Fidelity Mutual Life Insurance v. Bussell

Hill, C. J., (after stating the .facts.) In the case of Iowa Life Insurance Company v. Lewis, 187 U. S. 335, the Supreme Court of the United States carefully reviewed the decisions of that court and other courts on the effect of premium notes and their nonpayment and extension of time by agents,, and the conclusion reached is thus stated in the syllabus: “When the first premium on a policy of insurance is paid by note, and a receipt with such an indorsement thereon is given and accepted therefor, whilst the primary condition of forfeiture for nonpayment of the annual premium is waived by the acceptance of the note, a secondary condition thereupon comes into operation, by which tile policy will be void if the note be not paid at maturity,. and no affirmative action cancelling the policy is necessary on part of the insurance company if the note be not paid when due and presented; and if the polic)^ contains a provision that no person other than the president and secretary can waive any of the conditions, a local agent has no power to extend the time of payment of the note after the same has become past due.” The stipulation as to the president, and other officials, not the agents, being alone authorized to extend time of payment in that case was in the policy, and in this case is in the application. The application, note and policy, when forming one transaction, are read together as the entire contract. Jacoway v. Ins. Co. 49 Ark. 320. The Lewis case, supra, is much stronger on the facts for the beneficiary than this one, the alleged waiver being much clearer. This court recently decided a similar question in Jefferson Mutual Ins. Co. v. Murry, 74 Ark. 507, wherein it was held that a clause like the one in question, when not complied with, terminated the insurance, and it could only be reinstated by complying with the conditions therefor. The appellee invokes the rule that, notwithstanding provisions that waivers must be in writing, and cannot be made by agents, yet when made they work an estoppel. That rule, however, is confined to acts of the agent within the real or apparent scope of his authority, while common usage and the terms of this policy alike deny to collecting agents -the authority to grant extensions for payment. Iowa Life Ins. Co. v. Lewis, 187 U. S. 337. This case (the Lewis case) is in line with the decisions of this court sustaining a waiver of proof of death .required by the policy, and in other respects but brings into application to the facts of the case at bar principles frequently ruled by this court on waivers of conditions in policies. The cases in this court have always confined the waiver to an act done within the scope of the authority, and to a matter which can be waived. Ins. Co. v. Brodie, 52 Ark. 11; German Ins. Co. v. Gibson, 53 Ark. 494; German-American Ins. Co. v. Humphrey, 62 Ark. 348; American Employers’ Liability Ins. Co. v. Fordyce, 62 Ark. 562; State Muhial Ins. Co. v. Latourette, 71 Ark. 242. It is shown that Cloud’s commission on the first premium was $35.28, and it is argued that the payment of $25 more than discharged the debt to the company, and that, as the note was made to Cloud individually, and not to the company, it was his note, and not the company’s. There is no showing, however, that the commission of Cloud was to be other than a percentage of the premium. Even if it was true that all of this sum would have gone to Cloud, it was by virtue of a contract with the company, and not with Bussell, and as to Bussell it was all due the company. The evidence shows it was treated .as the company’s note. While made to Cloud, it was promptly indorsed by him to the cashier, and by the cashier also who sent it to the company, and its acceptance by the company alone prevented the policy forfeiting on November I, when the first note was due. After Bussell’s death, in the transaction between Cloud and his partner, Burnside, it was treated as representing money due the company, as evidenced by Cloud’s receipt to Burnside. The court erred on the evidence in this case in submitting the question of waiver of payment when due to the jury, and the judgment is reversed, and the cause remanded.