Mohrstadt v. Mutual Life Ins. Co. of New York

• Decision Date: 17 March 1902
• Docket Number: 1,594.
• Citation: 115 F. 81
• Parties: MOHRSTADT v. MUTUAL LIFE INS. CO. OF NEW YORK.
• Court: U.S. Court of Appeals — Eighth Circuit

115 F. 81

MOHRSTADT v. MUTUAL LIFE INS. CO. OF NEW YORK.

No. 1,594.

United States Court of Appeals, Eighth Circuit.

March 17, 1902

M. R Smith (William S. Anthony, on the brief), for plaintiff in error.

James A. Seddon (James L. Blair and George T. Weitzel, on the brief), for defendant in error.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

THAYER Circuit Judge.

The facts on which the decision of this case hinges are these:

On December 16, 1897, Simon Lederer, a local agent of the Mutual Life Insurance Company of New York, the defendant in error whose office was at Poplar Bluff, Mo., solicited Thomas A Thompson to take out a policy of life insurance in his company, with such effect that on that day the deceased, at Dexter, Mo., signed an application for a policy. The application which was so signed described the kind of policy that was applied for, and the amount thereof, as follows:

'I hereby apply for insurance on my life on the life plan; (--) years' payment; twenty-year distribution. Amount, $5,000.'

The annual premium on such a policy as was described in the application, according to the company's table of rates, amounted to $102.50. Contemporaneously with the signing of the application, the deceased executed and delivered to the agent his note for $102.50, representing the amount of the first annual premium; and a receipt was delivered to the deceased by the agent, which was in the following form:

'The Mutual Life Insurance Company of New York. Baker Brothers, General Agents, No. 421 Olive St., St. Louis, Mo.

'Am't Premium, $102.50 . . . Insurance, $5,000.

'No. 5,260. . . . Dexter, Dec. 16, 1897.

'Received from Thomas A. Thompson one hundred and two and 50/100 dollars, for the first annual premium on his application for a policy of insurance in the Mutual Life Insurance Company of New York, for five thousand dollars, on the life of Thomas A. Thompson. Said policy of insurance to take effect and be in force from and after the date hereof, provided the said application shall be accepted by the said company; but, should the same be declined or rejected by said company, then the full amount hereby paid will be returned to applicant upon the delivery of this receipt. This receipt will be void when applicant is notified that a policy has not been issued, and shall not be valid for any other consideration than cash actually paid.

'Baker Brothers, Gen'l Agents, 'By Simon Lederer.'

Across the face of this receipt was the following indorsement:

'Countersigned at Dexter, Mo., by Simon Lederer. This receipt is void if issued after January 31, 1898.'

The application so signed by the deceased was forwarded, together with the medical examination, to the general agents of the company at St. Louis, Mo., and thence to the home office, in New York, for acceptance or rejection by the company, according to the usual course of business. The application and medical examination were received at the home office December 20, 1897. The company declined to issue such a policy as was described in the application (that is to say, a policy 'on the life plan; twenty-year distribution'); but it did make out a policy on what is termed the 'endowment,' as distinguished from the 'life,' plan, the premium whereon was greater, amounting to $243.50 annually. This policy was mailed to the company's agents in Missouri, to be submitted to the deceased; but, when it reached the local agent at Poplar Bluff, it seems to have been accompanied with no letter of explanation, and as it was not the kind of policy applied for, and called for a higher rate of premium, the local agent wrote to the company for an explanation, and was advised that it was the best the company could offer; the company declining to issue a policy on the life plan at the lower rate, because of the early death of some of the decedent's ancestors. Before the endowment policy was tendered to the deceased for his acceptance or rejection, and before he was aware that such a policy had been mailed to the local agent, he died, or committed suicide; his death taking place about January 13, 1898. The endowment policy was thereupon returned to the company and canceled, but it seems that after Thompson's death his widow tendered the amount of the premium on the endowment policy, to wit, the sum of $243.50, and demanded the delivery of that policy, but the tender of the money was rejected. On this state of facts, concerning which there was no dispute, the trial court directed a verdict for the defendant. The question to be determined by this court is whether such a direction was proper.

We are of opinion that the execution of a policy on the endowment plan by the defendant company, and the mailing of such a policy, to be submitted to the deceased, cannot be construed as an acceptance by the defendant company of the application or proposition for insurance which was submitted in the first instance by the deceased, but that it was, in legal effect, a rejection of such...