(dissenting). The right decision cf this case does not depend upon any technicality of law. It is a case in which common sense and common honesty and legal sense and legal honesty are at one. It arises upon a contract of life insurance, which must.be interpreted according to the settled canons for the construction of such instruments, and the determination of the rights of the parties thereunder. In every contract of insurance, the law prescribes to each party the observance of the strictest integrity and truthfulness. Insurance law, when rightly expounded, is always in harmony with honesty and sound morality. At the very beginning of insurance law in England there was infused into it, through the influence of the civil law, a different spirit from that which prevailed in other branches of the common law. Neither the maxim caveat emptor nor its spirit has found a lodgment in the law of insurance. If there is any part of our jurisprudence which produces exact justice in each individual case, it is the law of insurance. It is founded on truthfulness, honesty, and fair dealing. It never affords shelter or protection for fraud, falsehood, or deception. In no other branch of the law — not even the law merchant— have the courts shown such merited deference to the rules, usages, and customs that prevail in the conduct of business. Insurance contracts are uniformly interpreted and enforced in harmony with the usages, business methods, and common sense of honest business men, and the moral sense of all reputable men.
At the threshold of the case it would be well to call attention, once for all, to certain fundamental and indisputable propositions: (1) That the facts found by the lower court must be accepted by this court as absolute verity; (2) that the failure to find any fact, or the insufficient or imperfect finding of any fact, essential to maintain the judgment of the lower court, is fatal to it; (3) that a statement of .the legal effect of a document or paper which is not in the record, nor made part of the findings, nor its contents anywhere disclosed, is not a finding of fact, but a mere conclusion of law upon the legal effect of an undisclosed document, and hence of no effect; (4) that Smith, who was soliciting these policies for the company, is, under the Iowa law, the agent of the company, "anything in the application or policy to the contrary notwithstanding,” and his statements and agreements, in the course of his business, in soliciting and delivering the policies and receiving the premiums, are, in law, the statements and agreements of the company itself. Society v. Clements, 140 U. S. 226, 11 Sup. Ct. 822, 35 L. Ed. 497; Indemnity Co. v. Berry, 1 C. C. A. 561, 50 Fed. 511; Cook v. Association, 74 Iowa, 746, 35 N. W. 500; Insurance Co. v. Chamberlain, 132 U. S. 304, 10 Sup. Ct. 87, 33 L. Ed. 341; Insurance Co. v. Russell, 23 C. C. A. 43, 77 Fed. 94.
Contracts of life insurance are sui generis. A policy consists of a printed form which the company has framed and adopted for its use, and uses in all cases without change or variation. All that is necessary to be done to make one of these policies a completed instrument is to insert in the blanks left for that purpose the name of the insured, the term of insurance, the amount and time of pay*873ment of the premium, the date of the policy, and the signature of the company. The insured never sees the policy during its preparation, and never signs it. What he does see and sign is an application for the policy. This application is also on a printed form, which the company has. framed and adopted for its use, and which it uses in all cases, and which is made part of the policy, and is as obligatory on the parties as any other part of the policy. This application contains numerous questions which the insured must answer, and warrant his answers “to be full, complete, and true.” The insured did this, and it is not claimed that his answers were not “full, complete, and true.” Butthe contention is that this duty to answer questions truthfully is not reciprocal; that, while the applicant for insurance must answer the company’s questions truthfully, the company has the privilege of knowingly returning false answers to the applicant’s questions, and profiting by such false answers at the expense of the beneficiary in the policy. From the beginning to the end of the majority opinion, a policy of insurance is treated as though it were a contract for which there was no precedent, and related to a subject about which neither of the parties ever before contracted, and in the preparation of which each party participated and had an equal voice, and the provisions of which were as well known to one party as to the other, and which was signed by both; and the court applies to a contract of insurance rules as harsh and technical as any that would be applied, under the rule of caveat emptor, to a trade between two horse jockeys.
