Opinion
32894.
DECIDED MARCH 17, 1950.
Complaint on life policy; from Fulton Civil Court — Judge Robert Carpenter. December 2, 1949.
Milam Smith, Robert G. Smith, James Glenn Lamar, for plaintiff.
William F. Buchanan, Mary J. Nelson, for defendant.
Under the terms of the contract involved in the present case the continuance of the policy was a prerequisite to the recovery sought, and the payment of premiums was a prerequisite to a continuance of the policy, and there is not even a general allegation showing that the insurance policy was in full force and effect at the time of death of the insured or that the conditions necessary for a continuance of the policy were ever met, and no legal excuse for the non-performance of the conditions is shown. It was essential that the plaintiff make the necessary allegation in this respect to show a right of recovery. The petition failed to state a cause of action, and the general demurrer of the defendant was properly sustained.
DECIDED MARCH 17, 1950.
This action was brought in the Civil Court of Fulton County by Mary M. Webb against the National Life and Accident Insurance Company, to recover on a life-insurance policy as the beneficiary. In the petition it is alleged: (2) that on September 2, 1946, "in consideration of the weekly premium paid and contracted to be paid to it," the defendant issued an insurance policy for $908, plus a like amount in the event of death by accidental means, on the life of Henry W. Webb, for the benefit of the plaintiff; (3) that Henry W. Webb died on November 10, 1946; (4) that his death resulted "directly and independently of all other causes from bodily injuries effected solely through accidental means, to wit, he was accidentally shot with a pistol in the hands of his nephew who was riding in the front seat of an automobile, to the right of the driver, at which time the deceased was riding on the left hand side of the rear seat of the automobile"; (5) that the defendant had due notice of said death on February 21, 1947, and declined to recognize the insurance policy as a valid obligation, and its action in this respect makes unnecessary the filing of any proof of death of the insured; (6) that written demand for payment was mailed to the defendant at its office in Nashville, Tennessee, in a properly addressed and stamped envelope, on February 21, 1947, and the defendant refused to pay the loss within 60 days after the demand was made, said refusal being in bad faith and the defendant having no reason to delay payment. Judgment was sought for double the amount of the insurance policy, plus the statutory penalty and attorney's fees.
A copy of the insurance policy is attached to and made a part of the petition. It indicates that it was issued to Henry W. Webb, age 23, on September 2, 1946, with Mary M. Webb as beneficiary, for a weekly premium of $.67, and the amount of the insurance is $908. Certain provisions of the insurance policy are as follows: "(1) Payment at Death of Insured — Immediately upon receipt of due proof of the death of the Insured during the continuance of this policy, the Company will pay the amount of Insurance to the Beneficiary. (2) Premiums — This insurance is granted in consideration of the payment of the weekly premium on or before each Monday, beginning with the Date of Issue, until paid for twenty full policy years or until the prior death of the Insured. . . If any premium is not paid when due, it shall be in default, and if it is not paid by the end of the grace period, described below, the policy shall lapse and cease to be in force except as otherwise provided in the policy. (3) Grace Period — A grace period of four weeks (twenty-eight days) will be granted for payment of premium and while no premium is in default more than four weeks, the policy shall continue in force. If death occurs within the grace period, any premium in default will be deducted from the Amount of Insurance payable." It is further provided in the policy that it may be reinstated after lapse, upon presentation of evidence of insurability and payment of all premiums in default, unless the extended insurance had expired or the cash surrender value had been paid, and there is a provision for payment of an additional amount equal to the amount of insurance in the event of accidental death under certain conditions, including due proof of accidental death during the continuance of the policy. In the event of a lapse certain nonforfeiture benefits of the policy became applicable. These benefits are extended insurance, or in lieu of extended insurance, paid-up life insurance or payment of a cash surrender value, upon written application of the insured within a certain time after lapse. As shown by a table attached to the policy the extended life insurance feature could become effective only after the insurance had been in force for 26 weeks, the paid-up life insurance after three years, and the cash surrender value after five years.
