Union Cent. Life Ins. Co. v. Phillips

• Decision Date: 06 February 1900
• Docket Number: 838.
• Parties: UNION CENT. LIFE INS. CO. v. PHILLIPS.
• Court: U.S. Court of Appeals — Fifth Circuit

102 F. 19

UNION CENT. LIFE INS. CO. v. PHILLIPS.

No. 838.

United States Court of Appeals, Fifth Circuit.

February 6, 1900

Action by William T. Phillips, administrator of William Arlena Pugh deceased, against the Union Central Life Insurance Company. From a decree for plaintiff, defendant appeals. Reversed.

Phillips as guardian of Ella L. Pugh, minor, brought suit at law for $5,000 and damages and attorney's fees in the superior court of Bibb county, Ga., against the Union Central Life Insurance Company of Ohio, on a policy alleged to have been issued by that company on the life of Willis Arlena Pugh, an older sister, also a minor, for the benefit of, and payable to, the said Ella L. Pugh, the plaintiff; alleging that the policy had been executed and forwarded by the company to its manager, T. S. Lowry, Macon, Ga., about the 1st day of June 1895, and that said Lowry thereupon became the agent of the assured for the delivery of said policy, and the said Lowry undertook and agreed as such to deliver, but had refused to deliver it; that the assured died on the 12th day of said month of June. Plaintiff also alleged demand for the policy and for payment, and due proof of claim and death, and that payment had been refused; giving notice to defendant to produce application and policy of insurance sued on, and praying for judgment. There was exhibited to the petition the receipt of Lowry, manager, to W. T. Phillips, of May 8, 1895 for $36.95, and for note of $100, being the first annual premium, and embodying agreement 'that said Willis Arlena Pugh is to be insured from date of this receipt in accordance with the provisions, conditions, and stipulations of the policies of said company. If, however, the application shall be declined by the company, this agreement to be null and void, and the amount returned to said Phillips by me on surrender of receipt. ' Defendant removed the cause into said United States circuit court, and therein appeared and pleaded, denying all the allegations in plaintiff's petition except paragraphs 2, 12, and 16; among the paragraphs emphatically denied being paragraph 14, which expressly alleged that the application and policy were for the benefit of, and payable to, said Ella L. Pugh.

The case was called for trial on the 15th of December, 1896, a year and a half after the death of the assured, and defendant's attorneys handed a policy to plaintiff's attorneys in response to notices given in petition and otherwise, accompanying the said policy with written and sworn response of John M. Patterson, president of defendant, showing the policy furnished to be the only one ever executed by defendant on life of the deceased. Plaintiff's attorneys, upon discovering the policy was not payable to Ella L. Pugh, but, in case of death of said Willis A. Pugh, to her executors, administrators, or assigns, moved to amend the suit at law by making it a suit in favor of Phillips as administrator of Willis A. Pugh, deceased, on a policy payable to such administrator, instead of a suit, as it then stood, in favor of Phillips as guardian of his minor ward, Ella L. Pugh, on a policy payable to her; the plaintiff incorporating in his motion allegations to the effect that defendant had refused to allow him to see the application or policy, and had concealed the terms, conditions, and provisions of the same, and that it then for the first time came to his knowledge that the same was payable to the legal representative of deceased. The court refused to allow the amendment, but by a separate order, on motion of plaintiff's counsel, ordered that plaintiff be allowed 'thirty days in which to file a bill on the equity side of the court, and in default thereof said case stand dismissed.'

