Opinion
33317.
DECIDED MARCH 13, 1951. REHEARING DENIED MARCH 29, 1951.
Complaint on disability policy; from Baldwin Superior Court — Judge Carpenter. September 12, 1950.
Erwin Sibley, for plaintiff in error.
Marion Ennis, contra.
The petition stated a cause of action for the accrued total and permanent disability benefits, and for the return of the annual premium paid through a mistake of fact, and there being no merit in any of the special demurrers to the petition, the court did not err in overruling all of the demurrers.
DECIDED MARCH 13, 1951. REHEARING DENIED MARCH 29, 1951.
Roy L. Nelson brought an action against Jefferson Standard Life Insurance Company. The material allegations of the petition were substantially as follows: (3) At the time of filing the suit the defendant was indebted to the plaintiff in the principal sum of $373.98 with interest thereon because of a payment of premium made to the defendant on September 17, 1949, under protest, in the amount of $73.98, and on account of permanent and total disability benefits due the plaintiff by the defendant from July 22, 1949 through April 22, 1950, under the provisions of a life insurance policy a photostatic copy of which was attached to the petition. (4) This policy issued by the defendant to the plaintiff contains the following provisions with respect to the benefits inuring to the insured in the event of total and permanent disability: "If, while this policy is in force, before default in the payment of any premium, and before the anniversary of this policy on which his age at nearest birthday is sixty years, the Insured shall furnish to the Company due proof: (a) That he has become totally disabled by bodily injuries or disease and will be permanently, continuously and totally prevented thereby for life from pursuing any occupation or employment whatsoever for remuneration or profit, or (b) That he has become totally disabled by bodily injuries or disease and has been continuously and wholly prevented thereby for three or more consecutive months from engaging in any occupation or employment whatsoever for remuneration or profit, the Company by endorsement in writing upon this contract with agree to waive the premiums which shall become payable after receipt and approval of said proof, and will agree to pay to the insured for each completed month of such disability after receipt and approval of said proof and during the further continuance of such disability, a monthly income of one percent of the face amount of this policy, during the lifetime of the Insured. But no disability income will be paid or premium waived for any period of disability which preceded receipt of a written notice of such disability at the Home Office of the Company. The amount otherwise payable at maturity of this policy shall NOT be reduced by any premiums waived or income payment made under the above provisions. Without prejudice to any other causes of total and permanent disability, the Company will consider that the entire and irrecoverable loss of the sight of both eyes, or of the use of both hands, or of the use of both feet, or of the use of one limb and the sight of one eye, or of the use of one hand and the use of one foot will constitute total and permanent disability of the Insured that will entitle him to benefits under this provision. Proofs of continued total and permanent disability shall be furnished as often as required by the Company, on forms prescribed by the Company, and any medical adviser of the Company shall be allowed to examine the person of the Insured in respect to any alleged disability at any time, but not oftener than every six months after the first two years of disability. If, however, the Insured fails to furnish due proof of continued disability, when required by the Company, or if he recovers so as to be able to engage in any occupation or employment whatsoever for remuneration or profit, the Company's obligation to waive premiums or pay monthly income shall cease and the Insured shall resume the payment of premiums on the premium date following such failure or recovery, any premiums already waived or monthly income already paid by the Company NOT being charged as a lien hereon. The values in the Table of Values incorporated in this policy shall increase while premiums are waived by the Company because of disability in the same manner as if premiums were being paid by the Insured. The provisions for disability shall terminate if any nonforfeiture provisions other than automatic premium loan become effective and no benefit will be paid or allowed hereunder for disability arising while engaged in military or naval service, or any allied branch thereof in time of war. If in a claim for benefits under this provision, the Insured shall furnish the Company, after anniversary of this policy on which his age at nearest birthday is sixty years, due proof exists as defined in (a) or (b) above, then by endorsement on this contract the Company will agree that premium payments which shall become payable after receipt and approval of said proof, during the continuance of such disability, will be advanced as a loan without interest, secured by this policy. Dividends will be paid during disability in the same amount and manner as if the premiums were being paid by the Insured, except that Option 3 shall not be available." (5) Prior to his attainment of age sixty the plaintiff became totally and permanently disabled within the meaning of the above quoted provisions with respect to total and permanent disability. The plaintiff submitted to the defendant, as required by the policy, due