
    Sophia L. Rowe, Plaintiff, v. The Brooklyn Life Insurance Co., Defendant.
    (Supreme Court, Oswego Trial Term,
    March, 1896.)
    1. Life insurance — Forfeiture — Notice of premiums.
    Where a policy on the life of a husband is taken out by a .wife, who is designated therein as the person who must pay the premiums and to whom the same is made payable, and the husband has no interest therein, the wife answers the description of “ the person whose life is assured ” within the meaning of chapter 321, Laws of 1877, and is the person upon whom notice of premiums to be paid must be served.
    8. Same — Agency of husband to receive notice.
    In such a case agency to receive such notice will not. be inferred from the relationship of husband and wife.
    3. Same — Waiver of forfeiture. ,
    A statement by the insurer as to the value of the policy made after an alleged forfeiture, in answer to an inquiry as to figures ■ for a paid-up policy, is a recognition of its continued validity, and operates as a waiver of such forfeiture.
    
      4. Same — TTotice of premiums.
    A. notice of premiums to become due, to form the basis of a 'forfeiture, must state the exact amount.
    Action on an insurance policy.
    .Defense,, lapse. Jury waived.
    L. C. Rowe, for plaintiff..
    William H. Ford, for defendant.
   Wright, J.

The defendant,, on December 23, 1865, upon the application of the plaintiff, issued and delivered to her a policy upon the life of her -husband, the late Nathan M. Rowe, Esq., of Oswego, who died August 29, 1893.

By the terms of the policy the defendant, “ in consideration of the representations and agreements contained in the application therefor and of $67.50 to them in hand paid by Sophia L. .Rowe, wife of Nathan M. Rowe, and of the annual premium of $67.50, to be. paid * * * do assure the life of Nathan M. Rowe in the amount of $2,000, * * * and do hereby promise and agree with the said Sophia L. Rowe, well and truly to pay to hep the said sum -assured for her. sole use, or in case she shall die before thv said Nathan M. Rowe,, to pay the said sum assured to her heirs, executors,, administrators or assigns, within sixty days after- due notice and proof of the death of said Nathan hi. Rowe, the balance of the year’s.premium, if any,■ and all indebtedness due or to become due the company to be first deducted therefrom; * * * this policy . * * * is granted by this company ánd accepted by the said Sophia L. Rowe upon the express conditions, that f * * in case the said Sophia L. Rowe shall not pay or cause to be paid the premiums * * * or any note given * ■ * * in payment -of any premium, on the day or days when the same shall become due, except the note given for half the annual premium * * * or shall not renew such last-mentioned note when the same shall become payable, and pay the interest or discount thereon * * * this policy shall cease and be null and void. * * *

“And it is further agreed * * * that the -dividends’ of ’ profits (if any) which may become’ payable by virtue of this policy to the holder thereof shall he applied toward the payment of the note taken for half premiums aforesaid; and that if this policy shall cease or become null and void * * * Sophia L. Rowe, her heirs, executors or assigns, shall be liable to pay to said company the amount. of all notes taken for premium which shall remain unpaid, except the balance remaining unpaid on the nóte taken for half premiums.”

The defense is that the policy, by the volition of the beneficiary, became lapsed in 1883.

The president of the defendant, by a letter to the plaintiffs attorney, dated December 15, 1895, wrote: “ The insured and assured voluntarily lapsed the policy in 1883 — the policy became null and void and of no value whatever in 1893, and that, too, by the volition of the beneficiary.”

This letter was introduced by the plaintiff as an admission, for the purpose of showing that the policy was in force after chapter 341 of the Laws of 1876, as amended by chapter 321 of the Laws of 1877, went into effect, and it does show that fact. Therefore, the policy is to he read as if those statutes were literally incorporated into it; and, as said in De Frece v. Nat. Life Ins. Co., 136 N. Y. 144: “ The plaintiff was not bound to allege or prove the payment of the annual premiums when due. * * ' * There could he no forfeiture for this cause unless the defendant alleged and proved nonpayment after the due service of the notice required by law.”

Said statute requires that - the notice respecting the premium or interest due or to become due shall be “ addressed and mailed to the person whose life is assured.”

On December 23, 1883, a premium became dué. It appears that thirty days prior thereto, and within the statutory period, the defendant mailed Nathan M. Rowe a notice, stating that $56.63 would be due on said policy on December 23, 1883; no premiums were paid thereafter, and the defendant claims that the policy consequently lapsed.

The plaintiff urges that the notice, to have any statutory force, should have been mailed to her. At the time in question, December 23, 1883, there were two statutes in force regulating the method of proof of the service of the notice; one, being section 2 of chapter 341 of the Laws of 1876, which provided: “The affidavit of any officer * * that the notice to the assured * * *- has been duly addressed and mailed by the company issuing such policy'to the assured, shall be presumptive evidence,” etc.; the other, section 2 of chapter'331 of the Laws of 1877, provided for the mating of the affidavit' of service by persons other than those mentioned in the foregoing section, and that the notice should be “ duly addressed to the person whose life is assured.”

