H.H. Walker, for plaintiff.
Alexander Green (Chas. B. Alexander and Chas. W. Pierson, of counsel), for defendant.
The complaint alleges two causes of action. The first one is to the effect that the defendant insured George H. Stayner in the sum of $75,000, on the 29th day of April, 1885, by a policy providing for annual payments of premium on July 28th; that three annual premiums have been paid on the policy, but that default was made in the payment of the premium which became due July 28, 1888, and no subsequent premium has been paid; that the policy contains a clause to the effect that "if premiums upon this policy, for not less than three complete years of assurance shall have been duly received by said society, and this policy should thereafter become void in consequence of default in payment of a subsequent premium, said society will issue, in lieu of such policy, a new paid-up policy, without participation in profits in favor of said George H. Stayner, his executors, administrators or assigns, for the entire amount which the full reserve on this policy, according to the present legal standard of the state of New York, will then purchase as a single premium, calculated by the regular table for single premium policies, now published and in use by the society; provided, however, that this policy shall be surrendered duly receipted within six months of the date of default in payment of premium as mentioned above;" that the reason why the policy was not surrendered duly receipted within six months after the date of the default, was financial trouble and mental distress both of the insured and the plaintiff; that the policy has been assigned to the plaintiff; that at the time of the default, the reserve as a single premium would have purchased $6,300 of insurance; and that the plaintiff on the 6th day of July, 1897, duly demanded a paid-up policy for that amount, which was refused.
The second cause of action is similarly based upon a policy issued June 1, 1887, for $5,000, payable to plaintiff, on which default was made on April 28, 1893, and on which the reserve will buy $1,065 of insurance.
The relief demanded is the award of a paid-up policy for $7,365.
The demurrer is that the complaint does not state facts sufficient to constitute a cause of action.
The facts presented do not furnish a case justifying equitable relief. The law seems settled in this state that equity will not relieve the insured from the consequences of a legal forfeiture. Matter of Attorney-General v. Continental Life Ins. Co., 93 N.Y. 70; Holly v. Metropolitan Life Ins. Co., 105 id. 437; Fowler v. Metropolitan Life Ins. Co., 116 id. 389.
The plaintiff, however, asserts that she is relieved from the consequences of the delay by the provisions of section 92 of the Insurance Law (Chap. 690 of the Laws of 1892), requiring the company to mail a notice stating the amount of the premium, etc., prior to the day when the same is payable, and declaring that no forfeiture or lapse shall occur unless such notice shall be mailed nor until thirty days after the mailing thereof. No allegation is made that the required notice was not mailed within the time limited by the statute prior to the 28th day of July, 1888, and the 28th day of April, 1893, respectively, but her counsel argues that it must be assumed that no such notice was in fact mailed, and that the policy is still in force.
Waiving the apparent inconsistency of a claim that the policy is still in full force, with a concurrent claim that the plaintiff is entitled to a paid-up policy, which by the terms of a contract is only to be issued after the policy has become void, it seems to me that the failure to mail the notice is a fact essential to her cause of action. In her complaint she treats the policy as forfeited and assigns no date for the default other than the one when the first unpaid premium became due. She asks to be relieved from her neglect in not demanding the paid-up policy during the six months immediately succeeding that default, not by asserting that the six months had not commenced to run as a result of the defendant's failure to mail the statutory notice, but by the assertion of financial embarrassment and mental distress. Both by the terms of the policy and the provisions of section 88 of the Insurance Law, a paid-up policy may only be demanded within six months after default, and if the time has been extended by any act or omission of the company, that fact should be pleaded as one essential to the plaintiff's right to the relief sought.
The demurrer must be sustained, and judgment entered accordingly, with costs.