What are the facts established by the findings? The seventh finding of fact is:
“By the express understanding had between F. W. Smith, the agent of the New York Life Insurance Company, and Frank E. McMaster, when the application for insurance was signed it was agreed that the first year’s premium was to be paid by McMaster upon the delivery to him of the policies, and that the contract of insurance was not to take effect until the policies were delivered.”
Here we have a definite, precise, and concluded contract as to when the policies were to take effect. They were “not to take effect until the policies were delivered.” This oral agreement as to when the policies should take effect was in complete accord with the express stipulation of the application, which is:
“That any policy which may be issued under this application shall not be in force until the actual payment to and acceptance of the premium by said company.”
The premiums were paid and the policies delivered on the 26th day of December, 1893, and from that date, and not before, the policies were “in force,” by the explicit provisions of the policies themselves, as well as by the terms of the oral agreement. The date when the policies took effect being settled beyond all cavil, the term or period of their duration is the next question. Each policy provided that: .
“After this policy shall have been in force three months, a grace of one month will be allowed in payment of subsequent premiums, subject to an interest charge of 5 per cent, per annum for the number of days during which the *874premium remains due and unpaid. During the said month of grace the unpaid premium, with interest as above, remains an indebtedness due the company; and, in the event of death during the said month, this indebtedness will be deducted from the amount of the insurance.”
When had the policies “been in force three months”? As we have seen, by the terms of the oral agreement the policies were not to take effect until they were delivered, and the policies themselves stipulated that, they should not be in force until the actual payment to and acceptance of the premiums by the company, which was coincident with the delivery of the policies. It is clear, then, that the policies went into effect and were “in forge” on the 26th day of December, 1893, and that 3 months from that date, the policies having remained in force, the insured became entitled to the grace of 1 month in the payment of subsequent premiums, which extended the time of the payment of the next annual premiums to the 26th of January, 1895. The insured died on the 18th of January, 1895, — 8 days before the policies could be declared forfeited for the nonpayment of the second annual premium. There was never any thought or suggestion that the policies would not insure the life of the applicant for 13 months from the date of the payment of the premiums. Confessedly, the period of 12 months and 17 days was never in the mind of either party, or ever thought of by either party. Prom the very inception of the business, it had been represented and understood that the policies would insure the life of the applicant for 13 months from the time of the payment of the premiums and the delivery of the policies. This is conclusively shown by the third and fourth findings of fact, which are:
“(3) That in December, 1893, F. W. Smith, an agent for the New York Life Insurance Company, residing at Sioux City, Iowa, solicited Frank E. McMaster to insure his life in that company, and, as an inducement to taking the insurance, pressed upon McMaster the provision adopted by the company, and set forth in the circulars issued by the company, and printed on the back of the policies issued by the company, under the heading ‘Benefits and Provisions Referred to in This Policy,’ in the following words: ‘After this policy shall have been in force three months, a grace of one month will be allowed in payment of subsequent premiums, subject to an interest charge of five per cent per annum for the number of days during which the premium remains due and unpaid. During said month of grace the unpaid premium, 'with interest as above, remains an indebtedness due the company; and, in the event of death during the said month, this indebtedness will be deducted from the amount of the insurance.’ (4) Relying on the benefits of this provision, and in the belief that if he accepted a policy of insurance upon his life from the New York Life Insurance Company, paying the premiums thereon annually, the company could not assert the right of forfeiture until thirteen months had elapsed since the last payment of the annual premium, the said Frank E. McMaster signed an application for insurance in said company, dated December 12, 1893, of the form which is made part of the policies sued on, and attached to the petition; the same being made part of this finding of facts.”
