New York Life Insurance v. English

The application of plaintiff in error presents the same questions that were decided by this court in answer to certified questions propounded by the Court of Civil Appeals. 95 Tex. 391 [95 Tex. 391]. In determining those questions we construed the law of New York as we understand it in the light of the decisions of the courts of that State, and we see no reason to change our conclusion as to the proper construction of that statute. We shall therefore not further discuss the questions which have heretofore been determined. The facts will be found in the report of our former decision, and we will only state here such as are necessary to the determination of the questions herein discussed.

The New York Life Insurance Company issued a policy of insurance upon the life of William E. English, payable to Annie E. English, his wife, for the sum of $3000, to be paid in ten annual installments of $300 each; the first payment to become due upon the delivery to the insurance company of proof of death of said William E. English.

William E. English died October 19, 1900, and proof of his death was presented to the insurance company December 20, 1900, when demand was made for payment of the first installment of $300, which being refused by the insurance company, this suit was instituted on February 2, 1901, in the District Court of Dimmit County, to recover of the insurance company the full amount of the policy with interest at 6 per cent per annum, 12 per cent damages and attorney's fees. It was alleged that, by reason of the failure and refusal of the insurance company to pay the first installment, the entire sum named in the policy became due. At the trial in the District Court the presiding judge instructed the jury to find for the plaintiff, Annie E. English, a verdict against the insurance company for the sum of $3000, with 6 per cent interest from the 20th day of December, 1900, 12 per cent statutory damages, and 10 per cent attorney's fees. The jury returned a verdict in accordance with the charge and judgment was entered in conformity to the verdict. Upon appeal to the Court of Civil Appeals, the judgment of the District Court was reversed and a judgment rendered in favor of Annie E. English against the insurance company for $3000, with execution for the first installment of $300 and 6 per cent interest, 12 per cent damages and 10 per cent attorney's fees upon that amount; and that at the end of each year from the 20th day of December, 1901, execution should issue in favor of the plaintiff against the insurance company for $300 with interest from that date until paid. The Court of Civil Appeals gave judgment for Annie E. English against the insurance company for the costs of the District Court and against her in favor of the insurance company for the costs of the Court of Civil Appeals.

A writ of error was granted in favor of each party. The insurance company objects to the judgment of the Court of Civil Appeals, because it provides for the collection of the installments which were not due at the time this suit was instituted, and we are of the opinion that the objection is well taken and the judgment of the Court of Civil Appeals must be reversed for that reason.

A contract for the payment of money will not support an action until it becomes due and payable according to its terms. Culberson v. Cabeen, 29 Tex. 254. To this rule there are some exceptions not necessary to be stated because the policy sued upon does not come within any one of the exceptions.

A failure to pay any one of the installments provided for in the policy sued upon gave plaintiff a right of action for that installment. 1 Enc. of Pl. and Pr., 154. We have not been able to find any precedent, nor any principle of law, which would permit suit upon the installments of this policy which had not matured because there had been a failure to pay the first. The honorable Court of Civil Appeals cites in support of its judgment in this case, Tinsley v. Boykin, 46 Tex. 596. That case does not give support to the judgment rendered in this case. In the case cited, there were several notes which held a lien upon one tract of land which was not susceptible of division, and the court held that a suit might be brought upon the first note, it being past due, and by making the holders of the other notes parties, the lien could be foreclosed upon the land and the proceeds of the sale equitably distributed in payment of all the notes. The judgment in that case rests upon the fact that it was necessary to dispose of the land, therefore necessary that all of the notes should be foreclosed at the same time. No such necessity is involved in the determination of the rights of the parties in this case.

In its opinion upon a motion for rehearing, the honorable court of Civil Appeals supports the judgment entered by it by the proposition, that the failure to pay the first installment entitled the plaintiff to sue upon "the entire policy in order that a multiplicity of suits might be avoided." The same reasoning would apply to every contract payable by installments, yet we have been unable to find any precedent for such a proceeding. Out of the multiplicity of such contracts the occasion for such action must have occurred frequently, and "it is a strong presumption that that which has never been done can not, by law, be done at all." Russell v. Men of Dover, 2 Durnf. E., 673. The liability of the insurance company, so far as put in issue by the pleading, would have been determined as to the whole policy if the suit had been instituted for one installment only. Lumber Co. v. Buchtel, 101 U.S. 638; Cromwell v. County of Sac, 94 U.S. 356. It does not follow that because the liability of the insurance company under the contract was in issue the entire sum became due.

Since this case will be remanded to the District Court for further trial, the other questions presented in the applications for writs of error become immaterial and will not be discussed.

The evidence as to the attorney's fees is undisputed, but the witnesses had in view the suit for $3000, and we do not feel authorized to fix the attorney's fees in favor of the defendant in error at that per cent upon $300, the sum for which we believe the judgment should have been rendered. It is therefore ordered that the judgments of the District Court and of the Court of Civil Appeals be and the same are hereby reversed, and that this cause be remanded to the District Court for further trial. It is further ordered that the plaintiff in error recover of the defendant in error the costs of the Court of Civil Appeals and of this court.

Reversed and remanded.