Southland Life Ins. Co. v. Hopkins

• Decision Date: 11 February 1920
• Docket Number: (No. 1592.)
• Citation: 219 S.W. 254
• Parties: SOUTHLAND LIFE INS. CO. v. HOPKINS.
• Court: Texas Court of Appeals

219 S.W. 254

SOUTHLAND LIFE INS. CO. v. HOPKINS.

(No. 1592.)

Court of Civil Appeals of Texas. Amarillo.

February 11, 1920.

Rehearing Denied March 3, 1920.

COPYRIGHT MATERIAL OMITTED

Appeal from District Court, Lubbock County; W. R. Spencer, Judge.

Action by Mollie I. Hopkins against the Southland Life Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

W. H. Bledsoe, of Lubbock, and Seay, Seay, Malone & Lipscomb, of Dallas, for appellant.

Bean & Klett and Percy Spencer, all of Lubbock, for appellee.

HALL, J.

The appellee sued appellant to recover $5,000, alleged to be due upon a policy of insurance issued the 28th day of February, 1916, upon the life of her husband, Bion P. Hopkins, who it is alleged died on the 29th day of October, 1918. She sues as the beneficiary under the provisions of the policy, alleging, in substance, that all premiums had been paid up to and including the date of the death of the insured; that if mistaken in her allegations as to the payment of the premium due February 28, 1918, the policy was nevertheless in effect at the time of the death of the insured, in that, on or about the 5th day of February, 1918, appellant agreed with the insured in writing to a modification of the policy, by changing the time for the payment of the premium due February 28, 1918, to October 28, 1918, it being stipulated that as part of the agreement for the extension of the payment of said premium it was made subject to the provisions of the policy, which contained a clause that a grace of 31 days should be granted for the payment of every premium after the first; that the death of the insured occurred during the period of grace so provided in the policy; that if she is mistaken in her allegation that the insured died during the period of grace then there was never a forfeiture of the policy by the appellant for nonpayment of the premium, because the validity of the premium was recognized by appellant and its right to forfeit the same, if it ever existed, was waived, in that, on October 19, 1918, appellant wrote a letter to the insured with reference to the payment of the premium due on October 28, 1918, stating that if it was inconvenient for him to pay the full amount due, viz., $69.13, appellant would accept a partial payment and extend the balance a reasonable time; that the insured was by said letter induced to believe, and did believe, that appellant was willing to negotiate for a settlement of said premium by receiving a part of the amount due, and to grant a reasonable time for the payment of the balance, and that he would have a reasonable time in which to reply to said letter and ascertain the terms upon which a settlement could be made; that at the time the insured received the letter he was suffering from influenza, which later developed into pneumonia and produced his death; that he was induced by said letter to postpone answering for a reasonable time until his recovery, but that in the course of 4 or 5 days he became irrational and unable to attend to business, and continued in such condition until the time of his death; that if it had not been for said letter the insured would and could have paid said premium when due. Wherefore the right of appellant to claim a forfeiture, if any, was waived, and it was estopped to insist that the policy was not in effect at the time of the insured's death. The prayer is for the recovery of the face of the policy, together with the statutory attorney's fees and penalty. The appellant answered, admitting the issuance of the policy, and alleging, in substance: That the policy was not in force at the time of the death of Bion P. Hopkins, on October 29, 1918, same having become null and void on account of the failure of the said Hopkins to comply with its terms and conditions. That the anniversary of said policy was the 28th day of February, and on the 28th day of February, 1918, there was due the annual premium of $66.45 cash; that the provision with reference to the payment of premiums as stated therein is as follows:

"All premiums are payable in advance at the home office of the company, or to any agent of the company on or before date due upon delivery of receipt signed by an executive officer (president, vice president, secretary, or assistant secretary) of the company, and countersigned by said agent. The mode of premium payments may be changed by the insured giving written notice to the company at its home office in not less than forty-five days prior to any anniversary of this policy from annual payments to semiannual payments or quarterly or vice versa, at the premium rates, and on the conditions in force at the date thereof, except as herein provided, the payment of the premiums or installments thereof shall not maintain the policy in force beyond the date when the next premium or installment thereof is payable. A grace of thirty-one days without interest shall be granted for the payment of every premium after the first, during which time the insurance shall continue in force. If death occur within the period of grace the unpaid premium for the then current policy year shall be deducted from the amount payable hereunder."

