Missouri State Life Insurance Company v. Burton

• Decision Date: 14 May 1917
• Docket Number: 372
• Citation: 195 S.W. 371,129 Ark. 137
• Parties: MISSOURI STATE LIFE INSURANCE COMPANY v. BURTON, ADMINISTRATOR
• Court: Arkansas Supreme Court

195 S.W. 371

129 Ark. 137

MISSOURI STATE LIFE INSURANCE COMPANY v. BURTON, ADMINISTRATOR

No. 372

Supreme Court of Arkansas

May 14, 1917

Appeal from Faulkner Circuit Court; T. C. Trimble, Judge; reversed.

Judgment reversed and cause dismissed.

Moore Smith, Moore & Trieber, for appellant.

1. The policy was never accepted and delivered during lifetime and good health, and no insurance ever became effective. 66 Ark 612; 111 Id. 173; Id. 324; 73 Id 117; 82 N.W. 966; 77 Ark. 117; 122 Ark. 124; 162 S.W. 779; 144 N.W. 543; 179 S.W. 749; 125 Ark. 115; 144 S.W. 362; 73 N.E. 842. The court erred in its instructions.

Sam Frauenthal and R. W. Robins, for appellee.

1. The policy was issued and delivered. 111 Ark. 173, 324; 66 Id. 612. None of the cases cited by appellant are in point. 22 S.W. 87; 1 Joyce on Ins., § 62; 16 Am. & Eng. Enc. 855; May on Ins., p. 71; 65 Ark. 581; 89 Id. 471; 42 L. R. A. 88; 99 Minn. 176; 51 Col. 238; 108 N.W. 1025; 138 N.W. 459; 45 L. R. A. (N. S.) 743; 164 Cal. 712; 130 P. 726; 131 N.W. 246; 34 L. R. A. (N. S.) 373; 224 F. 74; 73 N.E. 842.

2. The contract being for his benefit, the acceptance thereof is presumed. 60 Ark. 36; Lawson on Pres. Ev., p. 364.

3. The instructions express well established principles of law. Cases supra.

OPINION

MCCULLOCH, C. J.

This is a suit on a policy of insurance alleged to have been issued by defendant company on the life of plaintiff's intestate, Colia Diffee. Plaintiff recovered judgment for the amount sued for in the trial of the cause below before a jury, and defendant has appealed.

The facts deemed to be material in the disposition of the case here are undisputed. Diffee was a farmer residing in Faulkner County near the village of El Paso, and on June 6, 1914, applied to defendant's soliciting agent for a policy of insurance on his life in the sum of $ 2,500, payable to his estate at his death. The application was dated June 6, 1914, and contained the following stipulation:

"That the insurance hereby applied for shall not take effect unless the premium is paid and the policy delivered to and accepted by me during my lifetime and in good health."

The applicant was examined by the local medical examiner of the company at El Paso on June 9 or June 10, 1914, the precise date not being definitely settled by the testimony, and the application was favorably reported by the examiner. It is conceded that Diffee was then in good health and was a proper subject for life insurance.

Gunn, the soliciting agent for the company, was operating under J. D. Dunaway, the general agent residing at Conway, Arkansas, and the application was, after the completion of the examination, delivered by Gunn to Dunaway and by the latter transmitted to the home office of the company at St. Louis, and received there on June 13, 1914. The application took its usual course through the several departments of the company, and it was approved by the company on June 19, 1914, the policy was written and dated on June 20, and mailed out to Dunaway on June 22, for delivery to the applicant. A letter of instruction addressed to Dunaway accompanied the policy, in which the direction was given that no policy should be delivered unless premium was settled and applicant was in good health.

There is a little conflict in the testimony, not deemed material, however, as to the date of the policy. A witness testified that he saw the policy in the possession of Dunaway on June 25, 1914, and observed on the back of it that it bore date of June 14. A copy of the policy exhibited as evidence shows that it was dated June 20, and that the outside cover of the policy does not show its date, except that there is a statement reciting that the maturity of premium was to be June 14. It is clearly shown from the testimony that the maturity date of the premium was antedated so as to carry it back to the time when the assured would get the benefit of a lower rate of premium corresponding with his age on that date. It was customary for the general agent to deliver policies through the solicitor who took the application and on receipt of the policy Dunaway wrote to Gunn informing him of the receipt of the policy so that the latter could get it and make delivery to the applicant.

Diffee died on June 24, 1914, and the policy was never delivered to him. There is some conflict in the testimony as to when Diffee became seriously ill, but we deem that conflict to be unimportant. The illness which caused his death was typhoid fever, which developed after the medical examination was completed. Dunaway heard of the death of Diffee soon after he had written the letter to Gunn, and he thereupon addressed a letter to the home office of the company giving information of Diffee's death and explaining that the application had doubtless been made in good faith, and that it was just a case of an unexpected death. The officer of the company at the home office directed Dunaway to return the policy to that office, which was done, and it was canceled. Diffee gave a negotiable promissory note to Gunn for the amount of the premium at the time the application was secured, and Gunn sold the note to a Mr. Davis at Morrilton. Shortly after the death of Diffee and the return of the policy to the home office, Dunaway, upon instructions from the company, tendered to Davis the amount of the note, which was then immature, but the tender was refused, and subsequently the company tendered the money to the plaintiff, as administrator of the estate, the note having in the meantime been paid to Davis out of the funds of the estate.

The sole defense presented by the defendant is that there was no delivery of the policy, and that for that reason no liability was incurred, it being a part of the contract that the policy should not take effect until delivered to and accepted by the assured during his "lifetime and good health." The only question, therefore, for our consideration is whether or not there was a delivery of the policy within the meaning of the terms of the contract.

That question is, we think, clearly settled against the claim of the plaintiff by the decision of this court in the case of National Life Association v. Speer, 111 Ark. 173, 163 S.W. 1188. We held in that case that under a contract similar in terms to the one now before us no liability was incurred until the policy was delivered to the assured. In that case, as in the present one, the application for...