Wastun v. Lincoln Nat. Life Ins. Co. of Ft. Wayne, Ind.

• Citation: 12 F.2d 422
• Decision Date: 02 April 1926
• Docket Number: No. 7043.,7043.
• Parties: WASTUN v. LINCOLN NAT. LIFE INS. CO. OF FT. WAYNE, IND.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

12 F.2d 422 (1926)

WASTUN v. LINCOLN NAT. LIFE INS. CO. OF FT. WAYNE, IND.^*

No. 7043.

Circuit Court of Appeals, Eighth Circuit.

April 2, 1926.

George J. Danforth, of Sioux Falls, S. D. (Edward D. Barron, of Sioux Falls, S. D., on the brief), for plaintiff in error.

Fred B. Shoaff, of Ft. Wayne, Ind. (Charles O. Bailey, John H. Voorhees and Theodore M. Bailey, all of Sioux Falls, S. D., on the brief), for defendant in error.

Before SANBORN, Circuit Judge, and MUNGER and JOHNSON, District Judges.

MUNGER, District Judge.

The plaintiff in error brought suit against the defendant in error to recover upon a policy of insurance issued by the defendant in error upon the joint lives of the plaintiff in error and her husband, Cornelius O. Wastun, payable to the survivor upon the death of either of the insured persons. The action was dismissed, and this error proceeding is brought to review the judgment of dismissal. The question presented is whether the policy was in force at the time of the death of the husband of the plaintiff in error.

The case was presented to the court upon the pleadings and a written stipulation of the facts. The sufficiency of these facts to support the judgment may be reviewed in this proceeding, because an agreed statement of facts submitted to the court and upon which its judgment is founded is equivalent to a special finding of the facts. Lehnen v. Dickson, 13 S. Ct. 481, 148 U. S. 71, 73, 37 L. Ed. 373; Supervisors v. Kennicott, 103 U. S. 554, 556, 26 L. Ed. 486; Fellman v. Royal Ins. Co., 185 F. 689, 690, 107 C. C. A. 637; Mutual Life Ins. Co. of New York v. Kelly, 114 F. 268, 271, 52 C. C. A. 154. The policy was issued May 16, 1921. The application for the insurance was executed in South Dakota and delivered to the company's agent in South Dakota, and the policy of insurance was delivered to the insured in that state. The policy contained a provision that the insurance was granted in consideration of the payment in advance of $164.50, and the annual payment of a like sum to the company on or before the 16th day of every May thereafter during the continuance of the contract. The policy also contained a provision that "one month of grace (not less than 30 days) without interest charge shall be allowed in the payment of any premium after the first, during which time the policy shall remain in force." Another provision allowed the reinstatement of the policy, if it should lapse, if the insured jointly furnished evidence of insurability satisfactory to the company, and paid all premium arrears with interest thereon. The second annual premium was due on May 16, 1922. It was not paid then, nor within the period of one month thereafter. On July 17, 1922, the insured each made a written application for the reinstatement of the policy. With the applications there was delivered to the company's local agent in South Dakota $89.50 in money and a promissory note signed by Mr. Wastun, the husband of the plaintiff in error, dated June 5, 1922, whereby he promised to pay the company $75 on November 16, 1922, with interest from June 16, 1922. This note contained these provisions:

"On November 16, 1922, after date, for value received, I promise to pay to the order of the Lincoln National Life Insurance Company at Minneapolis, Minnesota, seventy-five and no/100 dollars, with interest at the rate of six per cent. per annum from June 16, 1922.

"This note, together with eighty-nine and 50/100 dollars in cash is tendered to said company by the maker upon the understanding and agreement that it shall not be binding upon the maker until it is accepted by the secretary or assistant secretary of said company, if and when accepted such acceptance shall be upon the following express agreement, to wit:

"That although the annual premium due on the 16th day of May, 1922, on policy No. 86758, has not been paid, the insurance thereunder shall be continued in force until midnight of the due date of this note; that if this note is paid on or before the date it becomes due, or within fifteen days thereafter, such payment, together with said cash, will then be accepted by the company as payment of said premium, and all rights under said policy shall thereupon be the same as if said premium had been paid when due; that, if this note is not paid on or before the day it becomes due, or within fifteen days thereafter, it shall thereupon automatically cease to be a claim against the maker, and said company shall retain said cash as a part compensation for the rights and privileges hereby granted and all rights under said policy shall be the same as if said cash had not been paid nor this agreement made; that said company has duly given every notice required by its rules or by the laws of any state in respect to said premium, and in further compensation for the rights and privileges hereby granted the maker hereof has agreed to waive, and does hereby waive, every other notice in respect to said premium or this note, it being well understood by said maker that said company would not have accepted this agreement if any notice of any kind were required as a condition to the full enforcement of all its terms."

The note was not paid at the date when it was due, nor was it ever paid. Mr. Wastun died on or about May 30, 1923.

The plaintiff in error contends that the contract between the parties is governed by the laws of South Dakota, and especially by portions of the statutes of that state providing that no policy of life insurance shall be issued or delivered in the state unless authorized by other portions of the statutes, a provision that the policy shall constitute the entire contract between the parties, and a provision that no life insurance company shall make any discrimination between policy holders of the same class in the amount and payment of premiums. South Dakota Rev. Code (1919) §§ 9330, 9331, 9340. She further contends that the construction placed upon these statutes by the Supreme Court of South Dakota, in the case of Ritter v. American Life Ins. Co., 203 N. W. 503, should be adopted by this court. The basis of these contentions is that the contract was one governed by the laws of South Dakota. The facts are undisputed that, after the policy had lapsed because of the failure of the insured to pay the second annual premium, the insured delivered to the company's local agent in South Dakota the written applications for reinstatement of the policy, the sum paid in cash, and the note. The applications were addressed to the company, and the note was payable to the company. The agent sent the applications, the note, and the money to the head office of the company at Ft. Wayne, Ind., and at that place they were accepted by the company July 20, 1922. The applications for reinstatement were mere proposals to the company. They requested the company to revive the policy, reciting that it had lapsed on May 16, 1922. The applications contained statements certifying to the good health of the insured, and a statement as follows:

"I also further agree that the said policy shall not be considered reinstated until this application shall be duly approved by the company at its home office and that any payment of premium made by me in advance shall not be binding upon the company until this application shall be so approved. It is understood that the amount of such advance payment shall be returned to me in case the company does not approve this application for reinstatement of said policy."

In the note was the statement, already quoted, that it was tendered to the company on the understanding and agreement that it should not be binding on the maker until it was accepted by the secretary or assistant secretary of the company. It is clear that the contract for reinstatement of the policy was an Indiana contract. The test of the place of a contract is the place where the last act was done by either of the parties, essential to a meeting of the minds. Mitchell Furn. Co. v. Selden Breck Co., 42 S. Ct. 84, 257 U. S. 213, 214, 66 L. Ed. 201; Clark v. Belt, 223 F. 573, 577, 138 C. C. A. 1; Elliott on Contracts, §§ 62, 1116. The validity and interpretation of the contract are governed by the law of the place where it is made. Scudder v. Union National Bank, 91 U. S. 406, 412, 413, 23 L. Ed. 245; Pritchard v. Norton, 1 S. Ct. 102, 106 U. S. 124, 130, 27 L. Ed. 104. After the company had accepted the applications, the contract consisted of the applications, the note, and the policy. Iowa Life Insurance Co. v. Lewis, 23 S. Ct. 126, 187 U. S. 335, 346, 47 L. Ed. 204; Insurance Co. v. Norton, 96 U. S. 234, 240, 24 L. Ed. 689. The statutes of South Dakota did not enter into the...