Beezley v. Des Moines Life Ass'n

Kinne, J. I. The contentions of the appellant are: First, that inasmuch as a note was given for the premium, except for the first quarter, which was paid in cash, it follows that the association cannot take advantage of the provisions of the policy relating to a forfeiture, but are limited to a right of recovery on the note; second, it is claimed that the notices were not mailed to the proper party. The contract between the assured and the association is embodied in the policy and the note. The quarterly premiums stipulated for in the policy and the quarterly payments provided for in the note are the same. By the terms of the policy it is expressly provided “that, if the quarterly payments * *■ * a,re pot received by the [439] association within sixty days from date of notice, then this policy shall be null and void and of no effect.” We look to both the policy and the note to ascertain the contract of the parties, and what that contract is must be determined in view of the fact that these two instruments were contemporaneous. Bearing these facts in mind, we conclude that there was no purpose or intent that the taking of the note should waive the provisions of the policy touching the prompt payment of premiums. This is not a case where a note is taken for the entire premium, for the premium due at the time the policy was issued was paid in cash. Nor is it a case of extending time of payment of a premium, and accepting a note therefor. The question is: Did the taking of the note, under the circumstances disclosed, operate to prevent the association from relying upon the provisions of the policy requiring a prompt payment of the quarterly premiums? It seems to us that it did not. Counsel for appellant relies upon McAllister v. Insurance Co., 101 Mass., 558. That case is, as it seems to us, rather an authority in support of the holding of the district court in this case. In the cited case the entire premium for a year was due and payable when the policy issued, and a like sum was to be paid at a fixed date every year. The policy contained the usual provisions for the forfeiture of the contract in case the premium was not paid. The company accepted a part of the payment in cash, and took notes for the remainder, one maturing in six months, and the others on demand after five years. The six-months note was not paid. The assured died. The court said: “The defendants rely upon that provision of the policy which declares that, ‘in case any premium due upon the policy shall not be paid at the day when payable, the policy shall thereupon become forfeited [440] and void/ except for a certain period, which had expired before the death of the assured in this case. But the court is of opinion that this clause, which is inserted for the benefit of the insurers, and to be construed most strongly against them, and which merely provides that the policy ‘shall become forfeited and void’ in case of a premium ‘shall not be paid at the day when payable,’ can only apply to a policy which has once taken effect, and to non-payment of a premium payable after that time, and cannot be held to refer to that premium which the policy contemplates, and required to be paid before the contract of insurance has any binding force.” The theory of that case is that as the company had waived the payment of the cash premium, which was due before the policy became binding, and had taken a note for it, it was estopped from claiming that, by reason of the non-payment of the premium, the policy had lapsed. The reasoning of the court is that such a forfeiture clause in the policy can only be applied in case the policy has once taken effect, and to the non-payment óf a premium payable after the policy has become a binding obligation. In the qase at bar the premium which must be paid before the policy went in force was paid in cash, and it is now sought to forfeit the policy on account of non-payment of premiums which thereafter became due, and for which the note was given. We have examined other cases cited, but they do not throw any light upon the question before us. Our conclusion is that a fair const" ’ *,tion of both policy and note upholds the judgment of the district court. II. As to the notices little need be said. They were sent to the wife of the assured by his direction, as given in his application. The evidence shows that she received them, and sent them to her husband. [441] Every end which, could be accomplished by such notices was fully attained in this case. In the light of the evidence, there can be no serious objection to them. The judgment below is affirmed.