State ex rel. Heuring v. Allen

• Decision Date: 18 January 1938
• Docket Number: No. 34761.,34761.
• Citation: 112 S.W.2d 843
• Parties: STATE OF MISSOURI at the Relation and to the Use of GEORGE HEURING, Relator, v. PERRY T. ALLEN, WALTER E. BAILEY and ROBERT J. SMITH, as Judges of the Springfield Court of Appeals.
• Court: Missouri Supreme Court

112 S.W.2d 843

STATE OF MISSOURI at the Relation and to the Use of GEORGE HEURING, Relator, v. PERRY T. ALLEN, WALTER E. BAILEY and ROBERT J. SMITH, as Judges of the Springfield Court of Appeals.

No. 34761.

Supreme Court of Missouri.

Division One, January 18, 1938.

Certiorari.

OPINION OF SPRINGFIELD COURT OF APPEALS QUASHED.

J. Grant Frye and B. Hugh Smith for relator.

(1) "On a writ of certiorari to an appellate court, the determination of error, under our decisions, is limited to the finding of a conflict between the Court of Appeals opinion and the latest ruling opinion of this court on the subject, either as to a general principle of law announced, or as to a ruling under a like, analogous, or similar state of facts. The purpose of certiorari is to secure uniformity in opinions and harmony in the law." State ex rel. Kroger Grocery & Baking Co. v. Haid, 323 Mo. 9, 18 S.W. (2d) 480. (2) The last previous ruling of the Supreme Court and the controlling decisions of the Supreme Court lay down the rule that in case of default in payment of premiums on a policy of life insurance, after three annual premiums have been paid, that extended insurance is mandatory, and that such right to extended insurance cannot be contracted away except by the method and on the conditions as expressed in the nonforfeiture statutes (Secs. 5741, 5744, R.S. 1929); and the opinion of the Springfield Court of Appeals, holding that relator could in advance contract away extended insurance for the "Special Premium Loan Privilege" is in conflict with such rulings, and in the face of such statutes as interpreted by the Supreme Court. Gooch v. Met. Life Ins. Co., 333 Mo. 191, 61 S.W. (2d) 704; Liebig v. Mut. Life Ins. Co., 269 Mo. 509, 191 S.W. 250; State ex rel. Clark v. Becker, 73 S.W. (2d) 769; Burridge v. N.Y. Life Ins. Co., 211 Mo. 158, 109 S.W. 176. (3) The last previous ruling of the Supreme Court and the controlling decisions of the Supreme Court lay down the rule that where there are conflicting provisions in a life insurance policy, the policy will be construed most favorable to the insured in order to prevent a forfeiture; and the failure of the Springfield Court of Appeals to construe the policy as giving extended insurance instead of the "Special Premium Loan Privilege" and to prevent a forfeiture is in conflict with such rulings. Bothmann v. Met. Lift Ins. Co., 299 Mo. 269, 252 S.W. 652; State ex rel. Security Mut. Life Ins. Co. v. Allen, 305 Mo. 614, 267 S.W. 379. (a) Upon default of premium payments, extended insurance ("automatic") is provided for in the policy; and the later provision of "Special Premium Loan Privilege," is in direct conflict therewith; and where there is such conflict, that provision which is more favorable to the insured must prevail. Bothmann v. Met. Life Ins. Co., 299 Mo. 269, 252 S.W. 652; State ex rel. Security Mut. Life Ins. Co. v. Allen, 305 Mo. 614, 267 S.W. 379; Gillen v. N.Y. Life Ins. Co., 178 Mo. App. 89, 161 S.W. 667.

Ward & Reeves and Jones, Hocker, Gladney & Jones for respondents.

The automatic premium loan clause of the policy is not in conflict with either the nonforfeiture statutes of Missouri or with the nonforfeiture benefits of the policy, and the holding of the respondents herein is not contrary to any previous ruling of the Missouri Supreme Court. Cooper v. New York Life, 211 S.W. 548; Alford v. New York Life, 280 Mo. 11; Barthel v. Sovereign Camp, W.O.W., 93 S.W. (2d) 285; Mutual Benefit Life Ins. Co. v. Commissioner of Ins., 151 Mich. 610, 115 N.W. 707; Mass. Mut. Life Ins. Co. v. Jones, 44 Fed. (2d) 540; Mo. State Life Ins. Co. v. Ross, 48 S.W. (2d) 230; Balyeot v. American Natl. Ins. Co., 265 N.W. 774; Oklahoma State Mut. Life v. Forrest, 91 S.E. 428; Friend v. Southern States Life, 194 Pac. 204; Texas Life Ins. Co. v. Cork, 59 S.W. (2d) 334.

Leahy, Walther, Hecker & Ely for St. Louis Mutual Life Insurance Company.

Williams, Nelson & English, Frank W. McAllister and Allen May, amici curiae.

