Pan-American Life Ins. Co. v. Peebles
| Decision Date | 16 January 1941 |
| Docket Number | 6 Div. 765. |
| Parties | PAN-AMERICAN LIFE INS. CO. v. PEEBLES. |
| Court | Alabama Supreme Court |
Petition for Certiorari to Court of Appeals.
Nathia Smith Peebles sued the Pan-American Life Insurance Company in assumpsit, and from a judgment for the plaintiff, defendant appealed to the Court of Appeals. The judgment being there reversed the plaintiff, Nathia Smith Peebles, applies for certiorari to review and revise the judgment and decision of said court in the case styled Pan-American Life Insurance Co. v. Peebles, 199 So. 880.
Writ denied.
Taylor & Higgins, of Birmingham, for petitioner.
Cabaniss & Johnston and L. D. Gardner, Jr., all of Birmingham, for respondent.
This is a suit by the beneficiary in an insurance annuity contract whose terms are set out in the opinion of the Court of Appeals. That court held that the beneficiary was not entitled to recover. We agree with the Court of Appeals, but the earnest argument of counsel for petitioner impels us to give expression to our views.
It is claimed that the beneficiary may recover, under the third agreement to pay, a certain amount by reason of an option right conferred on the annuitant in the nonforfeiture provision.
The third agreement confers on her at his death the right to a refund of all premiums which the annuitant had paid less annuity payments which he had received, in full of all obligations to her. But it was made subject to all the benefits, privileges and conditions stated in the contract and payable only if all premiums have been paid, and the contract is in force. Another provision of the contract stipulated that if any premium is not paid when due, this contract shall thereupon, without further notice, be void and all premiums forfeited to the company except as therein provided.
The annuitant made default in the payment of premiums before three full years' premiums had been paid, and died about three years after such default, and without reinstatement, without an offer to surrender the contract to the company under the non-forfeiture provision, supra. The first monthly payment was due to be made to the annuitant under the contract on August 1, 1950, provided also all premiums shall have been paid, and the contract be then in force.
The non-forfeiture provision stipulates that "after three full years' premiums have been paid," if default occurs the contract will become automatically paid up for a reduced annuity, payable at the same time and under the same conditions, and further, as follows: "or, if this contract is surrendered to the company during the lifetime of the annuitant and before the first annuity payment becomes due, the company will pay to the annuitant in one sum" an amount of the premium payments which had been made pursuant to a stated formula.
The beneficiary claims that this latter provision is not conditioned on the payment of three full years' premiums as is the first feature of the non-forfeiture provision. And that though he died without having made three full years' premiums, and without surrendering the policy so as to entitle him to a refund of the premiums pursuant to the stipulation, he had the privilege of doing so, and that under the third agreement to pay, such privilege vested in her, and existed though all premiums had not been paid at his death, and though the contract was not in force except to the extent of the non-forfeiture provision.
We doubt if the contract meant to confer on her the right to exercise an option conferred on him, and conditioned to be exercised in his lifetime, which was not done. It conferred a privilege which expired by its terms at his death. At most, the contract only conferred on her the same rights which he had in this connection. When that right expired it was probably lost to them both. It could very well be interpreted, however, to confer on her the right to recover the amount of premiums paid by him less the amount of reduced annuity payments paid to him, if any, under the terms of the non-forfeiture provision of the contract. But that is without question conditioned only upon the fact that three full years' premiums shall have been paid. So that is eliminated, and not insisted upon.
But it is contended that under that clause a refund of premiums is available to him, if called for by him in his lifetime, or if not called for by him then to her as a "privilege" conferred on her, after his death, and that such right is not in either event conditioned upon payment of three full years' premiums. So that waiving aside all other considerations, we reach that question.
"After three full years' premiums have been paid hereon" heads the non-forfeiture paragraph....
To continue reading
Request your trial
-
Zimmerman v. Mutual Life Insurance Co. of New York
...300 N.Y. 375, 91 N.E.2d 307; Toulouse v. New York Life Ins. Co., 40 Wash.2d 538, 245 P.2d 205; Pan-American Life Ins. Co. v. Peebles, 29 Ala.App. 534, 199 So. 880, Id., 240 Ala. 454, 199 So. 883; Lashley v. Lashley, 212 Ala. 255, 102 So. 229; Hall v. Burkham, 59 Ala. 349; Code of Alabama, 1......