Opinion
07-12-1877
CONNECTICUT MUT. LIFE INS. CO. v. DUERSON'S ex'or.
William A. Little, for the appellant. Marye & Fitzhugh, J. T. Goolrick and J. G. Mason, for the appellee.
1. Contracts of insurance entered into before the late war, between parties afterwards separated in domicil by the belligerent lines, were not abrogated, but only suspended, by the war. Acc. Ins. Co. v. Hendren, 24 Gratt. 546, and cases there cited.
2. This suspension extends to the stipulation requiring payment of premiums at dates falling within the period of such separation.
3. Nor in such case is it material whether tender of such payment was made at the day or not, even though the insurer's agent, resident in the state of the domicil of the insured prior to the war, continued to reside there on the same side with the insured whilst the insurer and insured were so separated.
4. If such tender would in any case be material, it will at any rate not be when before the premium in question became due such agent had publicly proclaimed his purpose not to receive any more premiums, which declaration was probably made known to the insured and was the cause of the failure to tender, and especially when insurer after the war refused to ratify the act of said agent in receiving payment of a premium from another person as much as a month before the premium in question was due.
5. In such case, however, it is the duty of the insured to tender payment within a reasonable time after the war, if living; and his failure so to do will occasion a forfeiture of the policy.
6. But in case of the death of the insured pending the war, his personal representative would be under no obligation to make such a tender, for then there would be in the hands of the insurer a fund of the insured out of which he could deduct the unpaid premium. Nothing more would then be necessary on the part of the insured than that the insurer should within a reasonable time from the ending of the war be informed of such death and of its date.
7. Such information will be sufficient though unaccompanied by any formal demand of payment or assertion of right to it.
8. An insurance company chartered by another state, but doing business in this state in compliance with the statutes of 1855-'6, is to be considered, for the purpose of being sued, as domiciled in this state, and is entitled to rely on the statute of limitations just as if it were a company which had been chartered by the legislature of this state.
9. The several acts of the government of Virginia during the war, suspending the statutes of limitations, were valid to prevent the running of said statutes to 3d March 1866. Acc. Johnston v. Gill, 27 Gratt. 587. And the time from 2d March 1866 to 1st January 1869 is to be left out of the computation under said statutes by virtue of the seventh section of the act of March 2d, 1866. commonly known as the stay law. Acc. Danville Bank v. Waddill, 27 Gratt. 448.
10. Though such company had after the war expressly revoked the powers of the resident agent it had before the war, and had never afterwards, appointed another in his place, service of process on such agent will nevertheless be effectual under the statutes in that behalf to give jurisdiction of an action against such company.
11. The provisions of said statutes of 1855-'6 were amendatory of the previous law, and extended as well to policies previously issued as to policies thereafter issued; and a foreign company doing business in the state under the same at the time said amendments were enacted, and continuing to do business afterwards in compliance with all said statutes, must be taken to have accepted said provisions and to be bound by them.
This case was heard at Richmond, but was decided at Wytheville. It was an action of assumpsit in the circuit court of Spotsylvania county, brought in December 1873, by William R. Duerson, executor of Robert C. Duerson, deceased, against the Connecticut Mutual life insurance company, to recover the amount of two policies of insurance upon the life of the said Robert Duerson issued by the said company. The process was served on A. A. Little, who had been the general agent of the company.
Upon the calling of the cause in September 1874, the defendant, by counsel, moved the court to quash the process in the cause, on the ground that the defendant had, in 1861, revoked the agency of A. A. Little in Virginia, and declined to reinstate it after the war, on account of the change in the legislation in Virginia by the act of February 1866, affecting foreign insurance companies.
It appeared from the evidence, that A. A. Little was an agent of the company from 1850 to some time in 1861, when the war breaking out, communication was cut off with Hartford, Connecticut, the home of said company, and he ceased to act as agent; and his agency was formally revoked by the company in March 1866; that he had done no act as agent of said company since; and no agent of the company had since been appointed in Virginia.
