Fox v. Volunteer State Life Insurance

AdaMS, J.,

concurring: On 1 June, 1921, William Adie English applied in writing to the defendant for a policy of insurance on bis life in' the sum of $3,000, payable to bis estate, and agreed to pay therefor an annual premium of $84.33. His application contained these provisions : “I hereby agree that this application (parts 1 and 2) and the policy wben issued, including a copy of this application annexed thereto, or endorsed thereon, shall constitute the entire contract between the parties hereto.” And further: “that the policy hereto applied for shall not take effect unless and until it shall have- been issued and delivered to me and the premiums thereon paid to the company or its authorized agent during my lifetime and in good health.”

The application was received by the defendant at its home office in Chattanooga on 1 June, 1921, and was thereafter accepted; and on 15 June the policy of insurance was sent by tbe defendant to its general agent at Burnsville and by him to its local agent at Mars Hill. To *128deliver tbe policy and to collect the premium was a part of the local agent’s duties. The applicant “began to get sick” on 1 or 2 July, and died 14 July, 1921. The plaintiff testified: “Mr. Buckner (the local agent who had the policy for delivery) come to my house on 6 July, 1921, and fetched the policy over there, which I think to be this same one, and told me it was for William Adie English; and he says, T come to see you — some one has told me he is sick, and I have come to see you to know what we would do about this policy.’ ‘Well,’ I says, 'Let’s go up and see Adie; I don’t think he is very sick.’ He said, 'You go up and see Adie and get the money and I will go to Asheville and see what they say up there about it.’ ”

“Q. Did he say what he would do when he got to Asheville? A. He says, 'I will bring you. back the policy this evening; I won’t wait until morning. I will bring it back this evening.’ Then he says, 'I ought to have delivered this policy some time ago. I have had this policy on hand something like two weeks or over.’ And he says, 'I met William Adie English out on the John White Hill, hauling lumber, and he seemed to be in good health then, and I had a conversation with him about wanting to raise this policy from $3,000 to $5,000.’ And he says, 'English says, “Yes, I told Dr. Baird to have you change my application from $3,000 to $5,000,”’ and he says, 'I can’t do it now, because your policy is done allowed and I have got your policy, and I can’t do it now, but we will make another application on this same examination and I will get you the other two thousand dollars on it.’ And William Adie English says, 'All right, let the one you have come ahead. Bring it on, I have got the money for you when you bring it.’ ”

He stated that the policy came two weeks before 6 July. He said he held up this policy on the ground that Mr. Hyder was getting up some in the same territory; and he wanted to make the visit with Mr. Hyder, and he was looking for others that he had got in, too, and he wanted to make the same delivery with Mr. Hyder.”

There was additional evidence tending to show that the applicant was ready, able, and willing to pay the premium. By the terms of the application the premium was to be paid when the policy was delivered.

