Miller v. Life Insurance Company - 79 U.S. 285 (1870)
U.S. Supreme Court
Miller v. Life Insurance Company, 79 U.S. 12 Wall. 285 285 (1870)
Miller v. Life Insurance Company
79 U.S. (12 Wall.) 285
1. The rules laid down in <|9 Wall. 125|>Norris v. Jackson, 9 Wall. 125, and in <|9 Wall. 428|>Flanders v. Tweed, 9 Wall. 428, and in the preceding case of Kearney v. Case, supra, <|79 U.S. 275|>275, as to the mode of finding the facts by the court (waiving a jury), under the Act of March 3, 1865 (relative to the trial of issues of fact in civil causes), and as to the effect to be given to such finding, and the manner in which the record is to be prepared for this and the extent of the inquiry to be made in this Court, again set forth in detail.
2. Under that act, when on a suit on a policy of insurance the question was whether a waiver of a payment in cash of the premium had or had not been made, held in a case where the court found on the evidence as a fact that it had been waived, that the correctness or incorrectness of a series of requests which were founded on an assumption that it had not been were not subject to review here under the act.
3. Where an insurance company instructed its agents not to deliver policies until the whole premiums are paid, "as the same will stand charged to their account until the premiums are received," and the agent did nevertheless deliver a policy giving a credit to the insurer and waiving a cash payment, held that the company, it being a stock company, was bound.
Error to the Circuit Court for the District of Maryland, the suit being one by Mrs. H. Miller against the Brooklyn Life Insurance Company to recover $5,000, insured by her husband, Walter Miller, for her benefit on his own life.
The evidence proved or tended to prove the following case:
The insurance company -- a stock company, not a mutual one -- being desirous of taking risks in St. Louis,
appointed Dutcher & Fasset their general agents for that place, and gave to them, as they did to all their general agents, a printed book showing to them their powers as agents and containing the instructions under which the company meant that they should act. The book contained these passages:
INSTRUCTIONS TO AGENTS"
"Agents must not deliver policies until the whole premiums are paid, as the same will stand charged to their accounts until the premiums are received or the policies returned to the office."
"POWERS OF AGENTS"
"Agents are not authorized to make, alter, or discharge contracts, waive forfeitures, name an extra rate for special risks, or bind the company in any way; their duties being simply to obtain applications for insurance, to collect and transmit premiums, and generally to be the medium of communication between the policyholder and the company."
"Agents are not authorized to write the receipt of premium, or make any endorsement whatever on the policy. The president or secretary are alone authorized to sign receipts for premiums on the part of the company. When a receipt is delivered to a policyholder by an agent, such agent must countersign the same as an evidence of payment to him."
The said Dutcher & Fasset being thus established as the recognized general agents of the company, Walter Miller, the husband, then of St. Louis, applied, in that place, June 19, 1868, for a contract of insurance for his wife's benefit to Dutcher & Fasset, general agents of the insurance company in the State of Missouri. The application, a printed form in part, was headed:
"BROOKLYN LIFE INSURANCE COMPANY"
"Statement required from persons proposing to effect assurance in this company, and which forms the basis of the contract."
It was stated in this paper that the assured wished to pay
partly by note and partly in cash. And at the close of it these words occur:
"It is agreed by the undersigned . . . that the policy of assurance hereby applied for shall not be binding upon this company until the amount of premium as stated therein shall have been received by said company or some authorized agent thereof during the lifetime of the party therein assured."
At the time of the application, the deceased having ascertained from Dutcher what was the amount of the cash portion of the premium and what the portion to be embraced in notes, said to him:
"Send the policy to me, with the notes, and call on Solomon Scott for the cash part. He has just promised me that he will pay it."
This Scott had been a partner in business and was a particular friend of Miller's.
The application was forwarded by the agents to the home office in New York, and in the course of a week the policy was received by Dutcher & Fasset. Miller in the meantime had gone to Maryland.
