Opinion
6 Div. 614.
June 27, 1934. Rehearing Denied October 2, 1934. Affirmed on Mandate November 27, 1934.
Appeal from Court of Common Claims, Jefferson County; E. N. Hamill, Judge.
Action on a policy of insurance to recover disability benefits by James P. Dovel against the National Life Insurance Company. From a judgment of nonsuit, plaintiff appeals.
Reversed and remanded.
Certiorari granted by Supreme Court in Dovel v. National Life Insurance Co., 229 Ala. 378, 157 So. 882.
By count 1 of the complaint plaintiff seeks to recover $100, with interest from March 6, 1933, alleging that on June 9, 1919, plaintiff and defendant entered into a written contract or policy of insurance on the life and health of plaintiff which provided, among other things, that if plaintiff (insured) has on or before August 1, 1928, become totally and permanently disabled by bodily disease so that he is and will be thereby permanently and continuously prevented from engaging in any occupation, or performing any work for compensation, gain, or profit, then defendant (the company) will thereafter pay to plaintiff the sum of $100 monthly during the lifetime and continuance of such disability of insured; that on July 31, 1928, plaintiff had become and was totally and permanently disabled within the meaning of said policy by disease, viz., arthritis, so that plaintiff at that time, and has been since that time, and will be, within the meaning of said policy, by said disease or condition, permanently and continuously prevented from engaging in any occupation or profession or from performing any work for compensation, gain, or profit; that the first monthly payment of $100 became due and was payable under the terms of said policy on March 6, 1933, which said monthly payment is the only one due before the bringing of this suit; which said payment defendant has wholly failed and refused to make. It is averred that under said policy said payment of $100 due March 6, 1933, as aforesaid, was and is payable with interest at 8 per cent. per annum thereon from March 6, 1933, and all sums due as interest are claimed. It is further averred that plaintiff has fully conformed and complied with all terms of said policy on his part to be conformed and complied with, and has performed all conditions precedent to the liability of defendant to make said monthly payment, according to the terms of the policy; and that said policy is the property of the plaintiff.
Defendant's plea 5 sets up that the policy of insurance referred to and described in the complaint contained the following provisions:
"If the Insured, after payment of premiums for at least one year from October 1, 1918, and before default in the payment of any premium and before the policy anniversary nearest the sixtieth birthday of the Insured and while this policy is in full force, shall furnish to the Company at its Home Office due proof that he has become totally and permanently disabled by bodily injury or disease, so that he is and will be thereby permanently and continuously prevented from engaging in any occupation or profession, or performing any work for compensation, gain or profit, and that such disability has then existed for not less than sixty days — without prejudice to any other cause of disability the permanent and complete loss of sight of both eyes, or the severance of both hands above the wrists or of both feet above the ankles or of one entire hand and one entire foot to be considered total and permanent disability — the Company will grant the following benefits:
"(1) Waiver of premiums. Commencing on the anniversary of the policy next following the receipt of such due proof and on each subsequent anniversary during the continuance of such disability, the Company will waive the payment of the premium for the ensuing policy year.
"(2) Income to insured. Six months after the receipt of such due proof the Company will pay the Insured One Hundred Dollars and thereafter a like sum monthly during the lifetime and the continuance of such disability of the Insured. Premiums waived and income payments made to the Insured under the operation of these disability benefits shall not be deducted in any settlement of this policy or from its loanable value. Interest on any indebtedness to the Company on account of this policy may be deducted from the income payments."
It is averred that plaintiff became sixty years of age on December 26, 1928, and that the anniversary of the policy nearest the said date was October 1, 1928; that on and before the last-mentioned date plaintiff had failed to furnish defendant at its home office with due proof that he had become totally and permanently disabled by bodily injury or disease so that he was then and would be thereby permanently and continuously prevented from engaging in any occupation or profession or performing any work for compensation, gain, or profit, and that such disability had then existed for not longer than sixty days. Wherefore, defendant says it is not liable for the amount claimed.
Plea 6 is the same as plea 5, with this added averment: "That the plaintiff did not submit the said proof during the time the said contract or policy of insurance was in full force and that the disability benefits which the plaintiff seeks to recover of the defendant in said count were conditioned upon the plaintiff complying with the aforesaid terms of said policy prior to the first day of October, 1928, while the policy was in full force and effect."
Plea 7 is substantially the same as plea 6.
Lange, Simpson Brantley, of Birmingham, for appellant.
Where the serving of notice of proofs of loss within a specified time is not by the policy of insurance expressly made a condition precedent to recovery, and no forfeiture is provided for in case of default notwithstanding forfeitures are stipulated for in case of breach of other requirements, the failure to serve notice of proof merely postpones the time for payment and for bringing suit, and, if notice and proof are subsequently served, insured or claimant may recover notwithstanding delay, provided, of course, the time for suing on the policy has not expired. 33 C.J. 14; Westchester F. I. Co. v. Green, 223 Ala. 121, 134 So. 881; 7 Cooley, Ins. (2d Ed.) 5766-5772.