The defendant claims that. Mr. Rowe was “ the person whose life is assured ” by the policy.

In solving this ambiguity of the statutes cited,, we must endeavor to ascertain the legislative intent.

“And where the language used is ambiguous or admits of more than one meaning, it is to be taken in such a sense as will conform to the scope of the act and carry out the purpose. of the statute.” Black, on Interpretation of Laws, 56.

“ The purpose of the act' is to require the insurers .to give the ■ notice so that the policyholder may not lose the benefit of the policy by forgetfulness or misapprehension as to the. time of the stated payments.” Merriman v. Keystone M. B. Assn., 138 N. Y. 123.

“The act should be construed according to the popular sig- . nification of the language used and with the view of securing to the policyholders in fife insurance companies the benefits contemplated by the legislation.” ' Carter v. Brooklyn Life Ins. Co., 110 N. Y. 15.

“ It (this act in question) was intended to, and undoubtedly does, subserve a useful' purpose in throwing, about the contract between the insurer and the assured, reasonable.safeguards against á forfeiture or lapsing of the interest of the assilred.” McDougall v. Provident Savings Life Ass. Soc. of N. Y., 135 N. Y. 555.

In Brockway v. Conn. Mut. Life Ins. Co., 29 Fed. Repr. 766, it is held that the term “ assured ” referred to the one on whose . application the policy was issued, who was the beneficiary, and paid the premiums.

In Ferndon v. Canfield, 104 N. Y. 143, Judge Rapallo says: “Although the life of Canfield was the life insured by the policy, he was not the party assured thereby; his life was the subject of insurance, but the contract does not' on its face purport to have been made either'with him or. for his benefit” ■

Again, the policy of 1877 provides that, in case of an assignment of the policy, and notice of 'the assignment is given to . the company, the. notice must be served on the assignee.

Did the legislature intend to invest the assignee of the beneficiary with greater rights and ampler protection than the assignor possessed?

In Classey v. Metropolitan Life Ins. Co., 84 Hun, 350, on an objection that the plaintiff had no insurable interest in the life of the person insured, the court says: “ One may insure his own life, and the policy when issued will be valid in the hands of the assignee. In the case at bar the person insured made the . application and caused the policy to be issued in favor of the plaintiff. In legal effect that was the same as if issued to the person whose life was insured, and by her assigned.”

In the light of the above authorities, was the object of the ■ statute subserved by the service of the notice on Mr. Rowe, who was not a party to the contract, who had no interest therein, present, future or contingent, to whom the policy was not issued or delivered, and who was not the holder thereof, who was under no liability for any indebtedness thereon, and who, Under the authorities was clearly not the person assured?

Again, in case Mrs. Rowe had died during the lifetime of Mr. Rowe, and the company had been informed of the appointment of her executors or administrators, would the object of the - statute then have been subserved by the service of the notice on Mr. Rowe?

Under the statutes, and the authorities construing the legislative intent, it must be held, where the contract is made with the beneficiary, to whom the policy is. delivered and to whom it is payable during her life, and after her death to her executors or administrators, and where the person on whose life the policy risk is taken has no interest, present, future or contingent therein, and where the beneficiary is designated in the policy as the person who must pay the premiums, and is therein obligated to pay all outstanding indebtedness, in case the policy shall lapse, and whose default forfeits the policy, that at the time in question, December 23, 1883, in order to effect a forfeiture of the policy, it was necessary to be shown, in the language of section 2 of chapter 341 of the Laws of 1876, that the notice to the assured has been duly addressed and mailed by the company issuing such policy to the assured,” and that in this case, the person “ assured,” and to whom, the policy was issued, was the plaintiff, and that she, in this case, also answers the description of the person whose life is assured” in the act of 1877.

The learned counsel for the defendant urges that Mr. Rowe must be regarded as the "agent of his wife for the .purpose of receiving notice. But there was no competent proof to sustain that contention, and such agency will not be inferred solely from the relationship of husband and wife.

The Schneider case, 123 N. Y. 109, holding the husband was the agent-of his wife for the purpose of receiving the statutory notice, does not sustain the defendant’s position in this case; for in that case the husband made the application, received the policy, retained it in his possession, paid the premiums, and the wife had no knowledge of its existence until his death.

The court said: The plaintiff cannot claim the benefit of a contract made in her behalf, but, as it appears, without her knowledge, without at the same time assuming all the responsibility of a failure" to perform its essential conditions.”