The company further insisted in behalf of said motion, that these contracts of insurance were made in 1850 and 1851, before the act of 1855-'56, which first required foreign insurance companies in Virginia to appoint an attorney to accept service of process in any suit against said company; and said act was therefore no part of the contract of insurance in these cases, and the company could not be required to retain an attorney in Virginia to accept service of process in this case. And second, that the act of 1855-'56 had been repealed by the act of February 3rd, 1866, inaugurating an entirely new policy, and requiring new regulations, licenses and deposits of foreign insurance companies doing business in Virginia; and the defendant declining to continue its business in Virginia, because of said legislation, has now no agent in Virginia, and no party upon whom process against said company in this case can be legally served.
But it was shewn in evidence, that in April 1856, the company executed a power of attorney, appointing Little their agent in Virginia, to accept service of all lawful processes against the company in the state of Virginia, and to cause an appearance to be entered in any action, in like manner as if the company had existed and been duly served with process within said state. And this power of attorney was filed in the office of the auditor of the state. It appeared further, that Little made his returns to the auditor, and paid the tax on the premiums received by him from May 1st, 1859, to May 1st, 1861.
The court overruled the motion to quash the process; and the defendant excepted.
The cause came on for trial on the 12th of December 1874, upon the general issue, with leave to the defendants to prove anything under that issue that they might prove under any special pleas; and when all the testimony had been introduced before the jury, the defendant demurred to the evidence, and the plaintiff joined in the demurrer. There was a verdict for the plaintiff for $3,500, with interest from, & c., subject to the demurrer; and the court holding that the evidence was sufficient to sustain the plaintiff's action, rendered a judgment upon the verdict in his favor for the amount. And thereupon the defendant applied to a judge of this court for a writ of error and supersedeas; which was allowed.
R. C. Duerson, of Spotsylvania county, Virginia, effected with the said company, a corporation chartered by the state of Connecticut, and having their home office in Hartford, through their agent in and for Virginia, A. A. Little, of Fredericksburg, two policies of insurance upon his life, dated respectively 10th June 1850, and 9th June 1851, one for $2,000, and the other for $1,500, and numbered 9,990 and 14,678 respectively.
By these policies, the company in consideration of the payment of the respective sums named therein by said Duerson, and of the annual premiums named, to be paid on or before the 9th and 10th days of June respectively in every year during the continuance of said policies, assure the life of said Duerson in the said respective amounts of $2,000 and $1,500 " for the term of the whole continuance of his life." And said company promise and agree to pay said sums within ninety days after due notice and proof of the death of said Duerson, deducting therefrom all notes taken for premiums unpaid at that date. There are numerous provisos and conditions, as usual, contained in said policies, none of which are material to this case, or necessary to be adverted to, except the clause which provides, that in case the assured shall not pay the said annual premiums on or before the several days therein before mentioned for payment thereof, then and in every such case the said company shall not be liable to the payment of the sum insured, or any part thereof, and the policies shall cease and determine, and all interest shall be forfeited.
The premiums upon these policies were regularly and promptly paid or settled for by Duerson with said Little up to and including the premiums falling due on the 9th and 10th days of June respectively, 1860, by which said policies were continued in force for the years following said dates. Before the next premiums fell due, to wit: the 9th and 10th days of June 1861, the great war between the Confederate States, of which Virginia was one, and the United States, of which Connecticut was one, had intervened. All intercourse with the north, the home of the company, had ceased, and the agent who, as well as the insured, resided in Fredericksburg, had publicly and freely proclaimed in the town-- there being a number of policy holders therein--before said dates, that he would not receive any premiums from any policy holders. And after the war the company refused to allow a credit for the amount of a premium which had been paid to Little on the 4th of May 1861 to another person holding a policy of the company, which he wished to have reinstated.
Little, who was examined as a witness by the defendant, states that Duerson at this time resided in Fredericksburg, was sergeant of the corporation; he was a prompt business man, prompt in paying his premiums, had abundant means, and said agent " supposes Duerson would have paid his premiums during the war had not he heard that said Little would not receive them, as he was prompt and punctual, and had paid the others promptly," though said Little cannot recollect whether he had any conversation with Duerson on the subject of the premiums and policies after the war begun. But said Little would not say he had not conversed with said Duerson during this time, and that the premiums were not tendered. And " it was generally known in town that Mr. Little was not receiving any premiums."
Duerson died on the 17th day of March, 1863, in Fredericksburg, Va., of pneumonia--his disease not having been induced by any military service, as he never was engaged as either soldier or sailor during the late war, and he died a natural death.
At the time of his death there were remaining unpaid the premiums for 1861 and 1862, and four notes given for premiums, & c.
