ON MOTION FOR REHEARING. Defendant contends that we ruled the case on an issue not within the pleadings and on a theory that was not presented to or considered by the trial court. It further contends that it had no opportunity to brief and be heard on the question.
The petition was conventional. It alleged the issuance of the policy, the performance of its conditions, the death of insured, and the refusal of payment by defendant.
The answer, after certain admissions, denied that the insured had performed all the conditions of the policy; that he did not pay the premiums as provided therein which caused the policy to immediately lapse; that there was an indebtedness of $224.57 on the policy, and that plaintiff was entitled to only $118.26 under the contract of insurance.
The reply was a general denial with a plea "that there was ample and sufficient funds due and owing the said Eugene Gooch under the terms of said policy to extend up to and beyond the 8th day of December, 1929, same being the date of the death of said Eugene Gooch; and that on account thereof this plaintiff states that she is entitled to the full amount of the said policy of one thousand ($1,000) dollars less the amount of the note entered into by the said Eugene Gooch."
In this connection it should be noted that the original brief of defendant (appellant) stated that "in presenting her case to the court (without a jury), respondent (plaintiff) endeavored to pick out the favorable part of the policy, to-wit, the reserve value and to apply it in purchasing extended insurance for the face of the policy as provided by Section 5741. Revised Statutes 1929, instead of for a reduced amount as provided by the policy. This attempt to mix the policy and the statute is in reality a re-writing of the policy, and this cannot be done. [Dougherty v. Mutual Life Ins. Co., 44 S.W.2d 206; Wilhelm v. Prudential Ins. Co., 227 S.W. 897.]"
Thus it appears that our ruling was within the pleadings and not on a theory different from that presented in the trial court. Furthermore, *Page 196 the question fully presented in defendant's original brief in this court and ably argued in said brief.
The effort of plaintiff to have the judgment affirmed on a theory different from that presented in the trial court did not relieve this court of the duty to rule the case on the theory presented in said court and briefed by defendant (appellant) in this court.
Defendant next contends that full term insurance for a reduced amount is the equivalent of insurance for the full amount of the policy for a reduced term.
The Legislature decided in favor of a reduced term rather than a reduced amount. Furthermore, if they are equivalents there would be no inducement to seek to evade the statute, and defendant's policies would conform to the non-forfeiture sections of the statute.
In this connection defendant contends that on the date the policy lapsed it could not have been told whether the statute or the policy allowed a greater indemnity. It argues that if the insured had lived beyond the reduced term fixed by the statute, he would have been without insurance, whereas, under the policy he would have been insured for $118.26 for a term of twenty-two years.
If the insurance under the statute and under the policy are equivalents, or if insurance under the policy when it lapsed afforded a greater indemnity, defendant would not seek to evade the statute. Indeed, said effort of defendant authorizies an inference that the statute allows a greater indemnity.
Of course, defendant admits that the statute must be read into the policy. However, in effect, it contends that when so read there are two contracts of insurance — one under the policy, and one under the statute. It then argues that the insured or the beneficiary must elect as between the contract under the policy and the contract under the statute. We do not think so. An election to be under the policy would be a waiver of the provisions of the statute. In Cravens v. Ins. Co., 148 Mo. 583, l.c. 604, 50 S.W. 519, 178 U.S. 389, we said:
"`Where an insurance company does business in this State, and issues its policies to residents of this State, the validity of clauses in its policies must be determined by the laws of this State. The laws of this State establish a rule of public policy, which overrides the freedom of contract of the parties, and makes waiver of statutory provisions ineffectual, although such waivers are contained in the strongest terms in the policies.'
"Foreign insurance companies which do business in this State, do so not by right but by grace, and must in so doing conform to its laws: they cannot avail themselves of its benefits, without bearing its burdens. Moreover the State may prescribe conditions upon which it will permit foreign insurance companies to transact business within its borders or exclude them altogether and in so doing *Page 197 violates no contractual rights of the company. [State v. Stone,118 Mo. 388; Daggs v. Ins. Co., 136 Mo. 382; s.c. 172 U.S. 557.]"
In this connection defendant seems to argue that because the policy provides a rule for computing reserve values more favorable than the rule provided in the statute, it should be permitted to violate the statute by reducing the amount rather than the term of the insurance.
Defendant next contends that the opinion is in conflict with certain sections of the State and Federal Constitutions. It does not point to a conflict and we find no conflict.
The motion for a rehearing should be overruled. It is so ordered. All concur.