Rice v. New England Mut. Aid Soc.

• Decision Date: 02 March 1888
• Citation: 146 Mass. 248,15 N.E. 624
• Parties: RICE v. NEW ENGLAND MUT. AID SOC.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

146 Mass. 248

15 N.E. 624

RICE v. NEW ENGLAND MUT. AID SOC.

Supreme Judicial Court of Massachusetts, Suffolk.

March 2, 1888

COUNSEL

S.J. Thomas and C.P. Sampson, for plaintiff.

The payment of this assessment having been seasonably made, the defendant had no right to attach a condition to its receipts. Lothrop v. Insurance Co., 2 Allen, 82. The well-settled rule of law is that conditions in an insurance policy will not be extended beyond their clear import, and that equivocal expressions therein must be construed most strongly against the company. Insurance Co. v Robinson, 64 Ill. 265; Rolker v. Insurance Co., 4 Abb.Dec. 76; Rann v. Insurance Co., 59 N.Y 387. A construction is preferred which prevents avoidance of a policy. Holly v. Insurance Co., 105 N.Y. 437, 11 N.E. 507. It has been decided, in cases where mailed notices of an assessment were not received by the insured, that he did not forfeit his policy by not paying the assessment within the time named on the notice; and the ground of the decision is that the insured is entitled to information of the assessment. Castner v. Insurance Co., 50 Mich 273; Insurance Co. v. Pierce, 75 Ill. 426. See, also, Mullen v. Insurance Co., 121 Mass. 171. If there was failure to comply with the terms of the policy, it was waived by the acts of the defendant. The provision for a forfeiture was solely for the benefit of the defendant, and might be waived, and was waived by frequently receiving payment after the dates named in the notices. Och v. Insurance Co., 21 Pittsb.Leg.J. 98. If the company so deals with the insured as to induce belief that a forfeiture clause will not be insisted upon, it will not be permitted to take advantage of a default thus encouraged. Helme v. Insurance Co., 61 Pa.St. 107; Insurance Co. v. Pierce, 75 Ill. 426. The terms of a policy may be waived by the custom of its office in dealing with its insured. Carroll v. Insurance Co., 10 Abb.Pr. (N.S.) 172; Kolgers v. Insurance Co., Id. 176; Bouton v. Insurance Co., 25 Conn. 542; Bodine v. Insurance Co., 51 N.Y. 117. See Hanley v. Association, 4 Mo.App. 258; Dilleber v. Insurance Co., 76 N.Y. 567. The defendants had full knowledge of the only essential fact, (viz., that 30 days since the date printed on the notice had elapsed,) when they received payment of the assessments on August 19th. If the payment was late they had a right to require evidence of the health of the insured, but could not enforce that right without notice to him that they would otherwise no longer continue to receive payments. Buckbee v. Trust Co., 18 Barb. 541. By receiving without inquiry the payment claimed to be overdue, the defendant waived its right to claim a forfeiture. Hodsdon v. Insurance Co., 97 Mass. 144; Froehlich v. Insurance Co., 47 Mo. 406; Wing v. Harvey, v. Lester, 62 Ga. 247; Och v. Insurance Co., 21 Pittsb.Leg.J. 98; Insurance Co. v. Gibson, 52 Ga. 640. Whatever rights may have been reserved by the conditional receipt of the assessment on August 19th were waived on the unconditional acceptance of six subsequent assessments upon the policy. Young v. Insurance Co., 2 Ins.Law J. 289, and cases cited above. The principle is the same as that in cases where answers to certain printed questions in an application are omitted, and a policy issued nevertheless. It is held that, by thus issuing the policy, the insurer waives the information called for by the unanswered questions. Hall v. Insurance Co., 6 Gray, 191; Association v. Insurance Co., 7 Gray, 261.

Ely, Gates & Keyes, for defendants.

Upon the facts, the receipt by the defendant of said subsequent assessments was not a waiver of the breach of the certificate relied on by the defendant. Hoxie v. Insurance Co., 32 Conn. 21; Insurance Co. v. Wolff, 95 U.S. 326; Insurance Co. v. Pruett, 74 Ala. 487; Servoss v. Society, 67 Iowa, 86, 24 N.W. 604. The doctrine of waiver, as asserted against insurance companies to avoid the strict enforcement of conditions contained in their policies, is only another name for the doctrine of estoppel. Insurance Co. v. Wolff, 95 U.S. 326. In order to create an estoppel in pais, the declaration or acts relied upon must have been accompanied with a design to mislead. Institution v. Littlefield, 6 Cush. 210; Plumer v. Lord, 9 Allen, 455; Andrews v. Lyons, 11 Allen, 349; Turner v. Coffin, 12 Allen, 401; Page v. Wight, 14 Allen, 182; Zuchtmann v. Roberts, 109 Mass. 53. It is said that the doctrine of estoppel has been introduced into our system of jurisprudence for the purpose of protecting the party from a loss arising from fraud or gross negligence of another in concealing his rights. Institution v. Littlefield, 6 Cush. 210. If the law recognizes a doctrine of waiver by conduct distinguished from that of estoppel in pais, the essential elements of such waiver are knowledge of the right claimed to be waived, and intention to waive it; and these must be concurrent. West v. Platt, 127 Mass. 367; Oakes v. Insurance Co., 135 Mass. 248; Holdsworth v. Tucker, 143 Mass. 369, 9 N.E. 764. The six subsequent payments and receipts relate back to the condition of the receipts of August 19, 1885, and are as much controlled and affected by it as though the words of that condition were stamped on each of said subsequent receipts. The evidence shows the utmost good faith and fair dealing on the part of the defendant. Each notice of assessment conspicuously shows at its top when it expired. The condition of good health, on receipt of a payment in arrear, was invariably insisted on. The insured clearly knew his rights and risks. The state of health of the insured was peculiarly within his own knowledge. The acceptance and retention of the receipt of August 19, 1885, was an affirmation and representation that the insured was then in good health. The insured intended that the defendant should act on that representation, and it did act upon it. The plaintiff is therefore estopped from taking advantage of such acts of the defendant to its prejudice. Dewey v. Field, 4 Metc. 381; Osgood v. Nichols, 5 Gray, 420; Cartwright v. Bate, 1 Allen, 514; Audenrie v. Betteley, 5 Allen, 382.

OPINION

C. ALLEN, J.

If it be assumed that the payment made on the 19th of August was too late, the question remains whether the company, by its subsequent acts, waived a right to avoid the policy or certificate of insurance on that ground. Without expressing any opinion as to the effect of the retention of that money, we think the levy of the subsequent assessments, and the acceptance of the money paid upon them amounted to such a waiver. When the time came for the levy of a new assessment, if Mr. Rice's...