Yates v. New England Mutual Life Insurance Company

• Citation: 220 N.W. 285,117 Neb. 265
• Decision Date: 26 June 1928
• Docket Number: 25228
• Parties: ANNE K. YATES, APPELLANT, v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, APPELLEE
• Court: Supreme Court of Nebraska

220 N.W. 285

117 Neb. 265

ANNE K. YATES, APPELLANT, v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, APPELLEE

No. 25228

Supreme Court of Nebraska

June 26, 1928

APPEAL from the district court for Douglas county: CHARLES LESLIE JUDGE. Reversed.

REVERSED AND REMANDED.

Frank C. Yates and Nelson C. Pratt, for appellant.

C. J Baird and L. C. Hupp, contra.

Heard before GOSS, C. J., DEAN, THOMPSON, EBERLY and HOWELL, JJ and CHASE, District Judge.

OPINION

HOWELL, J.

This is an appeal from a judgment of the district court for Douglas county, dismissing plaintiff's cause of action. Appellant was plaintiff, and the parties will hereafter be referred to as plaintiff and company.

The action was based upon a policy of insurance for $ 2,000, issued June 14, 1913, to John B. Lindsey, husband of plaintiff, she being named as beneficiary.

At the close of plaintiff's testimony, the company moved for a directed verdict. The court sustained that motion, discharged the jury and ordered plaintiff's action dismissed.

The pleadings have given us some trouble, and we deem it necessary to analyze them by paragraphs.

Paragraph 1 of the petition alleges the corporate entity of the company; the issuance of the policy to John B. Lindsey on June 14, 1913, a copy of the policy is attached to the petition, and made a part thereof, and its acceptance by Lindsey, "now deceased," at Omaha. Paragraph 1 of the answer admits those allegations.

Paragraph 2 of the petition avers that Lindsey resided in Omaha and paid all dues required to keep the insurance in force to and including January 14, 1915. Paragraph 2 of the answer admits the residence of Lindsey, concedes the insurance was in force to January 14, 1914, and denies payment of dues beyond that date.

Paragraph 3 of the petition alleges that, about April 13, 1914, Lindsey was employed and resided in Omaha, disappeared at that time and had not since been heard from. Paragraph 3 of the answer denies those allegations for want of sufficient information to admit them. Having admitted Lindsey's death, in paragraph 1, there is little, if anything, left of paragraphs 3 of the petition and answer.

Paragraph 4 of the petition alleges the plaintiff was the wife of Lindsey; vigilant efforts to find him; inability to trace him; his absence for seven years, and his death about April 13, 1914. Paragraph 4 of the answer states lack of information to admit, and therefore denies, those allegations. Affirmative matters of defense are alleged: (1) Lindsey died, if dead, "by his own hand or act" within one year from the date of the policy; (2) no proof was furnished of the death of Lindsey; and (3) a tender of premiums paid.

The only tender made was the offer in the answer. It was not actually made or kept good, and was offered only "in case proof should be furnished of his death as alleged in the petition." There was no allegation in the petition that Lindsey died by his own hand, or act, or suicided. As stated before, his death was admitted, and it only remained to be shown when it occurred, and not necessarily how it occurred. The denial was, death did not occur about April 13, 1914. By turning to paragraph 5 of the answer, it will be observed the company alleged the policy "had not been in force" one year, "and the first year's premium had not been paid," by reason of which, "said policy lapsed."

Paragraph 5 of the petition alleges the policy was in force at "the date of death of said John B. Lindsey;" plaintiff advised the company of the death and offered to make proof, and had submitted proof thereof; demanded payment, and the company "failed, refused and declined" to pay. Paragraph 5 of the answer denied the foregoing, and alleged the issuance of the policy on June 14, 1913, "in consideration of the application" for the insurance, "and of the payment of the advance annual premium of $ 55 together with the sum of $ 12.04 for temporary insurance to January 14, 1914," the payment of future like annual premiums, and "defendant agreed to pay, upon proof of his death, to his wife, Anne K. Lindsey, the sum of $ 2,000;" except the $ 12.04 for temporary insurance to January 14, 1914, the required premiums were not paid; in case of nonpayment of any premium when due within the first three years, the policy shall cease and all rights forfeited; that the policy had not been in force for a year at the time of the alleged death, and the first year's premium had not been paid, because of which the policy lapsed; "that more than five years have elapsed since the alleged cause of action accrued, and the same is barred by the statute of limitations."

