Boswell v. Gulf Life Insurance Co.

In this suit for reformation of an insurance policy so as to change the effective date as stated therein, and to recover on the policy as reformed, there was no evidence of fraud, accident, or mistake, so as to authorize reformation; and it appearing without dispute that the person named as the insured died two days before the policy by its terms was to become effective, the plaintiff beneficiary was not entitled to recover. The court did not err in directing a verdict for the defendant or in refusing a new trial.

No. 14768. FEBRUARY 9, 1944. Mrs. Opal D. Boswell filed suit in the superior court of Coweta County against Gulf Life Insurance Company, alleging that she was the beneficiary in a policy of life insurance issued by the company on the life of her husband, Willie A. Boswell, and seeking to recover stated amounts as principal, interest, attorney's fees, and damages. She prayed also for reformation by changing the date from "8-10-42," which was written in the policy as the effective date, to "8-5-42," which was alleged to be its true date. It was alleged that the policy was actually issued by the company at its home office in another State, on August 5, 1942, and was then forwarded to the local agent, E. W. Phillips, and was received by him on August 7. On Monday, August 10, Phillips "brought the policy" for delivery, but was informed that the insured had been accidentally drowned while fishing in a river on the afternoon of August 8. He refused to leave the policy, and returned it to the company. It was further alleged that if the policy showed any figures other than 8-5-42 as the date of issue, the same was a typographical error, mistake, or fraud; and it was prayed that the policy be reformed and modified so as to show the true and correct date of issue. Attached to the petition was a copy of a policy which was alleged to be in accord with the application and premium paid, and in which the date was stated as 8-5-42; it being averred further that the defendant refused to furnish petitioner with a copy or any information in relation thereto.

The defendant filed an answer denying the material averments of the petition, and pleading affirmatively that the policy was never delivered to the proposed insured or to any one for him, "and he died before the date the policy was to take effect."

At the close of the evidence, the judge directed a verdict for the defendant, and the plaintiff's motion for a new trial having been overruled, she excepted. In the motion for a new trial, it was averred that the court erred in directing a verdict, because the evidence did not demand a verdict for the defendant, but would have authorized a verdict for the plaintiff.

The evidence showed without dispute that Boswell was drowned on Saturday, August 8, and that although the policy was issued by the company at its home office in Jacksonville, Florida, come time before that date, it was never actually delivered to him, but was forwarded by the company to its local agent in Newnan, Georgia, by express. According to the defendant's agents, it was not received until that date, and until after the hour of Boswell's death, although there was evidence for the plaintiff that one of the defendant's agents stated that he received the policy on August 7.

The plaintiff introduced a receipt issued by the company's agent on July 31, 1942, for one weekly premium "on account of application for insurance in the Gulf Life Insurance Company," in which receipt it was stated: "If the application is accepted and a policy issued, this sum will be applied toward payment of the premiums thereon. If the application is rejected, the amount will be returned subject to the conditions of this receipt hereof. No obligation is incurred by said company unless and until a policy is issued and delivered while the life proposed is alive and in sound health. Except that if the life proposed is in sound health at the date hereof and the amount paid at the time the application is written is not less than five weekly premiums and this receipt bearing the date of the original application showing such payment is surrendered to the company, the company agrees, if the application is approved at the home office in Jacksonville, Florida, that, should death occur prior to the issue of the policy and within eight weeks from the date of the application, it will pay such amount as would have been due under the policy, if issued." The receipt contained no other language indicating the time or date when any policy should be issued, or become effective. The application, which was also introduced, was silent as to these matters, except that it contained a stipulation: "That the insurance policy hereby applied for shall not take effect unless and until the policy is delivered to and received by me while in good health and free from injury."

