Rice v. Provident Life & Accident Ins. Co.

• Decision Date: 01 March 1937
• Docket Number: No. 18802.,18802.
• Citation: 102 S.W.2d 147
• Parties: J.E. RICE, RESPONDENT, v. THE PROVIDENT LIFE AND ACCIDENT INSURANCE CO., A CORPORATION, APPELLANT.
• Court: Missouri Court of Appeals

102 S.W.2d 147

J.E. RICE, RESPONDENT, v. THE PROVIDENT LIFE AND ACCIDENT INSURANCE CO., A CORPORATION, APPELLANT.

No. 18802.

Kansas City Court of Appeals. Missouri.

March 1, 1937.

Appeal from the Circuit Court of Jackson County. — Hon. Allen C. Southern, Judge.

AFFIRMED.

W.V. Huston and C.R. Rittman for respondent.

Edgar J. Keating for appellant.

REYNOLDS, J.

This is a suit by the plaintiff, J.E. Rice, against the defendant, The Provident Life & Accident Insurance Company, a corporation, for benefits arising from disability from rheumatism, under a monthly health and accident insurance policy issued to him by the Southern Surety Company of Des Moines and later assumed by the defendant, to which benefits he claimed to be entitled.

The suit originated before Preston Forsee, a justice of the peace in Kaw township, Jackson county, Missouri; and, from a judgment rendered on a trial had before said justice, an appeal was had to the Circuit Court of Jackson County at Kansas City, where it was tried on March 26, 1936, at the March term, 1936, of the court before the Honorable Allen C. Southern, one of the judges of said court, without a jury, upon an agreed statement of fact, and resulted in a judgment on said date for the plaintiff in the principal sum of $153.33, together with the sum of $15.33 as a penalty for vexatious delay and the sum of $75 attorney's fees, in the total sum of $243.66, and for costs.

From such judgment so rendered, the defendant prosecutes this appeal.

Upon the trial in the circuit court, the policy sued on was introduced in evidence. It appears to be a monthly health and accident insurance policy issued to the plaintiff on June 1, 1928, by the Southern Surety Company. That same company thereafter was taken over by the defendant, and the policy in question was assumed by it, and the premiums thereon were collected by it. The policy provides that, in consideration of the agreements and representations contained in the application therefor and the payment of a premium of $3.65 on or before the delivery thereof, the company will pay to the insured (the plaintiff) benefits for disability resulting from sickness or accident as therein set forth, from June 1, 1928, to July 1, 1928, a period of one month. It contains a further provision under the heading "Renewal Agreement" that it "may be continued for one or more consecutive periods of one calendar month each by the payment to the Company and acceptance by the Company of a renewal premium of $3.65 Dollars for each period of one calendar month."

It is further provided in the policy that it could be cancelled by the company at any time by written notice to the insured and the repayment of unearned premiums.

As originally issued, the policy covers disability resulting from rheumatism.

The agreed statement of facts, signed by attorneys for the respective parties, is substantially as follows:

"It is agreed by and between the parties hereto and their respective attorneys that the facts herein are as follows:

"The plaintiff applied to the Southern Surety Company for an accident and health insurance policy and such a policy was issued by said company. Later the coverage was taken over by the defendant herein and premiums collected by defendant's agent from the plaintiff in the amount of $3.65 per month. The plaintiff, about June, 1932, suffered an attack of sciatic rheumatism and on or about July 20th, 1932, settled with the defendant, received payment and executed a release for said illness.

"The plaintiff will testify that, immediately after he had executed the release, the defendant's agent, Mr. J.M. Begley, said `I will have to put a rider on for rheumatism,' and presented a paper to Mr. Rice which he signed. Mr. Rice will also testify that he did not receive a copy of said rider.

"Mr. Begley will testify that he gave a copy of the rider to Mr. Rice and forwarded the original to the company and that he never attached a copy of said rider to the policy.

"On January 30th, 1935, plaintiff had another attack of sciatic rheumatism and was totally disabled from that date until March 20th, 1935, and that he was partially disabled from March 20th, 1935 to April 4th, 1935, and that said company was properly notified of said illness. The company refused to pay plaintiff's claim, maintaining that it was relieved of liability by said endorsement.

"It is agreed that the question to be submitted to the court is the question of the validity of the rider or endorsement mentioned above.