Tbe insured wanted tbe full benefit of tbe 13-months insurance, reckoning from tbe date of tbe payment of tbe first annual premiums. Upon this subject be bad been exacting and tenacious from tbe beginning, and to that end bad required tbe agent to agree that tbe contract of insurance should “not take effect until tbe policies were delivered.” And, as we have seen, this condition was carried *875into and repeated in his application, which declares the policy “shall not be in force until the actual payment of the premium.”. But this was not all the insured did to make it sure that he would be insured for 13 months from the payment of the premiums and the delivery of the policies. The ninth finding of fact is:
“The five policies, inclosed in envelopes, on or about December 26, 1893, were taken by F. W. Smith, the agent of the defendant company, to the office of Frank E. McMaster, who asked the agent if the policies were as represented, and if they would insure him for the period of thirteen months, to which the agent replied that they did so insure him; and thereupon McMaster paid the agent the full first annual premium, or the.sum of twenty-one dollars, on each policy, and, without reading the policies, he received them and placed them away. The agent did not in any way attempt to prevent McMaster from reading the policies, and he had the full opportunity for reading them, but in fact did not read them, and accepted them on the statement of the agent of the company, as hereinabove set forth.”
The question propounded by the applicant to the insurance agent was not an idle inquiry, and the answer to it not a mere casual statement. Nor was the answer, as is claimed, “preliminary information,” or a mere “opinion” as to the legal effect of the policies. There was nothing preliminary about it, and it was not a mere expression of opinion, but a clear, positive, and distinct statement of a material, existing fact. The answer given by the agent can only appear on paper in words, but it was doubtless accompanied by “the story of looks and message of voices,” common with soliciting agents, which cannot be put on paper, but which add force and emphasis to one’s utterances, and induce confidence in his assurances. The most persuasive and effective falsehoods are told in acts, not in words. But it is immaterial whether the answer of the agent was inspired by a fraudulent purpose, or was the result of an honest mistake. Confessedly, the minds of the parties never met and agreed upon a contract of insurance for twelve months and seventeen days. A mistake, no more than a fraud of the company or its agent, can bind the insured to a contract he never made.
No claim is made that the policy conforms to the terms of the application. The contention of the majority is that after receiving the application the insurance company “made a counter proposition,” and it is upon this alleged counter proposition, differing, as is confessed, in a material respect from the terms of the application, that it is sought to uphold the clause of the policies over which this controversy arises. This claim is thus stated in the majority opinion:
“The applications were nothing but a proposition to take insurance. They were not contracts, but mere requests for, or a proposition to take, policies. The company was not bound to grant these requests or to accept the proposition. It had the right to reject them in toto, or to reject some parts of them and to make a counter proposition. It took the latter course. It rejected some parts of the applicant’s proposition, and made a counter proposition.”
When, where, and how did the company make “a counter proposition” to that contained in the application? There is no finding of fact to that effect, and for the facts in this case this court cannot look beyond the facts found by the lower court. It can add nothing to and take nothing from the facts so found. The application was on the company’s standard form, and the propositions and con*876ditíons contained therein were the propositions and conditions the company itself had framed, and to which it required the assent of the applicant for insurance, as a condition of issuing the policies. And when the applicant subscribed to the application and delivered it to the company, so far as related to the conditions and stipulations therein contained, the minds .of the parties had met and were at one. It is not true that the company ever advised the insured that it had changed the propositions and conditions which it had itself inserted in his application, or that it would not insure the applicant on the basis of the propositions and conditions contained in the application. Nor did the company, at any time or place, offer, or propose any other terms for the insurance. On the contrary, upon the receipt of the application, it made out, signed, and transmitted to its agent policies of insurance, which, the agent assured the applicant, conformed to their agreement and the requirements of the application. But in violation of the agreement that the policies would insure the applicant for 13 months from the date of their delivery and the payment of the premiums, and in violation of the terms and conditions of the application, which guarantied policies for the same period, the insurance company had secretly, and without the knowledge of the insured, inserted a clause in the policies which reduced the term of insurance to 12 months and 17 days, and when it delivered the policies this fact was not only concealed from the insured, but he was told by the agent that the policies insured him for 13 months; and this is what the majority of the court call making "a counter proposition.” What the court is pleased to call “a counter proposition” was a fraudulent concealment of the fact that the policies varied in a material respect from the agreement made with the agent, and the requirements and conditions of the application. A counter proposition is an offer, openly made by one of the parties, of something for consideration and acceptance as a substitute for, or a modification of, a proposition previously made by the other party.
