American Assurance Ass'n v. Hardiman

Fish, C. J. (After stating the facts.) TJnder the express stipulations of the policy, it was forfeited upon the failure of the insured to pay the three weekly premiums due, respectively, November 21, November 28, and December 5, 1904. The policy could have been restored by the payment, during the third week, of all ar-rearages and the premiums for the next two following weeks, if the insured had been at that time in good health and had not suffered from disease or injury during the arrearage period. The evidence that the insured was, at the time a tender was made of a sufficient amount to cover the premiums due on November 21, November 28, and December 5, and the premiums for the next two succeeding weeks, in bad health and, suffering from the disease from which he subsequently died, was uncontradicted. So by the terms of the policy it was not only forfeited, but the right to restore it by the payment of these five premiums did not exist. It is contended, however, that the requirement of the policy with reference to the payment of the premiums on Monday of each week had been changed or waived by the course of dealing between the local agent of the insurer at Augusta, Georgia, and the insured, by which a custom had been established of fortnightly instead of weekly premiums, and that therefore there was an arrearage of only one premium, instead of three, when the tender was made by the attorney of the beneficiary. We do not think that there is any merit in this con [382] tention. It is, to say the least, very doubtful whether the mere habit of collecting the premiums every two weeks, instead of every week, could have the effect of changing or waiving the conditions of the policy with reference to its forfeiture' upon failure to pay three weekly premiums; for, while the policy provided that the premiums should be paid upon Monday of each week, no penalty or forfeiture was incurred by a mere failure to páy one weekly premium, nor for a failure to pay two weekly premiums. So, if the premiums were paid every two weeks, there could be no forfeiture of the policy. But admitting, for the sake of the argument, that an established custom on the part of the association of not insisting upon the payment of each weekly premium as it fell due, but of collecting the premiums at intervals of two weeks, would nullify the provision of the policy providing for its forfeiture whenever premiums for three weeks should be due and unpaid, the evidence fails to show that there was such a custom of the association. The alleged custom, if it existed at all, was between the local collecting agent of the insurer and the insured. From the evidence it appears that this agent was a special agent,, whose authority, so far as the record discloses, was limited to the collection of the premiums upon the certificate of insurance. It does not affirmatively appear that he had even this limited authority except during the months of November and December, 1904, as the evidence did not disclose that he acted as agent for a longer period. The policy put the insured upon express notice that agents of the insurer had no authority to discharge contracts, waive forfeitures, or receive premiums in arrears beyond the time specified in the policy. It is obvious, therefore, that the insurance association could ÍLot be bound by any acts of its agent in contravention of the terms of the policy, unless it subsequently ratified them. It is not contended that it expressly ratified the acts of the agent in reference to the collection of the premiums. Whether, in view of-the provision of the contract that “non-observance of any of. the written conditions or requirements of this policy, . . without the written endorsement of approval by the Association through its President or Secretary,” should render the policy void, the requirements and conditions of the policy in reference to the payments of premiums could be altered or waived by a mere implied ratification by the association of a course of dealing between its local agent and the insured, contrary to the terms of [383] the policy, it is not necessary to inquire; for the evidence wholly -fails to show such implied ratification. Before ratification by a principal of unauthorized acts of its agent could be implied, there would have to be knowledge b}r the principal of such acts, and then conduct on its part in reference thereto inconsistent with its repudiation of them. It is clear, therefore, that there could be no implied ratification by the insurance association of a previously unauthorized custom of its local agent in reference to the payment of premiums upon this policy, until the association had notice of such custom. The record wholly fails to show such notice or facts from which it can be legitimately inferred. The home office of the association was in Atlanta, Fulton couffiy, and the special agent collected the premiums on the policy in Richmond county. It does not appear how often he made returns or remittances to the association of his collections, nor does it even appear when he made any return or remittance to it of a premium or premiums collected on this policy. As we have said, so far as the evidence disclosed, he was acting as the agent of the association only during the months of November and. December, 1904. Perhaps it may be inferred from his testimony that he was acting as such agent somewhat longer than that, but, if so, there is nothing to show hów long he collected premiums due on this policy. Granting that the evidence in this case is sufficient to show a course of dealing between the local and special agent of the insurance association and the insured, with respect to the payment of premiums on the policy, which was not only inconsistent with the terms of the policy but had existed for a sufficient length of time to establish a custom between them as to the payment of the premiums, still the evidence fails to show that the acts-of such agent in this particular were either authorized at the time or- subsequently ratified by the association. Under the evidence, the association had the right to treat the policy as forfeited for the non-pajmient of the premiums due, respectively, November 21, November 28, and December 5, 1904; and as the insured was in bad health when a tender sufficient to pay these three premiums and premiums for the two following weeks was made, the policy could not be revived without the consent of the insurer. See Hutson v. Prudential Ins. Co., 122 Ga. 847. It follows that the judge of the superior court erred in overruling the petition for certiorari. Judgment reversed. All the Justices ' concur.