State v. Allen

• Decision Date: 25 November 1924
• Docket Number: No. 24883.,24883.
• Citation: 267 S.W. 379
• Parties: STATE ex rel. SECURITY MUT. LIFE INS. CO. v. ALLEN et al., Judges.
• Court: Missouri Supreme Court

267 S.W. 379

STATE ex rel. SECURITY MUT. LIFE INS. CO. v. ALLEN et al., Judges.

No. 24883.

Supreme Court of Missouri, in Banc.

November 25, 1924.

Motion for Rehearing Denied December 18, 1924.

Certiorari by the State of Missouri, at the relation of the Security Mutual Life Insurance Company, to quash opinion and judgment, in Howell v. Security Mut. Life Ins. Co., 253 S. W. 411, of Hon. William H. Allen and others, Judges of the St. Louis Court of Appeals. Writ quashed.

Lyle M. Allen, of St. Louis, for relator.

Howell & Jackson, of Troy, and Jones, Rocker, Sullivan & Angert, of St. Louis, for respondents.

GRAVES, C. J.

Certiorari to St. Louis Court of Appeals. The case in the circuit court was entitled "Myrtra M. Howell, Plaintiff, v. Security Mutual Life Insurance Company, Defendant," which was an action upon an insurance policy issued to James E. Howell of Troy, Mo., in August, 1906, in which policy his wife Myrtra M. Howell was the beneficiary. The amount of the policy was $1,000, and the annual premium was paid from 1906 up to and including the year 1912. The 1913 premium, and no subsequent premium, was paid. James E. Howell died July 12, 1919, and after due proof of death, payment of the policy was refused, and the circuit court action, supra, was brought. The plaintiff had judgment for $1,130, and the defendant appealed to the St. Louis Court of Appeals where the judgment of the circuit court was affirmed. It is for the purpose of having the opinion and judgment of that court quashed that the instant action was brought in this court. In the opinion of the Court of Appeals further details are thus stated:

"This is an action upon a life insurance policy issued by the defendant on the life of plaintiff's husband, James E. Howell. The cause was tried by the court without a jury, upon an agreed statement of facts, and the trial resulted in a judgment for the plaintiff for $1,130. Unavailing in its motion for a new trial, the defendant appealed.

"The only question presented by this appeal is whether the policy in suit is a `30-payment life policy' or a `30-year term policy.' The policy bears date the 9th day of August, 1906. The provisions of the policy, pertinent to the question presented, are as follows:

"`Security Mutual Life Insurance Company, by this policy of insurance, agrees to pay $1,000 at its home office, upon receipt of evidence satisfactory to the company of the fact and cause of death, occurring during the continuance of this contract, of James E. Howell, of Troy, county of Lincoln, state of Missouri, to Myrtra M. Howell, his wife, if living at the time of such death, otherwise to the executors or administrators of said insured. This contract is made in consideration of the application for this policy, which is made a part hereof. Also in consideration of the annual premium of $29.69, to be paid in advance on delivery of this policy. * * *

"`Provisions.

"`First. To continue this policy in force subsequent premium payments of $29.69 each shall be made to the company at its home office on or before the 9th day of August in every year for the term of 30 years from the date of issue. * * *

"`Fourth. This policy shall share equitably in all accumulations from lapses, interest and mortality savings, as determined by the actuary of the company, and, if in force on the 9th day of August, 1936, the insured shall then have his choice of the following options:

"`First. To surrender this policy properly receipted, and receive therefor in cash all such accumulations then to its credit; or,

"`Second. To receive therefor a nonparticipating paid-up policy for such an amount as its cash value will purchase at single premium rates; or,

"`Third. Beginning on the 9th day of August, 1936, this policy may be continued as a renewable one-year term policy at attained age, without medical re-examination, and all accumulations apportioned and to its credit shall be applied to maintain the original rate level. Should such accumulations become exhausted" the insured shall be required to pay only the net rate for one-year term insurance, and nothing for the general fund. * * *'

"It appears, from the agreed statement of facts, that James E. Howell paid the first or initial annual premium of $29.69, and also paid the annual premium of $29.69, due on said policy for the years 1907, 1908, 1909, 1910, 1911, and 1912, but neither he nor any one on his behalf paid anything on account of any premium on said policy due subsequent to August 9, 1912; that James E. Howell died at Troy, Mo., on June 12, 1919, leaving surviving him, his wife, Myrtra M. Howell, the plaintiff in this action; that, thereafter, on July 12, 1919, the defendant insurance company received from the plaintiff proofs of death of the said James E. Howell, which said company returned to the plaintiff with a letter in which it stated that the policy had lapsed for nonpayment of premium.

