Voris v. Aetna Life Ins. Co. of Hartford, Conn.

• Decision Date: 06 March 1939
• Docket Number: No. 2531.,2531.
• Citation: 26 F. Supp. 722
• Court: U.S. District Court — Northern District of Oklahoma
• Parties: VORIS v. ÆTNA LIFE INS. CO. OF HARTFORD, CONN.

26 F. Supp. 722

VORIS v. ÆTNA LIFE INS. CO. OF HARTFORD, CONN.

No. 2531.

District Court, N. D. Oklahoma.

March 6, 1939.

D. F. Rainey and Donald F. McMahon, both of Tulsa, Okl., for plaintiff.

Green & Farmer, of Tulsa, Okl., for defendant.

FRANKLIN E. KENNAMER, District Judge.

Defendant, by two separate group insurance policies, insured employees of the Barnsdall Corporation, and its "associated and operated companies" — one of which being the Barnsdall Oil Company. Plaintiff, as an employee of the Barnsdall Oil Company, was issued a certificate of insurance under each of these policies; the certificate under one policy being dated June 1, 1920, and that under the other, September 1, 1926. The policies were procured from defendant by the Barnsdall Company as a part of an insurance program devised by the company for its employees. Under the first issued policy the oil company contracted to pay the entire premium without cost to the employees, such payments being treated as additional compensation to the employees for the following expected considerations as expressed by the company management in connection with the certificates of insurance issued to the employees: "We expect you to pay for it by giving us greater loyalty and cooperation, by working to prevent waste, and by making your services with us continuous and permanent." The last issued policy was known as a "contributory" policy, as both the oil company and each insured employee contributed toward the payment of premiums; the practice being for the company to pay the entire premium to defendant as it had contracted to do, and to deduct from the wage of each insured employee a proportionate part of the premuim cost. The insured employees had nothing to do with the remittance of premiums to the defendant insurer under either of the policies.

Each of the policies provided for stipulated benefits payable to an employee in case of his total and permanent disability occurring before the age of sixty years, and plaintiff's action here is to recover such disability benefits in the amounts named in his respective certificates.

In both policies there was a provision that the insurance as to any employee should terminate when he ceased to be employed by the Barnsdall. Defendant asserts that it has no liability to plaintiff under either of the policies for the reason that plaintiff had been discharged from the service of the oil company, and his insurance coverage under the policies terminated, prior to the occurrence of his disability.

That plaintiff has suffered total and permanent disability as defined by the policies is not controverted. Neither is it disputed that plaintiff entered the employment of the oil company prior to the issuance of the first of the above described policies, and continuously so remained until September 30, 1934. Defendant contends, however, that the oil company discharged plaintiff as of the last named date from his position in the "Gasoline Department" of the company, and that he was re-employed by the company in its "Production Department" in a different locality in January, 1935, with the status of a new employee so far as insurance, service and pension were concerned, and that beginning with April 1, 1935, and continuing until March 2, 1936, plaintiff had no status as an employee of any kind, and that payments to him by the company of $25 per month during this period were made simply as a gratuity.

It is the position of plaintiff that he was at all the times aforesaid in the employment of the oil company; that he understood his insurance was being kept in force by his employer under the practice of premium payments heretofore mentioned, and that he never, at any time, received any notice from either the Barnsdall or the defendant of any discontinuance of premium payments for him, or of the cancellation of either of the policies as to him; therefore, his disability having occurred while still in the service of the Barnsdall, he is entitled to recover from the defendant the stipulated benefits under both policies for total permanent disability.

The evidence is clear that plaintiff was carried as an insured under both policies from the dates of his respective certificates, with the Barnsdall remitting the necessary premiums to defendant until September 30, 1934. Thereafter, no further payments of premium were made for plaintiff by the Barnsdall on either policy, and no premiums paid for him at all on the first issued policy. However, for the last quarter of the year 1934, plaintiff paid to one Odell, an agent of the oil company who handled the collection and remittance of premiums, plaintiff's share of the quarter annual premium due on the "contributory" policy. It appears at the time plaintiff made this payment to Odell he was temporarily off duty as an employee of the company because of a surgical operation and illness. This was the last payment of premium made under this policy so far as concerns plaintiff. Odell testified that it was the practice of the Barnsdall to send to defendant on the first day of each month what was called an application list, listing thereon the employees who had become eligible for insurance during the previous month, and also listing those employees who had been dropped during the same period, and that on such list of date October 1, 1934, he (Odell) reported the plaintiff as having left the service of the oil company as of September 30, 1934, but, after learning that plaintiff was working for the company during the month of October, 1934, he wrote the New York office of Barnsdall to continue plaintiff's insurance until October 30, 1934. Odell also testified that the "contributory" policy in its entirety was cancelled as of September 30, 1934, and a new policy in lieu thereof taken out by the Barnsdall with defendant, but that plaintiff was not included as an insured under the new policy.

The exact date plaintiff became totally and permanently disabled cannot be fixed, but was sometime shortly after he had returned from east Texas where he had been sent by the oil company, and where he worked for it from the latter part of January, 1935, until February 20 of the same year. At any rate, it can be said that the evidence discloses that such disability occurred sometime prior to March 2, 1936.

Without reference to specific dates, it is clear that the oil company attempted to cancel the insurance of plaintiff under both policies prior to the date of plaintiff's disability by giving notice to defendant that plaintiff was not to be carried as an insured employee. However, it is equally clear that neither defendant nor Barnsdall ever gave plaintiff any notice of default in payment of premiums under either of these policies, or any notice that plaintiff's insurance thereunder had been terminated. On the other hand, plaintiff testified that after he returned from east Texas, and the company began the $25 per month payments to him, he inquired of Odell — who, as before stated, appeared to be in charge of the insurance handling for Barnsdall — concerning his insurance, and that Odell assured plaintiff that his insurance was being taken care of and it was not necessary for plaintiff to bother himself about it.

It is not difficult under the evidence to find that plaintiff was in the employment of the oil company at the time of the occurrence of his disability. The Barnsdall checks of $25 per month issued to plaintiff after ...