Southland Life Ins. Co. v. Greenwade

• Decision Date: 27 June 1940
• Docket Number: No. 2212.,2212.
• Citation: 143 S.W.2d 648
• Parties: SOUTHLAND LIFE INS. CO. v. GREENWADE.
• Court: Texas Court of Appeals

143 S.W.2d 648

SOUTHLAND LIFE INS. CO. v. GREENWADE.

No. 2212.

Court of Civil Appeals of Texas. Waco.

June 27, 1940.

Rehearing Denied September 26, 1940.

Appeal from District Court, Hill County; J. D. Stephenson, Judge.

Action on life policies by Nina Marie Greenwade against the Southland Life Insurance Company. From a judgment for the plaintiff, the defendant appeals.

Affirmed.

Carpenter, Carpenter & Allison, of Dallas, for appellant.

Martin & Allred and Morrow & Calvert, all of Hillsboro, for appellee.

TIREY, Justice.

This is a suit on two insurance policies tried before the court without a jury. The defense was non-receipt of quarterly premiums within the grace period, and consequently the lapse of the policies. Plaintiff alleged payment of the premiums by means of mailing a check. The check was never presented to the bank on which it was drawn for payment. Therefore, the major question is whether the mailing of the check within the grace period constituted a payment of the premiums, so as to prevent a forfeiture of the policies. Judgment was rendered for plaintiff, and defendant appeals.

The policies in suit were issued and delivered on September 9, 1936, and premiums were payable in quarterly installments of $4.46 on each policy, which sum was payable on the 9th days of March, June, September and December of each year. The premiums that matured on the 9th of June, 1938, were not paid on the due date, and on July 5, 1938, the company, through its vice-president, wrote the insured, in part, as follows: "I notice that you have not sent in your remittance for the current premium which is now considerably past due. The end of the grace period is at hand and I trust that you will make prompt payment in order that your valuable protection and investment contract may be properly continued. If the present premium paying schedule is more than you can conveniently handle at this time, let us hear from you, as it is the sincere desire of myself and the management of this company to render every assistance possible in helping you to continue with your excellent life insurance program." The grace period expired July 10, 1938, which was on Sunday. The insured died on July 18, 1938. The record shows that the assured had been paying the premiums by check. The quarterly premiums that matured on December 9, 1937, were paid by the check of the insured dated January 7, 1938, which check was cleared through the Federal Reserve Bank at Dallas on January 12, 1938, two days after the expiration of the grace period. The quarterly premiums that matured on March 9, 1938, were paid by check of the insured, dated April 8, 1938, and was cleared through the Federal Reserve Bank on the 13th of April, 1938, which was three days after the expiration of the grace period. The January check above was actually paid by the bank on which it was drawn on January 13th, three days after the expiration of the grace period; and the April check above was actually paid on the 14th day of April, four days after the expiration of the grace period. The plaintiff introduced evidence to show that the check for the amount of the premiums was actually drawn by the insured on the 9th day of July, 1938, payable to defendant company for the amount of both premiums, and that it was deposited in the mail at Whitney, Texas, approximately 75 miles from the home office. The defendant offered detailed testimony showing the way in which its mail was handled. The record discloses that the postal authorities at Dallas securely tied defendant's mail in packages and delivered it to defendant's employee, who placed it in a sack and carried it to the home office where it was carefully opened and inspected under the supervision of the head of the premium accounting department. Checks received were clipped to the envelopes in which they came and these checks were registered in a book before the envelopes were taken off. The pages in this book were dated for each day's receipts and contained the number of the policy, the date of the check, and the name of the person signed to the check. These records were then checked with the premium cards of the company before the checks were turned over to the cashier. The records of the company from June 10th to July 18th, 1938, inclusive, disclosed that the company did not receive any check or cash from the assured. According to defendant's testimony, the envelope bearing the check was never received by the defendant company. The evidence was uncontradicted to the effect that defendant accepted checks to apply on premiums and issued its receipt, with the understanding that if the check was not paid the receipt was a conditional receipt.

Assignment of error No. 2 contends, in effect, that the evidence adduced failed to show that the quarterly premiums maturing June 9, 1938, were paid in advance at the home office, a requirement of the contract between the parties, and further that the evidence wholly failed to show that said premiums were paid within the grace period of the thirty-one days, and that there was no evidence that the premiums were paid at all and that the policies lapsed according to the terms of the contracts. Much has been written on the point at issue. In Texas the rule seems to be that "where the insurance company authorizes remittances of the premium by mail, that the payment is made when the letter containing the remittance is deposited in the post office." Travelers' Protective Ass'n v. Roth, Tex.Civ.App., 108 S.W. 1039, point page 1042. The plaintiff plead that the insurance company waived the provisions of the policies which provided for the payment of the premiums in advance at the home office of the defendant, and had authorized the insured to make payment of the premiums by sending his personal check through the mail. The record discloses that the two previous payments of the premiums had been made by check drawn by the insured on the bank at Whitney, and that each of these checks were received and accepted by the company, and that payment of these checks in each instance was actually made by the bank on which they were drawn after the grace period in each instance had expired. Our Supreme Court, in the case of Equitable Life Assurance Ass'n v. Ellis, 105 Tex. 526, 147 S.W. 1152, 1157 said: "The waiver was completed by the act or conduct of the company that constituted it." But the insurance company contends, in effect, that since it has fully accounted for the way its mail was received, and since defendant's evidence discloses that the envelope containing the check was not received by it, plaintiff's evidence merely raised the presumption of its receipt and that, under all the evidence, this presumption vanished. The rule in Texas is that where it is affirmatively shown that a letter, communication or notice has been properly stamped and addressed to a party, a presumption of fact arises that it was received by such party, and evidence of such mailing will support a finding of such receipt. Davis v. Petroleum Cas. Co., Tex.Civ.App., 13 S.W.2d 981, point page 982. Moreover, it has been held that "the presumption of the receipt of a letter from proof that it was mailed * * * does not stand merely until evidence comes in to then disappear. It continues as evidence, to be considered in the light of all the facts and circumstances adduced on the trial and to be given such weight as the triers think it entitled to in determining the fact at issue, whether the mailed leter was received." Atlantic Dredging & Construction Co. v. Nashville Bridge Co., 5 Cir., 57 F.2d 519, point 4, page 521; Rosenthal v. Walker, 111 U.S. 185, 193, 4 S.Ct. 382, 28 L.Ed. 395; East Texas Fire Ins. Co. v. Perkey, 89 Tex. 604, 35 S.W. 1050; Western Union Tel. Co. v. McDavid, 103 Tex. 601, 132 S.W. 115, page 116; American National Life Ins. Co. v. Callahan, 125 Tex. 222, 81 S.W.2d 504; Roberts v. Wichita Southern Life Ins. Co., Tex.Com.App., 221 S.W. 268; Hartford Life &...