Causey v. Gulf Life Insurance Co. , 62 Ga. App. 378 ( 1940 )

The petition showed that the policy of life insurance sued upon lapsed on December 27, 1937, for nonpayment of premiums due; that on January 29, 1938, one Morris, an agent of the defendant, collected from petitioner, the beneficiary named in the policy, the sum of $5.35, which more than paid up the unpaid premiums; that, at the same time, Morris filled out an application for a reinstatement of the policy which was signed by the insured; that the insured was then ill and Morris knew of this fact; that the application for reinstatement was never forwarded to the defendant's home office at Jacksonville, but was retained in its Atlanta office, with the notation thereon, "hold;" that Morris turned over the said sum of $5.35 and the application for reinstatement to one Bolton, another agent of the defendant at its Atlanta office; that because of the above-stated facts, the defendant waived the requirements of the policy providing that before a void policy can be revived evidence of insurability satisfactory to the company must be presented. On an oral motion, the petition was dismissed, and that judgment was assigned as error. The policy contained the following provision: "If for any reason the agent shall not call for the premiums when due, it shall be the duty of the policyholder to bring or send said premiums to the home office or to the company's authorized agent; and in the event of failure to perform this duty within four weeks from the date upon which said premium was due, this policy shall thereupon become void and all premiums paid hereon shall be forfeited to the company, except as herein provided." The policy contained the further provisions: "4. Revival. Should this policy become void in consequence of nonpayment of premium, it may be revived upon payment of all premiums in arrears and the presentation of evidence ofinsurability satisfactory to the company." (Italics mine.) "5. Alterations of contract. No person except the president, secretary, or assistant secretary has the power to modify, or, in the event of lapse, to reinstate this policy, or to extend the time of payment of a premium. No agent has power on behalf of the company to waive any forfeiture, or to bind the company by making any promise, or by making or receiving any representations or information."

The instant petition showed on its face that the policy of insurance sued on had lapsed because of the nonpayment of premiums, and that, while such premiums were subsequently paid, no evidence of insurability had been presented to the insurance company. Nor did the petition show a waiver by the company of the above stated provisions of the policy. In Harrod v. Sun LifeAssurance Co., 49 Ga. App. 433, 435 (176 S.E. 53), this court said: "The policy sued on provides that `No person except the president, vice president, actuary or secretary, has power to alter this contract in any way;' and parol evidence to prove a modification of the contract, by some one other than the officers named, so as to make it include a pre-existing disability should be rejected by the court. Civil Code (1910), § 4268, par. 1 [Code, § 20-704]. The petition did not set out a valid cause of action, and the court properly sustained the general demurrer." In Penn Mutual Life Ins. Co. v. Blount, 165 Ga. 193 (2) (140 S.E. 496), the court held: "The unauthorized act of an agent, done in the principal's behalf, can not be ratified by the principal without actual knowledge of the act. The provisions of the Civil Code (1910), § 4530 [Code, § 37-116], have no application to the subject of waiver as related to conditions imposing forfeitures in contracts of insurance." In that decision, many cases are cited to sustain its holding. "A principal is not put on notice of the unauthorized act of an agent by the mere knowledge of the agent of the acts he himself has done in excess of his authority." Newton v. Gulf LifeInsurance Co., 55 Ga. App. 330, 332 (190 S.E. 69). In RomeIndustrial Insurance Co. v. Eidson, 138 Ga. 592 (75 S.E. 657), the court held as follows: "A policy of insurance required the payment of a weekly premium, and declared that, if any payment should not be made when due, the policy should be void. It also contained this clause: `Its terms can not be changed, or its conditions varied, except by a written agreement signed by the president or secretary of the company. Therefore agents (which term includes superintendents and assistant superintendents) are not authorized and have no power to make, alter, or discharge contracts, waive forfeitures, or receive premiums on policies in arrears more than four weeks. . . Should this policy become void in consequence of nonpayment of premium, it may be revived, if not more than fifty-two premiums are due, upon payment of all arrears and the presentation of evidence satisfactory to the company of the sound health of the insured.'Held, that the company could thus limit the authority of its agents as to waiving forfeitures or receiving overdue premiums; and one who accepted a policy with these terms in it was charged with notice of such limitations."

In my opinion, the case just cited is controlling in the instant case; and the petition was properly dismissed on oral motion. If there is any conflict between the ruling in theEidson case, supra, and the decision of the Supreme Court of Alabama in Life Casualty Co. v. Street, 213 Ala. 588 (105 So. 672), this court is obligated to follow the decision of the Supreme Court of Georgia.