Shepherd v. Mutual Life Ins. Co.

• Decision Date: 17 February 1933
• Docket Number: No. 9555.,9555.
• Citation: 63 F.2d 578
• Parties: SHEPHERD v. MUTUAL LIFE INS. CO. OF NEW YORK.
• Court: U.S. Court of Appeals — Eighth Circuit

63 F.2d 578 (1933)

SHEPHERD v. MUTUAL LIFE INS. CO. OF NEW YORK.

No. 9555.

Circuit Court of Appeals, Eighth Circuit.

February 17, 1933.

M. Danaher and Palmer Danaher, both of Pine Bluff, Ark., for appellant.

Frederick L. Allen, of New York City, and A. F. House and Rose, Hemingway, Cantrell & Loughborough, all of Little Rock, Ark., for appellee.

Before KENYON, GARDNER, and SANBORN, Circuit Judges.

GARDNER, Circuit Judge.

Appellant brought this action to recover on two life insurance policies, in which she was named as beneficiary, upon the life of her husband, Edgar Shepherd. For convenience, the parties will be referred to as they appeared in the lower court.

It is alleged in the complaint that, by section 10 of the two insurance policies in question, it was provided that payment of premiums for three full years would entitle the insured to nonparticipating continued term insurance for an additional term of 3 years and 323 days, and that the cash value of each of the policies, at the end of the third year, was $500.80; that it was provided by section 9 of each of these policies that, "`If any premium remain unpaid at the end of the days of grace, and if at least three full years' premiums have been paid, this policy will, without action on the part of the Insured, continue, as from the due date of such premium in default, as paid up non-participating term insurance, without Double Indemnity or Disability Benefits.'" It is also alleged that the insured had paid the first premiums and the premiums which became due on February 2, 1929, and February 2, 1930, and that he died in July, 1931.

The defendant, in its answer, in effect admitted the issuance of the policies and the payment of the premiums as alleged, but it is alleged that sections 9 and 10 were not effective in the policies as issued, because of certain provisions written in the policies, postponing the invoked sections until after a period of five years, and that the policies, as issued, were five-year term insurance policies; that as such they had lapsed by reason of nonpayment of the premiums due February 2, 1931.

On stipulation of the parties, a jury was waived, and the action tried to the court. The plaintiff and defendant each requested declarations of law embodying their respective contentions. The court denied the declarations of law requested by plaintiff, granted those requested by defendant, and entered judgment of dismissal of the action, from which judgment plaintiff prosecutes this appeal.

The parties filed a written stipulation, admitting all the essential facts, including the issuance of the policies, payment of the premiums to February 2, 1930, and the failure to pay the premiums due February 2, 1931. The stipulation recites that, "If the court holds that sections 7, 8, 9, and 10, or any of them, as contained in said policies, became effective prior to February 2, 1933, then it is agreed that the policies were extended under the provisions of said section 10 for a period of three years and three hundred and twenty-three days following February 2, 1931."

It is the contention of appellant that sections 9 and 10 of the policies are repugnant to a clause appearing on page 4 thereof, thus giving rise to an ambiguity in the insurance policies, which should be construed most strongly in favor of the insured. United States Fidelity & Guaranty Co. v. Guenther, 281 U. S. 34, 50 S. Ct. 165, 74 L. Ed. 683, 72 A. L. R. 1064. This rule, however, is not to be invoked for the purpose of creating an ambiguity, but is applicable only when an ambiguity or inconsistency in fact exists. Bergholm v. Peoria Life Ins. Co., 284 U. S. 489, 52 S. Ct. 230, 76 L. Ed. 416; Firemen's Ins. Co. v. Lasker (C. C. A. 8) 18 F.(2d) 375; Callen v. Massachusetts Protective Ass'n (C. C. A. 8) 24 F.(2d) 694.

Insurance contracts are to be construed by the same rules as other contracts. It is not the province of the court to rewrite them for the parties, but to interpret the contract actually made according to the intention of the parties gathered from the written contract. Hawkeye Commercial Men's Ass'n v. Christy (C. C. A. 8) 294 F. 208, 40 A. L. R. 46; Whitney v. Union Central Life Ins. Co. (C. C. A. 8) 47 F.(2d) 861; Springfield Fire & Marine Ins. Co. v. National Fire Ins. Co. (C. C. A. 8) 51 F.(2d) 714, 76 A. L. R. 1287.

The intention of the parties must be gathered from the entire instrument, and not from detached sections or provisions, because the meaning of no particular part can be determined without considering all the provisions of the contract as a whole. United States v. Ansonia Brass, etc., Co., 218 U. S. 452, 31 S. Ct. 49, 54 L. Ed. 1107; Rushing v. Manhattan Life Ins. Co. (C. C. A. 8) 224 F. 74; Uinta Tunnel, Mining, etc., Co. v. Ajax Gold Mining Co. (C. C. A. 8) 141 F. 563. The individual clauses invoked by plaintiff must therefore be considered in connection with all the other parts of the policy, and, if possible, every provision of the contract must be given effect. Rushing v. Manhattan Life Ins. Co. (C. C. A. 8) 224 F. 74; Canadian Northern Ry. Co. v. Northern Mississippi Ry. (C. C. A. 8) 209 F. 758.

In any event, the insurance policies should be construed according to the sense and meaning of the language used. Gorman v. Fidelity & Casualty Co. (C. C. A. 8) 55 F. (2d) 4; Inter-Southern Life Ins. Co. v. Zerrell (C. C. A. 8) 58 F.(2d) 135. It goes without saying that there is no occasion for construction when the policy clearly fixes the meaning of the...