Wright v. Fuller

• Decision Date: 11 July 1918
• Docket Number: 682.
• Parties: WRIGHT, INS. COM'R, v. FULLER.
• Court: Georgia Supreme Court

96 S.E. 433

148 Ga. 223

WRIGHT, INS. COM'R, v. FULLER.

No. 682.

Supreme Court of Georgia

July 11, 1918

Syllabus by the Court.

A policy of insurance, in which the daughter of the insured was named as the beneficiary, contained the following clauses (1) In the event of the death of the insured, the company would pay to the beneficiary the sum of $5,000 in 100 monthly installments of $50 each. (2) Should the insured attain the age of 78 years while the contract was in full force and effect, she should receive the above-mentioned annuity under the same plan as provided for her beneficiary in the event of death: Provided that, should the insured die before the sum of $5,000 should be paid, her beneficiary should in like manner receive the unpaid installments. (3) "In the event said member [insured] should become totally and permanently disabled while this policy is in full force and effect, his premiums shall cease during such disability, and he may receive the said annuity in monthly payments of $25 each: Provided, that, should he recover from such disability the said payments to him shall cease, and the amount paid to him shall be charged against his policy as a loan." While the policy was in force the insured suffered an illness producing total and permanent disability. Five months thereafter insolvency proceedings were instituted against the insurer, and seven months thereafter the order of liquidation of the insurer as an insolvent company was passed. The insured continuously remained in a condition of total disability for more than a year after the passing of the order of liquidation, when she died. Held:

When the insured became "totally and permanently disabled," the obligation of the insurer was fixed definite, and demandable, and the obligation was to pay to the insured the full amount of the policy in monthly payments of $25 each.

The court did not err in fixing the damages for the breach of the contract of insurance at the full amount of the policy reduced to its present cash value as of the date of the order of liquidation, and in rendering judgment in favor of the personal representative of the insured against the assets of the insurer.

Error from Superior Court, Fulton County; Geo. L. Bell, Judge.

In the matter of the American Annuity Association, in liquidation. S. H. Fuller, administrator of the estate of Mary E. Fuller, deceased, filed an intervention against W. A. Wright, Insurance Commissioner. From a judgment for intervener, the Insurance Commissioner brings error. Affirmed.

Under an insurance policy providing that, if insured should become totally and permanently disabled, he was to receive a fixed monthly payment until amount of policy was paid, the obligation of the insurer became fixed, definite, and demandable when the insured became totally and permanently disabled, and, upon the breach of the contract of insurance by the insurer's liquidation, the insurer was liable for the full amount of the policy reduced to its present cash value as of the date of the liquidation order.

On August 28, 1911, the American Life Annuity Association issued a policy upon the life of Mary E. Fuller for the sum of $5,000. Lula J. Fuller, the beneficiary therein named, was the daughter of the insured. The policy contained the following material provisions:

(1) In the event of the death of the insured, the company would pay to the beneficiary the sum of $5,000 in 100 monthly installments, of $50 each.

(2) "Should the member to whom this policy is issued attain the age of 78 years while this contract is in full force and effect, he may receive the above-mentioned annuity under the same plan as provided for his beneficiary in the event of death: Provided, however, that should said member die before the sum of $5,000 shall have been paid, his said beneficiary shall in like manner receive the unpaid installments."

(3) "In the event said member should become totally and permanently disabled while this policy is in full force and effect, his premiums shall cease during such disability, and he may receive the said annuity in monthly payments of $25 each: Provided, that should he recover from such disability, the said payments to him shall cease, and the amount paid to him shall be charged against his policy as a loan. * * * This contract is issued in consideration of the payment of the first annual premium of three hundred and eight and no/100 dollars, and the further payment of a like amount on the 21st day of August each year until the assured shall attain the age of 78."

On July 14, 1913, the insurance company was placed in the hands of William A. Wright, insurance commissioner of Georgia, for liquidation. The order of liquidation was passed on September 28, 1913. On February 12, 1912, the insured was stricken with paralysis. This stroke of paralysis totally and permanently disabled the insured, and she was thereafter confined to her bed in a comatose condition. On January 8, 1915, the insured died. The premiums on the policy were paid at maturity from the date of the issuance of the policy until the death of the insured. The beneficiary in the policy intervened in the insolvency case, and claimed that she was entitled to receive the value of the policy as a death claim. Her contention was rejected by the trial court and by the Supreme Court; this court holding that inasmuch as the insured was living at the date of the order of liquidation the policy in question was "ipso facto canceled, and a claim of loss thereafter occurring is not a provable claim by the beneficiary against the company." Fuller v. Wright, 147 Ga. 70, 92 S.E. 873, L.R.A. 1917E, 1139.

Following the decision...