Hastings v. Brooklyn Life Insurance , 138 N.Y. 473 ( 1893 )

A recovery is sought in this action upon a policy of life insurance. At the last trial the court directed a verdict for the defendant, but subsequently, upon a case and exceptions, set the verdict aside and granted a new trial. The General Term has reversed this order and reinstated the verdict as directed. The appeal involves simply an inquiry whether the case was one for the court or the jury. The defendant by its policy bearing date June 5, 1882, insured the life of Edwin A. Walter, of Kendall Creek, in the state of Pennsylvania, in the sum of $2,500, payable, in case of death within the life of the policy, to his executors, administrators or assigns. The insured died on October 6, 1886, and his personal representatives assigned the policy to the plaintiff. The defense is that the policy was not in force at the time of the death of the insured, by reason of his failure to pay the semi-annual premium that became due Dec. 5, 1885, and another payment which became due June 5, 1886. There is no claim that these payments were in fact ever made, but it is claimed that the defendant has waived strict performance of the contract in that respect, and that while they are still due to the defendant, and may be deducted from any recovery on the policy, yet the circumstances and dealings between the parties were such that an omission to pay the premiums on the day when due, according to the terms of the contract, did not produce a forfeiture or cancellation of the policy. In order to determine whether there was any question in the case for the jury it becomes necessary to examine the testimony and state the facts established or conceded. A note was given for the payment due Dec. 5, 1885, which became due March 5, 1886, but was not paid, and a new note was given in its place at sixty days. These notes contained a provision pledging the policy as security for their payment, and that in case of non-payment, when due, the policy should become null and void. The renewal note, which became due May 4, 1886, was not paid, but the act of the defendant in extending credit to the insured for premiums falling due upon pledge of the policy established a course of dealing between the parties which it was necessary to terminate in some way before the policy could be treated as forfeited and void. On the trial the defendant produced and put in evidence a letter-press copy of a letter, signed by its secretary, bearing date May 27, 1886, addressed to the deceased at his place of residence in Pennsylvania, notifying him that his note for premium on the policy was due May 4, and was not paid. It stated further that by reason of this non-payment the policy lapsed, "and we are thereby obliged to cancel it on our books. If you have any desire to restore it to full force be good enough to inform us at once." This letter, if received by the deceased, doubtless operated to terminate the course of dealing and to render the policy void, unless he responded to it in a reasonable time or paid the arrears of premium. If it had been shown that the letter had been actually mailed to the insured, the presumption would be that he received it. But we think that the defendant did not prove the mailing of the letter so conclusively as to warrant the court in taking the question from the jury. The secretary swore that he wrote and signed the letter and then gave it to an attendant to copy in the book, who brought it back to him in such a condition as to show that it had been in the letter press. The secretary, as he swears, then folded and inclosed it in a sealed envelope, with a notice upon it to return unless delivered, directed it to the insured, and then put it in a basket in the office where letters for mailing were usually placed. This is all the secretary knew about the mailing of the letter, but the porter in the office testified that his business was to take the letters from the basket and mail them; that he mailed all letters found in the basket, but had no recollection of ever seeing or handling this particular letter. He knew nothing on that point except what is to be inferred from his usual custom and practice. On the other hand it was shown that no such letter was found among the letters or papers of the deceased, who was a physician, and, aside from what the porter testified to as to mailing, there was no fact or circumstance shown that would warrant the conclusion that he had received it.

It could not be held, therefore, as matter of law, that the facts shown established the mailing of the letter. While the facts and circumstances in support of that conclusion are quite persuasive and would amply warrant the jury in finding that it had been mailed, yet the question was one within their province and should not have been determined by the court. If, however, there is no sufficient answer to the default in the payment of the premium that fell due on the 5th of June, 1886, following the date of the letter, the question thus far considered would not be material. On the part of the plaintiff, some proof was given of a conversation between the deceased and the secretary of the defendant on or about May 5, 1886, at or near the place of residence of the insured in Pennsylvania. The witness who testified as to this conversation was the same person who was or had been the defendant's local agent in the territory where the insured lived, and who had charge of the collection of premiums there. He was not able to give the language used by the parties to this conversation, nor was his recollection of its substance very clear, but after several questions were put to him by counsel and the court, he finally swore that his best recollection of the substance of the conversation was that the secretary said to the insured that they would carry him and give him credit for premiums due and to become due thereafter. If this testimony stood alone it might be regarded as somewhat improbable, at least, but there are some conceded facts and circumstances that might be considered, possibly, as giving it some support. There is no doubt or dispute as to the fact that the secretary was there and met the deceased and had a talk with him in regard to the policy. The insured was the defendant's medical examiner in the locality, and the company or its officers were desirous of retaining him for some reason as one of its policyholders. The secretary himself admits this, and also that he urged the insured to retain his policy and that he told him they would give him time, but whether this related to the note that had just fallen due or to the premium to fall due a month afterwards is not clear. Whether there was in fact any promise or agreement on the part of the defendant to waive prompt payment of the June premium was, we think, under all the circumstances, a question for the jury.

However improbable the testimony of a witness may appear, who testifies to a fact not in itself impossible in the ordinary course of events, the credibility, force and effect of such testimony is for the jury. If the statement of this witness in its full scope and length is to be accepted, then there was an agreement between the insured and the defendant's secretary, acting in its behalf, to the effect that credit would be given for the premiums due and to fall due if the officer had the power to bind the company by such an agreement or promise. The learned General Term was of the opinion that, as the secretary was at the time in another state and not at the general office of the company, he had no power to bind it. We cannot concur in this view. The secretary is one of the general managing agents of a corporation, and when in the discharge of the duties of his office, he represents the corporation itself. To waive prompt payment of a premium about to fall due is an act within the general powers of the secretary of a life insurance company. The president or other general officer of a corporation has power,prima facie, to do any act which the directors could authorize or ratify. (Conover v. Insurance Co., 1 N.Y. 290; Booth v.Farmers' M.N. Bank, 50 id. 396; Leslie v. Lorillard, 110 id. 519; Holmes v. Willard, 125 id. 75; Patterson v.Robinson, 116 id. 193; Rathbun v. Snow, 123 id. 343; N.Y.,P. B.R.R. Co. v. Dixon, 114 id. 80; Morawetz on Corporations, §§ 251-253.)

There was no reason, and we are not referred to any controlling authority, for holding that the valid exercise of his powers depends upon the particular place where he may be at the time. The true test of his authority to bind the corporation is not whether he acts in the general office or in a distant state, but whether, at the time, he is engaged in the discharge of the general duties of his office, and in the business of the corporation. These views lead to the conclusion that the case should have been submitted to the jury. The facts were not before the General Term in such a form as to require it to determine where the weight and preponderance of the testimony was. The only question was whether the trial judge committed an error in setting aside the verdict which he had directed, and granting a new trial. He was authorized to review his own action on a motion for a new trial, and if satisfied that he had committed an error in refusing to submit the case to the jury, or in any other respect, to grant a new trial. He had the advantage of seeing the witnesses and observing their general intelligence, demeanor in testifying, and apparent fairness and candor, and unless in such a case it is clear that there was no evidence whatever to submit to the jury his order should be sustained. (Devlin v. Greenwich SavingsBk., 125 N.Y. 757.) We have already expressed our views on that question, and, indeed, the learned General Term did not hold that the case was destitute of all evidence to go to the jury as to the alleged agreement between the insured and the defendant's secretary to waive the payment of the premium about to become due, but only that the secretary did not possess the power to bind the company thereby at the place where he then was.

The order of the General Term should be reversed, and that of the Special Term affirmed, with costs.

All concur.

Ordered accordingly.