Paragraph 6 of the petition and the answer are merely formal, the answer including a general denial.

When the case was called for trial, the company was permitted to amend its answer by interlineation, and plaintiff was given leave to file reply. A jury was at once drawn and the trial proceeded without a reply being actually filed. Thus, the issues were permitted to loosely stand. So far as the record goes, issues the reply might have presented, or that were assumed, were not limited. No objection was made to any testimony as not being within issues. The field was open to plaintiff so long as the company acquiesced, as to any issue available within the proper functions of a reply, and the evidence properly received.

Pruned to crux, the petition declares that plaintiff's husband died about April 13, 1914, having insurance with the company for $ 2,000 in full force, evidenced by a policy issued June 14, 1913, naming her as beneficiary, and the company owed her the money.

The company admitted such a policy was issued, that insured was dead, and it had not paid the policy.

To avoid payment, the company set up four grounds of defense; (1) The policy lapsed for nonpayment of premiums before insured died. (2) Insured committed suicide. (3) No proof of death had ever been furnished the company. (4) The claim was barred by the statute of limitations. As we read the evidence and the pleadings, there is but one controlling ultimate question to be determined, and that is: Did the insured die within one year from the date of the policy, and before it lapsed for nonpayment of premiums?

At the trial two letters were received in evidence, which were objected to by the company for the reason they were "incompetent, irrelevant, immaterial, no foundation laid." No objection was made because they were not within the issues. The trial court was not asked to, nor did it, rule on that question. One letter was written May 3, 1921, by plaintiff's attorney to the company, saying: "We * * * hereby make demand upon you for the payment of the benefits under this policy. You will please prepare proofs of death and send same to us to be filled out. This is to inform you that John B. Lindsey disappeared on the 13th day of April, 1914; that he has not been seen or heard of, and the circumstances surrounding his disappearance are such as to be very strongly presumptive of his death. * * * You will please give some attention to this matter within the next ten days, as we have been authorized by our client that, unless action is taken by the company for the payment of the benefits under this policy, to immediately institute suit." The other letter was written May 16, 1921, by the company to the attorney, saying: "Replying to your letter of May 3, company advises us that policy No. 264010, on the life of John B. Lindsey, lapsed for nonpayment of the six months' note of $ 14, given in part payment of the first premium and became due July 14, 1914, and has no value."

This action was commenced December 7, 1921. At the time the company wrote the letter of May 16, 1921, every defense it sought to interpose by answer was complete, if good, and known to it, including limitations. In Mitchell v. Brotherhood of Locomotive Firemen and Enginemen, 103 Neb. 791, 174 N.W. 422, it is said:

"Defendant knew of the statements made in the application. It was also advised, before it promised to pay the loss when proofs were furnished, of the fact a witness had testified before a special master in United States district court, that decedent had received an injury in a railroad wreck on December 5, 1905, that he was operated upon, a portion of his skull removed, and a silver plate placed over the opening, and had since suffered from dizzy spells and epilepsy. This was sufficient notice of a probable defense, and if it desired to assert it, it should not have put its refusal to pay upon the other ground only. We are of the opinion that defendant is estopped to defend upon the ground set up in the amended answer."

Had the company furnished the blanks for proofs as requested, it would have learned all the facts. Its reply to plaintiff was, in effect, the company is not concerned about how the insured died or when he died, because the policy lapsed for nonpayment of the premium note which "became due July 14, 1914." Whether the reason was a good one, or bad, it precluded itself from setting up another after litigation started.

Powers v. Bohuslav, 84 Neb. 179, 120 N.W. 942, Good, C., now an honored member of this court, was dealing with a suit for commissions on a brokerage contract for the sale of land. The broker secured a purchaser, and the landowner refused to convey the land, giving a certain reason therefor. When sued, he set up another and different defense. On page 184, the court said: "Defendant, having failed to object upon the ground that the purchaser was willing to pay all cash, instead of deferring a part of the purchase price, until after litigation was instituted, will not now be heard to make such defense." In that case, the reply was a general denial, and no estoppel was pleaded.

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