(1) There is no jurisdiction in this court unless there be conflict between the opinion of the Springfield Court of Appeals in this case and the last controlling decision of this court. State ex rel. Met. Life Ins. Co. v. Allen, 85 S.W. (2d) 470; State ex rel. Kansas City Life Ins. Co. v. Allen, 85 S.W. (2d) 889; State ex rel. Mut. Assn. v. Allen, 78 S.W. (2d) 862. (2) The opinion does not conflict with Liebig v. Mutual Life Ins. Co., 269 Mo. 509, 191 S.W. 250, or Burridge v. New York Life Ins. Co., 211 Mo. 158, 109 S.W. 560, or Cravens v. New York Life Ins. Co., 148 Mo. 583, 50 S.W. 519, or Smith v. Mut. Benefit Life Ins. Co., 173 Mo. 329, because all of the policies covered by the opinions in those cases were policies issued prior to the 1903 Amendment of Section 5741, the statute having been amended to nullify the rulings in those cases. Burridge v. N.Y. Life Ins. Co., 211 Mo. 173; Laws of 1903, p. 208; Laws 1923, p. 233. (a) It does not conflict with the case of State ex rel. Clark v. Becker, 73 S.W. (2d) 769, because that case deals with the automatic option for the unconditional commutation of the policy under Section 5744, Revised Statutes 1929, while the policy in question contains an unconditional nonforfeiture clause under Section 5741. (b) Section 5741, Revised Statutes 1929, authorizes deduction of any indebtedness upon the policy from the cash value, which must be computed as of the date of the unpaid premium for which forfeiture is contemplated, and said premium must not only be due, but must be unpaid. The automatic premium loan provision in this case prevented the premium from remaining unpaid until May 10, 1933. R.S. 1929, sec. 5741; Rick v. John Hancock Life Ins. Co., 93 S.W. (2d) 1126; McGinnis v. Aetna Life Ins. Co., 78 S.W. (2d) 501; McCall v. International Life Ins. Co., 193 S.W. 865; Burridge v. Insurance Co., 211 Mo. 173.

HYDE, C.

This case, recently reassigned to the writer, is a proceeding in certiorari seeking to quash the opinion of the Springfield Court of Appeals in Heuring v. Central States Life Ins. Co., 87 S.W. (2d) 661. Relator, as plaintiff herein, sued for $1000 alleged to be due him as beneficiary in an insurance policy issued by defendant on the life of his minor daughter, who died October 20, 1933. Defendant had judgment in the trial court and, upon plaintiff's appeal, this judgment was affirmed.

Relator contends that the opinion of the Court of Appeals is in conflict with the following decisions of this court, construing the non-forfeiture statutes (Secs. 5741-5744, R.S. 1929) in our Insurance Code, namely: Gooch v. Metropolitan Life Ins. Co., 333 Mo. 191, 61 S.W. (2d) 704; Liebing v. Mutual Life Ins. Co., 269 Mo. 509, 191 S.W. 250; State ex rel. Clark v. Becker, 335 Mo. 785, 73 S.W. (2d) 769; Burridge v. New York Life Ins. Co., 211 Mo. 158, 109 S.W. 560; Cravens v. New York Life Ins. Co., 148 Mo. 583, 50 S.W. 519. The opinion of the Court of Appeals shows that the policy sued on was a twenty-payment life policy issued August 10, 1928, with an annual premium of $22.43. The trial court found (which is not disputed) that "the premium of $22.43 was paid August 10, 1928, August 10, 1929, and August 10, 1930; that the premium due August 10, 1931, was settled for by the insured, or her father for her, giving a note to defendant for $23.86 (which included interest in advance), which became due August 10, 1932; that on August 10, 1932, this note was not paid, neither was an additional premium (then due) of $22.43 paid... . The cash value of the policy on August 10, 1932, was $33, and according to the terms of the note, the defendant was entitled to have the note deducted from the cash surrender value of the policy on that date, which left a balance due of $9.14." The Court of Appeals found that $9.14 would buy extended insurance for 479 days, or until after the date of the insured's death.

The insurance company instead of applying this cash value as a premium for extended insurance applied it as follows:

"The fifth premium due August 10, 1932, was not paid, and as the reserve or cash value of the policy on that date was not sufficient, after deducting the outstanding lien note or indebtedness to pay the full premium, it was applied in accordance with the automatic premium loan clause of the policy to pay a semi-annual premium of $11.66 from August 10, 1932, to February 10, 1933; the semi-annual premium of $11.66, due February 10, 1933, not having been paid, and the reserve or cash value of the policy being insufficient, after deducting the outstanding indebtedness, to pay that premium, the defendant applied the same to the payment of a quarterly premium of $5.94 from February 10, 1933, to May 10, 1933; the insured failed to pay the quarterly premium of $5.94 due May 10, 1933; on that date the excess of the reserve or cash value of the policy over the outstanding indebtedness was $1.00. (The difference between the $9.14 reserve on August 10, 1932, and the total amounts thereafter applied to pay the semi-annual ($11.66) and quarterly ($5.94) premiums under the automatic loan provision as well as the $1.00 then remaining is accounted for by the increase of the reserve due to extending the life of the policy by payment of these premiums through the operation of the automatic loan clause.) As this amount was insufficient to pay the quarterly premium of $5.94 due May 10, 1933, the defendant, under the terms of the policy, was required to apply the same to continue the policy in force as extended insurance; this sum of $1.00, on May 10, 1933, applied to the purchase of extended insurance, continued the policy in force as extended insurance on the policy table, the American Experience Table of Mortality with 3½ per cent interest per anum, for a period of forty-nine days from May 10, 1933, or to June 28, 1933; on the Actuaries or Combined Table of Mortality with 4 per cent interest (the Statutory Table), this sum of $1.00 would continue the policy...