In August, 1863, Mrs. Duerson qualified as executrix of said R. C. Duerson. She having died in June, 1865, and the executor named in the will being under age, J. C. Cammack qualified as administrator d. b. n. c. t. a., on the 12th October, 1865.
On the 31st January, 1866, Cammack wrote to the company, informing them of the death of R. C. Duerson during the war, from natural causes, and stating that Duerson " was prevented from making further payments by the then existing war."
He says: If Duerson could have made one more payment his family, now in very reduced circumstances, would have been entitled to the full amount of the premiums. I do not know what has been your custom in such cases, but having heard that you were very liberal in the renewal of policies that had expired under similar circumstances, I thought it probable you might pay something on account of these policies. I administered upon Duerson's estate, besides which he married my sister.
I am, very respect'y,
JOHN C. CAMMACK.
To this letter the company reply:
HARTFORD, June 15, 1866.
Jno. C. Cammack, Esq., Louisa C. H. Va.,
Dear Sir --An answer to your letter of January 31st, 1866, has been delayed by the great demands upon my time. It has not been our custom, nor is it usual with other companies, to give any consideration in the case of the decease of persons that have allowed their policies to lapse. This being a mutual company, the right of each member to its benefits is based upon the fulfillment of his or her contract. The case you state is a somewhat peculiar one, and is perhaps entitled to more consideration than most cases, where whole or partial payment is desired after the forfeiture of the policy and the death of the insured: but the question will arise, if payment is made in this case, why not pay upon policies that lapsed in 1860, and if payment is made upon policies that lapsed in 1860, why not upon policies that lapsed in 1855, and so on. The practice once commenced, there is no point at which to stop. We are compelled, for the reasons stated above, to decline making partial payments upon policies Nos. 9,990 and 14,678.
Very respectfully yours,
GUY R. PHELPS, Pres't,
Per. Howard.
Cammack having died, and the executor named in the will, said W. R. Duerson, son of the assured, having come of age, he qualified as executor on the 12th June, 1873. And on the 1st July, 1873, he wrote to the company, reminding them of Cammack's previous application, and the death of his father, and calling upon them for settlement. To this letter no reply was made.
After waiting for some time to hear from the company, the executor of Duerson placed the matter in the hands of attorneys to procure a settlement by suit or otherwise, and there was some correspondence between the attorneys and the company. In the letter of the assistant secretary of the company, under date of August 8th, 1873, directed to the attorney of Duerson's executor, he says: " We have your favor of the 5th ultimo, relating to policies Nos. 9,990 and 14,678, on the life of R. C. Duerson, forfeited for non-payment of premiums in 1861. For reasons satisfactory to us and, as we believe, conclusive in law, we recognize no claim on these forfeited policies and acknowledge no liability by virtue thereof."
William A. Little, for the appellant.
Marye & Fitzhugh, J. T. Goolrick and J. G. Mason, for the appellee.
OPINION
ANDERSON, J.
It must be regarded as settled law, at least in Virginia, that contracts of life insurance entered into before the late war, by parties who were separated by the belligerent lines, are not abrogated, but only suspended, by the war. The New York Life Ins. Co. v. Hendren, 24 Gratt. 536; citing Manhattan Life Ins. Co. v. Warwick, 20 Gratt. 614; Mutual Benefit Life Ins. Co. v. Atwood's adm'x, 24 Gratt. 497; and New York Life Ins. Co. v. White --special court of appeals of Virginia--Insurance Law Journal for December 1873, p. 917. These Virginia decisions are in accord with the decisions of the supreme courts of the states of Kentucky, New York, New Jersey and Mississippi, and the Federal circuit courts for the southern district of New York, J. Blatchford, and for the eastern district of Virginia, J. Bond.
In the case under judgment one of the policies of insurance was issued by the plaintiff in error on the 10th day of June 1850, for the insurance of the life of Robert C. Duerson, of Spotsylvania county, in the state of Virginia, in the amount of $2,000, for the term of the whole continuance of his life, in consideration of the sum of $70.20 to the said company in hand paid by the said Robert C. Duerson, and of the annual premium of $70.20 to be paid on the 10th of June in every year during the continuance of the policy. The other policy, which is also an insurance for the term of the whole continuance of his life, is dated June 9th, 1851, and is for $1,500, in consideration of $54.45 in hand paid and of the annual premium of same amount to be paid on the 9th of June of every year during the continuance of the policy.
