Greenwood v. New York Life Insurance

27 Mo. App. 401, 1887 Mo. App. LEXIS 40

Opinion

Hall, J.

In considering this case, we shall assume that the defendant’s agent, Woodfin, both at the time-plaintiff made the application and at the time Woodfin delivered the policy to him, made the verbal agreement with him that he should pay the premiums, when due, at the Kirksville bank, and that, on that condition, the-plaintiff applied for and accepted the policy. The verbal agreement, made at the time of the making of the application, never became a part of the contract between plaintiff and defendant. “All previous verbal agreements were merged in the written agreement. * * *' The entire engagement of the parties, with all the conditions upon which its fulfillment could be claimed, must, be conclusively presumed to be there stated.” Ins. Co. v. Mowry, 96 U. S. (opinion by Field, J.).

The defendant was not, by said verbal agreement, estopped from forfeiting the policy, in accordance with the terms of the policy, on account of the non-payment- at the place named in the policy. “ The previous representation of the agent could in ho respect operate as an estoppel against the company. * * * An estoppel cannot arise from a promise as to future action with respect to a right to be acquired upon an agreement not yet made. * * * But the doctrine has no place for application when the statement relates to rights depending upon contracts yet to be made, to which the person complaining is to be a party. He has it in his power, in such cases, to guard in advance against any consequences of a subsequent change of intention and conduct by the person with whom he is dealing. For compliance with arrangements respecting future transactions, parties must provide by stipulations in their agreements, when reduced to writing. The doctrine, carried to the extent for which the assured contends in this case, would subvert the salutary rule, that the written contract must prevail over previous verbal agreements, and open the door to all the evils which that rule was intended to prevent.” Ins. Co. v. Mowry, supra, and authorities cited.

The verbal agreement made between plaintiff and defendant’s agent, contemporaneously with the delivery of the policy by the latter to the plaintiff, did not become a part of the contract between plaintiff and defendant. This is true for the same reason that the prior verbal agreement never became a part of such contract, and also for an additional reason. The very written contract which it was thus proposed to change, by a verbal agreement with defendant’s agent, recited, as one of its conditions: “Agents of the company are not authorized to make, alter, or discharge, contracts, or waive forfeitures.” This limitation upon the authority of its agents, the defendant had the right to make, and, being in the contract in plain and unambiguous terms, such limitation was binding upon the plaintiff. Ins. Co. v. Fletcher, 117 U. S. 530. The agent had no power to alter the contract. And said agreement did not operate as an estoppel against tlie defendant, for the reasons already given.

By receiving payment from plaintiff of the premiums at the Kirksville bank for eight years, the defendant did not waive the right to demand payment of the premiums, thereafter, at the place named in the contract. The defendant did not forfeit the policy for non-payment of a premium on the day designated in the policy, at the place therein named, but did forfeit the policy because the plaintiff refused to pay at said place at all, and stood upon his right to pay at the Kirksville bank only. Had the plaintiff, induced by the action of the defendant in receiving payment at the said bank, paid a premium there on the day designated in the policy, without notice from the defendant that it would demand payment at the place named in the policy, the defendant could not have forfeited the policy because the plaintiff had not paid the premium on the day so designated, at the place so named. The principle of estoppel would, in such a case, have had something on which to act. The plaintiff, having been induced by defendant to act contrary to the letter of the policy, could not have been deprived of a right under the policy for having so acted. In such a case the defendant would have waived the right to the payment of the premium on the designated day, at the place named, but not to the payment at the place named, forever, on some other day. Payment on the designated day could not have been demanded except to the injury of the plaintiff, in the case supposed, and could not, therefore, have been demanded, because it was not so made by reason of the conduct of the defendant.

Even a contract cannot be used by one party to it for the purpose of defrauding another party thereto. But the contract, nevertheless, would have remained the same, and could have been enforced, in every other respect. It could not have been enforced in that particular only, to have enforced it in which would have worked a wrong, and an injury to the plaintiff. But in this case there was no pretense that the plaintiff would be injured on account of his reliance on the conduct of the defendant, in receiving the premiums at the Kirksville bank for eight years, if he were, after said time, compelled to pay the premiums at the place named in the policy. There was no intimation that, by reason of the defendant’s •conduct, in the respect named, it would have cost the plaintiff any more to pay the premiums, at the place named in the contract, than it would have cost the plaintiff to have so done had he been compelled to so do in the beginning. The contract was not changed by reason of .such conduct on the part of the defendant. The Kirks-ville bank was not thereby substituted for the place of payment, named in the contract. The principle of estoppel has no such force or effect. In Insurance Company v. Eggleston (96 U. S. 577), the insured, residing in the state of Mississippi, had always dealt with agents •of the company, located either in his own state, or within some accessible distance. He had originally taken his policy from, and had paid his first premium to, such an agent, and the company had always, until the last premium became due, given him notice what agent to pay to. The court said, in discussing the question of estoppel: u * * * ]^0W) suppose the local agent is removed, or ceases to act, without the knowledge of the policyholders, and their premiums become due, and they go to the local office to pay them, and find no agent to receive them; are these policies to be forfeited? Would the plaintiffs in error, or any other company in good standing, have the courage to say so? We think not. And why not? Simply because the policy-holders would have the right to rely on the general understanding produced by the previous course of business pursued by the company itself, that payment could be made to a local agent, and that the company would have such an agent at hand, or reasonably accessible. We do not say this course of lousiness would alter the written contract, or would amount to a new contract, relieving the parties from their obligations to the company, if they can find no agent to pay to. That obligation remains. But we are dealing with the question of forfeiture for not paying at the very day ; and, in reference to that question, it is a good argument in the mouths of the insured, to say, ‘ Your course of business led us to believe that we might pay our premiums at home, and estops you from exacting the penalty of forfeiture, without giving us reasonable notice to pay elsewhere.’ The course of business would not prevent the company, if it saw fit, from discontinuing all its agencies, and requiring the papment of premiums at its counter in New York.” In this case there is no estoppel.