It is further said in the opinion of the court that “the word 'annually,’ which the application contains, signifies once in a year, but it does not signify what time in a year.” But the application provided that the policies should not be in force until the first annual premiums were paid, and they were, paid on the 26th of December, 1893. That this was the payment of annual premiums is conclusively established by the finding of the court that it was the payment in full of the “first annual premium.” Obviously, then, the next annual premium would be due one year from that date. “Annual,” in this connection, means on the recurrence of the same day in each year thereafter, and not at some other or uncertain time during the year. Therefore, when the company inserted in the policy a clause making the premiums payable at a different time, it inserted a provision in direct conflict with the terms of the application and the agreements of the parties. It is a fact found by the court that:
“There now appears on the face of the application, interlined in ink, the words,' ‘Please date policy same as application.’ These words were not in the *877application when it was signed by McMaster, but after the signing, thereof they were written into the application by F. W. Smith, the agent of the New York Life Insurance Company, without the knowledge or assent of Frank E. McMaster, and were so written by the agent in order to secure to the agent a bonus which the company allowed to agents for business secured during the month of December, 1893; and it does not appear that Frank E. McMaster ever knew that these words had been written into the application, and it affirmatively appears that he had no knowledge thereof when the application was forwarded to the home office of the company, and was acted on by the company.”
When the insured signed the application and delivered it to the agent, it was a completed document. It was the insured’s application, and neither the company nor its "agent could lawfully add to or take from it. The company could accept or reject the application as made, but it could not alter it. The insertion of this clause by the insurance agent after the insured had signed and delivered the application, and without his knowledge and consent, was an illegal act, if not a plain and palpable forgery. It was an act which cannot prejudice the insured or benefit the company. No one can profit by his unauthorized alteration of an instrument after the discovery of the fact. The company evidently understood by this clause interpolated into the application by the agent that he wanted the 12th day of December fixed as the date for the payment of the annual premiums, and the company accordingly fixed that date in the policies as the time for the payment of the annual premiums, and dated the policies their true date, namely, the 18th of December. By this extraordinary and unheard-of action the insured is made to pay a premium on the policies from the 12th of December, whereas the policies were not signed or executed by the company until the 18th of December, and by their terms did not take effect until the payment of the first annual premiums, on the 26th of December. Beyond all doubt, the applicant was not insured from the 12th of December, and yet from that day it claimed the 13 months must be reckoned, and we are told that they are policies, not for 13 months, but for 12 months and 17 days, — a most uncommon term for life policies, which are rarely or never issued for a fraction of a month.
In Society v. McElroy, 28 C. C. A. 365, 83 Fed. 631, the jury found there was a valid verbal agreement of life insurance, and that time was given for the payment of the premium, but a majority of the court in that case said:
•‘The almost invariable custom is for the companies to make no contract and to incur no liability to insure the life of any man until a premium has been paid. Accordingly, where no policy of life insurance has been issued, and no premium has been paid, there is a strong presumption that there was no contract, and no intention to contract otherwise than by a policy made and delivered upon the simultaneous payment of a premium.”
—And the verdict of the jury was set aside, and a recovery denied. But when, in this case, the insured claims and proves by an express provision of his application, now a part of the policies, that the policies were not to be in force for any purpose until the premiums were paid and the policies delivered, the court holds that as against the insured, and for the purpose of shortening the term of insur*878anee and defeating a recovery on the policies, the policies were in force 6 days before they were signed, and 14 days before they were delivered and the premiums paid. It is not pretended, however, that the applicant’s life was insured during this time. The policies were only in force to shorten the term of his insurance, and, to that extent, relieve the company from liability. As applied by the court in this case, there is a want of reciprocity in the rule laid down in Society v. McElroy, supra, which does not commend it to our sense of right and justice. Judge Shiras, in his opinion, forcibly points out the injustice and unreasonableness of this claim. He says:
“If the theory contended for on behalf of the company is correct, it follows that by the device of making the second and subsequent payments due on the 12th day of December, instead of the 18th, the date of the policies, the insured and his estate are deprived of the benefit of the month’s grace which MeMaster was assured he would be entitled to, when he applied for the insurance. Furthermore, if this construction of the policy is sustained, it makes it possible for the company, after using the month’s grace as an arrangement to secure insurance, then to escape the obligation by the simple device of so writing the policies as to make the second payments come due a month in advance of the date of the policies.” McMaster v. Insurance Co. (C. C.) 78 Fed. 33.
