Norris v. New England Mutual Life Insurance

GARDNER, J. It appears without dispute that the initial premium on the policy, the subject of this suit, was in the sum of $83.70, payable in quarterly installments; and that for its payment the assured executed four promissory notes, the first being payable to the soliciting agent of the insurance company 60 days after date, the note reciting that' it was given to reimburse the agent for actual money paid by him to the company. This note was discounted by the general agent of the company, and the company received its pro rata share thereof. The three other notes were payable to the company direct, and were due in three, six, and nine months, respectively. The insured died, on May 16, 1914, and none of these notes, nor any part thereof,, were ever paid, but were retained by the defendant company. (1) We are of the opinion that the case of Satterfield v. Fidelity Mut. L. I. Co., 171 Ala. 429, 55 South. 200, is decisive of this appeal adversely to the appellant. The two cases are strikingly analogous, and we are unable to see wherein there exists any material difference between thejn. The application for insurance formed a part of the policy in each case. A comparison of the contract and various policy provisions will disclose a close similarity in all essential details. It was argued in the Satterfield Case that the reference in the policy to forfeiture for nonpayment of premium had no application to the initial pre- ' mium, in this contention relying upon the case of McAllister v. New Eng. L. I. Co., 101 Mass. 558, 3 Am. Rep. 404. Like argu [46] ment is here presented. The McAllister Case received comment by this court in the Satterfield Case, and under that authority we hold that the forfeiture clause is applicable to the initial premium. (2) We are also clear to the view, under the authority of the Satterfield Case, and of the undisputed evidence in this case, that the provisions of section 4579, Code 1907, have not been infringed upon by the conclusion here reached. As stated in the opinion in that case, the purpose of that statute “is to protect the person insured from being overreached by agreements •outside of the policy not fully understood by him.” The application is a part of the policy contract, and the language of the contract is plain and clearly shows that the assured could not have been misled or- deceived thereby. The applicant knew he had not paid the initial premium, but had merely given notes which had not been paid. The receipt given him at the time of the issuance of the policy again gave him notice that a nonpayment «of the notes would work a forfeiture of the policy, and the notes themselves so recited. The letters written the assured by the ■general agent called his attention to the same fact and informed him in what manner the policy could be reinstated. (3) The validity and binding effect of the forfeiture clause in a life insurance policy for nonpayment of premium is well recognized by this court and was rather forcibly expressed in Imperial L. I. Co. v. Glass, 96 Ala. 568, 11 South. 671. See, also, Security Mut. Co. v. Riley, 157 Ala. 553, 47 South. 735, and Equitable L. A. Soc. v. Golson, 159 Ala. 508, 48 South. 1034. We are mindful of the rule established in this- court that forfeitures for the nonpayment of premiums are not favored in law, and the courts are always prompt to seize hold of any circumstances that indicate an election to waive the forfeiture.—Galliher v. State Mut. Co., 150 Ala. 543, 43 South. 833, 124 Am. St. Rep. 83; Security Mut. Co. v. Riley, supra; Washburn, Adm’r, v. Union Cen. L. I. Co., 143 Ala. 485, 38 South. 1011. It has been held by this court that the bare retention by the ■company of the note executed by the assured.for the premium would not amount, after default in its payment, to a waive of the forfeiture.—Washburn v. U. C. L. I. Co., supra; Galliher v. State Mut. L. I. Co., supra. (4) There is no evidence in the instant case indicating any waiver of the forfeiture clause on the part of the defendant [47] company for nonpayment of the premium. The letters written to the assured calling attention to his default in the payment of his notes also directed his attention to the fact that, under the terms of the policy, the same had been forfeited, and gave instructions as to reinstatement. It seems to be also insisted that, there was evidence sufficient for submission to the jury that the: company had accepted the notes in absolute payment of the: premium. The contract and all dealings in reference thereto were ini writing and are set out in the record, and we are unable to sea-any substantial foundation upon which this insistence could be rested. The evidence is without conflict and shows a forfeiture of the policy for nonpayment of these notes, and there is nothing upon which to base a reasonable inference that the forfeiture provisions of the contract had been waived. The affirmative charge was therefore properly given for the defendant, and the judgment of the court below is affirmed. Affirmed. Anderson, C. J., and McClellan and Sayre, JJ., concur.