New York Life Ins. Co. v. Nessossis

• Decision Date: 10 June 1940
• Docket Number: 33802
• Citation: 196 So. 766,189 Miss. 414
• Court: Mississippi Supreme Court
• Parties: NEW YORK LIFE INS. CO. v. NESSOSSIS

196 So. 766

189 Miss. 414

NEW YORK LIFE INS. CO.
v.
NESSOSSIS

No. 33802

Supreme Court of Mississippi

June 10, 1940

Suggestion Of Error Overruled October 28, 1940.

APPEAL from the chancery court of Hinds county, ON. V. J. STRICKER, Chancellor.

Action by Mary Sutton Nessossis against the New York Life Insurance Company to recover on a life policy. From a judgment for plaintiff, defendant appeals. Affirmed.

Affirmed.

Watkins & Eager, of Jackson, and Louis H. Cooke, of New York City, for appellant.

The policy sued upon provides in clear, unambiguous and unmistakable terms for the deduction of a surrender charge from the tabular reserve in arriving at the cash surrender value available for the purchase of temporary extended insurance on default in the payment of premiums. The provision is free from uncertainty and undisputedly shown to be nondiscriminatory.

The sum available under the policy sued on for the purchase of extended insurance upon default in the payment of the premium, as well as the exercise of other nonforfeiture privileges, is limited by the terms of the policy contract itself.

Atlantic Life Ins. Co. v. Bender, 146 Va. 312, 131 S.E. 806; 3 Couch, Cyc. of Ins. Law 2073, par. 641, notes 2 and 3; Elms v. Mutual Benefit Life Ins. Co., 211 Mo.App. 514, 524, 231 S.W. 653, 657; Mutual Life Assurance Co. v. Breland, 78 So. 362, 117 Miss. 479; Neal v. Columbian Mutual Life Assurance Society, 138 So. 353, 161 Miss. 814; Pacific M. L. Ins. Co. v. Turlington, 140 Va. 748, 125 S.E. 658; Packard v. Conn. Mut. Life Ins. Co., 9 Mo.App. 409; Payne v. Minn. Mutual Life Ins. Co. (Mo.), 191 S.W. 695.

The policy contract should be construed just as any other contract.

Barry v. Lamar Life Ins. Co., 142 So. 445, 165 Miss. 405; Brotherhood of Railroad Trainmen v. Bridges, 144 So. 554, 164 Miss. 356; Citizens Bank v. Frazier, 127 So. 716, 157 Miss. 298; Continental Cas. Co. v. Hall, 80 So. 335, 118 Miss. 871; Ferguson v. Provident Life, 155 So. 168, 170 Miss. 504; Lavender v. Volunteer State Life, 157 So. 101, 171 Miss. 169; U.S. F. & G. Co. v. Citizens Bank, 116 So. 605, 150 Miss. 386; U.S. F. & G. Co. v. Wilson, 195 So. 802; Williams v. Union Central Life Ins. Co., 291 U.S. 170, 78 L.Ed. 711, 92 A. L. R. 700.

Effect must be given to each and every word contained in the policy contract.

Harris v. Townsend, 58 So. 529, 101 Miss. 590; Home Mutual Fire Ins. Co. v. Pittman, 71 So. 739, 111 Miss. 420; Messina v. N.Y.Life Ins. Co., 161 So. 462, 173 Miss. 378; Southern Home Ins. Co. v. Wall, 156 Miss. 865, 127 So. 298.

This court has had occasion in a number of cases to consider the question of the propriety of the deduction of surrender charge under a life insurance policy. We contend that it is not necessary that this court shall overrule any of its former decisions dealing with the question. It is only necessary that the court analyze and reconcile the several cases heretofore passed upon by it wherein the question was involved.

N. Y. Life Ins. Co. v. Blaylock, 110 So. 432, 144 Miss. 541; Neal v. Columbian Mutual Life Assurance Society, 138 So. 353, 161 Miss. 814; Lamar Life Ins. Co. v. Minor, 154 So. 542, 170 Miss. 223; N. Y. Life Ins. Co. v. Boling, 169 So. 882, 177 Miss. 172; Mutual Life Ins. Co. v. Nelson, 184 So. 636, 184 Miss. 632; Sec. 5171, Code of 1930; Williams v. Union Central Life Ins. Co., 291 U.S. 170, 78 L.Ed. 711.

By reference and careful analysis of the opinion in chief and on suggestion of error in the case of Mutual Life Insurance Company v. Nelson, supra, it would appear that this court based a reversal of the Nelson case on three underlying differences between the Nelson case and the Boling case. They are as follows: (1) That this court found that the Boling policy was indefinite, uncertain and therefore discriminatory; (2) That the policy in the Boling case used the term "cash surrender value, " whereas the policy in the Nelson case used the term "cash value;" (3) That the policy in the Boling case used the term "guaranteed values, " which meant minimum values, whereas the policy in the Nelson case used the term omitting the language "guaranteed values."

The present case falls within the rule announced in the case of Mutual Life Insurance Company v. Nelson, 184 So. 636, 184 Miss. 632.

This court, in the Boling case, refused to allow the surrender charge because the court held that the provisions of the policy were discriminatory and in violation of Section 5171 of the Mississippi Code of 1930, in that the company might deduct one surrender charge as to a given policyholder and a different surrender charge as to another policyholder and that, since the surrender charge was in the nature of part of the premium, discrimination would be occasioned thereby. In respect to which, we call Your Honors' attention to the following facts shown in this record distinguishing the case from the Boling case:

(a) The bill of complaint in this case contains no charge of discrimination.

Neal v. Mutual Life Ins. Co., 138 So. 353, 161 Miss. 814; N. O. R. R. Co. v. State, 110 Miss. 210; Dunn v. Love, 172 Miss. 342.

