Smith v. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N.

• Decision Date: 27 July 1933
• Docket Number: No. 5079.,5079.
• Citation: 10 F. Supp. 110
• Parties: SMITH v. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N.
• Court: U.S. District Court — Western District of Oklahoma

10 F. Supp. 110

SMITH v. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N.

No. 5079.

District Court, W. D. Oklahoma.

July 27, 1933.

F. E. Young and W. A. Blakeburn, both of Oklahoma City, Okl., for plaintiff.

J. B. Dudley, of Oklahoma City, Okl., and Cleary, Horan & Skutt, of Omaha, Neb., for defendant.

VAUGHT, District Judge.

The plaintiff, after alleging jurisdictional facts in his petition, states that on the 2d day of June, 1927, defendant association issued its policy of insurance to the plaintiff insuring him against accidental death and against loss of time for accident or illness; that said policy provided for the payments by the assured of $36 annually or $9 quarterly, as premium; that plaintiff paid all premiums to the defendant necessary to continue the policy in full force and effect to October 1, 1932, and that same were accepted by defendant association; that on the 12th day of May, 1932, plaintiff was stricken with an illness which immediately confined the insured continuously within doors, required regular visitation by a physician and that said illness, resulting in total disability, has been continuous from that time until the filing of this suit; that on June 27, 1932, plaintiff paid to the defendant $9, the amount of the quarterly premium, which premium became due on July 1, 1932; that on the 14th of July, 1932, the defendant, from its home office in Omaha, Neb., returned the $9 payment to the plaintiff, advising that they could not accept the premium; that plaintiff made numerous efforts to pay the premium on the policy, all of which were refused, and under date of September 23, 1932, plaintiff caused to be mailed to defendant association $9 in currency, which was returned by the defendant with the statement that the defendant was returning the offered premium and exercising its option under the additional provisions of the contract in returning the premium, and indicating that the policy had lapsed as of July 1, 1932; that the defendant received due notice of plaintiff's disability as of May 12, 1932.

Plaintiff further pleads the noncancelable indorsement which was made part of the policy, as follows: "The association can not cancel this policy during any period for which the premium has been paid. It is further understood and agreed that this policy can not be canceled by the association during any period of disability of the insured."

Plaintiff then alleges that under the terms of the policy he was to receive during the disability $100 per month, beginning May 12, 1932, and continuing so long as assured was totally disabled. Plaintiff further alleges that the age of the plaintiff on May 11, 1932, was fifty-two years, and that at that time he had an expectancy of life under the American Experience Table of Life of 19.49 years but, based upon the statements by competent medical practitioners who had attended and treated plaintiff since the beginning of his disability, said expectancy of life is reduced from 19.49 to 10.34 years.

Plaintiff further alleges that defendant association carried the contract so long as the plaintiff was an insurable risk and then sought to cancel same, and that plaintiff is now unable to procure additional insurance, and because of the defendant's cancellation of said policy this defendant is entitled to a sum equal to the sum of $100 per month during the total disability for 10.34 years, or $11,328.64, for which sum he sues.

Defendant has filed a demurrer to the petition for the reason that the same does not state facts sufficient to constitute a cause of action against it or to entitle plaintiff to relief sought; and this matter comes on for hearing upon the demurrer of the defendant. For the purposes of the demurrer the allegations of the petition are taken as true. There are certain provisions of the policy which it is necessary for the court to construe in order to determine whether the plaintiff's petition states a cause of action. Under the standard provisions of the policy, section 10 provides: "Upon request of the insured and subject to due proof of loss all of the accrued indemnity for loss of time on account of disability will be paid at the expiration of each month during the continuance of the period for which the Association is liable and any balance remaining unpaid at the termination of such period will be paid immediately upon receipt of due proof."

Under additional provisions, section C provides:

"The copy of the application endorsed hereon is hereby made a part of this contract and this policy is issued in consideration of the statements made by the Insured in the application and the payment in advance of $46.00 on the first year; and the payment in advance of premiums of $36.00 annually of $9.00 quarterly, thereafter, beginning with October 1, 1927, is required to keep this policy in continuous effect. If any such dues be unpaid at the...