The plaintiff in error was an incorporated company of the state of Connecticut, and had an agent, A. Alexander Little, at Fredericksburg, Virginia. The testator of the defendant in error, R. C. Duerson, was a resident citizen of Virginia. The premiums on both policies were regularly and punctually paid to the agent, in the mode prescribed by the policies, by the insured, in fulfillment of his contracts up to the 9th and 10th of June 1861. At those dates the next premiums were due. They were not paid. The late war between the states, at those dates and prior thereto, was flagrant, and separated the home office and domicil of the company from its agent at Fredericksburg, and from the insured, R. C. Duerson, by the belligerent lines. The contract was thereby suspended, the agent of the company having resolved to receive no further premiums after the preceding 4th day of May, which he made known to the public. There is no direct proof that the premiums then due were tendered by Duerson to the agent. I think the presumption is they were tendered; or, if not tendered, it was because Duerson knew they would not be received, as the agent had stated publicly he would receive no more premiums; and he now testifies that if they had been tendered he would not have received them.
But I do not think it material whether they were tendered or not, inasmuch as the war suspended the contract, and if they had been tendered they would not have been received. In the Manhattan Life Ins. Co. v. Warwick, supra, it is true we held that a payment tendered to the agent in July 1861, and received by him, was valid and binding on the company, and that the insured should be credited with it, although the company never received it. But in that case it was shown that the agent had received it in compliance with express instructions from the company, which was therefore charged with it. But in this case there is no special authority given to the agent by the company to receive any premiums during the war, and after the war it refused to ratify his act in receiving payment of a premium from Gordon on the 4th of May 1861. If it had been competent for the agent to receive premiums without special authority, he resolved not to receive them, and it would not be right to hold the assured to a forfeiture of his policies in this case for not tendering them, inasmuch as if they had been tendered, the agent declares they would not have been received, and if they had been tendered and received the company would have refused to ratify it, as is inferrable from the fact, that they disclaimed the authority of their said agent in another case to receive payment of a premium, even at an earlier stage of the war, and refused to ratify it.
But the contract being suspended by the war, all acts which were to be done in its execution were suspended; and the stipulations that the insured should pay the premiums of the 9th and 10th of June 1861, as the conditions of the policies, were suspended.
But this being so, it was obligatory on the insured, if living, to have tendered payment in a reasonable time after the termination of the war. But if the insured had not survived the war, but had died pendente bello, the case, it seems to me, is different, and the assured is not liable to a forfeiture of the policy by reason of the failure of the personal representative of the insured to make a tender of the unpaid premiums after the termination of the war. The insurer had in his own hands money due from him to the assured, out of which he was entitled to retain the unpaid premiums, and a tender of them by the personal representative would have been unnecessary if not improper. But the insurer should have been informed in a reasonable time after the war ended of the death of the insured, that he might know what his liabilities were. The non-payment of premiums pending the war, and by reason of its existence, were facts within his knowledge, and need not have been communicated to him by the personal representative, because not necessary to inform him of his liability or its extent.
In this case the insured died March 17, 1863, pendente bello. His wife qualified as his executrix, and died in June 1865, soon after the termination of the war. Letters of administration d. b. n., c. t. a., were granted to her brother, J. C. Cammack, on the 12th of October following; and he wrote to the secretary of the company in January following, informing him of the death of R. C. Duerson from disease. He also informed him of the date of his death, and of whatever it was necessary for the company to learn from him to form a conclusion as to its liability. I do not regard this letter as conceding that there was no legal liability on the company to pay the policy as contended for by its counsel. On the contrary, it seems to me that, according to its natural import, the writer was of opinion that the assured had a claim upon the company, but to what extent, or whether it could be legally enforced or not, he was not informed, and wished to have the views of the company with regard to it. Relying upon what he had heard as to its liability in other cases, he hoped it would come to just conclusions. I do not think it can be regarded as a surrender in any manner of any just or legal claim, which, as the personal representative of R. C. Duerson, he had upon the company, though it is not a positive assertion of any legal claim. The company replied through its president, after a delay of some five months, declining to pay anything, and for its conclusion assigns reasons which absolutely ignore the only fact, the existence of the war, which might relieve the insured from a forfeiture on account of the non-payment of premiums, but puts its refusal to pay anything upon the ground of the non-payment of premiums, and upon that ground alone. No objection is made upon the ground of delay in communicating the death of the insured, or for the want of a more formal notice of his death, or for the non-compliance with any formal requirement of the policies, but only on the ground of the non-payment of premiums, which may therefore be regarded as a waiver of such requirements if not strictly observed. It does not appear that Cammack made any response to the said letter.