(b) Mere opportunity to discriminate does not constitute discrimination.

Dixon v. State, 74 Miss. 271; Williams v. State, 20 So. 1023, 170 U.S. 213, 42 L.Ed. 1012.

(c) An illegal contract is one where the moving party has definitely agreed to do an act prohibited by law.

Knut v. Nutt, 83 Miss. 365, 35 So. 686, 122 Am. St. Rep. 452, 200 U.S. 12, 50 L.Ed. 348; Byrd v. Newcomb, 79 So. 100, 118 Miss. 179.

(d) The proof is undisputed that no discrimination has ever taken place.

N. Y. Life Ins. Co. v. Boling, 169 So. 882, 177 Miss. 172.

(e) If possibility of discrimination violated the statute, it would be impossible to write a contract not violative of the statute.

Code of 1930, sec. 5171; Mutual Life Ins. Co. v. Nelson, 184 Miss. 632, 184 So. 636, 186 So. 837; N. Y. Life Ins. Co. v. Boling, 169 So. 882, 177 Miss. 172.

(f) That policy in the Boling case used the term "Cash Surrender Value, " whereas the policy in the Nelson case used the term "Cash Value."

Mutual Life Ins. Co. v. Nelson, 184 So. 636, 184 Miss. 632.

The undisputed proof is that the terms "cash value" and "cash surrender value" and "guaranteed values" are one and the same thing; that each of such terms is a technical term applicable only to the life insurance business.

22 C. J. 1203; Finch v. Branham, 148 Miss. 137, 114 So. 257; Hattiesburg Plumbing Co. v. Carmichael & Co., 80 Miss. 66; Hurst v. Lake & Co. (Ore.), 16 P.2d 627, 89 A. L. R. 1222; 10 R. C. L. 1072; Williston on Contracts (Rev. Ed.), sec. 629.

The policy of insurance in the Nelson case treats the terms "cash value" and "cash surrender value" as synonymous terms. The record in the Nelson case uses the term "cash value" as synonymous with "cash surrender value."

Mutual Life Ins. Co. v. Nelson, 184 Miss. 644.

(g) That the policy in the Boling case used the term "Guaranteed Values, " which meant minimum values, whereas the policy in the Nelson case used the term omitting the language "Guaranteed Values." The evidence established that the term "Guaranteed Values" means contractual values.

Ackley v. Prime, 278 P. 932; Border v. Am. Nat. Bank, 282 F. 73; Carter v. Mut. Ben. Life Ins. Co., 161 So. 446; Drovers Bank v. Tichenor, 145 N.W. 777; Gaster v. Ashley, 1 Ark. 325; Lamar Life Ins. Co. v. Minor, 154 So. 542, 170 Miss. 223; Neal v. Columbian Mut. Life Assur. Society, 138 So. 353, 161 Miss. 814; Pathe v. Bray Pictures, 247 N.Y.Supp. 476; Stumph v. Bldg. & Loan Assn. (Kan.), 79 P.2d 896; Thayer v. Wild, 107 Miss. 449; Yankelwitch v. Beach, 2 P.2d 498.

The term "guaranteed values" applies to each and every nonforfeiture option contained in the policy, as well as the loan value thereof, and with no kind of reason can it be held that, if the policy lapsed, the insured would be entitled to all of the reserve in the policy, because of the use of the words "guaranteed values, " but if he brought it back to get the cash on it or to have endorsed for paid-up insurance, the cash surrender value as stated in the policy would be the full measure of his rights to participation in the surplus.

Mutual Life Ins. Co. v. Nelson, 184 Miss. 632, 646.

Properly distinguishing all the facts in New York Life Insurance Company v. Blaylock, Lamar Life Insurance Company v. Minor, New York Life Insurance Company v. Boling, every reported case justifies the deduction of a graduated surrender charge from the third through the ninth year and holds that the table in the policy giving the value of available nonforfeiture options is the full measure of the insured's rights.

Atlantic Life Ins. Co. v. Pharr (C. C. A. 6), 59 F.2d 1024; Bene v. N.Y.Life Ins. Co., 191 Ark. 714; Bostik v. Va. Life Ins. Co., 93 F.2d 557; Brown v. Mutual Life (S. C.), 195 S.E. 552; Bryant v. Mutual Benefit Life Ins. Co. (Tenn.), 109 F. 748; Carter v. Mutual Benefit Life Ins. Co., 161 So. 446; Darby v. Equitable Life Assurance Society (La.), 79 So. 329; Davis v. Mutual Life Ins. Co., 119 S.W.2d 488; Devitte v. Mutual Life Ins. Co., 22 D. L. R., p. 1915, 183; Erickson v. Equitable Life Assurance Society (Minn.), 258 N.W. 736; Golightly v. N.Y.Life Ins. Co., 191 So. 111; Inter-Southern Life Ins. Co. v. Zerrell, 58 F.2d 135; Kurth v. National Life & Acc. Ins. Co. (Tex.), 79 S.W.2d 339; Life Ins. Co. of Va. v. Sluss (Ind.), 11 N. E. (2d.) 500; Code of 1930, sec. 5171; Moss v. Aetna Life Ins. Co., (C. C. A. 6) 73 F.2d 339; Mutual Life Ins. Co. v. Nelson, 184 So. 636, 184 Miss. 632; Neal v. Columbian Mutual Life Assur. Society, 161 Miss. 814, 138 So. 353; Palmer v. Central Life Assurance Society, 258 N.W. 732; Pilot Life Ins. Co. v. Owen, 31 F.2d 862; Williams v. Union Life Ins. Co., 291 U.S. 169, 78 L.Ed. 711.

Alexander & Satterfield, of Jackson, for appellee.

This policy is a Mississippi contract and is governed by the Mississippi decisions.

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