N.Y. Life Ins. Co. v. Morgan

• Court: Oklahoma Supreme Court
• Writing for the Court: DAVISON, J.
• Citation: N.Y. Life Ins. Co. v. Morgan, 1940 OK 126, 101 P.2d 826, 187 Okla. 214 (Okla. 1940)
• Decision Date: 12 March 1940
• Docket Number: Case Number: 28820
• Parties: NEW YORK LIFE INS. CO. v. MORGAN

1940 OK 126

101 P.2d 826

187 Okla. 214

NEW YORK LIFE INS. CO. v. MORGAN

Case Number: 28820

Supreme Court of Oklahoma

Decided: March 12, 1940

Syllabus

¶0 1. INSURANCE--Under policy provisions compensable disability conclusively presumed from continuance of total disability for three months and insurer liable for disability benefits though insured recovered from total disability before suit instituted.

A policy of insurance containing provisions for disability benefits during the "continuance of disability" in the event the insured should become "totally and permanently" disabled, and providing further that a presumption of disability (compensable under the policy) should arise from the continuance thereof for a period of three months, examined and held, by reason of insured's continued total disability for the prescribed period, to have created a conclusive as distinguished from a rebuttable presumption of compensable disability, thus rendering the company liable for disability benefits, even though the insured subsequently and before the institution of the action had recovered from total disability.

2. SAME-- Clause creating presumption of compensable disability from continuance thereof for three months not effective to lessen aggregate or ultimate liability though it may operate to delay time where duty of company to make disability payments arises.

A policy of insurance providing for disability benefits to an insured during the continuance of disability, and also containing a clause creating a presumption of compensable disability from the continuance thereof for a period of three months, held not, by reason of such presumptive clause, to lessen the period of disability for which the company is liable. Such clause, when applicable to an existing disability, may operate to delay the time when the duty of the company to make disability payments arises, but does not lessen the aggregate or ultimate liability, in the absence of additional policy provisions clearly indicating such an intent.

3. SAME--APPEAL AND ERROR--Error favorable to appellant not considered-Trial court's erroneous holding which diminished period of appellant insurer's liability for disability benefits.

Since error favorable to a complaining party will not be considered on appeal, error of the trial court, if any, in holding that proof of disability was a condition precedent to the accrual of liability under the disability provisions of an insurance policy as distinguished from a condition subsequent, or a condition precedent to the duty to pay, thus diminishing the period of liability, held not to present a question for review on appeal by the insurance company.

4. INSURANCE-- Disability benefits under policy--Letter to insurer as sufficient proof of disability unless more formal proof required.

A letter advising an insurance company of the existence of disability claimed to be compensable under an insurance policy is sufficient proof of such disability until and unless more formal proof is required by the company.

5. SAME--Judgment for disability benefits sustained by evidence.

Evidence examined, and held, to support the judgment of the trial court.

Appeal from District Court, Oklahoma County; Sam Hooker, Judge.

Action by William Morgan, Jr., against New York Life Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

W. F. Wilson and W. F. Wilson, Jr., both of Oklahoma City (Louis H. Cooke, of New York City, of counsel), for plaintiff in error.

Dudley, Hyde, Duvall & Dudley, of Oklahoma City, for defendant in error.

DAVISON, J.

¶1 This action was instituted on August 1, 1935, in the district court of Oklahoma county by William Morgan, Jr., as plaintiff, to recover disability benefits alleged to have accrued under a policy of insurance issued by the New York Life Insurance Company, a corporation, which was named as defendant.

¶2 The right to trial by jury was waived and the cause tried to the court on November 22, 1937, resulting in judgment for the plaintiff for the principal sum of $1,513, plus accumulated interest.

¶3 The defendant presents the case for review, appearing herein as plaintiff in error, and urges as its principal contention that:

"The judgment of the trial court awards to the plaintiff a recovery for temporary total disability under a policy of insurance the coverage of which is for total permanent disability."

¶4 Under plaintiff's pleading and proof offered in support thereof, he became totally disabled by reason of sickness on October 6, 1934. He was thereafter continuously and totally disabled until February 5, 1935.

