Opinion
No. 4423.
November 20, 1933. Rehearing Denied November 30, 1933.
Appeal from District Court, Bowie County; R. J. Williams, Judge.
Action by Mrs. Edna Hicks against the National Mutual Accident Insurance Company. Judgment for plaintiff, and defendant appeals.
Affirmed.
The suit is by appellee upon a policy of accident insurance issued by the appellant, the National Mutual Accident Insurance Company, to John W. Hicks, insuring him against death, resulting directly and independently of all other causes from bodily injuries sustained through purely accidental means. The appellee was named as beneficiary in the policy of insurance.
The petition set up the issuance and delivery of the policy to John W. Hicks, and with the provision therein that, in the event John W. Hicks lost his life resulting directly and independently of all other causes from bodily injuries sustained through purely accidental means, it would pay to plaintiff $7,500 in twenty-five equal monthly installments; that payments of all premiums as provided by the terms of the policy had been made, and the policy was in full force and effect on the dates and time John W. Hicks was injured and died; that on November 1, 1931, John W. Hicks was injured, and; as a result thereof, died on November 2, 1931. The prayer reads: "Wherefore, in view of the facts aforesaid, the plaintiff brings this action and prays that upon the trial of this action the plaintiff have judgment against the defendant for the sum of monthly installments accruing up to the date of the trial of this case, together with legal interest thereon from the due date of each of said payments, and that she have all such other and further relief as by reason of the facts aforesaid, she is entitled, and that she have general relief."
The defendant's answer set up that a premium in the sum of $6 was due and payable on said policy for each of the months of September and October, 1931; that default had been made in the payment of the said premiums, and that said policy had lapsed and was of no force and effect on November 1, 1931, when John W. Hicks was injured, and on November 2, 1931, when he died. The answer further set up the stipulation in the policy that, in the event of default in the payment of premium, the subsequent acceptance of premium by the company should reinstate the policy, but only to cover accidental injuries thereafter sustained, and that the payment of $18 received by the defendant on November 3, 1931, could only operate as a reinstatement to cover accidental injuries thereafter sustained.
The plaintiff replied to the answer, and, setting up the special facts, claimed waiver of and estoppel to urge the forfeiture.
The appellant is a mutual accident insurance company chartered under the laws of Texas as such. The policy of insurance provides that:
"The Company will pay, for loss of life, $7500.00. All sums due under this policy for loss of life, limbs or sight shall be paid after receipt of satisfactory, affirmative, and final proof of loss in twenty-five equal monthly installments."
That "3. If default be made in the payment of the agreed payment for this policy, the subsequent acceptance of the premium by the Company or any of its duly authorized agents shall reinstate the policy, but only to cover all accidental injury thereafter sustained, and such sickness as may begin more than ten days after the date of such acceptance."
Further:
"Additional Provision. (d) The application of the insured hereunder is hereby made a part of this contract and this policy is issued in consideration of the statements made by the insured in the application, and the insured agrees to make payments in the sum of $6.00 each month and to remit same to the Home Office within ten days after notification, and failure to so remit automatically cancels all benefits and insurance given by reason thereof and by reason of this policy. Premiums due under this policy must be paid to the Company by the insured even though a claim is pending, and should the insured fail to pay any due premiums during such period this policy shall be lapsed. This policy shall be non-cancellable except for nonpayment of premiums when due.
"(e) The date of payment of premiums shall be as indicated from the date of issue of the policy, or ten days from date notification is mailed in Houston, Texas, but the mailing of such notice is merely a matter of service to the insured, and the Company assumes no responsibility for failure to send such notice or for nondelivery of same, and no offer of reinstatement after due date of any premium shall be held a waiver of this condition."
The plaintiff complied with the terms of the policy by giving notice of the injury and death of the insured, and made proof of such fact and demanded payment, but the defendant refused payment, and suit was instituted.
On the afternoon of November 1, 1931, between 5 and 6 o'clock, an automobile suddenly swerved and ran off the highway and forcibly struck against a room of a nearby filling station, practically demolishing that end of the building. The insured, John W. Hicks, who at the time was in the room seated on a chair, sustained serious bodily injuries. He died during the morning time of November 2, 1931, as the direct and proximate result of being injured in the manner stated. The defendant upon the trial of the case admitted: "We will admit Mr. Hicks met his death by an accidental injury. We make no point about his having received his death from accidental means. We admit he received his death in the manner set forth and required by the terms of the policy."
