Opinion
No. 33199.
May 9, 1938. Suggestion of Error Overruled June 6, 1938.
1. JUDGMENT.
In insured's action to recover disability benefits under policies of life, health, and accident insurance, judgment, entered on agreement of parties, settled issues raised by pleadings and determined obligation of insurer and insured to each other under policies for period covered by suit.
2. INSURANCE.
An insurer is under duty of applying accrued accident disability benefits or as much thereof as is necessary to payment of premium due on policies of life, health, and accident insurance.
3. INSURANCE.
Where insured elected in first suit to recover full amount of accrued benefits under policies of life, health, and accident insurance, compromise settlement had effect of adjusting both liability of insurer for benefits and liability of insured for premiums that were in arrears during period involved in suit, so that, if insured was still disabled and continued so disabled from and after that period, there was imposed on insurer the duty to pay any premiums thereafter accruing out of unpaid disability benefits to thereafter accrue.
4. INSURANCE.
In action for disability benefits under policies of life, health, and accident insurance, question of disability of insured was for jury.
APPEAL from the circuit court of Adams county; HON. R.E. BENNETT, Judge.
Joseph E. Brown, of Natchez, for appellant.
It is undisputed that no premiums were paid upon these policies subsequent to May 22, 1933. The policies contained no provision for the waiver of premiums in the event of disability. The policies could only be kept alive, therefore, by the existence of a fund in the hands of the insurer, due to the insured, with respect to which the insured had a right to have applied upon his premiums. It is our contention that even though such a fund in fact existed, sufficient to pay premiums, that fact alone would not be sufficient. The relation between the parties must be such that the court may say that the insured had the right to have the fund applied on premiums and that there rested upon the insurer the co-relative or reciprocal duty of so applying them.
We do not contend that the insured must stipulate or demand that any fund of his in the insurer's hands be applied toward premiums. In the case of Owen v. New York Life Ins. Co., 89 So. 770, 17 A.L.R. 1225, this court, although having before it a case where the insurer had in the application specifically insisted upon such a right, nevertheless quoted with approval the case of Union Central Life Ins. Co. v. Caldwell, 68 Ark. 522, 58 S.W. 361, wherein the Arkansas court had held that the duty rested upon the insurer to apply a fund toward premiums even in the absence of stipulations in the policy or directions by the insured. We do insist, however, that though it be the law that the duty rests upon the insurer to apply a fund toward premiums when bound by the policy or when directed by the insured, and even though the duty rests upon the insurer to apply a fund due to the insured upon the premiums in the absence of policy stipulations or directions by the insured, nevertheless the insured can neither claim such a right nor invoke such a duty when he, himself, has, by demanding the full amount of the fund, thereby waived the right and denied the reciprocal duty.
We submit that in both the first suit and the instant suit the insured by suing for the full five dollars weekly disability benefits waived any right he might have had to have the premiums subsequent to May 22, 1933, paid out of any disability fund due him. He not only failed to invoke the duty of the insurer to apply such a fund on premiums but he thereby denied and contradicted the existence of such a duty, insisting in each suit that the full fund be paid to him.
Even though the appellee, subsequent to February 24, 1934, had been making each week actual and direct payments of his premiums he would not have been entitled to disability benefits unless he had been disabled from "work of any kind."
Casualty Ins. Co. of Tenn. v. Jones, 73 So. 566, 112 Miss. 506.
In the case now before the court the undisputed proof is that at the latest, the appellee commenced operating a barber shop, and actually barbering, in August, 1933, and operated the shop and barbered continuously until shortly prior to his second operation in October, 1934. This had been his trade since he was sixteen years old. He was, therefore, during the first seven months of the period covered by his present claim for disability benefits, actually engaged in doing work which was not merely work which could be generally described as "work of any kind" but it was the type of work for which he was fitted by nature, experience and training and in which he had been engaged for over forty years.
Under these circumstances even though he might have been disabled for three or four months subsequent to October, 1934, midway of the alleged disability period here involved, it goes without dispute that for the first seven months of the period involved in this suit he was not disabled within the terms of the policy. He was not entitled to accident benefits. There was created no fund in the hands of the appellant, due to the appellee, from which it was under any duty to pay premiums. Therefore, even though the policies had not lapsed at the terminal period of the first suit, being February 24, 1934, the initial period of the present suit, nevertheless on account of non-payment of weekly premiums directly, and on account of the utter and absolute absence of any fund due the appellee from which premiums could be paid the policies had lapsed and become null and void long prior to October, 1934, when the appellee under-went three or four months' disability on account of the second operation.
Brandon Brandon, of Natchez, for appellee.
Since the insurance company was indebted to this appellee for accident benefits and had refused to pay those benefits, they could not take the position that the policy became in default for non-payment of premiums under the authority of this court in the case of National Life Accident Co. v. Sparrow, 151 Miss. 387, 118 So. 195; and the refusal of the insurance company to accept payment of premiums was a waiver of any requirement that premiums continue to be paid.
Daggett v. Prudential Life Ins. Co., 175 Miss. 89, 166 So. 405.
The facts in the case were that the first suit brought by this insured for this same accident covered a period of from January 10, 1933, to February 24, 1934, and was for a demand at $5.00 per week in the total demand of $292.85. This suit was settled some fifty-six weeks after it had been filed for a compromise judgment of $150.00, and at the time the settlement was made there had additionally accrued to this claimant fifty-six weeks of disability claims, totaling $280.00, far more than enough to pay any premiums required at 25c per week, if any such were in fact due; and the above cited authorities are applicable upon the proposition that the insurance company cannot, in view of the subsequent finding of the jury, that the insured was continuously disabled contend that the policy was forfeited for non-payment of premiums.
