Prescott v. Mutual Ben. Health & Acc. Ass'n

• Citation: 183 So. 311,133 Fla. 510
• Court: United States State Supreme Court of Florida
• Decision Date: 19 July 1938
• Parties: PRESCOTT v. MUTUAL BEN. HEALTH & ACCIDENT ASS'N.

183 So. 311

133 Fla. 510

PRESCOTT v. MUTUAL BEN. HEALTH & ACCIDENT ASS'N.

Florida Supreme Court

July 19, 1938

Rehearing Denied Sept. 30, 1938.

Suit for declaratory judgment by Isaac Sylvan Prescott against Mutual Benefit Health & Accident Association for determination of rights under health and accident policy. Decree for defendant, and plaintiff appeals.

Affirmed.

ELLIS C.J., dissenting. Appeal from Circuit Court, Orange County; Frank A. Smith, judge.

COUNSEL

Maguire & Voorhis, of Orlando, for appellant.

Giles &amp Gurney, of Orlando, for appellee.

OPINION

BUFORD Justice.

The appeal is from final decree as follows:

'It is hereby considered, ordered and decreed that said policy of insurance is unambiguous; that additional provisions 'C' and 'D' contained in said policy give the defendant Insurance Company the right to accept or reject any payment of renewal premiums offered, and that in the absence of an acceptance of any renewal premium offered, said policy terminates and ceases to continue in effect past the end of the previous term for which premium was accepted by the Defendant Company; that the refusal of the Defendant Company to accept the renewal premium tendered in advance by plaintiff for the purpose of renewing said policy from April first, 1937, was authorized, and that in so refusing the Defendant Company acted within its rights under said policy, and said policy terminated and ceased to continue in effect past the end of the previous term for which premium was accepted by the Defendant Company; plaintiff allowed till April rule day to amend his Bill of Complaint, and upon failure to amend it is hereby considered, ordered and decreed that this Decree be and the same is hereby made final.'

The record shows that on November 22, 1932, Prescott, and plaintiff, made application to Mutual Benefit Health and Accident Association, the defendant, for an insurance policy, which defendant's agent represented and stated was a noncancellable policy and would continue in force so long as Prescott promptly paid the quarterly premiums of $12.00 each.

The initial premium of $17 was paid, and the policy then delivered to Prescott purported to insure him 'against loss of life, limb, sight or time, resulting directly and independently of all other means from bodily injuries sustained through purely accidental means' and 'against loss of time on account of disease contracted during the term of this Policy.'

Such policy bore on the face thereof in heavy black type and large block capital letters, the following: 'TEN YEAR INCREASING POLICY' and the words: 'This policy provides benefits for loss of life, limb, sight or time, by accidental means, or loss of time by sickness as herein provided.'

The policy further provides that after the first year's premium has been paid, each year's renewal premium paid in advance on said policy shall add $250 to the death benefit until the same amounts to $5,000.

The policy further provided that when 20 full annual premiums shall have been paid, the death benefit of $5,000 may be continued in force thereafter at a yearly cost of $5 without a medical examination.

The policy did not contain any provision for the cancellation of the policy, 'Standard Provision No. 16' relating thereto having been entirely omitted.

Among the 'Additional Provisions' contained in the policy are the following:

'(c) The term of this policy begins at 12 o'clock noon Standard time, on date of delivery to and acceptance by the Insured against accident and on the thirty-first day thereafter against disease and ends at 12 o'clock noon on date any renewal is due. No reduction in the benefits of this policy shall be made during the lifetime of the Insured on account of age except in Parts D and K which shall be reduced ten per when the Insured is or becomes fifty-six years of age, with further reduction of an equal amount effective with each additional attained year of age to and including age sixty.

'(d) The copy of the application attached hereto is hereby made a part of this contract and this policy is issued in consideration of the statements made by the Insured in the application and the payment in advance of Seventeen ($17.00) Dollars as first payment; and the payment in advance, and acceptance by the Association of Premiums of Twelve ($12.00) Dollars Quarterly thereafter, beginning with April 1st, 1933, is required to keep this policy in continuous effect. The mailing of notice to the Insured at least fifteen days prior to the date they are due shall constitute legal notice of dues, and should the premium provided for herein be insufficient to meet the requirements of the Association it may call for the difference not to exceed one additional quarterly premium.'

Prescott promptly paid all premiums due on said policy, the 'official receipt' in each instance of premium payment acknowledging receipt of the premium and further reciting: 'Payment of this premium receipted for, if made on or before the date to which premiums have already been paid, keeps your policy in continuous effect, and if made after that date, reinstates the policy on date of this receipt as provided in policy, until 12 o'clock noon, Standard Time, ----- at which time another premium will be due.'

When the defendant Company received on December 30, 1936, the regular quarterly premium due January 1st, 1937, it demanded of Prescott that, as a condition to the continuance of the policy, he sign a form of agreement limiting future liability, as follows: 'That no payment will be made under my Policy No. 100-S-1933 on account of disability or loss resulting directly or indirectly from Rheumatism, Arthritis, Neuritis, Sciatica and/or Lumbago.' The insurance policy contained no provision authorizing or permitting the defendant to demand or require any such endorsement.

Upon being requested to advise 'the specific provision of the policy which (the defendant) contend authorizes (it) to require the execution of any such endorsement,' the Company replied: 'Upon Mr. Prescott's refusal to sign this endorsement, we referred his case to our Membership Committee for their consideration. They have finally agreed to withdraw their request for that endorsement.'

When remittance was made for the amount of premium which would become due on April 1, 1937, the Company (on March 31st) renewed its demand that the 'arthritis' endorsement be executed by Prescott, as a condition to allowing 'credit for your premium payment.'

The Company 'attempts to construe said insurance policy as reserving to the defendant the option of continuing or terminating said insurance contract at the expiration of any quarter, and the defendant contends that said insurance policy is not now in force despite the payment of the premium of $12.00 due April 1, 1937.'

Prescott tendered to the Company in advance the money for payment of the premium due April 1, 1937, and has tendered in advance the money for payment of the premium due July 1, 1937, and is ready, able and willing to pay all sums that may be lawfully required to be paid for premiums in accordance with the terms and provisions of said insurance policy.

Bill of Complaint for declaratory judgment, etc., was filed June 30 1937. Motion to dismiss was denied; and Answer was filed November 12, 1937. Upon hearing on motion for decree on bill and answer, decree was entered, that: 'said policy of insurance is unambiguous; that additional provisions 'C' and 'D' contained in said policy give the defendant Insurance Company the right to accept or reject any payment of renewal premiums offered, and that in the absence of an acceptance of any renewal premium offered, said policy terminates and ceases to continue in effect past the end of the previous term for which premium was accepted by the defendant company; that the refusal of the defendant Company to accept the renewal premium tendered in advance by plaintiff for the purpose of renewing said policy from April first, 1937, was authorized, and that in so refusing the defendant company acted within its rights under said policy, and said policy terminated and ceased to continue in effect past the end of the previous term for which premium was accepted by the defendant company.' So it is seen that the question presented is whether...