Wilhelm v. Prudential Ins. Co. of America

• Decision Date: 08 February 1921
• Docket Number: No. 16282.,16282.
• Parties: WILHELM v. PRUDENTIAL INS. CO. OF AMERICA.
• Court: Missouri Court of Appeals

227 S.W. 897

WILHELM v. PRUDENTIAL INS. CO. OF AMERICA.

No. 16282.

St. Louis Court of Appeals. Missouri.

February 8, 1921.

Rehearing Denied February 24, 1921.

Appeal from St. Louis Circuit Court; J. Hugo Grimm, Judge.

"Not to be officially published."

Action by Julia M. Wilhelm, formerly Julia M. Barber, against the Prudential Insurance Company of America. Judgment for defendant, and plaintiff appeals. Affirmed.

Frederick H. Bacon, of St. Louis, for appellant.

Fordyce, Holliday & White, of St. Louis, for respondent.

ALLEN, J.

This is an action upon a policy of life insurance issued by the defendant insurance company on the life of William J. Barber, deceased, for the sum of $5,000, payable to plaintiff. The policy was issued on March 8, 1909, in consideration of an annual premium of $130.45. Three annual premiums were paid on the policy, but the fourth annual premium, due March 8, 1912, was not paid. The insured died May 17, 1912. During the lifetime of the insured he and the plaintiff, the beneficiary, borrowed from the defendant company the sum of $170, executing as security for such loan an assignment of the policy, said assignment being contained in a "loan certificate" in evidence. It does not appear, however, that the policy was delivered to defendant. On March 8, 1912, this loan, with accumulated interest, amounted to $179.98. At that time the cash surrender value of the policy, as shown by an indorsement thereon, was $180. On or about April 1, 1912, the defendant was duly notified of the death of the insured, but disclaimed all liability, on the policy.

The cause was tried before the court without a jury, a jury having been waived, upon an agreed statement of facts, together with a stipulation containing a schedule of actuarial computations, and two exhibits, viz. the policy and the loan certificate mentioned above. The trial court found the issues for the defendant, and rendered judgment accordingly, from which judgment the plaintiff prosecutes this appeal.

A provision of the policy regarding the payment of premiums is as follows:

"If any premium be not paid when due, this policy shall be void, and all premiums forfeited to the company, except as herein provided."

The further provisions of the policy here pertinent are as follows:

"If this policy, having lapsed or become forfeited as specified in the clause, Paid-Up Life Policy,' above, be not surrendered for its cash value or for a paid-up life policy, the company will write in lieu of this policy, without any action on the part of the insured, a non-participating paid-up term policy for the full amount insured by this policy, such paid-up term policy to be dated on the day to which premiums have been duly paid, and to continue in force for the term indicated by the following table: Provided, however, that if there be any indebtedness to the company on account of this policy the amount of such paid-up term policy shall be the face amount of this policy less the amount of such indebtedness, and the tent for which such paid-up term policy shall run shall be changed to that term for which the cash surrender value of this policy herein specified, after deducting such indebtedness, will carry the modified amount at single premium term rates according to the American experience table of mortality, with three and one-half per cent. interest. The paid-up term policy will be delivered on the legal surrender of this policy."

In the stipulation containing the schedule of actuarial computations it was stipulated and agreed as follows:

"First. That the net reserve on the policy in suit computed as of the 8th day of March, 1912, and in accordance with the provisions of section 6946 of the Revised Statutes of Missouri 1909, viz.: According to the combined experience or actuaries' table of mortality with 4 per cent. interest was $223.50, and that three-fourths of said amount was $167.63.

* * * * * * * *

"Fourth. That the single premium term rate, according to the American Experience Table of Mortality, with 3½ per cent. interest for one year's insurance of $4,820.02, being the face amount of said policy less the indebtedness thereon, based on the insured's attained age of forty-three (43) on March 8, 1912, was $48.97 and proportionately for a shorter period."

It Is said in the brief of learned counsel for appellant that "this suit requires the application of the principles of equity." The action, however, is clearly one at law upon a contract of insurance, no equitable relief being sought, and the appeal is to be determined by the principles applicable to such cases.

It is also the contention of appellant's learned counsel that "the reserve on a regular life insurance policy such as that in suit is the property of the insured," and that the company cannot by contract, or otherwise, deprive the insured thereof. As to this we need only say that the rights of the parties are to be determined by the contract of insurance, construed in the light of the rules of law applicable to contracts of that character, except in so far as such contract is affected by our statutory law applicable thereto.

It is further argued for appellant that the "lien attempted to be created by the pledge of the policy under the loan certificate is void, because if a mortgage it is, in substance, usurious, and if a pledge it provides for a forfeiture." It is unnecessary to follow in detail the argument of appellant's counsel touching this matter. No question is here involved as to the effect of the terms of the loan certificate, or of any act of the company thereunder. The only question involved is whether the policy was carried in extended insurance from the date of the lapse by failure to pay the premium, viz....