Blount v. Royal Fraternal Ass'n

AlleN, J. There.is neither -allegation nor proof that the certificate of insurance, containing the provision reducing the amount of insurance to less than $500 in certain contingencies, has not been approved by the Insurance Commissioner, and as the validity of the provision is not affected by the fact that it was stamped on the certificate, it is a part of the contract. In Waters v. Annuity Co., 144 N. C., 671, there was a paster on the policy and entries on the application, and the Court said of them: “It is urged upon our attention that some of the entries, by means of which the application was made to accord with the policy and the paster, were made on the margin of the application and written longitudinally, and that such entries, so made, and even the paster itself, are presumptive evidence of a change in the contract after the application had been first signed. But neither the authorities nor the known usage in the making of such contracts are in support of the position to the extent contended for. We know that these policies, as well as the applications, are gotten up on printed forms designed to meet the average and general demand in contracts of this nature, and frequently changes are made to meet special circumstances; that these are ordinarily noted on the margin, and a slip is then pasted on the face of the policy to express the contract as affected by these changes. In the absence, therefore, of some special circumstances tending to cast suspicion on such entries, there should be no presumption of any alteration.” The presumption is in favor of the validity of all contracts (Loyd v. Loyd, 113 N. C., 189), and this presumption is aided in this case, as the plaintiff declares on the contract, without alleging the fact upon which she now relies to destroy a part of it, and she also introduced the contract in evidence in its entirety. *170 We are, therefore, of opinion, if the contention of the plaintiff as to the legal effect of Revisal, see. 4773a, is sound, that, as the presumption is that the contract and every part thereof is valid, nothing to the contrary appearing on the face of it, the burden was on the plaintiff to allege and prove that the Insurance Commissioner did not approve the certificate, and having failed to do so, she cannot recover more than the sum of $110 awarded here. If, however, the fact appeared affirmatively that the Insurance Commissioner had not approved the certificate, we would not give our assent to the position of the plaintiff that this would avoid the effect of the provision stamped on the certificate, leaving other parts of the certificate in force. The section of the Revisal relied on reads as follows: “It shall be unlawful for any insurance company, association, or order or society doing business in this State to issue, sell, or dispose of any policy, contract, or .certificate for less than $500, or use applications in connection therewith, until the forms of which have been submitted to and approved by the Insurance Commissioner of North Carolina, and copies filed in the Insurance Department.” The statute does not purport to deal with the validity of the contract of insurance, but with the insurance company. It does not say a policy for less than $500 shall be void unless approved by the Insurance Commissioner, but that it shall be unlawful for the company to issue such policy, and the reason for the language used is obvious. Those who apply for policies of less than $500 usually have little experience in the forms of insurance, or other contracts, and it was thought wise for the Insurance Commissioner to have special supervision over their contracts for their protection, but it was not intended to relieve the company from the contract made. If the position of the plaintiff should prevail, a policy for $300 would be unlawful unless approved by the Insurance Commissioner, and no recovery could be had on it, except possibly upon the idea that the insured would not be in pari delicio with the company. *171 Tbe ease of Ober v. Katzenstein, 160 N. C., 440, is in point. There tbe plaintiff sued upon a contract for tbe sale of fertilizer, and tbe defendant contended tbat tbe contract was illegal because tbe plaintiff bad failed to comply witb tbe requirements of tbe statute as to domestication, and was, therefore, doing business in tbe State unlawfully; but tbe Court said: “But"the statute does not invalidate either the express contract made between tbe plaintiff and tbe defendant, nor, indeed, tbe implied contract raised by tbe receipt of tbe goods of tbe former by tbe defendant. This point has been recently adjudicated. Tobacco Co. v. Tobacco Co., 144 N. C., 352. . If tbe State, in addition to tbe penalty, bad desired to render invalid tbe contract and to deny a recovery thereon, it would have so enacted, as it has done in regard to gambling and other illegal contracts.” We are, therefore, of opinion there is no error. Affirmed.