Clark v. New York Life Ins.

May 24, 1915. The opinion of the Court was delivered by Two actions were brought by the plaintiff against the defendant, and as the two cases were identical, by agreement of counsel, they were heard together at the April term of Court, 1914, for Lancaster county, by his Honor, Judge DeVore. A jury being waived, Judge DeVore filed his decree finding in favor of the plaintiff. Defendant appeals, and by thirteen exceptions alleges error on the part of the Judge in finding in favor of the plaintiff. The decree of Judge DeVore should be reported in the case. It will be seen by the exceptions that the question before the Court is: What right to extended or continued insurance did the insured, Adolphus J. Clark, have on July 14, 1907, the date of the lapse of the policies? The Court below found, and it is not disputed, that by the terms of the policies as originally written, Adolphus J. Clark, the insured, was entitled to five years and three months extended insurance as provided in the table in the policy, which term began on the 14th day of July, 1907, and expired on October 14th, 1912, or more than a month before the date of the death of the insured.

As originally agreed upon, the premiums on the policies in evidence were to be paid annually, and the first premiums were paid on that basis. On February 18, 1903, an agreement was entered into changing the mode of the payment of the annual premium to quarterly payments. Under this agreement and clause, "second" thereof, it was the contention of the plaintiff, and held and found by the Circuit Court, that upon each payment of the quarterly premium, the extended insurance therein expressed and stipulated was increased proportionately, and that, therefore, the two payments made by the insured, Adolphus J. Clark, on the sixth annual premium increased the extended insurance provided for in the table for four months, which would carry the insurance in force, according to the finding and decree of his Honor, to February 14, 1913, which was after the death of the insured, Adolphus J. Clark, on December 5th, 1912. The policies were introduced in evidence, and had notations on them in pencil, which the evidence shows was made by the deceased insured, Adolphus J. Clark: "Premiums paid on this policy for five and one-half years (up to July 14th, 1907). This extends the policy for five years and seven months after said date, or February 14th, 1913." This clearly shows how the insured construed the agreement and what his understanding was.

In Williamson v. Association, 54 S.C. 593, 32 S.E. 769, this Court laid down this wholesome rule by Mr. Justice Gary (now Chief Justice) wherein as the organ of the Court he says: "It is a well known fact that comparatively few people who become shareholders in such associations are familiar with their by-laws. They rely upon the honesty, integrity and fair dealing of those who manage the affairs of the association. It is also a well known fact that the by-laws are frequently intricate and almost unintelligible to the average shareholder, and that those in charge of the affairs of the association usually become exceedingly expert in the interpretation of them, thus giving the association a decided advantage in the way of information over the shareholders. Public policy, in order to prevent the perpetration of fraud, and to prevent just such a case as we now have before us, in which the plaintiff alleges that he was induced by the express promises and the literature of the defendant to part with his money, in purchasing its shares of stock, demands that the defendant should not be allowed to elect whether it will be bound by its by-laws, or its express agreement, as to the time when the shares would mature. These views render unnecessary a consideration of the rule of interpretation discussed in the case of Wis. M. and F. Ins. Co. Bank v. Wilkin, 95 Wis. 111;69 N.W. 354, 60 Am. St. Rep. 86, and in the extensive notes to that case, that when two clauses of a contract are in conflict, the first governs rather than the last. The circular will next receive consideration. The construction of a written instrument is a question of law to be decided by the Court. This Court has the right, therefore, to construe the circular. It unquestionably shows that the defendant interpreted the contract to mean that the shares would mature ata fixed and definite period. It is a well settled principle that when the construction to be given a contract is rendered doubtful by the language thereof, the interpretation of the contract by the parties themselves, is entitled to great weight.Chicago v. Sheldon, 9 Wall. 50; Railroad Co. v. Trimble, 10 Wall. 367; Steinbach v. Stewart, 11 Wall. 566; Lowber v. Bangs, 2 Wall. 728."

We think that Clark's interpretation of the contract was correct, and we agree with the Circuit Judge both as to his finding and reasoning in reference to the construction, and we see no error at all on the part of the Circuit Judge in his decree as complained of on the part of the defendant and as made by the exceptions. All exceptions are overruled. Judgment affirmed.

MESSRS. CHIEF JUSTICE GARY and JUSTICE FRASER concur in the opinion of the Court.

Mr. JUSTICE HYDRICK dissents.