There remains to be considered the question of ratification by the defendant of the unauthorized agreement made by its agent.

The judgment, in this case, cannot be upheld on the ground of such ratification, because no such issue was made by the pleadings. Katification must be pleaded. Wade v. Hardy, 75 Mo. 399. The plaintiff to maintain this action, on the ground of the defendant’s ratification of the unauthorized agreement, had to plead such ratification in express terms, or by the allegation of facts, from which ratification would have been necessarily implied. The allegation of facts, from which ratification might have been inferred, was not sufficient. The facts alleged to raise the issue of ratification by force of the allegation of them had to conclusively show ratification. In other words, ratification was not pleaded by the allegation of certain facts, unless the judgment of the law on those facts is that those facts, of themselves, necessarily constituted ratification. If the facts alleged constituted ratification, not as a matter of law, but only by reason of the inference drawn from them by the trier of the facts, by the exercise of his judgment on the question of fact, that the facts essential to ratification did exist, •<heD the facts alleged did not raise the issue of ratifica tion. For in such case the facts did not make ratification, bnt were simply evidence of ratification.

In the petition, ratification was not pleaded in express terms ; neither was ratification pleaded by the allegation of facts, from which it was necessarily implied. Bnt we cannot hold, with the defendant’s counsel, that, from the facts proved, which were also alleged in the petition, that the defendant, for eight years, sent to the Kirksville bank [properly executed receipts for the premiums as due, it might not be inferred that the defendant ratified the unauthorized agreement, made by its agent with plaintiff, that such course would be pursued.

Ratification of the agreement, of course, could have been made by the defendant, only through an officer authorized to have made the agreement in the first place ,* and ratification of the agreement could not have been made through such officer, unless he had knowledge of such agreement. While the course pursued by the defendant referred to does not conclusively show that the officers of the defendant, competent to have made the agreement, knew that such agreement had been made, it tended, we think, to show such knowledge. The bank was not an agent, such as referred to in the policy, authorized to receive payment of premiums, on the presentation of properly-executed receipts. The bank was selected by the defendant for the specific purpose of receiving payment of the premiums and delivering the receipts therefor, and acted for the defendant in no other matter, and it may be reasonably inferred that the selection of the bank for'such purpose was made in pursuance of the agreement that such course would be pursued with full knowledge of said agreement. But such inference need not be necessarily drawn, and the defendant has the right tu show, by proper evidence, that the facts inferred are not true.

In my opinion the judgment should be reversed and the cause remanded. The other judges concur in this opinion except in so far as concerns the question of rati fication. Upon, that question their views are thus expressed :

They are of opinion that the facts pleaded in the petition and proved at the trial are equivalent to a ratification by .the defendant company. As it is distinctly alleged in the petition, that notwithstanding the provision of the policy directing the payments of premiums to be made in the City of New York, or to the agent, yet the plaintiff thereafter, for a period of nine years, made such payments at the Kirksville Savings Bank, according to the understanding had with the agent, Woodfin, and the defendant, during all this period, recognized the act by the receipt of the money through this bank, the majority hold that these facts would constitute a ratification ; and because the pleader alleged that defendant’s “subsequent acts in receiving payments from plaintiff at the Kirksville Savings Bank” estops it, etc., could not alter the legal effect of the facts pleaded and proved, or disentitle him to relief according to the facts pleaded and proved. Under the prayer “ for all proper relief ” the court can administer such relief as in equity the facts stated and proved authorize, no matter how the pleader may designate them in terms. Wilkin v. Wilkin, 1 Johns. Ch. 111; Holmes v. Fresh, 9 Mo. 201; McGlothlin v. Hemery, 44 Mo. 351; Northcraft v. Martin, 28 Mo. 469; Ashby v. Winston, 26 Mo. 210-213. “The relief to which the party is entitled — the effect of the matter set up — is determined by the court as a matter of law from the facts pleaded.” Turley v. Edwards, 18 Mo. App. 689-690. The majority hold that, when the defendant, through a period of eight years, knew the plaintiff was making payment at the Kirksville bank, when the policy required a different mode of payment, the presumption of fact arises that it must have made inquiry into the cause of this departure of its agent, and its continued silence and receipt of the money through the bank is a most persuasive proof of a waiver and rat ification; and as the decree was for the right party, they will not disturb it because the circuit court may have given a wrong reason for it, and as no reason is assigned in the decree different from the one entertained here, the presumption is to be indulged that the court was influenced by the proper one.

It follows that the judgment of the circuit court must be affirmed.