Murray v. Metropolitan Life Ins. Co

• Decision Date: 13 December 1926
• Docket Number: 25878
• Citation: 110 So. 660,145 Miss. 266
• Court: Mississippi Supreme Court
• Parties: MURRAY v. METROPOLITAN LIFE INS. CO. [*]

110 So. 660

145 Miss. 266

MURRAY v. METROPOLITAN LIFE INS. CO. ^[*]

No. 25878

Supreme Court of Mississippi

December 13, 1926

Division A

. (Division A.)

1 INSURANCE. Insurer's liability under master policy becomes fixed at time of injury to employee, and may be enforced after termination of employment.

Liability of insurer of employees under master policy, providing for termination on employee's discontinuance in active employment, becomes fixed at time of injury to employee, and may be enforced after termination of employment.

2 INSURANCE. Provisions of master policy and of individual certificates issued to employees should be construed together.

Provisions of master policy insuring employees and those of individual certificates issued to employees should be construed together.

3 INSURANCE. Provision should not be construed in favor of in insurer unless clearly required by policy.

Provision of policy should not be construed in favor of insurer unless clearly required by language of policy.

4. INSURANCE. Demurrer held properly overruled to replication of waiver of proofs of disability filed to plea alleging failure to furnish proofs.

Where replication to special plea averring insured's failure to furnish proofs of disability pleaded waiver of proofs thereof, demurrer thereto was properly overruled.

HON. R. S. HALL, Judge.

APPEAL from circuit court of Forrest county, HON. R. S. HALL, Judge.

Suit by William C. Murray against the Metropolitan Life Insurance Company. Judgment for defendant, and plaintiff appeals, Reversed and remanded.

Judgment reversed and cause remanded.

Mayson & Kelly, for appellant.

The declaration is predicated solely upon that provision in the policy providing for disability benefits. It is provided in other places in the policy that if employment ceases and the assured employee so desires, he can have a life policy only issued to him, payable at his death to his beneficiaries. It is also provided in what is denominated the "Master Policy" by provisions, however, under which the appellant would not be bound, that when an employee ceased to work, the lumber company would report it and his insurance would cease and a register of such transactions would be kept, and this provision is the basis of the first special plea.

The second special plea is predicated on a provision in the "Master Policy," as if is called, that it would report persons ceasing to be in its employ on the fourteenth day of the preceding calendar month, and that on the first of April, 1925, which was four or five months after appellant became permanently disabled, the J. J. Newman Lumber Company reported to the appellee that the appellant was not in its employ and, hence, at the time of filing this suit, the terms of the policy did not cover the appellee.

The fourth special plea is exactly the same as the former except that it was styled "Register" and avers that, according to the register kept, the appellant was not in the employ of the Newman Lumber Company on the first day of April, 1925, and that the insurance was discontinued at that time.

The sixth special plea averred that pursuant to the terms of the policy the certificate of insurance would issue and in the certificate it was to be provided that in case of the termination of employment with the employer from any cause whatever, the assured would be entitled to have issued to him without further evidence of insurability the life policy, but not term insurance, that employment with the Newman Lumber Company on the part of the appellee ceased about April 1, 1925, and that insurance automatically discontinued and terminated.

The appellee filed a demurrer to the several special pleas and with reference to special plea number one, it averred that it was without application to appellee's declaration for the reason that the register provision had no application or connection with the provision of the policy providing for disability benefits, and had application only to employees who had not been permanently disabled but who voluntarily retired or were discharged from the employment without receiving such injury.

To special plea number two it averred that said special plea was utterly without application to the suit in question and that the provision in the policy headed: "Insurance To Be Discontinued" was altogether disassociated from and had no connection with that part of the policy upon which the suit was brought.

With reference to special plea number six, it averred that said plea was not well made because it was predicated on that provision of the policy styled "Register" and was disconnected from and had no application to the provision of the policy upon which the suit was brought. Further, because the appellant was injured permanently and disabled while in the employ of the J. J. Newman Company and while the policy was in full force and effect, that provision referred to in said plea was intended to apply only to employees voluntarily retiring from the service.

