Rassieur v. Mutual Ben. Life Ins. Co.

• Decision Date: 10 March 1947
• Docket Number: 40022
• Citation: 201 S.W.2d 173,356 Mo. 48
• Parties: George M. Rassieur, Executor of Last Will of John J. Gilmore, Deceased, Appellant, v. The Mutual Benefit Life Insurance Company, a Corporation
• Court: Missouri Supreme Court

201 S.W.2d 173

356 Mo. 48

George M. Rassieur, Executor of Last Will of John J. Gilmore, Deceased, Appellant, v. The Mutual Benefit Life Insurance Company, a Corporation

No. 40022

Supreme Court of Missouri

March 10, 1947

Rehearing Denied April 21, 1947.

Appeal from Circuit Court of City of St. Louis; Hon. William K Koerner, Judge.

Affirmed.

Harry A. Frank for appellant.

(1) A completed oral contract for immediate life insurance containing all the essential elements, and arising from the practices of the insurer in offering to insure within a limited period of time, a policyholder for additional insurance without further medical examination and upon the payment of the required premium, is valid and enforceable. Such an oral contract is not conditioned upon the approval or acceptance, at a later date, by the insurer, but continues from the agreed date and prepayment of premium, in full force and effect until superseded by a written policy or is terminated only by the rejection of the agreement and notice thereof to the insured during his lifetime. Rhodus v. Kansas City Life Ins. Co., 156 Mo.App. 281, 137 S.W. 907; Colorado Life Ins. Co. v. Teague, 117 S.W.2d 849; De Cesare v. Metropolitan Life Ins. Co., 278 Mass. 401, 180 N.E. 154; Starr v. Mutual Life Ins. Co. of N.Y., 41 Wash. 228, 83 P. 116; Murphy v. Great American Ins. Co., 221 Mo.App. 727, 285 S.W. 772; Shelby v. Connecticut Fire Ins. Co., 218 Mo.App. 84, 262 S.W. 686; Life & Casualty Ins. Co. v. Daniel, 286 Ky. 579, 151 S.W.2d 63. (2) An insurance company is bound by the acts of its agent, acting within the scope of either real or his apparent authority, notwithstanding that the agent may be in violation of certain limitations and restrictions upon his power, of which the third person dealing with him in good faith, has neither actual nor constructive notice and knowledge. Shelby v. Connecticut Fire Ins. Co., 218 Mo.App. 84, 262 S.W. 686; Patterson v. Prudential Ins. Co., 23 S.W.2d 198; Shook v. Retail Hardware M.F. Ins. Co., 154 Mo.App. 394, 134 S.W. 589; Rhodus v. Kansas City Life Ins. Co., 156 Mo.App. 281, 137 S.W. 907; Beswick v. Natl. Casualty Co., 206 Mo.App. 67, 226 S.W. 1031; Stockton v. Sedalia Life Ins. Co., 31 S.W.2d 108. (3) The existence of an oral contract of insurance may be established by circumstantial evidence as well as direct evidence. A motion for a directed verdict for defendant can only be sustained where the inferences and facts are all so strongly against the plaintiff as to leave no room for reasonable minds to differ, but even where the facts are not disputed, but nevertheless are such that opposing inferences may be honestly deduced therefrom, the determination thereof is within the special province of the jury and the court should not as a matter of law determine the case. Friedman v. John Hancock Mut. Life Ins. Co., 168 S.W.2d 956; Marden v. Radford, 84 S.W.2d 947; John Powers v. St. Louis Transit Co., 202 Mo. 267; Wooldridge v. Scott County Milling Co., 102 S.W.2d 958.

Jones, Hocker, Gladney & Grand, Orville Richardson and J. Chester Jones for respondent.