It is not shown by any competent evidence that Mr. Rowe ever paid; a premium or took any action respecting the policy further than the writing of a few letters inquiring the value of the policy in exchange for a paid-up policy; and, so far as it appears, the notice in question is the only notice for the payment of a premium the -defendant ever served upon him, and the presumption is that the plaintiff paid every premium that was paid, Certainly, under such circumstances, it cannot be held that Mr.. Rowe was the plaintiff’s agent for the purpose of receiving the notice. • •

There is also involved in this case an interesting question of waiver. On December 24, 1883, the day after the date on which the defendant noio urges that the policy lapsed for the nonpayment of premium, Mr. Rowe wrote the company with reference to this policy, asking “figures for a.paid-up policy, free from all liens or claims,” and “ a detailed statement of the condition of my policy.”

On December 26, 1883, three days after the forfeiture date, as now claimed by the defendant, the president of the company, in answer to Mr. Rowe’s letter of the 24th, wrote him, stating The equity, if we may so term it, of your policy, if surrendered,, is represented in the' amount of your liens, and there .would be no paid-up policy free of liens.”

The letter contains no claim or suggestion that the policy was , lapsed, but on the contrary states, in substance, that the policy at that time had a value, and that, if surrendered, the value was the amount of liens against it, which, in the former letter to Mr. Rowe from the president, dated December 22, 1883, was stated at $381.46, conditioned on the payment of annual interest thereon.

This letter is wholly inconsistent with the theory that the policy was lapsed or forfeited up to December 26, 1883, but is a full and complete certificate of its legal existence at that time.

“It may .be asserted broadly that if, in any negotiations or transactions with the insured, after knowledge of the forfeiture, it (the insurance company) recognizes the continued validity of the policy, or does acts based thereon, * * * the forfeiture is, as matter of law, waived; and it is now settled in this court, after some difference in opinion, that such a waiver need not be based upon any new agreement or an estoppel.” Titus v. Glens Falls Ins. Co., 81 N. Y. 419.

It cannot be claimed that the president had in view the surrender value which now exists after a lapse, under section 1, ■ chapter 347, Laws of 1879, because the policy was issued prior to that enactment. Therefore, if it should be conceded to the defendant that either of its positions is correct — that Mr. Rowe was the proper person to be served with the notice under the statutory designation, or that he' was the plaintiff’s agent for receiving such notice — then the defendant falls into the other alternative of the dilemma of having waived-the force and effect of that service by its correspondence with Mr. Rowe, recognizing the validity of the policy. '

Again, the notice did not state the correct amount due on the policy, biit stated a considerably larger amount than was due. The policy could not be forfeited by the nonpayment of such excessive amount,- and the notice was not, therefore, the statutory notice. And the defect was not waived by Mr. Rowe’s neglect to call attention to it in the correspondence above mentioned, because the benefit of a statute which, in pursuance of a general policy,- requires notice of the accruing premiums on life insurance policies to be given to the assured cannot be waived. Phinney v. Mutual Life Ins. Co. of N. Y. (C. C.), 67 Fed. Repr, 493.

The remaining question is, how much is due on the policy. It provides that all indebtedness shall be deducted therefrom.

There is no competent evidence of any indebtedness arising until the year 1875, when Jenkins, the cashier of the defendant, speaking from personal knowledge, states that from that year until December 23, 1882, inclusive, only one-half the annual premiums, besides interest moneys hereafter mentioned, were received at the home office. The plaintiff had during those years paid certain sums on premiums to the agent of the company at Oswego, who forwarded them to the home office. • ■

The cashier states that, kfter December 23, 1882, no premiums whatever were- received at the home office. That evidence is sufficient to throw the burden upon the plaintiff to show that she paid those premiums either at the home office or to the local agent authorized to receive them. This no't being shown, it must be held that the plaintiff is ■ indebted to the company, for the amount of the unpaid half premiums which became' due each year from December 23, 1875, until December 23, 1882, inclusive, less the • dividends declared each year,, and also less the amount of all other moneys received on said , policy.

• Certain sums were received at the home office from the agent Harmon, at Oswego, which the cashier, in his testimony, characterizes as interest; but no authority is shown to have been given by the .plaintiff, or even by Mr. Rowe, to the agent-to pay any money as interest to the company. And there being no competent evidence of the existence of any indebtedness to the company prior -to the year 1875, consequently - all. those sums thus, designated, commencing with that year, and continuing each year until December 23, 1882, inclusive, must be credited to Mrs. Rowe on her indebtedness for the half annual premiums left unpaid. ' ■

The' plaintiff is also indebted to the company for the amount of the whole premiums which became due each year, since December 23, • 1883, until December 23, 1892, inclusive, less the dividends which would have accrued each year, as shown by the defendant’s expert testimony, had the premiums been paid when due.' • .

The plaintiff is, therefore, ' entitled to judgment against the defendant for $2,000, and interest up to date of the entry of judgment, less said indebtedness, with interest to the same- date on each. of the aforesaid yearly balances of - said indebtedness, to be struck as above directed, with costs.

Ordered accordingly.  