On the 12th of June 1873, William R. Duerson, son of decedent, qualified as his executor, and on the 1st July following he wrote to said company, informing them that he had in his possession as executor the said policies, and demanding payment. This letter was not answered, and the claims were placed in the hands of an attorney for collection, who, after some correspondence with the company, instituted suit, the company having denied all liability.
I am not aware that the claims in this suit can be defeated on account of delay in their assertion and prosecution by suit, unless it was such delay as would bar the plaintiff's recovery under the statute of limitations, which is pleaded by the company. And the company, under the Virginia act, having a local existence and domicil in this state, for the purpose of being sued, the statute of limitations may be relied on just as if the company had been chartered by an act of the Virginia legislature. It is necessary therefore to inquire whether the assured's right of recovery in this case is barred by the statute.
The questions arising under this head have been answered by recent decisions of this court. In Johnston v. Gill, 27 Gratt. 587, it was held that the several acts of the government of Virginia during the war, suspending the statutes of limitations, were valid, to prevent the running of the statute prior to the 3d of March 1866. Consequently the claims involved in this suit were not barred by the statute on the 3d March 1866. And in the Danville Bank v. Waddill, 27 Gratt. 448, it was held that in an action of assumpsit, on the plea of the statute of limitations, the time from the 2d March 1865, to the 1st day of January 1869, is to be left out of the computation by virtue of section 7 of the act of 2d March 1866. The statute could not therefore begin to run before the 1st January 1869, and suit was brought on the 29th day of December 1873, within the five years, so that the plea of the statute of limitations is not sustained.
But it is contended for the plaintiff in error, that if it had a domicil in this state, to the end that it might be sued here, the right of action was not suspended by the war, and consequently the right to collect the premiums, and unless the defendant in error has shown a tender to the agent on the day, and refusal, he cannot be relieved from a forfeiture of the policy. To this objection, it is only necessary to reply, that it does not lie in the mouth of the plaintiff in error to put in such a plea, since its agent, after the 4th day of May, publicly refused to receive any more premiums, and declares that if the premiums had been tendered by Duerson, he would not have received them. And his determination was not only approved by it, but it actually refused to ratify his act in receiving a premium on the 4th of May preceding.
But it is further contended for the plaintiff in error, that the judgment of the court below is erroneous for the want of jurisdiction, no process having been served on it,--the service on A. A. Little being futile, as he was not its agent, his agency having been revoked by the war, and also by express revocation after the war was over. But by the express provision of the Virginia act of 1855-'56, it was not authorized to grant policies in this state, or make renewals, until it had appointed an agent in the way described by the statute, and was not allowed to revoke the authority of said agent until it had appointed another in his place, as long as any of its obligations in the state remained unsatisfied. So that by virtue of this act the agency which had been constituted in A. A. Little was irrevocable as long as those obligations remained unsatisfied, no other agent having been appointed by the company.
But it is contended, that said provision of the law not being in force at the time the contracts in question were made, but being subsequently enacted, were not binding upon the company in this case. The said provisions were amendatory of the previous law, and extended to policies which had been previously made, as well as those which were made subsequently, and the company by its acts of compliance with its terms and by operating under it, must be held to have accepted its provisions, and cannot now, at this late hour, after having for years carried on its business, and exercised corporate powers and enjoyed special privileges under its provisions, without protest or objection, be allowed to plead that those provisions of the law requiring it to keep an agent here, not only for negotiating new policies, but for executing those which had been previously made, were not binding on it, and that it could, at its pleasure, revoke the authority of its agent with regard to the fulfillment of its obligations already incurred, without appointing another in its place. I am of opinion, therefore, that A. A. Little continued to be the agent of the company for receiving the service of the process in this case. Upon the whole, I am of opinion that there is no error in the judgment of the circuit court, and that the same be affirmed.
JUDGMENT AFFIRMED.