(1) There was no substantial evidence of any oral agreement by the defendant to insure the life of John J. Gilmore in the sum of $ 50,000. (2) It is not within the apparent scope of the authority of a soliciting agent of a life insurance company to make oral contracts of insurance on the company's behalf. Mitchell v. Metropolitan Life Ins. Co., 116 S.W.2d 186; Patterson v. Prudential Ins. Co., 23 S.W.2d 198; King v. Mutual Life Ins. Co. of Baltimore, 105 S.W.2d 994; Zielinski v. General American Life Ins. Co., 96 S.W.2d 1059; Hill v. Metropolitan Life Ins. Co., 185 S.W.2d 76; Banks v. Cloverleaf Casualty Co., 207 Mo.App. 357; Rhodus v. Kansas City Life Ins. Co., 156 Mo.App. 281, 137 S.W. 907; Carpenter v. St. Joseph Life Ins. Co., 212 Mo.App. 336, 246 S.W. 623; Boswick v. Natl. Casualty Co., 206 Mo.App. 67, 266 S.W. 1031; Hawes v. American Central Ins. Co., 222 Mo.App. 1057, 7 S.W.2d 479; Byrne v. Farmers Mut. Fire Ins. Co., 138 S.W.2d 705. (3) Mr. Gilmore knew, not only from the provisions of the February 8, 1944 application, but also from the provisions of the December 1, 1943, application that Mr. Lonergan, the defendant's soliciting agent, was not authorized to make oral contracts of insurance on defendant's behalf. Distassio v. American United Life Ins. Co., 179 S.W.2d 610; Salisbury v. Indiana & Ohio Live Stock Ins. Co., 202 S.W. 412; Neuner v. Gove, 133 S.W.2d 689; Thetford v. Hanford Fire Ins. Co., 183 S.W.2d 314. (4) The rules and practices invoked by plaintiff are not sustained by the evidence and, furthermore, contracts cannot be created by rules or practices. Atchison, T. & S.F. Ry. Co., 176 Mo. 687, 75 S.W. 776; State ex rel. Chicago, M. & St. P. Ry. Co. v. Public Service Comm., 269 Mo. 63, 189 S.W. 377; Leonard v. Dougherty, 221 Mo. App., 1056; Harbaugh v. Ford Roofing Co., 261 S.W. 686; Wolff v. Campbell, 110 Mo. 114; Jordan v. Daniels, 27 S.W.2d 1052. (5) Instead of proving an oral contract to insure the life of John J. Gilmore in the sum of $ 50,000, plaintiff proved a written offer or proposal by the G.L. Tarlton, Contractor, Inc., and John J. Gilmore to the defendant to insure Mr. Gilmore's life in the sum of $ 50,000, but failed to prove any acceptance of that offer or proposal by the defendant. An acceptance by defendant of the application of February 8, 1944 was required before there was any contract of insurance. Asel v. Order United Commercial Travelers, 197 S.W.2d 639; Brouster v. John Hancock Mut. Life Ins. Co., 171 S.W.2d 775. (6) Gilmore's death prior to the receipt by defendant of the application of February 8, 1944 operated as a withdrawal of that application. Zielinski v. General American Life Ins. Co., 96 S.W.2d 1059; Mitchell v. American Ins. Union, 226 Mo.App. 696, 46 S.W.2d 231; Starr v. Mutual Life Ins. Co., 83 P.2d 116; Paine v. Pacific Mut. Life Ins. Co., 51 P.2d 689; Broman v. Mutual Life Ins. Co., 73 F.2d 391. (7) The premium receipt, which was attached to the application of February 8, 1944, and which provided that there should be no insurance unless or until that application was accepted by the company at its Home Office, was a part of that application by reference thereto in the body of the application. Swinney v. Connecticut Fire Ins. Co., 9 S.W.2d 1090; City of St. Louis v. Laclede Gas Light Co., 70 Mo. 69; State ex rel. Life Ins. Co. v. McElhinney, 232 Mo.App. 107, 90 S.W.2d 124; Berger Mfg. Co. v. Crites, 178 Mo.App. 218, 165 S.W. 1163; 12 Am. Jur., p. 780. (8) Temporary insurance was not provided for by this receipt. State ex rel. Equitable Life Assur. Society v. Robertson, 191 S.W. 989; Bearup v. Equitable Life Assur. Society, 172 S.W.2d 942; Fields v. Equitable Life Assur. Society, 118 S.W.2d 521; Pickett v. Equitable Life Assur. Society, 27 S.W.2d 452; Insurance Co. v. Young's Admr., 23 Wall. 85; Broncato v. Natl. Reserve Life Ins. Co., 35 F.2d 612; Braman v. Mutual Life Ins. Co., 73 F.2d 391; Mohrstadt v. Mutual Life Ins. Co., 115 F. 81. (9) Plaintiff cannot transform what plaintiff's assignor agreed was an application to the defendant for a policy of insurance into an acceptance by plaintiff's assignor of an oral offer of defendant to insure. Banks v. Cloverleaf Casualty Co., 209 Mo.App. 357, 233 S.W. 78; Himes v. Metropolitan Life Ins. Co., 36 S.E.2d 137; Field v. Missouri State Life Ins. Co., 290 P. 976; Chamberlain v. Prudential Ins. Co., 85 N.W. 128. (10) An oral contract of life insurance cannot rest on mere surmise, guess or conjecture, but must be established by evidence which is clear and convincing. American Can Co. v. Agricultural Ins. Co., 12 Cal.App. 133, 106 P. 720.

Barrett, C. Westhues and Barrett, CC., concur.

OPINION

BARRETT

"This is a suit on a completed oral contract for immediate life insurance," in the sum of $ 50,000 against the Mutual Benefit Life Insurance Company of New Jersey. The suit is by George M. Rassieur as the executor of John J. Gilmore's estate and as the assignee of the beneficiary, G.L. Tarlton, Contractor, Inc. Mr. Gilmore is alleged to have procured the policy of business life insurance in the sum of $ 50,000 for the benefit of the corporation, G.L. Tarlton, Contractor, Inc., of which he was president and principal owner. Upon this appeal by the plaintiff the question is whether the trial court was in error in directing a verdict for the insurance company at the close of the plaintiff's evidence.

The plaintiff contends that the policy of insurance resulted and was effectuated under these rather unusual and exceptional circumstances: The plaintiff says that the usual procedure of procuring a signed application which was to be forwarded to the home office as a proposal requiring acceptance and the issuance of a policy by the company was not followed. In this case a "binding receipt" was not delivered to the insured or to the beneficiary, consequently any cases turning on the effect of such "binding receipts" are not in point here. 29 Am. Jur., Secs. 143, 144. In December 1943 Mr Gilmore applied for and the company issued a $ 30,000 personal life insurance policy upon his life. In the procurement and issuance of that policy the usual procedure was followed: there was an application, a medical examination, approval by the company and the issuance and delivery of a policy. The plaintiff's theory is that the oral policy involved here resulted from a company practice, custom and certain rules used in the procurement of additional insurance business. The executorassignee claims that after the company issues a personal policy pursuant to the usual procedure and thereby determines, after a previous medical examination, that the insured is a standard insurable risk that it is the further practice,...