The policy, dated June 21, 1868, and the premium notes for him to sign, were mailed to him, in a note dated July 2, 1868, in which the agents said:
"You will find enclosed the yearly note and the six months' note, both of which you will please to sign and return us by mail. The cash payment we will get of Scott when the time arrives."
It was stated in the policy that it was made:
"In consideration of the representations and agreement contained in the application therefor, and of the sum of $254.85 to them in hand paid, and of the annual premium of $254.85, to be paid on or before the 21st of June in each year during the continuance of this policy."
And it was provided in it, among other things, that in case the assured
"Should not pay or cause to be paid the premium as aforesaid
on or before the day herein mentioned for the payment thereof, or any note or notes which may be given to and received by said company in part payment of any premium &c. . . . then this policy shall cease and be null, void, and of no effect."
On the margin of the policy were these words:
"Agents are not authorized or permitted to waive, alter, or change any of the provisions of this policy."
Miller signed the notes sent to him in the letter of Dutcher & Fasset, and returned them, but said nothing about the cash premium. In their letter to Miller enclosing the policy, Dutcher & Fasset sent a receipt in this form, partly printed, and apparently as to that part a form with which the insurance company furnished all their agents:
BROOKLYN LIFE INSURANCE COMPANY
141 Broadway, New York
Walter Miller -- June 21st, 1868 -- Policy No. 4447 -- Life --
Amount of $5,000 -- Amount of Premium, $254.85
One-third loan note $101.94 Two-thirds cash $76.46
Cash note 76.45 Interest on loan note 7.13
------- " cash note 2.67
Total cash $86.26
DUTCHER & FASSET, Agents
July 1, 1868
N.B. Agents MUST NOT DELIVER policies until premium is received,
as no policy is IN FORCE until PAID for.
Dutcher & Fasset, as the evidence went strongly to show, frequently gave credit for the cash payment in the case of persons whom they knew would pay when called on, and in this case they sent the receipt because, as one of them testified, they had "confidence that they could get the money at any time they called for it."
As it turned out, however, Dutcher & Fasset did not get the money payment from Scott, although it was a fact that
Scott had promised to pay it, and there was no allegation anywhere of fraud.
The following correspondence now took place.
"[Dutcher & Fasset to Miller]"
"ST. LOUIS, July 23, 1868"
"WALTER MILLER, ESQ."
"Reese's Corner, Maryland"
"DEAR SIR: The last of the month we make our report according to custom, and last evening, going home, I (the writer) called in the store and found our friend Scott intending to start East on Monday. I suggested to him that he should pay your cash part of premium as you suggested to me, but he would not listen to it at all; so we depend on you for it, the amount being $86.26, made up as follows:"
Interest on annual note. . . . . . 7.13
" " six months' note . . . 2.67
"For which amount please send me check on New York."
"DUTCHER & FASSET"
"[Miller to Dutcher & Fasset]"
"REESE'S CORNER, MARYLAND, August 3, 1868"
"MESSRS. DUTCHER & FASSET"
"GENTLEMEN: In reply to yours of the 23d, I regret that Mr. Scott did not do as he promised you. I did not solicit or ask him to pay the note. He told you that he would pay you the note. Had he not told you, I should have provided for the amount long since. I have about sixty dollars on hand. Will get the $86.26 and send to Baltimore and purchase a draft on New York, and have it sent in a day or two."
"Hoping that all things will be all right in a few days, I am,"
"[Same to Same]"
"REESE'S CORNER, MARYLAND, August 18, 1868"
"MESSRS. DUTCHER & FASSET"
"DEAR GENTS: I shall ship some wheat tomorrow to Messrs. Cox & Brown, Baltimore, and will direct them to send you a draft on New York for $86.26. I regret the delay, and hope it may never occur again. Shall be in St. Louis this fall. Will make arrangements to have all my notes paid at maturity."
The draft, however, not coming, Dutcher & Fasset wrote again thus:
"ST. LOUIS, September 10, 1868"
"W. MILLER, ESQ.,"
"Reese's Corner, Maryland"
"DEAR SIR: Your several letters have been received, the last, under date of August 18th, in which you remark, 'I shall ship wheat tomorrow to Messrs. Cox & Brown, Baltimore, and will instruct them to send you a draft on New York for $86.26.'"