proof of such total and permanent disability of the plaintiff. The defendant accepted the proof submitted by the plaintiff and began to pay the plaintiff the disability benefits on November 22, 1948 as provided for in the policy. The defendant paid the plaintiff disability benefits without interruption from November 22, 1948 through June 22, 1949 at the rate of $30 per month, in conformity with the provisions of the policy. (6) On May 20, 1949, the defendant forwarded to the plaintiff two forms upon which the defendant said the plaintiff was to furnish the defendant with proof of total and continuous disability. The plaintiff executed one of the forms and Dr. Charles B. Fulghum, the plaintiff's attending physician, executed the other. Both forms stated unequivocally that the plaintiff was totally disabled and unable to follow any and all gainful occupations. These forms were duly forwarded by the plaintiff to the defendant. (7) On July 19, 1949, without having requested of the plaintiff any additional proof whatever of total and permanent disability other than that requested on May 20, 1949, the defendant discontinued the plaintiff's disability benefits and demanded of him the payment of premiums beginning with the annual premium on August 28, 1949, which, under the terms of the disability benefit provisions of the policy were waived. (8) On July 22, 1949, the defendant defaulted in payment of total and permanent disability benefits due the plaintiff in accordance with the terms of the policy. On August 16, 1949, the plaintiff's attorney forwarded to the defendant voluntarily an affidavit sworn to by the plaintiff and an affidavit sworn to by his attending physician, in which it was stated that the plaintiff was totally and permanently disabled to such an extent that he was prevented for life from pursuing any occupation whatsoever for remuneration or profit. The defendant refused to accept this additional proof submitted voluntarily by the plaintiff, and has since that time refused to pay the total and permanent disability benefits due under the policy. (9) The defendant's representative, Louis B. Reece, Chief Inspector of Retail Credit Company, of Macon, Georgia, visited the plaintiff unexpectedly on or about July 5, 1949, at 3:30 p. m. for the purpose of procuring information for the defendant, and found the plaintiff at home in bed resting as the plaintiff's physician had directed. (10) The defendant's representative interviewed the plaintiff's physician, Dr. Fulghum, on or about July 5, 1949, and the doctor informed the representative that the plaintiff was totally and permanently disabled for life. (11) Despite this first-hand information, the defendant, without reason or justification, terminated the plaintiff's total disability payments which are due. (12) The defendant has never requested of the plaintiff any additional proof of total disability since the defendant submitted its request, and which the plaintiff complied with on May 20, 1949. (13) On September 17, 1949, the plaintiff forwarded to the defendant a check in the amount of $73.98, covering the annual premium on the policy. This premium was paid under protest for the reason that it should have been waived by the defendant under the terms of the policy on account of the plaintiff's total and permanent disability. This payment was forwarded to the defendant by registered mail with return receipt requested. (14) At the time the defendant began paying the disability benefits under the terms of the policy, the defendant was, and has continuously since that time, suffered with arteriosclerosis and hypertension from which ailments the plaintiff suffers intense pains in the head, hemorrhages of the nose, swelling of the feet and ankles, shortness of breath and the defendant has a hernia also. (15) On account of these infirmities the plaintiff has been, and will be, totally and permanently disabled for the remainder of his life, and such infirmities will forever prevent the plaintiff's pursuing any occupation or employment whatsoever for remuneration or profit. (16) The plaintiff, as owner and holder of the policy, made, through his attorney, a demand for the payment of the disability benefits on August 16, 1949, upon the defendant. The defendant refused to make payment within sixty days of such demand. The plaintiff further demanded the return of the premium paid under protest in the amount of $73.98, and gave the defendant sixty days' notice within which to pay the same, informing the defendant that unless these demands were complied with suit would be filed for the amounts due together with a request for penalties in conformity with the provisions of Code § 56-706. (17) The defendant failed to pay the disability benefits without justification or excuse and refused to do so in bad faith and the refusal to repay the premium paid under protest, which by the terms of the policy had been waived, was likewise an act of bad faith on the part of the defendant. (18) At the time the defendant ceased payment to the plaintiff of disability benefits under the policy, the plaintiff was totally and permanently disabled within the meaning of the provisions of the policy and such total and permanent disability has continued without interruption to the date of the filing of the action, and now continues and will continue throughout the lifetime of the plaintiff which the defendant well knows as the diseases suffered by the plaintiff are progressive. The plaintiff prays judgment for $373.98 with interest thereon at seven percent and twenty-five percent of the principal sum as attorney's fees.