The plaintiff concedes that the contract of insurance was not to become effective until the policy was delivered and the premium collected, but he asserts that his cause of action does not arise from the breach of an executed contract of insurance, but from the defendant’s wrongful failure to deliver the policy after the application had been accepted and the policy had been duly signed, issued, and forwarded for delivery, and after the applicant while in good health had demanded its delivery. It is said that this is the very thing against which the defendant contracted. I think not. The parties contracted that the insurance should be in *129force when the policy was delivered and the premium paid; but surely tbis cannot be construed into an agreement that the defendant should be released from liability for negligently-failing to do that wbicb for value it bad agreed to do. In my opinion the whole controversy should be determined by the contractual relation that existed between the parties after the policy bad been received by the local agent and after the applicant bad requested the agent to deliver it and bad signified bis readiness to pay the premium. What is the undisputed evidence as to tbis relation? (1) the intestate’s application bad been accepted and the policy bad been placed in the bands of the defendant’s local agent; (2) it was the local agent’s duty to tender the policy and call for the premium; (3) the premium was to be paid when the policy was delivered; (4) while the policy was thus in the possession of the local agent, and while the applicant was in good health, be requested the agent to deliver the policy and was ready to pay the premium; (5) the local agent admitted, on 6 July, that be bad held the policy for two weeks and “ought to have delivered it some time ago.” In my judgment the result was tbis: the application was the intestate’s promise to pay the premium when the policy was issued and tendered to the applicant, for the premium was to be paid “cash on delivery.” the acceptance of the application and the sending of the policy to the local agent was an agreement by the defendant that the policy should be tendered in a reasonable time if the applicant was in good health. When, the agent received the policy, and for two weeks afterwards, the applicant was in good health; be demanded the policy; be was ready to pay the premium; the defendant’s agent negligently failed to deliver the policy at a time when be should have delivered it. Tbis the agent admits. So the situation was tbis: In effect the applicant said to the defendant, “I will pay you an annual premium of $84.33 if you will insure my life while I am in good health.”. the defendant answered, “We accept your offer.” the evidence, then, presents the case of an offer and acceptance, or a promise for a promise, wbicb is a sufficient consideration to support an agreement. Anson defines consideration to be something done, forborne, or suffered, or promised to be done, forborne, or suffered by the promisee in respect of the promise. Under these circumstances neither party bad a legal right to withdraw from the agreement, and either would be liable in damages for disregarding it and committing a breach. True, an offer unsupported by any consideration may be withdrawn at any time before acceptance, but when an offer is accepted on the terms in wbicb it is made before a valid revocation, the agreement becomes instantly binding on the parties, and neither party can subsequently recede from the agreement without the consent of the other. It should be borne in mind just here that the local agent’s duty was purely ministerial. the defendant *130bad signified its acceptance of tbe applicant’s offer by issuing tbe policy, and bad thereby bound itself to execute its part of tbe agreement. Also, it should be remembered that tbe intestate insisted upon tbe defendant’s performance. If tbe defendant, when tbe demand was made, bad positively refused to deliver tbe policy at any time, it would evidently have been liable to tbe intestate — tbe evidence showing that be was then in good health and ready and able to pay tbe premium; and none tbe less is tbe defendant liable if its agent unreasonably delayed to comply with tbe demand and abide by its agreement. Tbe result is tbe same whether tbe action be considered as a suit to bold tbe defendant liable for damages caused by its agent’s negligence or a suit to bold it to tbe liability it would have incurred if tbe agent bad not been negligent.

It is insisted that the agent would have delivered tbe policy but for tbe applicant’s sickness and' death, and that there was no obligation resting upon him to deliver it at any particular time. Tbe contract, it is true, specified no definite time within which tbe policy should be delivered, but tbe law imposed upon tbe defendant tbe duty to see that it was delivered in a reasonable time after tbe intestate demanded it. Tbe local agent was not tbe agent of tbe applicant, but of tbe defendant by whom be was employed for tbe purpose of delivering policies and collecting premiums. Tbe crucial point in tbe case is whether tbe intestate was wrongfully denied possession of tbe policy, and thereby deprived of insurance to which be was justly and legally entitled. If tbe agent bad tbe right to postpone tbe delivery for two weeks, why not for two months, or for twelve, and in this way to abrogate tbe agreement? He admitted substantially that bis carelessness defeated tbe insurance.

After considering tbe questions involved in tbe light of principles which in my judgment are sustained by tbe authorities, I am convinced that a new trial should be granted, and tbe jury permitted to find from tbe evidence whether tbe intestate, while in good health, requested tbe agent to deliver tbe policy, and whether be was ready, able, and willing at that time to pay tbe premium; and, if so, whether tbe agent, carelessly disregarding tbe ajjplicant’s rights, failed to deliver tbe policy within a reasonable-time thereafter.

. Tbe defendant introduced no evidence. Tbe motion to dismiss tbe action as in case of nonsuit was allowed. I have treated tbe questions presented as if tbe circumstances which tbe evidence tends to establish were formally admitted. Upon consideration of all tbe evidence which may be offered at tbe trial tbe jury may find tbe facts to be otherwise, but with these matters we are not concerned.