The case was submitted to the jury upon the single issue: "Special Issue No. 1: Do you find from a preponderance of the evidence introduced on this trial that the defendant, Insurance Company waived the failure of the deceased, J. W. Hicks, to pay the premiums on the policy for September and October, 1931, when they were due, as a cause or reason for the forfeiting his rights under the terms of the policy sued on?" Answer of the jury: "Yes."
The evidence supports the finding of the jury, and such finding of fact is here adopted by this court, that the insurance company did waive the default in the payment and its right to insist on the policy provisions for forfeiture in respect thereto, of the monthly premiums which had matured on September 9, 1931, and October 9, 1931.
It was proven that on Saturday morning of October 31, 1931, in due course of mail, the insured received the following letter from the home office of the appellant:
"Geo. H. Cottrill, President.
"C. E. Hill, Secretary.
"National Mutual Accident Insurance Company.
"Licensed by the Texas Insurance Commissioner.
"809-814 Scanlan Building.
"Houston, Texas.
"October 29, 1931.
"Important — Do Not Lay This Aside.
"The Sending of this Notice Shall Not constitute a Waiver of the Policy Conditions.
"John W. Hicks, Box 332, Texarkana, Ark.
"Dear Policyholder: There will be a premium payment due on your Health and Accident policy of $18.00 due Sept. Oct. Nov. 9th.
"Your protection is best assured by prompt remittance, and we thank you in advance for your early attention to the matter. Your check should reach us not later than ten days from this date.
"We appreciate your business and believe you wish to keep your policy in force.
"Yours very truly,
"National Mutual Accident Insurance Company,
"By George H. Cottrill, President."
The following evidence appears undisputed: Mrs. Hicks, the wife of the insured, testified: "This letter (above set out) is dated October 29, 1931, which according to the calendar you handed me, is Thursday. I remember the date of October 31, 1931, when we received the letter, to be Saturday. My husband was in the front of our house when the postman delivered the letter, and he said he had `a letter from the insurance company.' I later in the morning read the letter and then wrote out and signed a check. I put the check in an envelope and addressed it to the National Mutual Accident Insurance, 809 Scanlan Building, Houston, Texas. I stamped the envelope. I did not go to the Post Office and mail the letter that day. We did not close our filling station until late at night, being Saturday, and we were tired. We opened the filling station on Sunday, the next day. We did not go to the Post Office that day. After the accident happened on Sunday afternoon Mr. Hicks was at once carried to the hospital in an ambulance. At the hospital some one came to me and said `There are letters in the office,' (of the filling station), on the desk,' and asked if I wanted them mailed.' I said, `Yes, mail the letters.'"
Thereafter the following was timely received in due course of mail:
"Premium Receipt.
"Houston, Texas, Nov. 3, 1931.
"Received of John W. Hicks, Box 332, Texarkana, Ark. Eighteen Dollars, $18.00 in payment of premium on Health and Accident Policy to December 9, 1931, (Checks are accepted subject to collection and are not to be considered a payment until collected.)
"National Mutual Accident Insurance Company
"By: I. Greer."
The check, which was mailed in payment of the premiums mentioned, reads:
"Texarkana, Ark. Oct. 31, 1931.
(N. P.) "The State National Bank."Pay to the Order of: National Mutual Accident Insurance Co. $18.00 Eighteen and 00/100 Dollars.
"Mrs. Edna Hicks.
"(Paid on Accident Policy for John W. Hicks.)"
Indorsements appearing: "Pay to the order of Public National Bank Trust Co., 465 Houston, Texas. For Deposit Only. National Mutual Accident Insurance Co."
The check was promptly paid on November 6, 1931. The cashier of appellant testified that "a payment of $18.00 was received by the Company for the months of September, October and November, 1931, and proper credit was applied." The credit was entered as of date November 3, 1931. At the date of the credit, the company had no notice of the death of the insured. After the date of receiving from the company the receipt above mentioned, the plaintiff made out proofs of death of the insured upon the blanks for the purpose forwarded to her by the company. Also: "And I sent them (Home Office) as requested the newspaper clippings of Mr. Hicks' death." The plaintiff testified:
"Q. Now, Mrs. Hicks, as to the $18.00 which you sent to them (Home Office) on October 31, have they ever paid that money back to you? A. No, sir.
"Q. Have they offered to pay it back to you? A. No, sir.
"Q. After you got the receipt back and some time after then, did you take up with the Company about paying your policy? A. Yes, sir.
"Q. Did they ever pay you this policy, or offer to pay it? A. No, sir.
"Q. They have not paid it to this day (of trial)? A. No, sir."