The policy as actually issued was dated "8-10-42," and contained the following stipulations: "This insurance is granted in consideration of the application for this policy which is hereby made a part of this contract, and of the payment of the weekly premium on or before such [each?] Monday, beginning with the date of issue, of every week. . . This policy shall not take effect unless on the date and delivery hereof the insured is alive and in sound health. The company assumes no obligation prior to the date hereof. The application and this policy constitute the entire agreement by the company and the insured which terms can not be changed or its conditions varied except by written agreement by the president or secretary of the company." There was no evidence of fraud, accident, or mistake as to the date of the policy, unless such may be inferred from the facts and circumstances above stated. The time when an insurance policy shall become effective is an essential element of the contract, and the parties may fix a future date upon which it shall become effective. Clark, Rosser Co. v. Brand, 62 Ga. 23;Metropolitan Life Insurance Co. v. Thompson, 20 Ga. App. 706 (7) (93 S.E. 299); Electric City Lumber Co. v. New YorkUnderwriters Insurance Co., 43 Ga. App. 355 (158 S.E. 620); Matlock v. Hollis, 153 Kan. 227 (109 P.2d 119, 132 A.L.R. 1316); 6 Couch on Insurance, § 1328; 29 Am. Jur. 225, § 219; 32 C. J. 1164, § 277. A policy bearing a given date, and purporting to insure for the future only, can not be made the basis of an action to recover for a loss occurring on a prior date. Fowler v. Preferred Accident Insurance Co., 100 Ga. 330 (3) (28 S.E. 398).

In this case, the application amounted only to an offer, and the company was free either to accept or reject it entirely. Accordingly, in acting upon such application, it could fix a future date on which the policy would become effective. If the policy as thus issued, either because of its date or for other reason, did not conform to the application, it would constitute only a counter offer, and could not be reformed merely because of such variation. Gray v. Lynn, 139 Ga. 294 (77 S.E. 156); 29 Am. Jur. 170, § 155.

Since the policy here bore the future date of August 10, 1942, and stipulated that it should not "take effect unless on the date and delivery thereof the insured is alive and in sound health," and that "the company assumes no obligation prior to the date hereof," it could not have been accepted as written and then treated as one effective before such date. There was no evidence tending to show fraud, accident, or mistake, so as to authorize reformation, and therefore, even if it could be said that the policy was delivered before the death of the applicant, still it could only be dealt with according to its terms, and by them it was not to become effective before August 10. The person named as the insured having died in the meantime, to wit, on August 8, the plaintiff, under the evidence, was not entitled to recover. See in this connection, Newton v. Gulf Life Insurance Co., 55 Ga. App. 330 (190 S.E. 69); Westmoreland v. Gulf Life Insurance Co.,57 Ga. App. 303 (195 S.E. 316); Strickland v. Gulf LifeInsurance Co., 70 Ga. App. 365 (28 S.E.2d 314), dealing with the same type of policy.

In this view, we need not determine whether the act of the company in forwarding the policy to its local agent, or the receipt thereof by such agent, could, under the terms of the policy and the application, have been taken as a delivery to the insured; for, in any view of this question, the evidence did not show liability. See New York Life Insurance Co. v. Babcock,104 Ga. 67 (30 S.E. 273, 42 L.R.A. 88, 69 Am. St. Rep. 134);Reserve Loan Life Insurance Co. v. Phillips, 156 Ga. 372 (119 S.E. 315); Mitchiner v. Union Central Life InsuranceCo., 185 Ga. 194 (194 S.E. 530); Massachusetts Mutual LifeInsurance Co. v. Boswell, 20 Ga. App. 446 (2) (93 S.E. 95);Folds v. New York Life Insurance Co., 27 Ga. App. 435 (108 S.E. 627); Glover v. New York Life Insurance Co., 27 Ga. App. 615 (109 S.E. 546); Life Casualty Insurance Co. ofTennessee v. Palmer, 48 Ga. App. 380 (2) (172 S.E. 823);Pierce v. Life Insurance Co. of Virginia, 50 Ga. App. 337 (2) (178 S.E. 189).

The court did not err in directing a verdict for the defendant or in refusing a new trial.

Judgment affirmed. All the Justices concur.