"According to the terms of the policy, if plaintiff is entitled to recover, he is entitled to remuneration as follows:

                One month and twenty days at
                  $80.00 per month ................  $133.33
                Fifteen days at $40.00 per month ..    20.00
                				     _______
                     Total ........................  $153.33
                

"The policy of insurance and the endorsement are admitted as evidence herein and made a part hereof.

"Respectfully submitted to the court."

The endorsement referred to in the statement of facts is as follows:

"Effective July 20, 1932. Not valid unless countersigned by a duly authorized agent.

"The insured under the policy to which this rider is attached, having suffered disability as a consequence of arthritis it is understood and mutually agreed that, in lieu of an increase in the premium, no liability shall attach to the Company should there be further disability or loss on the part of the insured, caused directly or indirectly, wholly or in part, by rheumatism, arthritis, lumbago, neuritis and/or sciatica, or any sequel of same.

                	"[Signed] J.E. Rice, Insured
                "_________, Witness
                

"Subject otherwise to all conditions, agreements and limitations of the policy as written, except as herein specifically provided."

It is set out therein that the endorsement was attached to and formed a part of the policy No. AC507956 (plaintiff's policy) and was countersigned at Kansas City, Missouri, July 23, 1932, by J.M. Begley, authorized agent, and W.C. Cartinhurt, vice-president and secretary.

Paragraph 1 under the heading "Standard Provisions" of the policy is as follows:

"This policy includes the endorsements and attached papers, if any, and contains the entire contract of insurance except as it may be modified by the Company's classification of risks and premium rates in the event that the Insured is injured —"

The rider in question was to become effective July 20, 1932, during the period for which the policy was then in force. It extended to the first day of August following.

The policy was continued in force from month to month from August 1, thereafter until on or about January 30, 1935, by the payment of the agreed premium of $3.65 for each month by the plaintiff to the defendant and by the defendant's acceptance of such premium, when plaintiff suffered a second attack of sciatic rheumatism which disabled him. The company refused to pay his claim, maintaining that it was relieved of liability therefor by said rider.

The plaintiff introduced evidence tending to show that the reasonable value of his attorney's fees was $75.

At the conclusion of the evidence, the defendant requested an instruction in the nature of a demurrer to the case as made by the plaintiff, which instruction was refused.

OPINION.

The defendant (appellant herein), upon this appeal, makes the following assignment of errors:

"I. The trial court erred in not sustaining and in refusing to give defendant's demurrer to the evidence offered and requested at the close of the entire case for the reason that the rider which plaintiff admitted he signed was a complete bar to plaintiff's action.

"II. The trial court erred in assessing defendant with penalties and attorney's fees for vexatious delay for the reason that the case turned on a disputed question of law upon which lawyers might honestly differ and because there was no evidence to support a finding of vexatious delay.

"III. The trial court erred in overruling the appellant's motion for new trial."

1. The first point made by defendant is under its assignment of error No. 1, and is to the effect that the court erred in refusing to give its demurrer to the evidence requested at the close of the entire case.

In support of its assignment of error and point made thereunder, the defendant urges that the rider in question is a complete bar to the plaintiff's action, by reason of which it was entitled to its requested instruction in question sustaining a demurrer and that the court committed error in refusing it.

That this contention is well made seems apparent, provided such rider was valid as such and was based upon a sufficient consideration. It is, however, contended by the plaintiff that such rider was not valid and that it formed no part of the policy for the reason that it was neither attached thereto nor endorsed thereon; and that plaintiff cites Paragraph 1 under the heading "Standard Provisions" in said policy to support such contention.

The plaintiff contends further that, even if it had been attached to said policy and had formed a part thereof, it was nevertheless without any consideration, by reason of which it was invalid and it in no manner affected the policy as originally issued and as continued from month to month thereafter, up to and including the date of the second attack of sciatic rheumatism suffered by him, which disabled him and gave rise to the claim for the disability benefits for which he now sues.

It is insisted by the defendant that the rider was based on a valid consideration; that it is valid notwithstanding it may not have been actually attached to or endorsed on the policy; that the plaintiff admits that he executed it and had full knowledge of its contents and knew that it was intended thereby that the company should be relieved of liability for any disability thereafter resulting from future attacks of rheumatism and agreed thereto; that, with such knowledge, he renewed and continued the policy from month to...