¶5 Previous to the period of disability above mentioned (June 6, 1923) the defendant company had issued to the plaintiff an insurance policy insuring his life for the sum of $25,000, containing provisions for the payment of disability benefits in the sum of $250 per month as well as provisions for the remainder of premiums falling due during disability contemplated by the policy.

¶6 The policy was still in force at the time of and during the period of disability for which liability is herein sought to be imposed. The premium on the policy was payable annually on the 6th day of December. One annual premium for the sum of $1,013 became due while the plaintiff was disabled. It was paid by the plaintiff, who subsequently sought to, and by the judgment of the trial court, did, recover the same in this action. It constituted a part of the principal sum for which judgment was rendered, the remainder thereof consisting of disability benefits payable for two months (December 6, 1934, to February 6, 1935) at the rate of $250 per month.

¶7 The provisions of the policy upon which the decision of the trial court rests read:

"Disability Benefits:

"And the Company Agrees to pay to the Insured One Per Cent of the face of this policy ($10 per $1,000 each month) during the lifetime of the Insured and also to waive the payment of premiums, if the Insured becomes wholly and permanently disabled before age 60, subject to all the terms and conditions contained in Section 1 hereof. * * *

"Section 1--Disability Benefits:

"1. Disability Benefits shall be effective upon receipt at the Company's Home Office, before default in the payment of premium, of due proof that the Insured became totally and permanently disabled after he received this policy and before its anniversary on which the Insured's age at nearest birthday is sixty years.

"Disability shall be deemed to be total whenever the Insured becomes wholly disabled by bodily injury or disease so that he is prevented thereby from engaging in any occupation whatsoever for remuneration or profit, and under this contract disability shall be presumed after the Insured has been continuously so disabled for not less than three months and during all of that period prevented from engaging in any occupation for remuneration or profit. The permanent loss of the sight of both eyes, or the severance of both hands or of both feet, or of one entire hand and one entire foot, shall be considered total and permanent disability without prejudice to other causes of disability.

"2. Income Payments: The Company will pay the insured, or if such disability results from insanity will pay the beneficiary in lieu of the Insured, a monthly income of one per cent. of the face of the policy during the lifetime of the Insured and the continuance of such disability. The first income payment shall become due on the first of the calendar month following receipt of proof of total disability for three consecutive months, as above, and succeeding payments shall become due on the first day of each calendar month thereafter. Any income payments becoming due before the Company approves the proof of disability shall become payable upon such approval, and subsequent payments will be made as they become due. * * *

"The sum payable in any settlement of the Policy shall not be reduced by income payments made or premiums waived under the above provisions. The loan and surrender values, provided for in sections 3 and 4 of this policy, shall be calculated on the basis employed in said sections the same as if the waived premiums had been paid as they became due. The amount of the dividends provided for in section 2 will be the same as if the waived premiums had been paid as they became due. * * *

"5. Recovery From Disability: The company may from time to time demand due proof of the continuance of such total disability, but not oftener than once a year after such disability has continued for two full years, and upon failure to furnish such proof, or if it shall appear to the Company that the Insured is able to engage in any occupation for remuneration or profit, income payments shall cease and the payment of any premium thereafter falling due shall not be waived."

¶8 It may be noted at this point that the presumptive clause of the policy now before us is slightly different in wording than the comparable clause in many of the policies involved in decisions which we shall hereafter mention, in that it provides that the continuance of disability for the specified time shall create a presumption of disability, whereas most policies provide in substance that the continuance of disability shall create a presumption of permanency. However, the word disability, as used alone in the presumptive clause, must be considered as alluding to the class of disability compensable under the policy, which comprehends permanent disability as that term is used in the preceding portion of the insurance contract. Thus it is obvious that the difference in wording of the presumptive clause is not sufficient to create the basis of a distinction. Since neither of the parties urges such a distinction, further analysis and comparison of the clause will not be made. It will be treated in this opinion as comparable to clauses of the same import though differently worded.

¶9 The question presented in this case is whether, as plaintiff contends, the...