Union Central Life Insurance v. Taggart

Mitchell, J. The notes in suit were executed for part of the first year’s premiúm on a policy of insurance on the life of the defendant. One of the conditions annexed to the policy was that it “shall not be valid or binding until the first premium is paid to the company or its authorized agent.” The main contention of the defendant, and the only one we deem it necessary to consider, is that there was an entire want of consideration for the notes, for the reason that, under the condition quoted, the policy never became operative, because the first year’s premium had not been paid in cash. There is clearly nothing in this point. It is usually provided that the policy, though delivered, shall not be binding until the premium is paid; and, where this is the case, the policy does not take effect, even though delivered, until the provision is complied with. But the mode of payment of the premium is immaterial if it be accepted by the company or its agent, and no special mode be provided for in the policy. The policy was silent as to the mode of payment. It was delivered with a receipt for the first year’s premium attached, countersigned by the company’s agent, who accepted defendant’s notes for part of it. On this state of facts, even in the absence of any express agreement to that effect, the company must, in judgment of law, be deemed to have accepted the notes in payment of the premium. See Tayloe v. Merchants’ Fire Ins. Co., 9 How. 390-402. (Opinion published 56 N. W. Rep. 579.) This constituted a consideration for the notes. There is no other point in the case worthy of any special consideration. Order affirmed.