Peters v. Aetna Life Ins. Co. of Hartford, Conn

• Decision Date: 21 May 1937
• Docket Number: No. 37.,37.
• Citation: 279 Mich. 663,273 N.W. 307
• Parties: PETERS v. AETNA LIFE INS. CO. OF HARTFORD, CONN, et al.
• Court: Michigan Supreme Court

279 Mich. 663

273 N.W. 307

PETERS

v.AETNA LIFE INS. CO. OF HARTFORD, CONN, et al.

No. 37.

Supreme Court of Michigan.

May 21, 1937.

Action by Pearl Peters against the AEtna Life Insurance Company of Hartford, Conn., and another. From a judgment for the defendant notwithstanding a verdict in favor of the plaintiff, the plaintiff appeals.

Reversed and remanded, with directions.Appeal from Circuit Court, Wayne County; Glenn E. Warner, judge.

Argued before the Entire Bench.

Sol Blumrosen, of Detroit, for appellant.

Butzel, Eaman, Long, Gust & Bills, of Detroit (Charles F. Cummins, of Lansing, of counsel), for appellees.

FEAD, Chief Justice.

Plaintiff brought action on a group insurance policy for death of her son, Chester Peters. The policy provides: ‘The insurance of any employee shall automatically cease when the employee fails to make the required premium contribution, or upon termination of employment; except that if any employee is absent on account of sickness or injury, temporarily laid off, granted leave of absence, pensioned or retired, his insurance shall continue until it is terminated by the employer.’

It also contained the conversion privilege upon termination of employment and provision for individual certificates to the employees, as required by Comp.Laws 1929, § 12435.

It is undisputed that the last day Chester Peters worked for Chrysler Corporation was June 4, 1930, and that he died June 17, 1930. It is not claimed that his insurance was terminated by his employer.

The court submitted to the jury the sole issue whether on June 4th Peters' employment terminated or he was temporarily laid off. The jury returned a verdict in favor of plaintiff and against defendant insurance company. The court entered judgment for defendant non obstante.

The burden of proof that the policy had lapsed by reason of termination of Peters' employment was on defendant. Wilson v. Prudential Ins. Co., 276 Mich. 232, 267 N.W. 824;Sturmer v. Travelers Ins. Co., 279 Ill.App. 607;Travelers' Ins. Co. v. Fox, 155 Md. 210, 141 A. 547.

It is evident that ‘termination of employment’ within the terms of the policy means something more than that the employee ceased to work and the employer to pay him. Such a situation ordinarily would exist in case of sickness, injury, layoff, or leave of absence, during which, by its express terms, the policy nevertheless continued in force. The clause must mean a complete severance of the relationship of employer and employee by positive act on the part of either or both. In the absence of conclusive evidence, the character of the cessation of work must be found from the attendant circumstances. Powell v. Equitable Life Assur. Soc., 173 S.C. 50, 174 S.E. 649;Zeigler v. Equitable Life Assur. Soc., 219 Iowa, 872, 259 N.W. 769;Ozanich v. Metropolitan Life Ins. Co., 119 Pa.Super. 52, 180 A. 67, 576.

Both parties claim that incompetent testimony was received, but, as plaintiff asks reversal and entry of judgment upon the verdict and not reversal with new trial, and as defendant did not take a cross-appeal, the rulings on evidence are not for review. Moreover, most of the testimony now challenged was received without objection.

There was testimony of a custom of the employer sometimes to discharge and sometimes to temporarily lay off employees as long as three months. It was the business of Peters' foreman to discharge or lay him off. The foreman was not produced at the trial. A witness stated that he was at the plant the day of trial but later said he was not employed there any more. Defendant showed no effort to find the foreman. It was also the business of the foreman to make...