Opinion
40724.
DECIDED JUNE 2, 1964.
Action on insurance policy. Fulton Civil Court. Before Judge Parker.
Paul C. Myers, William I. Aynes, for plaintiff in error.
Edenfield, Heyman Sizemore, William F. Buchanan, William H. Major, contra.
1. The burden is on the litigant contending that the law of a foreign State controls over the law of Georgia to allege and prove both that such law is applicable and of what it is comprised. The response to the motion for summary judgment, which did not itself plead the law that movant now contends is controlling, also failed to set out wherein the law of South Carolina differs from the law of Georgia. The case must therefore be decided under applicable provisions of the common law as interpreted by the appellate courts of this State.
2. Unless expressly accepted as payment by agreement between the parties, a check given for an insurance premium is not payment until itself paid. Where the check tendered to the insurer on the last day of the grace period was dishonored because of insufficient funds the policy lapsed prior to the death of the insured.
DECIDED JUNE 2, 1964.
Mrs. Kersh brought suit seeking to recover $2,500 as the death benefits under a policy of insurance issued by the defendant in error, and also for the statutory penalty and $2,000 attorney's fees for alleged bad faith in refusing to pay the proceeds of the policy.
The plaintiff alleges that at the time of the death of the insured, which occurred on June 9, 1963, the policy was in force and effect. The insurance company denies that the policy was in force and effect by reason of the fact that the policy had lapsed prior to the death of the insured because of the failure to pay the monthly premiums.
The policy of insurance was purchased on December 21, 1961, and the contract provided for the payment of a monthly premium in the amount of $11.25 on the 21st of each month. On April 21, 1963, the monthly premium was not paid, but on May 21, 1963, being the last date of the grace period provided for by the terms of the policy, the insured gave an agent of the company a check for $10 and $1.25 in cash. The agent gave to the insured a printed receipt. The receipt on the reverse side of the signatures set forth the following language: "It is understood and agreed that a returned check or past due note or obligation of any kind is not payment, and that any obligation given in exchange for this receipt, when dishonored or not paid at maturity shall render this receipt and said policy absolutely void, except as provided by its terms."
The check was dated May 20, 1963, was delivered to the agent on May 21, 1963, was presented to the bank for payment on May 22, 1963, and was returned by the bank on May 24, 1963, for insufficient funds. It is uncontradicted that on each of the above dates the account of the insured was overdrawn.
When the check was returned the agent attempted to contact the insured at two different locations in Charleston, S.C., in order to get the insured to pay $10 in cash in lieu of the dishonored check. The agent ascertained that the insured had left Charleston without leaving any address. The company retained the returned check and also the $1.25 in cash. The company states that they could not refund the $1.25 in cash because the whereabouts of the insured was unknown. The insured was killed by a train on June 9, 1963, in Cobb County, Georgia. No legal representative of his estate was ever appointed.
Thereafter, appropriate notice and demands were given the company and it refused to pay the claims. When sued the company tendered the $1.25 cash into court. A motion for summary judgment was made by both parties and a general demurrer was filed by the plaintiff to the defendant's motion. Following the sustaining and the granting of the motion for the insurance company, the plaintiff assigns as error the overruling of her general demurrer to the defendant's motion for summary judgment and the sustaining of the defendant's motion for summary judgment.
1. The presumption is, where the law of another of the 13 original States is not pleaded and proved, that it is the common law as interpreted by this State. Trustees of Jesse Parker Williams Hospital v. Nisbet, 189 Ga. 807, 811 ( 7 S.E.2d 737). The burden is upon one contending that the law in such State is different from that laid down in the Code to allege and prove such fact. Wells v. Gress, 118 Ga. 566 (2) ( 45 S.E. 418). An appropriate receipt may of itself be considered a contract (17 CJS 726, Contracts, § 57), but whether this would be true of a receipt for a premium payment issued and received in South Carolina for an insurance contract delivered to the insured in Georgia need not here be considered. Even assuming that the receipt was of itself a contract and that this contract was a South Carolina contract because exchanged there for a consideration which thereafter partly failed, the question of what law governs relates not to the existence but to the legal effect of the instrument. The movant, in this case the defendant insurance company, may by failing to plead any differing South Carolina law present its case for decision under the law of this State, as it in fact did. The plaintiff in opposing the motion would, if not satisfied to have it decided under the provisions of the Georgia Code, have the burden cast on her to plead and prove that other law was in fact applicable. It is no ground for contesting the grant of the motion on its merits that the movant did not plead the law of South Carolina, since the result of such failure only raises the presumption that the law of Georgia prevails.
2. The provisions on the reverse side of this receipt to the effect that a returned check is not payment in this case does no more than call to the attention of the recipient what is in fact the law of this State to the effect that a check is not payment until itself paid unless explicitly taken with a contrary understanding. Code § 20-1004. Winton v. Butler, 53 Ga. App. 696, 699 ( 186 S.E. 773). In Veal v. Security Mut. Life Ins. Co., 6 Ga. App. 721 (1) ( 65 S.E. 714) it was stated: "If the holder of a policy of life insurance sends to the company on the day the premium is due a check in payment thereof, and when the check is presented at bank, payment is refused because of lack of funds to the credit of the drawer, the company, although it has delivered the premium receipt to the insured, may, by taking the proper steps, repudiate the transaction for the legal fraud resulting from the insured's having sent a check without having in bank the funds to meet it, and may enforce a lapse of the policy for non-payment of the premium. But if the company, in such a case, after notice that the check has been dishonored, retains it, and, instead of repudiating the transaction by returning the check and demanding back its receipt, insists upon the insured's paying it after the date on which the policy would otherwise have lapsed, a waiver of the punctual payment of the payment in cash results." Where on the other hand after notice of dishonor of the check the insurance company does not continue to claim liability but notifies the insured of the lapse which it couples with an offer of reinstatement not accepted by the insured, a verdict is demanded in favor of the company's contention that the policy has lapsed. Chandler v. American Central Life Ins. Co., 27 Ga. App. 810 ( 109 S.E. 919). "It is a generally accepted rule that where a check is taken for an insurance premium, it will ordinarily be assumed that the acceptance was conditioned upon the check's being honored upon proper presentation, so that if payment is refused, and in the meantime the period in which payment could be made has elapsed, the insurer may declare the policy forfeited for nonpayment." 50 ALR 2d, Anno., 630, 639 and citations. And where as here the company attempted to locate the insured to inform him of the fact that the check had not cleared but was unable to do so because the insured had departed without leaving a forwarding address, the company did all that it reasonably could under the circumstances and the fact that it retained the check and the $1.25 is insufficient to show a waiver on its part of the payment provision. "Waiver is a voluntary relinquishment of some known right, benefit, or advantage, which, except for such waiver, the party otherwise would have enjoyed." Gray Lumber Co. v. Harris, 8 Ga. App. 70, 76 ( 68 S.E. 749); New York Underwriters Ins. Co. v. Noles, 101 Ga. App. 922, 924 ( 115 S.E.2d 474). The inability of the company to contact the insured, due entirely to the fault of the latter, did not constitute a voluntary relinquishment by the company of its right to insist on a cash payment of the premium or its right, in the absence of this, to declare the policy lapsed.
The trial court did not err in granting the motion for summary judgment.
Judgment affirmed. Nichols, P. J., and Hall, J., concur.