That on January 2, 1918, the assured wrote appellant as follows:

"The next payment on my insurance policy will be due in March, and I am asking to carry my note for the amount until fall, while I can pay it at maturity, but it would be quite a favor to have it carried."

That said letter was received by the appellant on January 23, 1918, and on that day it replied:

"We are in receipt of your letter of the 21st and shall be pleased to accommodate you and are inclosing note due October 28th, which we will accept in lieu of the current premium on this policy."

That said Hopkins executed the note inclosed and returned it to the appellant, same being received and accepted by it, under date of February 5, 1918, subject to the terms of the receipt issued therefor. The note is in terms as follows:

                "$66.45        Dallas, Texas, Feby 28, 1918
                

"On or before the 28th day of October, 1918, without grace, for value received, I promise to pay to the Southland Life Insurance Company, or order, at its office, Dallas, Texas, $66.45, with interest at six per cent per annum. This note is given on account of the premium due February 28, 1918, on policy No. 170003, issued by said company and if it is not paid at maturity, said policy shall be void, subject to the provisions therein contained — in which event this note shall be a valid obligation for the pro rata premium from the date to which premiums on this policy have been actually paid in cash to the date of maturity of this note, together with interest thereon. In case of the death of the insured before this note falls due the amount of this note with interest shall be deducted from the amount of said policy. [Signed] B. P. Hopkins."

That on February 5, 1918, the appellant issued and sent to the said Hopkins a receipt for the annual premium of $66.45. That Bion P. Hopkins did not pay said note, and his policy became null and void on October 28, 1918, and at the time of his death, on October 29, 1918, the policy was void and of no effect. Appellant denied that it had waived the forfeiture of the policy or was estopped to claim a forfeiture, alleging that the true facts in reference to appellee's contention are as follows: That on October 19th, appellant wrote the insured Hopkins as follows:

"In order that your policy may not lapse, we beg to remind you that the note due October 28th you gave in lieu of the premium due last February, provides no grace, and settlement should be made without fail on or before maturity. If inconvenient to pay the full amount due ($69.13) we will accept a partial payment and extend the balance a reasonable time."

That prior to the maturity of said note the appellant sent it to the Citizens' National Bank of Lubbock, Tex., and that said bank presented the note to the insured while he was in good health, but that he did not pay the note. That it never had, by letter or otherwise, led the said Bion P. Hopkins to believe that a settlement of the note would not be accepted at maturity, but, on the contrary, expressly advised him that unless it was paid or settlement made prior to its maturity the policy would lapse and become null and void.

The case was tried without the assistance of a jury, resulting in a judgment in favor of appellee for the sum of $5,000, together with the further sum of $600, penalty, and attorney's fees in the sum of $1,500, with interest from January 24, 1919, at the rate of 6 per cent., less the amount of the premium note. $66.45 with 6 per cent. interest thereon from February 28, 1918. After the receipt of the note appellant issued and mailed to the insured the following receipt:

"Premium Receipt.

"Southland Life Insurance Company, Dallas, Texas. Received payment as described below. Countersigned, J. W. Hurst, Secretary. February 5, 1918. B. W. G. As. Cashier. Policy No. 170003. Annual premium, $66.45. Mr. Bion P. Hopkins, Lubbock, Texas. Note for $66.45, given on account. This receipt is issued subject to the following terms and conditions: If settlement of the amount described on the face of this receipt is made by draft, or check, and default is made in the payment of such draft or check, this receipt shall become null and void and all insurance under this policy shall cease and determine and the policy shall stand canceled as of the date on which the payment described on the face hereof was due, subject to the provisions of said policy."

The court filed findings of fact and conclusions of law, setting out, amongst others, the facts hereinbefore recited, and further that proofs of death were made and forwarded to the company January 22, 1919, and—

"(12) I further find that about the 1st of October, 1918, the defendant's agent, Ura Embry, as cashier of the Citizens' National Bank of Lubbock, Tex.,...