Reed v. Bankers' Reserve Life Ins. Co.

• Decision Date: 06 November 1911
• Docket Number: 1,582.
• Citation: 192 F. 408
• Court: United States Circuit Court, District of Washington
• Parties: REED v. BANKERS' RESERVE LIFE INS. CO.

192 F. 408

REED v. BANKERS' RESERVE LIFE INS. CO.

No. 1,582.

United States Circuit Court, D. Washington, Eastern Division.

November 6, 1911

John M Gleason, for plaintiff.

Cain &amp Macdonald, for defendant.

RUDKIN District Judge.

This is an action on a life insurance policy. The policy provides that:

'In consideration of the application for this policy, which is hereby made a part of this contract, and for an advance premium of one hundred dollars and no cents, to be actually paid in cash on or before the delivery hereof for one year's insurance from date of this contract, and upon condition of the further payment in advance of a like amount on or before the 5th day of the month of August in each succeeding year during the condition of this policy or until twenty years' premiums have been paid, hereby insure the life of Mary B. Kirkendall, of Spokane, county of Spokane, state of Washington, in the sum of twenty-five hundred dollars, and, upon receipt of due proof of death of said insured while this policy is in full force, promise to pay in gold coin of the United States of the present standard of weight and fineness at its home office in the city of Omaha, to Ethel Reed, her niece, if living, or, if not living, then to the executors, administrators, or assigns of said insured, the said sum insured, after deducting therefrom the balance of current year's premium, and any indebtedness of the insured to the company.'

Numerous provisions and conditions attached to the policy are made a part of the contract of insurance, the following of which are deemed material:

'The insured may, at any time during the continuance of the policy, provided such policy has not been assigned, change the beneficiary upon written request to the home office of the company, together with a surrender of the policy.'

'Premiums hereon after the first are due and payable in advance, either at the home office or to an agent of the company, upon delivery of a receipt signed by the president, secretary, or treasurer.'

'Except as herein otherwise provided, the payment of a premium or installment thereof shall not maintain the policy in force beyond the date when the next premium or installment thereof is payable.'

'A grace of one month, subject to an interest charge at the rate of six per centum per annum, shall be granted for payment of every premium after the first, during which month the insurance shall continue in force.'

'This policy is based upon premiums payable annually, in advance, but, upon written notice to the company, the insured shall have the option at the time any premium falls due of paying an annual, semiannual, or quarterly premium, according to the company's schedule for this kind of policy, and the same will continue this policy in force for the time paid for, the receipt for which must be signed as aforesaid.'

'This policy may be reinstated within three years from default in the payment of any premium hereon, upon proof of good health satisfactory to the company and the payment of all defaulted premiums, with interest thereon at the rate of six per cent. per annum. This privilege shall not apply if the policy has been surrendered to the company for its cash surrender value and been canceled.'

'January 1, 1909, and annually thereafter for nineteen years, provided this policy is then and has been in force not less than one year, the insured shall be accredited with a dividend from the company's expense fund upon the following basis: A dividend fund shall be accredited annually for 20 years beginning January 1, 1909, and shall consist of and be computed at the rate of $1.00 per $1,000 on all insurance then in force written in the state of Washington by this company within 10 years after January 1, 1908. The amount of such dividend shall be the insured's pro rata share of said fund in the same proportion that the amount of this policy bears to the total amount of Washington increasing dividend policies then in force in which such dividends have matured.' On the 10th day of August, 1909, the plaintiff in this action was substituted as beneficiary in the mode prescribed in the policy. The premium due and payable on the 5th day of August, 1910, was not paid at maturity, nor within the one month's grace allowed by the contract. On the 8th day of October, 1910, the insured, Mary B. Kirkendall, executed and delivered to the company her three certain promissory notes, for the sum of $25, $35, and $21.40, payable on or before the 8th day of January, 1911, on the 8th day of March, 1911, and on the 1st day of May, 1911, respectively, for the premium due on the 5th day of August, 1910. Each of these notes contained the following provision:

'If this note is not paid at maturity, policy No. 12131 issued by the Bankers' Reserve Life Company, of Omaha, Nebraska, for which it is given, shall be ipso facto null and void, without notice to the maker hereof, and without any act on the part of the company, and shall remain so until

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