"The agreed statement of facts further stipulates as follows:

"`That if the policy sued on herein is a 30-payment life policy for $1,000, then three-fourths of the reserve on such policy, calculated and applied as a net single premium in accordance with section 6046, Revised Statutes of Missouri 1909, to the purchase of extended insurance, would continue said policy as extended insurance for its full amount, $1,090, from the date of its lapse on August 9, 1913, for the nonpayment of the premium due on that date, to a date beyond the death of the said James E. Howell.

"`A "30-payment life policy" is one which by its terms requires the payment of premiums thereon annually in advance for 30 years only, and which at the expiration of such 30-year period becomes fully paid up for life, no further premium payments being required thereunder, but which remains in force and is payable upon the death of the insured.

"`That if the policy sued on herein is a 30-year term policy for $1,000, then three-fourths of the reserve calculated and applied as a net single premium in accordance with section 6946, Revised Statutes of Missouri 1909, to the purchase of extended insurance was insufficient to continue said policy as extended insurance from the date of its lapse on August 9, 1913, on account of nonpayment of the premium due thereunder on that date, to the date of the death of the said James E. Howell.

"`A "30-year term policy" is one which by its terms requires payment of premiums thereon annually in advance for a term of 30 years only, and which is payable only in the event of the death of the insured within such stipulated term of 30 years and while such policy is in force, and under which nothing is payable in event the insured survives the stipulated term of 30 years.'

"In interpreting the contract in question certain fundamental canons of construction, relating to the construction of insurance contracts, should be kept in mind. They may be stated as follows: (1) The policy is to be construed liberally in favor of the assured and against the insurer. (2) Where a policy is susceptible of two interpretations equally reasonable, that construction most favorable to the assured must be adopted, even though, in fact, intended otherwise by the insurer. (3) The law does not favor forfeitures, and contracts of insurance must be so construed, if possible, as not to defeat the claim to indemnity. (4) The provisions in a policy, limiting or avoiding liability, must be construed most strongly against the insurer. Cunningham v. Union Cas. & Surety Co., 82 Mo. App. 614; Souders v. Commonwealth Casualty Co. (Mo. Sup.) 246 S. W. 613; Stix v. Indemnity Co., 175 Mo. App. 177, 157 S. W. 870; Mathews v. Modern Woodmen, 236 Mo. 342, 139 S. W. 151, Ann. Cas. 1912D, 483; Still v. Insurance, 185 Mo. App. 553, 172 S. W. 625; La Force v. Williams City Ins. Co., 43 Mo. App. 530; Stark v. Insurance Co., 176 Mo. App. 580, 159 S. W. 758; Rosenbach v. Fid. & Cas. Co., 204 Mo. App. 154, 221 S. W. 386; Rieger v. London Guar. & Acc. Co., 202 Mo. App. 204, 215 S. W. 920; Wiest v. Insurance Co., 186 Mo. App. 29, 171 S. W. 570; Schmol v. Travelers' Ins. Co. (Mo. App.) 189 S. W. 600; 1 Joyce on Insurance (2d Ed.) pp. 574, 575, 581; 25 Cyc. 740; Cooley on Insurance, 036; 14 R. C. L. 926."

The Court of Appeals ruled that the policy was a "30-payment life policy" and under the agreed facts it was in force at the death of Howell, although no premium had been paid since 1912. This ruling is charged to be in conflict with our rulings. Counsel for relator has an assignment of errors, but such an instrument really has no place in this, an original proceeding here. The sole question is conflict or no conflict of opinion. Further details are left to the opinion.

I. It is urged that the opinion of our learned brothers of the...