This record abundantly shows that this appellee because of his severe injury was continuously disabled within the meaning of the policy from doing work. It is true that despite the advice of doctors and physical pain and suffering he has done his best to earn a modest living as a negro barber in a one-chair negro neighborhood barbershop; but he has been able to do so only with considerable personal discomfort and by endangering his own health. As a matter of fact, the jury should have found in this case for the full amount sued for as his continued disability is amply shown in the record.
The appellant cannot complain now of any finding of fact by the jury in this case because the appellant did not file a motion for a new trial below, and hence can complain only of errors predicated upon rulings of the trial court.
Standard Oil Co. v. Franks, 167 Miss. 282, 149 So. 798; Standard Coffee Co. v. Carr, 171 Miss. 714, 157 So. 685; Coccora v. Vicksburg Light Traction Co., 126 Miss. 713.
As a matter of fact, had this appellee filed a motion for a new trial in the court below upon the ground that the verdict of the jury was inadequate, he would here have a right to take a cross appeal, for he was most certainly entitled under the evidence in this case to recover the full amount for which he sued, for he was continuously disabled during the entire period within the reasonable meaning of the terms of his insurance policy.
Life Casualty Ins. Co. of Tenn. v. Jones, 112 Miss. 506, 73 So. 566; Metropolitan Cas. Ins. Co. v. Cato, 113 Miss. 283, 74 So. 114; Equitable Life Assur. Society v. Serio, 155 Miss. 515, 124 So. 485; New York Life Ins. Co. v. Best, 157 Miss. 571, 128 So. 565; Mutual Benefit Health Acc. Assn. v. Mathis, 169 Miss. 187, 142 So. 494.
Argued orally by Joseph E. Brown, for appellant.
The judgment appealed from in this case was rendered in a suit filed by the appellee on two policies of life, health, and accident insurance, covering an alleged disability caused by an accidental injury for the period beginning February 24, 1934, and continuing to September 28, 1935, and during which period the benefits for continuous disability would have amounted to the sum of $415, at the rate of $5 per week. The judgment, however, was for only the sum of $100.
One of the policies provides, among other things, for accident benefits at $3 per week, while the other provides for such benefits at $2 per week, and the two contain the same terms and conditions throughout governing the liability of the insurer.
The declaration alleged that the appellee sustained an accidental injury on January 10, 1933, from which he had suffered disability within the terms of the policies; that in a previous suit returnable to the March, 1934, term of the circuit court of Adams county he had claimed disability benefits on account of said injury for a period beginning from January 10, 1933, and continuing to February 24, 1934, at the total sum of $5 per week provided for under the two policies, aggregating $292.85; and that thereafter settlement was made between the parties "for the amounts of benefits sued for in said suit to said date of February 24th, 1934." The proof in the present suit shows, and the judgment entered in the previous suit recites, that the first suit was settled by agreement of the parties at the sum of $150 and costs, but the amount of the judgment was immaterial as affecting the issues here involved, since the result of such judgment was to settle the issues raised by the pleadings in the first suit, that is to say, no obligation of either the insurer or insured to each other under the policies was left outstanding and unsatisfied so far as the period from January 10, 1933, to February 24, 1934, was concerned. There was reserved to the insured the right to bring, without prejudice, any suit for any subsequently accruing disability benefits or claims for the same alleged disability, which he might claim or demand as having matured and become payable subsequent to the time for which the first suit was brought, and reserved to the insurer its right of defense thereto.
The jury was warranted in finding under the conflicting evidence in the case at bar, on the question as to whether the weekly premiums were in arrears for such time as would cause the policies to lapse, that the insurance was in full force and effect on January 10, 1933, when the insured sustained his accidental injury and disability; and that the weekly premiums were continually paid as provided for in the policies until and including May 22, 1933, but that none were thereafter paid. There was no provision contained in the policies that would relieve the insured of the payment of the weekly premiums during the period of disability.
It is contended, however, by the appellee, that it was the duty of the appellant to apply the accrued accident disability benefits of $5 per week, or so much thereof as may have been necessary, to the payment of the premiums so as to keep the policies in force after February 24, 1934, and continuing through the period now sued for. Such a duty was in reality imposed by law upon the insurer to the extent of accrued and unpaid disability benefits, if any, under the authority of the cases of National Life Ins. Co. v. Sparrow, 151 Miss. 387, 118 So. 195, and Daggett v. Prudential Life Ins. Co., 175 Miss. 89, 166 So. 405.
The appellee elected in his first suit to sue for the full amount of accrued benefits on account of all liability of the insurer to him from January 10, 1933, to February 24, 1934. The compromise settlement of that suit, however, covering such period, had the effect of adjusting both the liability of the insurer for accidental benefits and the liability of the insured to pay any premiums that may have been in arrears on February 24, 1934. This judgment, which was not agreed upon and entered until April 13, 1935, shows on its face that the policies were not deemed by the appellee to have become lapsed on February 24, 1934, since the right was therein expressly reserved to him to bring any other suit desired for any subsequently accruing disability benefits which he might claim or demand as having matured and become payable subsequent thereto. Therefore, if the appellee was still disabled within the meaning of the policies and continued so disabled from and after February 24, 1934, then there was imposed upon the insurer the duty to pay any premiums thereafter accruing out of any unpaid disability benefits to thereafter accrue. This issue of disability was submitted to the jury under sufficient evidence to justify its submission; and while the verdict in the sum of only $100 shows that the jury was not satisfied that the appellee was continuously disabled throughout the period sued for from February 24, 1934, to September 28, 1935, we would not be warranted in applying the verdict to any particular period of such alleged disability so as to work a forfeiture of the policies for nonpayment of the premiums, and so as to hold that the appellant was entitled to a peremptory instruction. Since no other error is complained of, the judgment must be affirmed.
Affirmed.