New York Life Ins. Co. v. Noble
| Decision Date | 19 March 1912 |
| Citation | 124 P. 612,34 Okla. 103,1912 OK 267 |
| Parties | NEW YORK LIFE INS. CO. v. NOBLE. |
| Court | Oklahoma Supreme Court |
Rehearing Denied June 4, 1912.
Syllabus by the Court.
Under the statute of New York (Laws 1909, c. 33, § 88 [Consol. Laws 1909, c. 28]), regulating life insurance, the provision that in case of lapse or forfeiture for nonpayment of a premium when due etc., the reserve "shall on surrender of the policy and demand made, within six months after such lapse be taken as a single premium of life insurance," etc is not to be construed so as to limit the right to make such surrender and demand to the insured alone; under it the beneficiary of the policy may make such surrender and demand after the death of the insured, within the period named.
Where the statute controlling a life insurance policy, which has lapsed for nonpayment of a premium when due, gives the insured the option to within six months surrender the policy and have the net accumulated reserve on the policy applied as a single premium in extending the policy for such term as the reserve will purchase, but provides that such extended insurance shall not participate in the profits of the company, held that, under a tontine policy contract which on its face covenanted that, in the event that it became a death claim within the tontine period, all payments of premiums should be paid to the beneficiary together with the amount named in the policy, and where such option was exercised within the time allowed, and the insurance was extended, and the insured died within the tontine period and before such extension expired, the beneficiary had the right to recover, in addition to the amount named in the policy, the premiums that had been paid, as the agreement to pay such in the face of the policy did not involve any question of profits of the company or a participation therein.
Commissioners' Opinion, Division No. 2. Error from District Court, Carter County; S. H. Russell, Judge.
Action by Eva Noble against the New York Life Insurance Company. Judgment for plaintiff, and defendant brings error. Affirmed.
James H. McIntosh, of New York City, Potterf & Walker, of Ardmore, and Locke & Locke, of Dallas, Tex., for plaintiff in error.
Cruce, Cruce & Bleakmore, of Ardmore, for defendant in error.
This is a suit on a life insurance policy. The material facts are: On June 12, 1891, the plaintiff in error, hereafter called the company, issued its policy of insurance of the life of Edward T. Noble in the sum of $1,000 on "the 20 payment life mortuary dividend plan," naming Eva Noble, wife of the insured, the defendant in error herein, as beneficiary; she will hereafter be called plaintiff. The annual premiums on this policy were $41 by its terms payable on May 21st each year for the full term of 20 years, unless said policy should in the meantime become a death claim, in which event it was provided in it: "If this policy shall become a claim by death, within the tontine period, above specified, a mortuary dividend will be paid therewith, equal to the total amount of premiums paid." That on June 18, 1894, a supplemental agreement was entered into between the insured, the plaintiff, and the company, by which the date of the payment of annual premiums was changed to November 21st of each year. That on November 21, 1899, another agreement was entered into between the parties, under which the "benefits of its (the company's) accumulation policy plan" were extended to this policy, with the understanding that, "except as modified by such benefits, said policy should remain unchanged." A certificate to this effect was issued by the company which provided that the company would make advances as loans on said policy at the fifth or any subsequent anniversary of the insurance, upon the assignment to it of the policy as collateral security, etc. That on February 8, 1900, the company loaned to the insured and the plaintiff $120 on the policy which was pledged to and deposited with the company to secure the loan. That the insured paid on said policy 16 full annual premiums of $41 each, but defaulted and failed to pay the annual premium due November 21, 1907. That after such default in the payment of premium and on February 22, 1908, when the insured was sick, an application was made to the company for a reinstatement of the policy, accompanied with remittance of $41.50 to cover the annual premium past due, and interest thereon from date of default. This sum was retained by the company, temporarily, pending action on the reinstatement of the policy. On March 7, 1908, a demand for full medical examination of the insured was made by the company; this demand reached the insured when sick unto his death, which occurred on March 14, 1908. Several months after the death of the insured, checks for the amount of this annual premium and interest were sent to plaintiff, but were never accepted or used by her.
That, within a short time after the death of the insured, the company tendered to plaintiff the sum of $471, the amount of paid-up insurance purchased with the reserve accumulations of the policy, calculated at the date of default, and applied in payment of premiums. This was refused. The same sum was tendered in the company's answer later and is admitted to be due plaintiff. Suit was brought on March 4, 1909, in the district court of Carter county, and judgment was demanded for the full face value of the policy, $1,000, and for the full sum of the annual payments of premiums made on the policy amounting to $738, less the loan of $120 made on the policy.
The company answered setting up the issuance of the policy, the supplemental agreements, the loan to insured, setting out certain portions of these writing, and alleged the default in the payment of the annual premium due November 21, 1907, and the lapse of the policy at that date because of such nonpayment of premiums. The company further alleged that by the terms of the policy the contract should be construed according to the law of the state of New York, specially pleading the parts of such law applicable. The company alleged that the reserve on said policy computed according to the New York law, at the date of the default of insured, was $435.75, and that, after deducting the loan of $120, it left a net reserve of $315.77. The company further alleged that after the default the insured never surrendered the policy or made any demand for a settlement of his rights under the policy according to either plan allowed under the said law within the six months allowed, but that the company had waived such demand, and upon the lapse of the policy had given the insured the benefit of paid-up insurance for the amount the net reserve on the policy of $315.77 would purchase at the date of default of insured, and that such reserve, taken as a single premium, would purchase paid-up insurance in the sum of $471, which it tendered.
The plaintiff filed a reply in which it was alleged that the policy at the time of the alleged lapse was in the possession of the company; that, if the court should hold there was a lapse, then that the insured, or, after his death, plaintiff as beneficiary, had the right under the New York law, within six months from such lapse, to elect to use the net reserve accumulations of the policy in purchasing extended insurance in the full amount of the policy for such time, as such reserve would pay for as a single premium, and...
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