Waddell v. New England Mutual Life Insurance Company, of Boston, Massachusetts

• Decision Date: 08 October 1924
• Docket Number: 11,866
• Citation: 147 N.E. 816,83 Ind.App. 209
• Parties: WADDELL v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, OF BOSTON, MASSACHUSETTS
• Court: Indiana Appellate Court

147 N.E. 816

83 Ind.App. 209

WADDELL v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, OF BOSTON, MASSACHUSETTS

No. 11,866

Court of Appeals of Indiana

October 8, 1924

Rehearing denied February 3, 1925. Transfer denied May 22 1925.

From Morgan Circuit Court; Alfred M. Bain, Judge.

Action by Maude Waddell against the New England Mutual Life Insurance Company of Boston, Massachusetts. From a judgment for defendant, the plaintiff appeals.

Reversed.

A. W Fenstermacher and W. B. Waddell, for appellant.

Charles Martindale, for appellee.

OPINION

NICHOLS, P. J.

Action by appellant against appellee upon an insurance policy.

The complaint was in six paragraphs, to each of which appellee answered in two paragraphs, the first a general denial, and the second an affirmative answer, to which appellant filed a demurrer which was overruled. There was a trial by the court which resulted in a finding and judgment in favor of appellee. Appellant's motion for a new trial was overruled. This ruling and the action of the court in overruling the several demurrers to the said second paragraph of answer are assigned as error.

The facts averred and in evidence, and which are undisputed, so far as we need to consider them, are, in substance, that one Courtney of Boswell, Indiana, by his application was insured under a policy of insurance dated November 10, 1913, whereby, in consideration of the payment in advance of $ 337.50 and of the payment of a like sum on or before the tenth day of November in each year thereafter during the life of said Courtney, appellee agreed to pay, upon proper proof of the death of the insured, $ 5,000 to his daughter, appellant herein, less any indebtedness to the company on account of or secured by the policy. The insured paid the first and second annual premiums but, in November, 1915, when the third annual premium became due, in payment of that premium, he applied the amount to which he was entitled as distribution (dividend) under said policy, paid a portion of the premium in cash, and, for the remainder of the premium, executed and delivered to appellee three promissory notes, all dated November 10, 1915, each note being for $ 84, all aggregating $ 252, said three notes being due respectively in three, six and nine months after date, with interest at six per cent. per annum. He paid the first two of said notes, due in three and six months after date, but he did not pay and never has paid the third of said notes. When the next annual premium, due November 10, 1916, became due, he defaulted in the payment of said premium, and paid no further premiums upon said policy. On November 10, 1915, there was due the insured under said policy the sum of $ 58.75 as his share of the apportionment of the surplus of the company distributable to said policy. From the reserve on the policy November 10, 1916, the company deducted the indebtedness evidenced by said premium note for $ 84 and the interest thereon $ 5.04, aggregating $ 89.04, and added thereto the said amount due the insured as his share of the apportionment of the surplus, being said $ 58.75, the net cash value of the policy so found by appellee being $ 450.46, which sum appellee applied to the purchase of $ 4,970 of extended term insurance for a period of three years and fifty-nine days. The amount of extended insurance was determined by adding to the face value, $ 5,000, the surplus $ 58.75 and deducting therefrom the amount of the note $ 89.04, making $ 4,969.71 or, in round numbers, $ 4,970.

Appellee paid to the insured during his life time the share of the surplus distribution to said policy in the years 1917, 1918 and 1919, and he died on March 3, 1920, the policy having expired by appellee's method of adjustment on January 8, 1920. It is stated by appellee and contended by appellant that, "The whole issue in this case is whether the company (appellee) had the right, in calculating the cash value of the policy on November 10, 1916, to be applied as a net single premium to the purchase of extended insurance, from the anniversary date last passed for its face amount including any additions and less any indebtedness hereon or secured hereby for such time as the then cash value together with any accumulated surplus held at interest will purchase as a net single premium, to deduct the premium note of $ 84.00." If appellee had such right, the several demurrers and the motion for a new trial were properly overruled. Otherwise, they should have been sustained. The court held that the company had such right and it was proper to make such deduction of said note in calculating the cash value so to be applied as a net single...