Mutual Life Ins. Co. of New York v. Murray
| Decision Date | 01 December 1909 |
| Citation | 75 A. 348,111 Md. 600 |
| Parties | MUTUAL LIFE INS. CO. OF NEW YORK v. MURRAY. MURRAY v. MUTUAL LIFE INS. CO. OF NEW YORK. |
| Court | Maryland Court of Appeals |
Appeals from Superior Court of Baltimore City; Henry D. Harlan Judge.
Action by G. Moseley Murray against the Mutual Life Insurance Company of New York. From a judgment for plaintiff defendant appeals, and from an order denying plaintiff's application for allowance of counsel fees he appeals. Affirmed as to both appeals.
Argued before BOYD, C.J., and BRISCOE, PEARCE, SCHMUCKER, BURKE, and THOMAS, JJ.
John J Donaldson, for G. Moseley Murray.
Aubrey Pearre, Jr., and Randolph Barton, Jr., for the Mutual Life Insurance Company of New York.
This is an action of assumpsit instituted under the rule day act [1] in the superior court of Baltimore city by the Reverend G. M Murray against the Mutual Life Insurance Company of New York to recover a sum alleged to be due under a policy of insurance upon his life. On the trial of the case before the court without a jury, judgment went against the company and it took an appeal. The record also contains an appeal taken by Mr. Murray from the refusal by the court of his application for the allowance of a counsel fee under the act. The two appeals will be considered together.
There is practically no dispute as to the facts of the case. It appears from the record that the company issued to Mr. Murray on May 10, 1888, what is known as a "twenty-year distribution" policy of insurance on his life for $5,000. The policy called for the payment of semiannual premiums of $132.40 each for the period of 20 years, at the end of which the $5,000, together with a distributive share of surplus, became due and payable to the insured if he was then alive. If the insured died before the expiration of the 20 years, the $5,000 became at once payable, but without any share in the surplus. During the 20 years no dividends were payable upon policies of that character, but all surplus applicable to them was accumulated until the end of that period, and at that time divided between such of them as then remained in force. For the purposes of such division of surplus the 20-year distribution policies issued in each year formed a separate class. The policy also provided that after three full annual payments of premiums had been made upon it the insured might at his election have it converted into a paid-up nonparticipating policy for the proportion of its original amount which the number of full year's premiums paid bore to the total number required. In the event of his making such election, he was required to surrender his policy to the company, and receive in lieu of it a paid-up policy which was a new and different style of contract. After Mr. Murray had paid 16 semiannual premiums on his policy, he called at the office of the company's Baltimore agents, O. F. Bresee & Co., and asked Mr. Bresee if he would be permitted to make payment of a lump sum to the company, and by that means avoid the necessity of continuing to make semiannual payments of premiums on his policy. Mr. Bresee told him that he would be permitted to make payment of the remaining premiums in the manner suggested by him if he desired to do so, but warned him that, if he did it and then died before the expiration of the 20-year period, he would lose the sum which he had thus paid, as he would then only receive the face of the policy. Mr. Bresee, however, made no intimation of any kind to Mr. Murray that, if he commuted the remaining dividends on the policy in the manner suggested and then survived the 20 years, his distributive share in the surplus would be affected or diminished. Mr. Murray then paid to Mr. Bresee the sum of $2,070.27, that being the amount which the company agreed to receive as a lump sum in lieu of the remaining premiums to fall due on the policy, at the same time handing him the policy to be sent to the company for an indorsement thereon of the transaction. The policy was in a few weeks returned to Mr. Murray, bearing the following indorsement:
Mr. Murray subsequently borrowed money from the company and deposited the policy with it as collateral security for the loans, which amounted to a total of $4,726.50 when the policy matured on May 10, 1908, at the end of the 20-year period. A short time before that date, Mr. Murray was informed at the company's Baltimore office that in the division of the surplus it had awarded to each policy of the class to which his belonged a distributive share of $352.68 on the thousand of their face value. At that rate of distribution Mr. Murray would have been entitled to receive on his policy its face value of $5,000, less the $4,726.50 of loans due on it, leaving the net sum of $273.50, which added to $1,763.40, being a full share of the surplus, would have amounted to $2,036.90. When he called at the company's office at the expiration of the 20-year period and asked for the proceeds of his policy, his right to the $273.50 balance of its face value was conceded, but he was informed that the share of surplus to which his policy was entitled was, by reason of his having commuted the payment of his premiums, only $980, and he was offered a check for $1,253.50 as the full proceeds of his policy. He refused to accept the sum thus offered him, and, the company refusing to pay him more, he brought the suit now before us, and recovered judgment for the full amount of his claim. The suit was brought upon the common counts only, the plaintiff filing with the declaration an account charging the company with the balance due on the face of the policy and a full distributive share of the surplus amounting in all to $2,036.90. The company as defendant filed the general issue pleas supported by an affidavit under the act and paid $1,253.50 into court.
The substantial question presented by the company's appeal from the judgment is whether the commutation of premiums made with its consent on Mr. Murray's policy in the manner shown by the record had the legal effect of reducing its share in the surplus for division among the class of policies to which it belonged. The policy is a written instrument, and there appears upon it a written memorandum of the terms of the commutation, and their interpretation is therefore under the well-settled law a matter for the court. Roberts v Bonaparte, 73 Md. 191, 20 A. 918, 10 L. R. A. 689; Clark Dist. Company v. Cumberland, 95 Md. 476, 52 A. 661. The terms of the policy are free from ambiguity, and it is...
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