A copy of the letter which was sent to the insurance company is attached to and made a part of the petition. This letter is dated February 19, 1947, and is signed by counsel for the plaintiff. The body of the letter is as follows:
"On January 13, 1947, Mr. Alton T. Milam, for our firm, wrote you requesting Proof of Death forms to be filled out on the death of Henry W. Webb, and we have your letter in which you failed to send the forms, and say, `According to our records the policy is not in force and does not have a non-forfeiture value.'
"Inasmuch as you failed to send the forms, so that we can make proper proof of death, we take this as a denial of any liability under the policy, and on behalf of Mrs. Mary M. Webb, beneficiary, demand the payment of $1816.00, which includes the $908.00, the amount of the insurance, and a like amount because of death by accidental means, as defined in said policy, and in case you refuse to pay said amount within 60 days from the time you receive this demand, then we shall file the necessary suit to recover said amount, together with not more than 25% on the liability of your company for said loss, and also reasonable attorneys fees for the prosecution of the case, as provided in Sec. 56-706 of the Code of Georgia. Will you please take notice of this demand for payment.
"If we have misconstrued your answer and you desire to send us forms for making the required proof of death, please do so right away."
The trial judge sustained a general demurrer to the petition, and dismissed the action, to which ruling and judgment the plaintiff excepted.
"A contract may be absolute or conditional. In the former, every covenant is independent, and the breach of one does not relieve the obligation of another. In the latter, the covenants are dependent the one upon the other, and the breach of one is a release of the binding force of all dependent covenants. The classification of every contract must depend upon a rational interpretation of the intention of the parties." Code § 20-109. "Conditions may be precedent or subsequent. In the former, the condition must be performed before the contract becomes absolute and obligatory upon the other party. In the latter, the breach of the condition may destroy the party's rights under the contract, or may give a right to damages to the other party, according to a true construction of the intentions of the parties." § 20-110. By the provisions of the insurance contract the insurer would pay the amount of insurance to the beneficiary on receipt of due proof of the death of the insured during the continuance of the policy, and on receipt of due proof of accidental death as defined in the policy the insured would pay a like amount to the beneficiary. In order for there to be a continuance of the policy it was provided that the weekly premiums must be paid when due, or within the grace period of four weeks, or else the policy would lapse, entitling the insured and eventually the beneficiary to certain non-forfeiture benefits, under certain conditions, but if the insurance policy was lapsed in the present case at the time of the death of the insured, it could not have been in force for a sufficient length of time for any of these non-forfeiture benefits to become applicable, inasmuch as the first non-forfeiture, extended insurance, came into effect automatically upon lapse, provided the insurance had been in force for 26 weeks, at least. Without determining the necessity of furnishing due proof of death to the insurer under the alleged facts in the present case, the case is controlled by the effect of the provisions of the insurance contract in regard to a continuance of the policy by a payment of the premiums when due or within the grace period. In substance, the petition shows that the policy was issued on September 2, 1946, and that the death of the insured occurred on November 10, 1946, solely as the result of the accidental discharge of a pistol by another. Construing the allegations of the petition most strongly against the pleader, as must be done on demurrer, there is nothing in the petition to show that there was a continuance of the policy by a payment of the weekly premiums, but on the contrary, as shown by the statement of the insurer to which reference is made in the demand of the beneficiary, the insurance policy was not in force. Under the terms of the contract involved in the present case the continuance of the policy was a condition prerequisite to the recovery sought, and the payment of premiums was a prerequisite to a continuance of the policy, and there is not even a general allegation showing that the insurance policy was in full force and effect or that the conditions necessary for a continuance of the policy were ever met, and no legal excuse for the non-performance of the conditions is shown. It was essential that the plaintiff make the necessary allegation in this respect to show a right of recovery. The petition failed to state a cause of action, and the general demurrer of the defendant was properly sustained.
Judgment affirmed. Felton and Worrill, JJ., concur.