Lewis v. Phœnix Mutual Life Insurance

Carpenter, J. George T. Lillie, whose life was insured by the defendants, died on the 18th day of May, 1874. By the terms of the policy the semi-annual premium, payable partly in cash and partly in notes, fell due May 9th, 1874. On that day Charles T. Wells drew his check "payable to C. E. Tilling-hast, an agent of the defendants, for the amount of the cash part of the premium, and delivered it to one Beardsley. Beardsley on the 13th day of May, and after Lillie’s death, delivered the check to Tillinghast, who, not knowing of Lillie’s death, took it, and gave to him the renewal receipt. The notes were never given. The jury rendered a verdict for the plaintiffs. The defendants move for a new trial. We will consider only the alleged errors in the charge of the court to the jury. The evidence in the case is stated at length in the record. Upon a careful consideration of the evidence in connection with the charge, we are satisfied that the charge was not adapted to the evidence, but on the contrary was so expressed as to be liable to mislead the jury and induce them to come to a wrong result. The simple facts of the case, which are conceded, or established by the proof beyond controversy, that Lillie was dead when the cash premium was paid, that that fact was unknown to Tillinghast or the defendants, and that the premium notes were never given as required by the express terms of the policy, would seem to be conclusive against the plaintiffs. The defendants in substance requested the court so to charge the jury. As the case is presented before us we do not see why they were not entitled to have that request complied with. We do not overlook the fact that there was a claim that the defendants had waived the non-payment of the premium, and that they were estopped from claiming that the policy was thereby forfeited. Those claims will be noticed more fully hereafter. The court, after stating the claims of the parties, said to the jury:— “ If you find that Beardsley was acting for Tillinghast when he took out the corrected notice and received the check on the — 88 — 9th day of May, and that Tillinghast got the money on the check, then the payment to Beardsley was payment to Tilling-hast, and through him to the company, and so the cash part of the premium would have been paid in due time.” This charge might have been proper if there had been any evidence that Beardsley was the agent of Tillinghast, or if there had been conflicting evidence upon that point; or if, in connection with it, the court had called the attention of the jury to the evidence, so that the jury could have seen that the plaintiffs’ claim was not supported by proof. The case* shows that all the evidence upon that point was to the effect that Beardsley was the agent of Lillie, and there was no evidence to show that he was acting as the agent of Tillinghast. The charge therefore was not such as the case called for. It was a distinct intimation to the jury that they were at liberty to find, notwithstanding there was no evidence to the fact, and notwithstanding the evidence showed the contrary to be true, that Beardsley acted as the agent of Tillinghast. It is the duty of the court to 'submit to the jury all controverted questions of fact when there, is any evidence to support the respective claims of the parties; but if a claim is made against the evidence in the case, and wholly unsupported by proof, it is error to submit it to the jury as if the evidence justified the claim, and without comment, as there is great danger of its leading to an unjust verdict. Under this charge the jury may have found that Beardsley was the agent of Tillinghast., If so, the verdict was manifestly unjust. The court further said to the jury:— “If you find that Beardsley was acting for Lillie and not for Tillinghast; that he applied to Tillinghast for a correct notice, and was told by him that the policy should not lapse though there were a few days delay; that Beardsley knew that the company customarily received premiums overdue, and continued the policies alive; and if you find that Beardsley, acting on his knowledge of that custom and the assurances of Tillinghast, did not pay over the money which on the 9th Lillie had paid to him, then, unless you find that he delayed longer than such assurances and such knowledge of that cus — 89 — tom warranted, or unless you find that Beardsley or Lillie by some deceit or fraud procured this money to bo received, the conduct of Tillinghast, in connection with that custom, and with his subsequent reception and retention of the money as the agent of this company, would estop the defendants from denying that this money was paid in time, and prevent the forfeiture of this policy on that ground.” This sentence is long and somewhat involved, and it is doubtful whether the jury understood what the judge meant by it; but assuming that they did, and assuming that we after careful study rightly apprehend its meaning, it would seem that the jury was instructed, provided the facts should be found as therein stated, to apply the doctrine of estoppel. Even if there were no other facts in the case bearing on this question than those stated by the judge in his charge, we should very much doubt whether the doctrine of estoppel would properly apply to this case. We are by no means prepared to sanction the claim that there was any such custom proved as will vary the terms of the written contract. The policy is explicit that the premium must be paid on or before the day it falls due. The renewal receipt given to Beardsley contains on its reverse side a printed notice, in which it is distinctly stated that no agent has authority “to receive any premium after date of its being due without special permission from the officers of the company.” It is extraordinary that local and limited agents should have the power, by a course of dealing with the policy-holders, to establish a custom which shall practically nullify these plain provisions, and bind the company without its knowledge or consent. We are inclined to think that all that can be claimed from the custom proved is, that the company or its agents are in the habit of waiving strict payment at the day in some cases, when there is no change in the health or condition of the insured. Hence, it seems from the evidence that when payment has been deferred but a short time, and there is nothing to excite suspicion, the premiums have been received without further inquiry; but if the premium has been delayed a long time, or there are other suspicious circumstances, the usual course seems to have been — 90 — to require a certificate of continued good health. If we are right in our views of the evidence there is nothing that will bind the company to waive strict payment in any case, but they are