Missouri State Life Insurance v. Hill

Hart, J., (after stating the facts). It is contended by counsel for the defendant insurance company that when Hill deposited the letter containing the check for his premium in the postoffice he thereby made the United States mail his agent for the delivery of the letter and check to the defendant, and the failure of his agent to deliver the check on or before the 15th day of January, 1912, by virtue of the terms of the policy and the premium note, worked a forfeiture of the policy. On the other hand, it is contended by the plaintiff that the United States mail had been employed by the insured for transmitting his premiums to the company on the policy sued on, and that the insured “having deposited in the postoffice, properly addressed and stamped, a letter containing a check for the premium in apt time to have reached the insurance company before the premium note was due no forfeiture of the policy could be declared. The conclusion we have reached renders it unnecessary to decide this contention. If it be assumed that the insurance company had no legal rights under the terms of the insurance policy and of the premium note under the circumstances to forfeit the policy the fact remains that it claimed the right to do so and exércised that right. “The rule as to the inability of the insurer .to cancel the policy on its own initiative does not prevent an abandonment of the contract by agreement of the parties. And in the absence of fraud or coercion, such abandonment, if definite, will be effective, though at the time the •company is erroneously claiming the right to forfeit or avoid the policy on account of some alleged violation of its conditions.” Cooley’s Briefs on the Law of Insurance, § 2883- The defendant insurance company several times wrote to Hill, the insured, and called his attention to the fact that, under the provisions of his insurance policy and premium note and the strict insurance laws of the State of Missouri, it was necessary to file an application for reinstatement and that, unless he did so, bis policy would be forfeited. Tlie insurance company called his attention to the fact that nothing was to be feared in making bis application for reinstatement provided he was in as good health as when he took out the policy and had had no serious sickness, accident, etc., since that time. Upon his repeated refusal or neglect to answer its letters, the insurance company on March 22, 1912, returned to the insured his check tendered in payment of his renewal premium note, and the insured received and accepted the check returned to him. The record shows that he after-wards procured a policy in another company and this is conclusive proof of the fact that he was not sick at the time the company declared his policy forfeited and is also proof of the fact that, by signing up the blank application for reinstatement, he might have kept his policy in force. He made no attempt to obtain a judicial interpretation of Ms contract of Ms insurance. He did not return to the insurance company his check for the premium note and insist that his policy of insurance was still in force. On the contrary, he kept the check and made no reply to the insurance company. Under the circumstances this amounted to a voluntary agreement between Mmself and the insurance company to cancel Ms policy and the effect was to terminate the contractual relation between Mmself and the insurance company. The ease is not one where the company is seeking after the death of the insured to declare the insurance forfeited, but the question is whether or not, under all the circumstances adduced in evidence, the contract of insurance was terminated by the parties themselves during the insured’s lifetime, and we hold that it was. Under the undisputed facts and circumstances adduced in evidence no other conclusion can be drawn than that both parties considered the contract of insurance at an end, and, in accordance with the general rule as to the construction of contracts in determining the intention of the parties, we will follow the construction and interpretation of the contract adopted by the parties themselves as shown by the acts and conduct. The plaintiff, who was the wife of the insured, and the beneficiary named in the policy, had knowledge of all the facts which we have above set forth and which we do not deem it necessary to repeat here. Therefore, we hold that under the principles announced in the case of Franklin Life Insurance Company v. Morrell, 84 Ark. 511, the plaintiff was estopped to assert that the policy had not been cancelled and that she can not assert any rights under the policy in this suit. The evidence in the case is undisputed and the case appears to have been fully developed. Therefore, the judgment will be reversed and the cause of action dismissed.»