On the 4th of January, 1897, Phillips, the same natural person, but as administrator of Willis A. Pugh, the deceased, and not as guardian of Ella L. Pugh, his monor ward in life, nor as plaintiff in the suit at law, filed a bill in the same court against the same defendant in aid of the common-law suit, under order of the judge at chambers, granted on that day, in which order the judge required the defendant to show cause why the common-law action should not be enjoined. Complainant alleged in his bill substantially what the plaintiff did in the common-law petition, expressly alleging in paragraph 8 that said Lowry, manager, after receiving said policy, held the same as agent of orator, and alleging, additionally, that said Lowry, as manager, on the 3d of June, 1895, after receiving said policy, 'wrote and mailed to orator, at Delight, Twiggs county, Ga., a postal notifying your orator that said policy had been received by him 'O.K.,' and that he would shortly come down and deliver same, ' which postal was duly received at Delight post office on June 5, 1895, and that before he went to Twiggs county, and turned over said policy to orator or Willis Arlena, but while he still held the same as agent of Willis Arlena, to wit, on the 11th of June, 1895, the said Willis Arlena died. The complainant also charged fraud on the part of defendant, its agents and attorneys, in failing and refusing to deliver and exhibit the policy or copy thereof, and in repossessing itself of the same, and that orator was illiterate, and could not read, and believed the application was made by Willis Arlena for a policy to be payable to her sister Ella Louise Pugh, minor ward of orator, and that said policy had been so issued, and did not discover otherwise until said policy and application were produced under notice in court in the common-law suit on the 15th of December, 1896; that he had, under such impression that the policy was payable to said Ella Louise, made proof of death, and demand of payment, and brought the said suit as her guardian, in Bibb superior court, to recover the amount due on said policy. Complainant also charged that defendant refused to allow his counsel to inspect said policy, or give a copy thereof, to prevent proper suit being brought within one year after death, and thus invoke the one-year clause to defeat said suit. He prayed injunction against common-law suit, delivery of policy, recovery of the money, and for damages, and for attorney's fees, and for general relief.

Defendant demurred to the bill as follows: '(1) No jurisdiction; (2) no equity; (3) not maintainable in aid of the cause therein referred to, or as ancillary thereto, or as supplemental thereto; (4) not maintainable as an original bill, or as a bill in the nature of an original bill, or bill not original; (5) because under averments and exhibits not maintainable in cause or court in aid of suit, complainant not being party to suit, and the cause of action in bill not being same cause of action in suit, and right of recovery in bill not being same right of recovery in suit; (6) because complainant (as administrator of deceased) had never made proof of death, proof of claim, or demand for payment; (7) because it appeared from the terms of the contract sued on and exhibited that the time within which suit could be brought and maintained thereon, either in law or in equity, had expired before the filing of the bill; (8) because complainant not entitled to any relief prayed.' Defendant filed an answer for cause, as required by the order of the judge, denying all the material allegations of the bill, including the averments of fraud, and pleading the one-year clause, and complainant and defendant supported the bill, and answer by affidavits.

The court heard the demurrer and rule to show cause at the same time, and on the 29th of April, 1897, overruled the demurrer, and refused the injunction; the defendant filing, and having the court to note, exceptions to the order overruling said demurrer.

The respondent duly filed its answer June 5, 1897, denying all the material allegations in the bill, including those of fraud; and also, in denying the delivery of the policy alleged that the same was 'forwarded to said Lowry upon condition that he would visit the said Willis Arlena Pugh at her residence, and after enabling himself to do so, by acquiring all necessary and proper information, answer in writing certain questions hereafter given in the opinion; that in forwarding said policy to the said Lowry the same was accompanied with this form, and the said Lowry was instructed and required before delivering it to visit the residence of the said Willis Arlena, and to fully answer in writing the said questions; that the said Lowry had no instructions or authority to otherwise deliver the same, and he never made said visit or answered said questions, and was never in a position to act for respondent in delivering said policy; that he received the same as agent of this respondent; that he so held the same as agent of this respondent; that no contract of insurance ever existed between respondent and the said Willis Arlena, except the conditional contract set forth in said receipt; that respondent never approved said application, and never delivered said policy, and never authorized it to be delivered, except upon the conditions stated; that at the time said Lowry wrote the postal card he assumed that there would be no difficulty in his making the necessary written statement, as required of him by the company, upon his visit to the residence of the said Willis Arlena, and fully expected when he made said visit to complete the said examination and answer said questions in writing as required, and then to deliver the said policy; that before he made said visit or statement the said Willis Arlena died, leaving the said contract of insurance incomplete, and not binding upon respondent. ' Respondent further alleges that until the motion to amend the common-law suit was made it never knew or had any notice...