To special plea number five, it averred that the plea was not well taken because the provision styled "Certificate of Insurance" had no connection whatever with the policy upon which the action was brought, the provision providing for disability benefits, and because the provision of the policy applied to those who left the service uninjured and expected to maintain the policy by keeping the annual or quarterly premiums paid.

The defendant's third special plea sought to evade liability because appellant never furnished the defendant due proof or proofs of any kind to the effect that he was totally or permanently disabled and that after April 1, 1925, he ceased to have any sort of insurance. To this plea appellant presented a replication in which he averred that he was not required to furnish proof of disability prior to April 1, 1925, (there is no time limit in the policy providing when proof of disability shall be furnished, the limitation in the policy is to the effect that six months after proof of disablement the first payment will be made) but that on August 14, 1925, he requested the appellee to provide him with blanks to make due proof of permanent disability and that the appellee refused to do so.

No provision in the policy for forfeiture. Unless there is a provision in the policy providing for a forfeiture, there can be none until notice is served on the assured that unless he complies with the conditions imposed in the terms of the policy, the same will be forfeited. Parker's Ins. Law; Friend v. So. States. Life Ins. Co., L. R. A. 1917B 208.

Denial of liability obviates the necessity of furnishing proof. One of the pleas alleged that proof was not furnished in time and another that the suit was prematurely brought on that account. Other pleas denied liability under the policy, there being a denial of liability it was not necessary to furnish proof of disability. Atlantic Horse Ins. Co. v. Nero, 108 Miss. 321, 66 So. 780; Cranford v. Mass. Protective Ass'n, 137 Miss. 876, 102 So. 171. Any disavowal by an insurance company of its liability waives proof of loss. 77 A. S. R. 432.

After a claim is preferred, negotiations and calling for proof estops the insurer from claiming a forfeiture. Affidavits showed permanent disability. These affidavits were put in the record by the appellee itself. The insurance company is estopped to insist on a forfeiture by requiring a furnishing of proofs at some trouble or expense. 25 Cyc., page 872.

If the company requires the assured by virtue of the contract to do some act or incur come expense or trouble inconsistent with the claim, then the contract would become inoperative in consequence of a breach of some of the conditions, the claim is waived. Da Rin v. Casualty Co. of America, 137 A. S. R. 729; 29 Cyc. 193 and 198.

Defendant's plea not applicable to the provision of the policy sued on. After liability actually attaches under the policy, the relation between the parties is changed from that of insurer and insured to that of debtor and creditor. 2 Elliott on Contracts, section 1581; Ill. Bankers Ass'n v. Byassee, 41 A. L. R. 381, 275 S.W. 519.

In the case at bar appellant's claim had ripened long before he ceased to be an employee, April 1, 1925. His injury became permanent in December, 1924, while he was an employee of the lumber company and while his policy was in full force and effect.

The case ought to be reversed and judgment entered in this court for the appellant.

Wells, Stevens & Jones, for appellee.

Counsel for appellant in their brief seem to understand or interpret the master policy to provide for temporary total disability, but such is a misconception of the terms thereof. The master policy insures against death and against total and permanent disability but not against total and temporary disability.

Under said provisions manifestly only an employee insured under the master policy could make proof of such total and permanent disability. When the employee ceased active employment with the company and was, on notice from the lumber company, dropped from the protection of the insurance by the Metropolitan such employee thereafter could submit no proof of total and permanent disability. The statement on the back of page 1 of the certificate in no wise misleads such employee for it expressly states "any employee insured under this plan . . ." who has become permanently disabled "will be regarded as a claimant by the Metropolitan Life Insurance Company."

In April, 1925, the J. J. Newman Lumber Company reported to the Metropolitan Life that insurance was to be discontinued on certain employees who had terminated their services and among others whose employment was terminated as of April 1, 1925 was given...