The defendant's general and special demurrers were overruled and it excepted.
1. The defendant contends that under a proper construction of the contract of insurance, the plaintiff has failed to state a cause of action by virtue of his failure to allege that the defendant had agreed in writing, by endorsement on the policy, to pay the stipulated monthly benefits for total and permanent disability, and the plaintiff failed to allege that the defendant had likewise agreed in writing, by endorsement on the policy, to waive premiums which became due after receipt and approval of proof of total disability, since such agreements in writing endorsed upon the policy constituted conditions precedent to the plaintiff's right to receive these benefits under the policy.
As we construe the contract of insurance, in order for the plaintiff to be entitled to the total and permanent disability payments and to the waiver of premiums, it must appear (a) that the plaintiff, prior to the anniversary of the policy on which his age would be sixty years, had become totally, continuously, and permanently disabled for life while the policy was in force and before any default in the payment of premiums due; (b) or that because of such total disability he was unable to engage in any occupation or employment for remuneration or profit for three or more consecutive months; (1) that he had submitted due proof of such disability to the defendant who had accepted and approved such proof; and (2) that the defendant had agreed in writing by endorsement on the policy to pay the disability benefits and to waive the premiums. Subdivisions 1 and 2 are applicable to both subdivisions which are denominated a and b. Compliance with these provisions of the policy is a condition precedent to the insured's right to the indemnities and benefits provided for in the policy and to his right to maintain a suit therefor. McLendon v. Jefferson Standard Life Ins. Co., 59 Ga. App. 399 ( 1 S.E.2d 75); Turner v. Life Casualty Insurance Co. of Tenn., 54 Ga. App. 424 ( 188 S.E. 269); Dean v. Northwestern Mutual Life Ins. Co., 175 Ga. 321 ( 165 S.E. 235); Equitable Life Assurance Society v. Adams, 56 Ga. App. 5 ( 192 S.E. 90); Mavrikis v. National Life c. Co., 55 Ga. App. 241 ( 190 S.E. 41).
However, "any provision of a policy made for the company's benefit may be waived by the company either expressly or impliedly by the company's action." Jones v. Pacific Mutual Life Ins. Co., 57 Ga. App. 16, 23 ( 194 S.E. 249); Rogers v. American National Ins. Co., 145 Ga. 570 ( 89 S.E. 700); Guaranty Life Ins. Co. v. Pughsley, 57 Ga. App. 588, 591 ( 196 S.E. 265). The clause of condition in the policy providing that upon receipt and approval of due proof of total disability the insurer would agree in writing by endorsement on the policy to pay the benefits and waive the premiums was for the benefit of the defendant and could be waived; and, when this clause is considered in connection with other provisions of the contract and the allegations of the petition, it is apparent that it was waived by the defendant insurer.