at liberty to insist in any and all cases upon strict performance. That being so the risk of the delay is with the insured, and if death or sickness occur after the premium is due and before payment, the company would be at liberty to refuse the premium. Now the vice in the charge of the court was, that it did not take into consideration the all-important fact that the insured was dead when the premium was paid, and that Tillingliast was not aware of his death when he received it. It assumed that the assurances of Tillingliast and the custom proved obligated the company, provided the agent actually received the money, without reference to the material facts. Whatever may be the effect of the agent’s promise, if he made any such promise, that the policy should be valid notwithstanding the delay of payment, whatever might happen to Lillie in the mean time, it is manifest that the custom proved did not extend to a case in which the insured died after the premium fell due and before payment. We think, therefore, that the court was wrong in charging the jury that, under the circumstances, the company would be estopped from denying that the money was paid in time. The jury were further instructed that, “ if they should find that it was the custom of this company to give notices of the payment thirty days before it came due, and that Lillie knew of such custom, and that by the erroneous notice Lillie was misled and prevented from making this payment, when otherwise he was ready and willing to pay and would have paid it, then also are the company estopped from claiming that this payment was not made in due time, nor was the policy forfeited on that account, provided the payment was made or tendered within a reasonable time after the correct notice had been sent.” We see nothing in this transaction that should operate as an estoppel. There is no evidence that the company or its agents intentionally sent an erroneous notice. There was no intention or motive to mislead or deceive. The error was — 91 — simply a mistake; and Lillie, when he received the notice, knew that it was a mistake. There was no mistake, however, in respect to the time when the premium fell due. It related solely to the amount. There is no evidence that Lillie was, in fact, deceived or misled, and no deception can be inferred from the circumstances. He knew that the amount was erroneously stated, and he knew how to have it corrected when first received, as well as he did when he employed Beardsley. There is- no pretense that he had then received any additional information. It was his own folly to wait until the premium was due before taking measures to correct the mistake. The delay therefore was justly attributable to his own want of diligence rather than to the mistake of Tillinghast. The court next stated to the jury:—“If you find that Tillinghast received this money after Lillie’s death, and sent the money to the company, and that the company, with full knowledge of all the facts, has kept the money, or has exercised such dominion over it as shows that they claimed it as their own, then again they are estopped from denying that they have received such premium in due time, and have waived the forfeiture of the policy so far as that is concerned.” There is some doubt from the evidence whether the money was actually received by the company; but as that is purely a question of fact, we do not care to discuss it. If received, whether, under the circumstances, it constituted a waiver or not, is a different question. “A waiver is an intentional relinquishment of a known right.” It is incredible that a company or its agents, if rational men, knowing of Lillie’s death, and that the premium was overdue and unpaid, should receive the premium, and thereby intentionally give force and validity to the policy, which otherwise was inoperative. It does not appear when the company first knew of Lillie’s death, and that the premium was not paid until after his death. If, with full knowledge of that fact, they accepted this premium, they would be bound by it. But if, as is probable, they first knew of it after a claim was made upon them for the sum insured, then the retention of the money while investigating the case, and pending litigation, could not be regarded as any evidence of a waiver or as constituting an estoppel. — 92 — In connection with this charge the attention of the jury-should have been called to these circumstances, and they should have been instructed to ascertain when they received the money, if they received it at all, and whether at that time they knew that Lillie was dead, and if not, when they first knew of it, and under what circumstances, and what their conduct then was—whether they retained it intending to give force and validity to the policy, or retained it awaiting the result of the plaintiffs’ claim. It seems to us that injustice might have been done to the defendants by this part of the charge. In conclusion, the court charged the jury as follows:—“It is claimed here that this premium was to be paid, part in cash and part in notes. The same rules which govern the payment of the cash part of this premium may be taken by you as controlling the giving of the notes, it being the law governing this contract that the premium must be paid or its payment waived by the company, in order to save the policy from forfeiture.” This was manifestly erroneous. If the notes had been signed by L'illie, had been given to Tillingliast at the same time the money was paid, and had been treated by him the same as the money was, then the law applicable to the cash premiums would apply equally well to the notes. But the notes were never received by the company or its agent; in fact were never signed by Lillie,. The facts were entirely different, and the charge should have had some reference to the facts. We have noticed in detail four several sections or paragraphs of the judge’s charge in respect to the cash part of the premium, in every one of which the judge submits to the jury a distinct question. In every instance the actual payment of the cash premium to Tillingliast as an agent of the company is made an important and material element. How the same rules which govern the payment of the cash premium may be regarded as controlling the giving of-the notes is beyond our comprehension. The defendants requested the court to charge the jury that these notes should also have been given, or the giving of them — 93 — waived or prevented by the defendants. This request should have been complied with. If it had been, then unless the jury had found a waiver, or that the defendants prevented the giving of the notes, (of which we discover no evidence,) the verdict would probably have been the other way. For these reasons we advise a new trial. In this opinion the other judges concurred.