Northwestern Mut. Life Ins. Co. v. Dean

• Decision Date: 31 March 1931
• Docket Number: 20990.
• Citation: 157 S.E. 878,43 Ga.App. 67
• Parties: NORTHWESTERN MUT. LIFE INS. CO. v. DEAN.
• Court: Georgia Court of Appeals

157 S.E. 878

43 Ga.App. 67

NORTHWESTERN MUT. LIFE INS. CO. v. DEAN.

No. 20990.

Court of Appeals of Georgia, First Division

March 31, 1931

Syllabus by the Court.

Proof of total and permanent disability held condition precedent to waiver of premiums during continuance of disability; insured's failure to prove disability waiving premiums, because of insanity and failure by others to make proof because not knowing of policy, did not keep policy in force until insured's death over year after disability (Civ. Code 1910, § § 2475, 4266).

Under the stipulation in the contract of insurance sued on, to the effect that, if "the insured shall *** furnish proof satisfactory to the company that he has become totally and permanently disabled from any cause, *** the company, on receipt of such proof, will by suitable endorsement of this agreement waive payment of the premiums thereafter falling due under said policy and this agreement during the continuance of such disability," such proof was a condition precedent to such waiver, and the fact that because of his insanity the insured could not make proof, and that no one else could make such proof for him, for the reason that no one knew that he had such policy of insurance, did not have the effect of keeping the policy of insurance in force until his death more than a year from the time of such total disability. Therefore the petition did not set out a good cause of action.

Error from Superior Court, Fulton County; A. H. Howard, Judge.

Suit by A. S. Dean against the Northwestern Mutual Life Insurance Company. Judgment for plaintiff, and defendant brings error.

Reversed.

Colquitt Parker, Troutman & Arkwright, and Robt. S. Sams, all of Atlanta, for plaintiff in error.

Thomas M. Stubbs and McDaniel, Neely & Marshall, all of Atlanta, for defendant in error.

LUKE J.

Agnes S. Dean, as beneficiary in a policy of insurance upon the life of her son, Sidney S. Dean, filed suit in the municipal court of Atlanta against the Northwestern Mutual Life Insurance Company, to recover the amount of the policy originally $2,500, but reduced by two loans secured by and charged against it, to the amount of $2,024.30.

It appears from the petition that the policy was dated January 24, 1918; that all premiums were paid up to January 29, 1926; that some time prior to the latter date, and while the policy was in force, the insured became completely incapacitated by reason of a brain disease, to such an extent that he was wholly and permanently unable to perform any work for money compensation; that his mental condition grew progressively worse until he died completely insane on April 16, 1927, from blood poisoning or septicemia; that during the entire period from the fall of 1924 until the time of his death he was incompetent, and that it was impossible for him to give notice of disability, required by the terms of a supplementary agreement, attached to and made a part of the policy, providing for a waiver by the insurer of payment of premiums by the insured in the event of such total and permanent disability. It is alleged that, because of his mental condition, rendering it impossible for the insured to give the required notice, he was legally excused and relieved from that requirement of the contract; that the conditions of the supplementary agreement, other than those relating to the giving of notice of disability, were fulfilled by the insured; that neither the beneficiary named in the policy, nor other members of her family, had notice or knowledge of the existence of the policy of life insurance until after the death of the insured, and that, therefore, they were unable to give the notice required. It is averred that notice of death was given to the company; that proof of death was waived; and that, the company having refused payment, by reason of the premises, the petitioner was entitled to recover.

The agreement for waiver of premiums, or supplementary agreement hereinbefore referred to, omitting portions immaterial to the consideration and decision of the questions raised, is as follows: "In consideration of the payment of an extra premium of seventy-eight cents (first payment hereby acknowledged) with each annual premium required under said policy, it is agreed that if, after payment of premium for one full year and during the continuance of this agreement the insured shall, prior to his 60th birthday anniversary, furnish proof satisfactory to the company that he has become totally and permanently disabled from any cause, and is physically and mentally incapacitated to such an extent that he is and presumably will be wholly and permanently unable to engage in any gainful occupation or perform any work for money compensation, the Company, on receipt of such proof, will by suitable endorsement of this Agreement waive the payment of the premiums thereafter falling due under said policy and this agreement during the continuance of such disability, except as hereinafter stipulated and agreed:" 1. Omitted as immaterial. "2. Notwithstanding the acceptance of proof of disability, the Insured, or his legal representatives, shall annually on the anniversary of the date of said policy, or within 31 days thereafter, file with the company a declaration of continued disability of the insured, and shall upon request, but not oftener than once a year, furnish proof thereof satisfactory to the company. If the insured, or his legal representatives, at any time after such waiver shall, upon such request mailed by the company to his or their last known address, fail to furnish such proof of continued disability, or if it shall appear to the company that the insured has so far recovered as to be able to perform work of any kind for compensation, gain or profit, then and in either such event said waiver shall be deemed to have failed, and any premium or premiums then or thereafter falling due under said policy and this Agreement shall be payable in accordance with the terms thereof the same as if no waiver of premiums had been made." (Certain provisions omitted as immaterial.) Other provisions of the policy are: "6. The insurance under this policy is based upon annual premiums payable in advance, but payments may be made semiannually or quarterly, in advance, at the premium rates now in use by the company. Change may be made on any anniversary of the policy. No premium after the first will be considered paid (except it be duly charged as a premium loan) unless a receipt, signed by the president or secretary of the company and countersigned by an agent authorized to receive such premium, shall have been given therefor. Upon default in the payment of any premium this policy shall cease and determine except as hereinafter provided." "12C. Upon default in payment of premium, unless paid within the grace period, the amount of this policy and any existing dividend additions, less any indebtedness to the company on account hereof, shall be extended automatically as non-participating term insurance for such time from the date of default as the then cash surrender value will provide at the net single...