Texas Prudential Ins. Co. v. Corn

• Decision Date: 19 September 1947
• Docket Number: No. 14861.,14861.
• Citation: 205 S.W.2d 78
• Parties: TEXAS PRUDENTIAL INS. CO. v. CORN.
• Court: Texas Court of Appeals

Page 78

205 S.W.2d 78

TEXAS PRUDENTIAL INS. CO. v. CORN.

No. 14861.

Court of Civil Appeals of Texas. Fort Worth.

September 19, 1947.

Rehearing Denied October 17, 1947.

Appeal from District Court, Wichita County; Temple Shell, Judge.

Action by Valta Corn against Texas Prudential Insurance Company to recover under policy of life insurance. From an adverse judgment, defendant appeals.

Judgment reversed and rendered.

Levy & Levy, of Galveston, and King, Dawson & Jones, of Wichita Falls, for appellant.

Allen, Locke & Kouri, of Wichita Falls, for appellee.

HALL, Justice.

Appellee Valta M. Corn obtained judgment in the 89th District Court of Wichita County, Texas, against appellant Texas Prudential Insurance Company, upon an insurance policy in the sum of $1,715.00, face value of the policy, plus $500.00 attorneys' fees, plus 12% penalty, less $45.96, which represented the balance of insurance premiums for the full policy year.

The policy was issued upon the life of the late husband of Valta M. Corn, to-wit, Dalpha W. Corn, of Wichita Falls, Texas, appellee having been named beneficiary in the policy. The policy was issued on May 11, 1944, and provided for the quarterly premium payments of $11.49 each, to be paid in advance on or before the 11th day of each May, August, November, and February. The facts show that quarterly premiums were paid on May 11, 1944, August, 1944, and November, 1944. Then the deceased began to pay monthly premiums in the sum of $4.14, which the policy relates to be the correct monthly payment. These payments were made consistently to and including the month of March, 1946, and monthly receipts were issued for each monthly premium paid. The three quarterly premium payments, plus the 14 monthly premium payments, paid the policy up through April 10, 1946. The policy, and under the statute, allowed a 30 day grace period which would keep the policy in force until May 11, 1946. The insured died on May 30, 1946.

Appellee's contentions can more easily be ascertained from the court's finding of facts and conclusions of law, which are as follows:

"I. The Court finds that on May the 11th, 1944, the Defendant issued its policy of insurance No. 98945 on the life of Dalpha W. Corn in the sum of $1,715.00, in consideration of the quarterly premium of $11.49, in which the Plaintiff, Valta M. Corn, is named as beneficiary.

"II. The Court finds that on May the 30th, 1946, Dalpha W. Corn died in Wichita Falls, Texas.

"III. The Court finds that under the terms of the contract the premiums were payable quarterly, that three quarterly and fourteen monthly installment payments were paid by insured and accepted by the company, and payment made by insured's wife on May the 29th, 1946, in the sum of $8.28, and accepted by M. B. White, agent of the company, when policy was not lapsed.

"IV. The Court further finds that quarterly payments were due under contract in the sum of $11.49, and that insured paid fourteen monthly payments or installments on quarterly premium which gave insured credit on payments of $3.41 over-payment.

"V. I find that the February the 11th, 1946, payment and the March the 11th payment of $4.14 each, with credit due insured of $3.41 on over-payment of the quarterly premium, made a total of $11.55, and paid up the February the 11th quarterly payment due and extended the insurance to May the 11th, 1946, that the grace period of thirty days extended the policy to June the 11th, 1946.

"VI. I find that the policy had not lapsed when insured's wife paid company agent $8.28 on the quarterly payment due May the 11th, 1946."

"Conclusions of Law

"I. I find that the insured's policy is a binding obligation in the sum of $1,715.00, payable to Valta M. Corn upon the death on May the 30th, 1946, of the insured, Dalpha W. Corn.

"II. I conclude that the contract provided for quarterly payments in the sum of $11.49, and the company, by accepting partial or monthly payments on the quarterly premium due February the 11th, 1946, are estopped from setting up the date for the beginning of the thirty-day grace period before May the 11th, 1946, which extended the policy to June 11th, 1946; that giving the insured credit for amount overpaid on quarterly premium, of $3.41, added to the amount of $8.28, overpaid the quarterly premium of February the 11th by the amount of twenty cents.

"III. I conclude that by the company's acceptance of partial payment on the quarterly premium due February the 11th, 1946, the company waived the balance due on said quarterly payment, and the amount, if any, due was a debt to the company by insured.

"IV. I conclude that the Plaintiff is entitled to recover in this suit against the Defendant the sum of $1,715.00, with interest from this date at the legal rate, plus 12% penalty, and attorneys' fees in the sum of $500.00.

"V. The Court finds as a matter of law, taking into consideration the custom prevailing between the insured and insurer, said policy was in full force and effect at the time of the death of D. W. Corn; and that, by reason of its acceptance of the premiums, it is estopped to deny that the policy was in full force and effect on May the 30th, 1946."

The contention of appellant is found in its six brief points, quoted as follows:

"First Point: The court erred in holding the policy had not lapsed on May 30, 1946, when it was originally issued May 11, 1944, and there having been paid three quarterly premium payments and 14 monthly premium payments.

"Second Point: The court erred in holding that the agent, M. B. White, could extend time for payment of the premiums due upon the insurance contract.

"Third Point: The court erred in holding the company to be estopped to claim the lapse of the policy.

"Fourth Point: The court erred in holding that the insured could pay premiums on a monthly basis, receiving and retaining monthly premium receipts for each payment, and then at the end of a 14 month period have such total premium payments applied on quarterly premium payments at a reduced premium rate.

"Fifth Point: The court erred in holding that the company was estopped to claim that the policy in question had lapsed, because there was no evidence to support such a finding.

"Sixth Point: The court erred in holding that the company waived the balance due on the quarterly premium due on February 11, 1946, because there was no admissible evidence to support such a finding."

After a review of all the testimony in the light most favorable to appellee, we find that all six of appellant's points of error are well taken, even though it is conceded that appellee testified that the agent M. B. White contracted with her orally that the monthly payments would be construed to be a partial payment of a quarterly premium, yet we find that M. B. White was not such an official as could authorize a change in the written contract. The policy has the usual written provision, designating the persons or officers of the company who have the authority to make, or modify the contract, or extend the time for paying any premium and M. B. White was not one of those persons.

The contract further provides that the company shall not be bound by any promise or statement heretofore or hereafter made by any other person. Section 3 of the policy provides: "* * * Premiums are due and payable in advance at the Home Office of the Company in the city of Galveston, Texas, but may be paid to an authorized agent of the Company only in exchange for the Company's receipt therefor signed by its President, Vice-President, or Secretary and countersigned by the designated agent as evidence of such...