And again:
"Can there be any doubt that when MeMaster received the policies dated December 18, 1893, and paid one year’s premiums thereon, he was justified in assuming that, if he died within one year from the date of the policies, his estate would receive the indemnity which it was his purpose to secure, even though the policies did not contain the provision giving one month’s grace on subsequent payments. Suppose MeMaster had died on the 1st of December, 1894, — less than one year from the date of the policies; would it be open to the company to deny liability on the policies on the ground that it had put in the policies a provision that the second premiums were payable on October 1, 1894? That is exactly the claim now made by the defendant company. If the company, after accepting a proposition to insure MeMaster on the basis of annual premiums, can make the second premiums payable in six days less than a full year, which is its claim in the present case, it could have made the second premiums payable in three or six months, and would thus change the policy from one wherein the premiums were payable annually into one wherein the premiums were payable quarterly or semiannually.” MeMaster v. Insurance Co. (C. C.) 90 Fed. 40.
The interpolated clause in the policies contradicts and is inconsistent with the stipulations and conditions of the application, which are a part of the policies, and the only part which the assured ever saw and assented to. It is a settled canon for the construction of policies of insurance that when they contain contradictory, conflicting, or inconsistent provisions, effect will be given to the provisions most favorable to the insured, and, in cases where their construction is doubtful, the construction most favorable to the insured will be adopted. First Nat. Bank v. Hartford Fire Ins. Co., 95 U. S. 673, 24 L. Ed. 563; Grace v. Insurance Co., 109 U. S. 278, 3 Sup. Ct. 207, 27 L. Ed. 932; Moulor v. Insurance Co., 111 U. S. 335, 4 Sup. Ct. 466, 28 L. Ed. 447; Surety Co. v. Pauly, 170 U. S. 133, 18 Sup. Ct. 552, 42 L. Ed. 977; Insurance Co. v. McConkey, 127. U. S. 661, 666, 8 Sup. Ct. 1360, 32 L. Ed. 308; Thompson v. Insurance Co., 136 U. S. 287, 297, 10 Sup. Ct. 1019, 34 L. Ed. 408; Insurance Co. v. Coos Co., 151 U. S. 452, 462, 14 Sup. Ct. 379, 38 *879L. Ed. 231. No notice is taken of this rule by the majority of the court, although it is exactly applicable to this case, and decisive of it. In McGlother v. Accident Co., 32 C. C. A. 318, 89 Fed. 685, the majority of this court characterized this fundamental rule of construction, which has been repeated, affirmed, applied, and enforced by the supreme court of the United States in scores of cases, as a "much-abused rule.” As the rule has been more frequently and effectively applied by the supreme court of the United States than any other court, it may be inferred from the remark quoted that the doctrine of the supreme court does not meet the approval of the majority of this court, and will not be applied by them in any case. Certain it is that they have done more than ignore the rule in this case, — they have inverted it; and, where the provisions of the policy are inconsistent or conflicting, they have given effect to the provisions most favorable to the insurance company, and, wherever the meaning of the policies is doubtful, they have resolved the doubt in favor of the insurance company.