A proviso to this very clause provides: "But no disability income will be paid or premium waived for any period of disability which preceded receipt of written notice of such disability at the Home Office of the Company." The plaintiff alleges that "prior to attainment of age sixty plaintiff became totally and permanently disabled within the meaning of . . [the policy] with respect to total and permanent disability. Plaintiff submitted to the defendant as required by said policy, due proof of such total and permanent disability on plaintiff's part. The defendant accepted the proof submitted by the plaintiff and began to pay plaintiff the disability benefits provided for in said policy on November 22, 1948. Defendant paid the plaintiff disability benefits without interruption from November 22, 1948, through June 22, 1949, at the rate of $30.00 per month in conformity with the . . [policy]." It is clear that under the terms of the contract of insurance payments for disability benefits are not to be begun by the insurer until after receipt and approval of due proof that the plaintiff is totally disabled for life, or has been totally disabled for three or more consecutive months, within the meaning of the policy, and that payment of premiums is not to be waived except upon receipt and approval of the same proof of total disability. The plaintiff alleges, however, that the payments were begun and continued for a period of some eight months. Obviously the defendant had received and approved the plaintiff's proof of total disability or the alleged monthly payments would not have been forthcoming. Under these circumstances, therefore, the defendant will be held to have waived the requirement that the agreement to pay disability benefits and waive payment of premiums be endorsed upon the policy. Consequently in the absence of any other showing, the plaintiff was, under the terms of the contract of insurance together with the waiver of the requirement for endorsement of the agreement upon the policy, entitled to receive the monthly disability benefits and entitled to the waiver of premiums which thereafter became due during the continuance of such disability.
2. The plaintiff alleged in paragraph 3 of his petition: "At the time of the filing of this suit the defendant is indebted to plaintiff in the principal sum of $373.98 with interest thereon, because of a payment of premium made by plaintiff to defendant on September 17, 1949, under protest, in the amount of $73.98 (hereinafter more fully stated) and on account of permanent and total disability benefits due plaintiff by the defendant beginning July 22nd, 1949 through April 22nd, 1950, under the provisions of the following life insurance policy." In paragraph 13 of the plaintiff's petition he alleged: "Plaintiff shows that on September 17, 1949, he forwarded to the defendant a check in the amount of $73.98 covering annual premium on the above referred to policy, which premium was paid under protest, for the reason that the same should have been waived by the defendant under the terms of the policy on account of plaintiff's total and permanent disability. Same was forwarded to the defendant by registered mail with return receipt requested." The defendant lodged the following demurrers against these portions of the petition: "3. Defendant specially demurs on the ground that the said petition is duplicitous in that the same is for the recovery in one count, ten (10) monthly installments of $300.00 per month alleged due as disability payments under the alleged policy and also is an action for the return of an alleged premium paid of $73.98." "10. Defendant demurs to paragraph (13) on the grounds that the same is irrelevant and shows no facts of liability of this defendant therein nor anywhere else in the petition."
"As a general rule, if the premium is paid through mistake as to the facts, under the supposition, which is unfounded, that there is an obligation to pay, it is returnable; or, in other words, if a premium is paid under a supposition that a certain state of facts exists whereby the company would be entitled to the money, and the supposed facts do not exist, and the premium would presumably not have been paid had the actual facts been known by the payer, such premium so paid may be recovered back. Thus, if a premium be paid after a forfeiture of the policy under a mistake as to the fact of waiver, it shall be returnable. So, also, in case an assessment collected by mistake after a forfeiture, or in a case of an endowment policy which has matured, on which the insured, induced by the representations of the insurer's agent, continues to pay premiums." 3. Couch, Cyclopedia of Insurance Law, p. 2397, § 729.
Here the petition in its entirety shows that it was based upon a consistent statement of a single state of facts arising under one insurance contract; that the premium was paid under the supposition, which was unfounded, that to keep the policy in force during the time of the total and permanent disability in question and sued for, the plaintiff was obligated to pay such premium, when under the terms of the policy such premium should have been waived on account of the plaintiff's total and permanent disability, and the payment of such premium was induced by the representations of the insurer's agent. We think that the petition stated a cause of action for the return of the premium and that under the facts of this case was not duplicitous.