This suit was filed on February 19, 1932. It appears in the record during the trial on September 26, 1932, namely: "The defendant now makes tender of $18.00 in United States currency to plaintiff, admitting that it has never tendered this amount until today." "The tender is not accepted by plaintiff."
Simmons Arnold, of Houston, and Keeney Moseley, of Texarkana, for appellant.
King, Mahaffey, Wheeler Bryson, of Texarkana, for appellee.
There is directly presented by the proposition which is based on the first and second assignments of error the controversial and vital point in the case of whether in the circumstances proven the insurance company can be deemed to have waived the right of forfeiture of the policy for nonpayment of premiums. The evidence is without dispute that the insured failed to pay the monthly premiums as and when due on his policy during the months of September and October, 1931; that the default and nonpayment thereof was existing on the days of October 29 and October 31, 1931; that the policy of insurance contains the express provision that: "The insured agrees to make payments in the sum of $6.00 per month and to remit the same to the Home Office within ten days after notification, and failure to so remit automatically cancels all benefits and insurance given by reason thereof and by reason of this policy." Such provision is valid, and its effect upon such default in the payments mentioned by the insured is to preclude the beneficiary from a recovery upon the policy, unless the answer thereto would be, of waiver by the insurance company of its right to urge or take advantage of such default in the payments mentioned. It is the conceded rule that, if the insurer intentionally elects to take advantage of the known existing default in the payment of premiums, the law, in order to avert the forfeiture of the policy, will hold the insurer irrevocably bound as by an election to treat the contract of insurance as if no cause of forfeiture had occurred. This election may be either expressed or implied; and any competent evidence, whether direct or circumstantial, may be shown which tends to prove or disprove such fact. Equitable Life Assur. Soc. v. Ellis, 105 Tex. 526, 147 S.W. 1152, 152 S.W. 625; Dunken v. Ætna Life Ins. Co. (Tex.Civ.App.) 221 S.W. 691; 33 C.J. § 847, p. 120. And we can see no good reason why a waiver should not be predicated upon the evidence considered as a whole. The language of the letter of October 29, 1931, written to the insured from the home office of the insurance company, is entirely consistent with the purpose and intention of waiving the default in the payments mentioned. In the commencement of the letter there is specific statement of the premiums as and when due, and in the language following the whole tenor thereof implies an admission that the company waived the literal requirements of the policy as to their timely payment. The statement of the premiums evidences not only the delinquent payments "due September and October," but also the payment for October yet to be due on "Nov. 9th." It was dealing altogether as one matter, with premiums past due and unpaid and a premium not at the time due and payable. It was pointed out to the insured that "your protection is best assured" by the "prompt remittance" of the total amount of the premiums mentioned, both past due and the one yet to become due, and directed him to have "your check" for the total amount thereof "reach us not later than ten days from this date (of October 29, 1931)." The expression in the conclusion is that: "We believe you wish to keep your policy in force," meaning thereby not automatically canceled for nonpayment of the premiums. The whole letter seeks to have, and holds out the hope of, the payment of delinquent premiums, the same as if no cause of forfeiture had occurred. The undisputed evidence in behalf of the insured reflects there was "prompt remittance" of the money to pay the delinquent and coming due premiums, and in the very purpose of keeping the "policy in force" and prevent its being considered lapsed. The insurance company at the time of the letter and at the time of the payment by check knew of the delinquent payments and could not claim ignorance thereof. The ledger account as reflected by the evidence showed it. After receiving the payment of the delinquent premiums and the premium coming due on November 9, the company credited the account of the insured therewith, and, with full knowledge of the death and date of death of the insured through due proofs of loss made, kept the money and kept it to the credit of the account of the insured, and made no offer to return same until the date of trial, some eleven months after payment. The waiver was complete and irrevocable of the default in the payments mentioned. The jury has found a waiver, and the finding is here sustained.
Error is predicated upon the refusal to submit to the jury certain special issues. It is believed there was no error. The issue submitted to the jury is in proper form, and there was no other issue in the case, but that of purely waiver or not.
The appellant predicates error upon the judgment as to the amount of recovery. The plaintiff sued for the matured installments, and specially asked that the liability of the insurance company be fixed as to the future installments. The court granted this relief, as was authorized to be done, under the general prayer for such other and further relief as entitled to by reason of the facts pleaded. The liability of the appellant to pay the amount promised in a lump sum has been decided in many cases.
We have considered all the assignments, and conclude that same should be overruled, as not presenting reversible error.
The judgment is affirmed.