff's life expectancy under the conditions of his health, considered in connection with the amount to be paid weekly as disability under the policy.

¶7 Defendant's first assignment of error is that the court erred in giving to the jury certain instructions excepted to by defendant.

¶8 The consideration of said question of error necessitates a review of the instructions given by the court, to which defendant saved exceptions, the theory of law under which the case was tried, the instructions given by the trial court and the law applicable to the case at bar.

¶9 In instruction No. 3, the court, in substance, instructed the jury that if defendant wrongfully repudiated its contract of insurance, plaintiff is entitled to recover a sum of money equal to the present worth of such policy based upon his life expectancy. "In finding the life expectancy, you will take into consideration the expectancy of life of a normal individual of plaintiff's age, as shown by the mortality tables, less such time as you believe his present condition of health will shorten that life expectancy. After determining his life expectancy, you will ascertain the amount that would be paid under the terms of the policy, had the same not been repudiated, and from said amount you will deduct the annual premium required to be paid, for his life expectancy. From the sum thus ascertained you will ascertain the sum of money which if paid now with interest at 6 per cent., will equal such sum, if paid in installments as provided by the policy during the period of the life expectancy of plaintiff. To the sum so ascertained, you will give plaintiff credit for the amount of interest which would have accrued to plaintiff had he paid the interest annually instead of in bulk, and the amount so found will constitute the present worth of the policy and the measure of damages the plaintiff should recover on his first cause of action."

¶10 By instruction No. 8, the court instructed the jury, in substance, that if plaintiff became ill on or about August 8, 1928, and since such time necessarily and continuously confined within doors or partially confined, as heretofore defined, and disabled from performing his work, and that such total disability will continue during plaintiff's life expectancy, then and in that event plaintiff is entitled to recover on the first cause of action damages amounting to the present worth of the policy.

¶11 In our consideration of said matter and in determining whether or not there was error in the giving of said instructions, we should first investigate the terms and conditions of the insurance contract, which is the basis of this suit.

¶12 The insurance contract is a health and accident policy, and in this case we are in no wise confronted with that portion of the policy pertaining to accidental injuries.

¶13 The portion of said policy covering health insurance is the only part of said policy applicable in our consideration of said cause.

¶14 Said policy contains the following pertinent parts:

"Article A. Full Time Life Indemnity for Confining Sickness.

"Part 1. If such sickness, necessarily and continuously confines within doors and totally disables the insured from performing any and every kind of duty pertaining to his occupation, the Company will pay him at the rate of $ 50.00 per week as long as he lives and suffers such continuous total disability.

"Part 2. If such sickness does not necessarily confine the insured within doors, but totally and continuously disables him from performing any and every kind of duty pertaining to his occupation, the Company will pay 50% of the amount under Part 1, of Article 'A' as long as he lives and suffers such continuous total disability."

¶15 Paragraph 1 of article N, in substance, provides that by the payment of an annual premium of $ 94 after the 1st day of November, 1928, this policy may be maintained in continuous effect. Fourteen days' grace will be allowed in the payment of premiums.

¶16 Paragraph 8 of article N is as follows:

"The Company assumes no liability under this contract beyond the period of time extended by the first premium payment or by any additional renewal premium thereafter. The acceptance of any renewal premium may be optional with the Company, but without prejudice to any claim then existing and for which due notice has been filed at the Home Office of the Company. * * *"

¶17 Defendant contends that the court erred in instructing the jury as set out when plaintiff's suit was based upon the contract containing the provisions just enumerated, and further contends that if plaintiff was entitled to recover any sum whatsoever, the only sum that could be recovered would be in accordance with the terms of the insurance policy.

¶18 The theory under which the trial court instructed the jury was the rule of law announced by this court where a life insurance policy had been breached by the insurance company.

¶19 This court has on several occasions approved the rule laid down in the trial court's instructions where the suit was over a life insurance policy, but we observe that in a life insurance policy the elements to be considered are much different from those to be considered in a health and accident policy. In the average life insurance policy the same is payable upon the death of the insured, which is in no way certain. There is some speculation, however, as to the length of time the policy in the case at bar would run before becoming payable, and it is contended the rule as set out in the trial court's instructions is inapplicable.

¶20 However, we observe that there is a marked distinction between the terms and conditions of the usual life insurance policy and the terms and conditions of the health and accident policy under consideration.

¶21 Under the terms of the policy as just enumerated, supra, the insurance company agrees to pay for the disability specified in the policy a sum certain per week in accordance with the provisions of the policy.

¶22 The policy also provides that the sum will be continued from year to year upon the payment of the premium designated therein and contains a further provision: "The acceptance of any renewal premium may be optional with the Company, but without prejudice to any claim then existing and for which due notice has been filed at the Home Office of the Company."

¶23 By the terms and conditions of the accident policy, which is the insurance contract...