Robert E. Smith, of Birmingham, for appellee.
An allegation that policy was or was not in force is not bad as a conclusion. Amer. Bankers Ins. Co. v. Dean, 227 Ala. 387, 150 So. 333; Amer. Bankers Ins. Co. v. O'Neal, 25 Ala. App. 559, 150 So. 562. The furnishing of due proof of disability prior to the anniversary of the policy nearest insured's sixtieth birthday is a condition precedent to liability under the terms of the policy. McGifford v. Protective L. I. Co., 227 Ala. 588, 151 So. 349; Mutual L. I. Co. v. Hibron, 166 Miss. 145, 146 So. 445; Berry v. Lamar L. I. Co., 165 Miss. 405, 142 So. 445, 145 So. 887; N.E. Mut. L. I. Co. v. Reynolds, 217 Ala. 307, 116 So. 151, 59 A.L.R. 1075; Bergholm v. Peoria L. I. Co., 284 U.S. 489, 52 S.Ct. 230, 76 L.Ed. 416; Kasarsky v. N.Y. L. I. Co., 145 Misc. 732, 260 N.Y.S. 769; Gottlieb v. N.Y. L. I. Co., 136 Misc. 194, 240 N.Y.S. 568; Parker v. Jefferson Standard L. I. Co., 158 S.C. 394, 155 S.E. 617.
All of the questions necessary to a decision in this appeal are contained in count 1 of the complaint and defendant's plea 5, to which plea demurrer was overruled.
In the case of Prudential Life Insurance Company v. Gray, 159 So. 262. this court held that in a case claiming for total disability the plaintiff was not entitled to a recovery, where the proof of such disability had not been made until after the policy had terminated, although the disability had occurred while the policy was in full force and effect. In other words, the proof of disability was, under the terms of that policy, a condition precedent to a recovery, and could not be made after the termination of the policy. In writing the opinion in the above case, Rice, J., speaking for this court, emphasizes the fact that the proof was not made until after the policy had lapsed and become terminated. To the same general conclusion are the decisions in McGifford v. Protective Life Insurance Company, 227 Ala. 588, 151 So. 349 and New England Mut. Life Ins. Co. v. Reynolds, 217 Ala. 307, 116 So. 151, 59 A.L.R. 1075. In the McGifford Case, supra, Mr. Justice Brown registered a dissent, but we take it that the above-cited cases fix the principle in this state that where the contract clearly provides that liability for disability is dependent upon proof of such disability being made, such proof becomes a condition precedent to recovery and must be made during the life of the contract.
Post, p. 268.
It may be that in an insurance contract where there was a clear and definite provision as to the time of making proof of disability, and a forfeiture provided in case of failure, the insured would be held to the plain terms of the policy as a condition precedent to liability on the part of the insurer. In this case, however, that question does not arise and is not decided.
In the instant case, the provisions in the policy relative to notice, "If the insured * * * and before default in the payment of any premium and before the anniversary nearest the sixtieth birthday of the insured and while this policy is in full force, shall furnish to the company, due proof of disability," etc. There is nowhere in the policy any specific forfeiture of any right by reason of a failure to furnish the proof at a designated time. The payment of indemnity to the insured is one of the valuable considerations in the policy moving from the insurer to the insured and for which the insured has paid and each year continues to pay a premium. This consideration is not forfeited or lost by reason of a condition precedent without a clear, specific provision in the contract to that effect. United Benev. Soc. of America v. Freeman, 111 Ga. 355, 36 S.E. 764. In the absence of such express stipulation forfeiting the policy for delay in furnishing proof beyond the fixed period, the effect of such delay will be to postpone liability of the company, vol. 7, Cooley's Briefs, p. 5766(h); 33 Corpus Juris 14(661); provided, the proofs are made while the policy is in full force and effect.
The plaintiff contracts for and there is issued to him by the defendant a certain policy of insurance in 1918; this policy provides for certain benefits passing to plaintiff, among which is an indemnity for and on account of total disability, up to a certain age limit; the defendant charges and receives certain annual premiums based upon this risk. There is a requirement of notice of such disability at a certain time, but no specific agreement as to forfeiture in case of failure. The disability actually occurs within the age given in the policy, but no notice is given at the time, and the policy continues in force and plaintiff continues to pay the premium. If the required notice and proof is made during the life of the policy, there is no forfeiture; but liability is deferred. The demurrer to plea 5 should have been sustained.
Pleas 6 and 7 were bad in that they stated as a conclusion that "plaintiff did not submit said proof during the time the said contract or policy was in full force." The pleas should have stated the facts causing the termination of defendant's obligations under the policy. Dwight Mfg. Co. v. Holmes, 198 Ala. 590, 73 So. 933; Yorkshire Ins. Co., Ltd., v. Gazis, 215 Ala. 564, 112 So. 154.
The judgment is reversed, and the cause remanded.
Reversed and remanded.
Affirmed on authority of Dovel v. National Life Insurance Co., 229 Ala. 378, 157 So. 882.