3. Grounds 13, 14, and 15 of the defendant's demurrer, lodged against paragraphs 16, 17 and 18 of the plaintiff's petition, upon the ground that they set forth no fact showing liability for attorney's fees and damages for bad faith and that there was a continuation of the alleged disability. It is alleged that on two occasions, once upon request of the defendant and once voluntarily, the plaintiff had furnished proof of his total disability, but the defendant refused to continue the disability payments. These allegations were in aid of the plaintiff's contention that the defendant so acted in bad faith as to entitle him to statutory damages and attorney's fees. It was not incumbent upon the plaintiff to show a continuation of the alleged disability under the provisions of the contract of insurance. The fact that he had recovered or had refused to furnish proof of his continued disability would be a matter of defense. Guardian Life Insurance Co. v. Snow, 51 Ga. App. 280 ( 180 S.E. 241); New York Life Insurance Co. v. Bradford, 55 Ga. App. 248 ( 189 S.E. 914). The court properly overruled these grounds of the demurrer.
4. In ground 2 of the defendant's demurrer objection is made that the petition "is duplicitous in that in one count plaintiff sues as the basis of his cause of action a default in the continuance of payments of monthly claims of $30.00 per month for disability already existing and also for the failure to pay $30.00 monthly claims for a disability to which due proof was given by plaintiff." Assuming for the sake of argument that this language of the demurrer means something and that it objects, as counsel says in his brief, "to the petition and points out that in one count plaintiff has sued on a special provision of the policy which contains two (2) distinct and different causes of action: `(a) that he has become totally disabled . . and will be permanently, continuously and totally prevented thereby for life from pursuing any occupation or employment' etc., and `(b) that he has become totally disabled . . and has been continuously and wholly prevented thereby for three or more consecutive months from engaging in an occupation or employment' etc., and that plaintiff has not sufficiently set out which of these two causes of action he bases his recovery in this one count of his petition," this ground of the demurrer is not meritorious.
It is clear that the plaintiff is setting up that he has been totally and permanently disabled since the latter part of November 1947; that the defendant commenced payments for total and permanent disability on November 22, 1948, and discontinued these payments on July 19, 1949; and that the plaintiff is now seeking only those payments for total and permanent disability which have accrued between the time the defendant discontinued the payments and the filing of the petition, or trial of the case. We find no intimation in the petition that the plaintiff anywhere seeks to recover for total (but not permanent) disability which has continued for a given number of months more than three, and prevented the plaintiff from pursuing any gainful occupation or employment.
5. Grounds 4, 5, 6, 7, 8, 9, 11, and 12 of the defendant's demurrer which object to the allegations of certain designated paragraphs of the petition as being conclusions of the pleader and irrelevant to the cause of action are without merit.
Judgment affirmed. Gardner and Townsend, JJ., concur.
ON MOTION FOR REHEARING.
Paragraph 5 of the plaintiff in error's motion for a rehearing seeks to raise the question that the plaintiff in the allegations of his petition is claiming too much interest and also too much damages based on this excess of interest under Code § 56-706. A defect in the petition, in that the wrong measure of damage is set out, can be reached only by special demurrer, which specifically points out the defect in the petition and is directed to that particular portion of it. Atlanta Plow Co. v. Bennett, 49 Ga. App. 672 (6) ( 176 S.E. 822); Koch Co. v. Adair, 49 Ga. App. 824 (3) ( 176 S.E. 680); National Bondholders Corp. v. Cheeseman, 190 Ga. 166, 168 ( 8 S.E.2d 391). There is no such special demurrer and the question is not now presented by this record. Brown v. Georgia, Carolina Northern Ry. Co., 119 Ga. 88, 91 ( 46 S.E. 71). The petition sets forth a cause of action and if it set forth the wrong measure of damage, this may be reached by a proper special demurrer; but the wrong measure of damage does not subject the petition to a general demurrer. Elwell v. Atlanta Gas-Light Co., 51 Ga. App. 919 (6) ( 181 S.E. 599). This and all other matters in the motions for rehearing having been considered, the motions are denied.
Rehearing denied. Gardner and Townsend, JJ., concur.