"The draft has never been sent, or it has never come to hand. Now, sir, we are fearful you will lose your policy if payment is not made soon. Give it your attention at once, if you please; and as it has been running so long, you will have to add the interest, which will be $1.34, making the amount to be remitted $87.60."
"DUTCHER & FASSET, Agents"
And hearing that he was "quite sick," wrote thus:
"ST. LOUIS, October 14, 1868"
"WALTER MILLER, ESQ.,"
"Reese's Corner, Maryland"
"DEAR SIR: We learn from Mr. Scott that you are quite sick. As you have not paid your cash payment on your life policy in the Brooklyn, you must be aware that the policy is forfeited, and we now enclose you two notes for part payment of the premium.
It has now been standing for four months beyond the time of payment."
"You will please return the policy to us. The writer regrets very much to hear of your illness, and hope you may speedily recover."
"DUTCHER & FASSET, General Agents"
Miller died before this last letter reached him, and the company refusing to pay, solely upon the ground that the policy had never been in force by reason of the nonpayment of the premium, the widow brought this suit, as already said, in the court below, on the policy. By consent of parties, the case was tried by the court without the intervention of a jury, this sort of trial being in virtue of the 4th section of an Act of Congress of March 3, 1865, which, after enacting that issues of fact in civil cases may be determined by the court without a jury whenever the parties file a stipulation in writing &c., proceeds thus:
"The finding of the court upon the facts, which finding may be either general or special, shall have the same effect as the verdict of the jury. The rulings of the court in the progress of the trial, when excepted to at the time, may be reviewed by the Supreme Court of the United States upon a writ of error or upon appeal, provided the rulings be duly presented by a bill of exceptions. When the finding is special, the review may also extend to the determination of the sufficiency of the facts found to support the judgment."
The testimony which tended to prove a case, such as above given, being closed, the record thus disclosed
"THE PLAINTIFF'S PRAYER"
"If the court shall find that the application for the policy was made by Miller, through the general agents of the defendant at St. Louis; that upon said application the defendant executed said policy and sent the same to its general agents at St. Louis; that the said general agents, upon receipt by them of the policy, forwarded and delivered the same to Miller, who, in obedience
to the directions of the said general agents executed and remitted to them the premium notes provided for, and that Miller died in October, 1868, and that the defendant refused to pay the insurance money, solely upon the ground that the policy was not in force; and further shall find that neither at the time of said application for insurance nor at the time said policy was sent to or received by said Miller did the said general agents demand immediate payment of the cash premium, but on the contrary agreed to call upon Solomon Scott for such case premium when to them it should seem proper so to do; and said agents waived the payment of said cash premium for several months, and treated the said policy as an executed contract, then, if the court so find, the plaintiff, by her counsel, prays the court to render its verdict and judgment for the plaintiff, even though it should further find that the said cash premium was never in fact paid."
Under this prayer of the plaintiff, the court below wrote this
"The court finds all the facts stated in the above prayer, and orders judgment to be entered for the plaintiff for the sum of $5,013, and costs."
The defendant had contended and so prayed the court to rule:
1st. That if Dutcher & Fasset never intended to waive the payment of the cash portion of the premium, and if deceased did not believe that said payment was intended to be waived, there was in law no waiver of it.
2d. If the deceased knew that Dutcher & Fasset had no authority to deliver the policy without payment of the cash portion of the premium, there was no waiver.
3d. If Dutcher & Fasset's authority was such as stated above, the defendant was not bound by their delivery of the policy without payment of the premium.
4th. That the facts, if true, as stated in the testimony in reference to the application for insurance, the correspondence between Miller and Dutcher the sending of the policy and receipt to Miller, and the receipt of the notes by Dutcher & Fasset, showed that there was no waiver.
5th. That all the facts in reference to the subject, in evidence, if true, showed there was no waiver.
The court refused thus to rule, but found that the payment of the cash premium was waived, and gave judgment in the way already mentioned.