The company made no objection to the stipulations and conditions of the application, or to the agreement made with its agent, and made no counter proposition, but proceeded to issue and tender its policies upon the application as made. When the policies were tendered under these circumstances, the insured would have been entirely justified in paying the premiums and accepting the policies without reading them. He had a right to presume that the period of insurance named in the policies conformed to the agreement and to the stipulations and conditions of his application; and to that effect are the authorities, as we shall presently see. When the period of insurance has been agreed upon, it is the almost universal usage for business men to pay the premium and accept their policies without reading them. Under the doctrine laid down by the majority, if a man were to make a written application' for a policy of insurance on his house for 1 year, and the company should write the policy for 1 month only, and tender that, and receive a year’s premium, and the insured, going on the reasonable assumption that the policy conformed to his application, should accept the policy and put it away in his safe without reading it, his policy would be effective for 1 month only. But the insured in this case did not, as he might well have done, rest on the reasonable assumption that the policies insured him for the period of 13 months, as agreed upon, and called for by the stipulations and conditions of his application, but he applied to the company’s agent to know if they did so insure him, and was answered that they did; and thereupon, in reliance upon the truth of this answer, and in the belief that the policies insured him for 13 months, as his application called for, he paid the first annual premiums, and laid the policies away without' reading them'. Upon this state of the case the court holds that, by the mere acceptance and retention of the policies without reading them, the insured is estopped to show the truth of the transaction. The question is not whether the finding of facts establishes the mistake or fraud, but whether, the mistake or fraud being conclusively established by the finding of facts, the court will declare that the
*880insured is estopped from availing himself of the truth by the mere receipt of the policies and putting them away without reading them, in reliance upon the truth of the agent’s answer and the stipulations of his applications. It must not be forgotten that there is no claim or pretense that the policies in fact expressed the contract of the parties. The finding of facts precludes any such claim. The contention is that, by receiving the policies under the circumstances mentioned, the insured is "conclusively presumed” to have assented to all their provisions, and will not be heard to say to the contrary. The rule for the application of estoppels is thus inverted and applied in favor of the company, when it is obvious that it is the company that is estopped from setting up the defense relied on. Estoppels are invoked to prevent and relieve from fraud, not to shield and protect it. The most frequent occasion for invoking the doctrine is where one party makes a representation upon the faith of which the other party acts and pays money, or changes his position, or refrains from doing something he otherwise would do. In all such cases the party making the representation is estopped from contesting its truth.' It will be perceived at a glance that the estoppel in this case applies to the insurance company, and not to the insured. The insured made no representation to the company, and the company parted with no money or other valuable thing on the faith of any false statement that he made, hfor did it do or omit to do anything on account of the insured putting away the policies without reading them. But, on the faith of the solemn assurance of the company’s agent that the policies insured him for 13 months, the insured parted with his money, and refrained from reading his policies and from taking out policies in other companies. Upon the faith of the truth of the agent’s representations, the insured rested confidently in the belief that he had made provision for his family in the event that he died at any time within 13 months from that date. The law upon the subject is well settled. The vital principle is that he who by his language or conduct leads another to do what he would not otherwise have done shall not subject such person to loss or injury by disappointing the expectations upon which he acted. Such a change of position is sternly forbidden. It involves fraud and falsehood, and the law abhors both. Dickerson v. Colgrove, 100 U. S. 578, 580, 25 L. Ed. 619. It is said that the insured was guilty of culpable negligence in placing any reliance on the truth of the agent’s statement. But the law will not hear any man complain that another has too implicitly relied on the truth of things he has himself stated. He will not be heard to say: ‘
“It Is true, I misrepresented the facts to the insured, and by so doing induced him to pay for and accept, without reading, policies which insured him for a less period than that agreed upon. But he ought not to have trusted to my word. He ought to have known I was unworthy of belief.” •
The rule of the court obliterates all distinction between truth and falsehood in the dealings of men. It establishes the doctrine that the law has no partiality for truth, and no prejudice against falsehood. . If applauds and approves an end obtained by falsehood and fraud, as a high exhibition of business tact and skill, and reserves *881its censures for the innocent and trusting victim of the fraud, because, forsooth, he accepted as true the word of the man he was dealing with; and it permits the party who made the false representation to avail himself of his own falsehood, to the prejudice of the man who trusted him. It makes confidence and bunco games respectable, and elevates the sharper who practices them to a plane of equality with honest and reputable business men. It is a rule at which all rascaldom will rejoice, and all. honest and trustful men take alarm. It stimulates falsehood and deceit by the grant of impunity, and destroys confidence among men. It converts written contracts, which were designed to prevent fraud, into the most powerful agencies for the perpetration and protection of fraud. In this case the insurance company, in effect, receives a reward of $5,000 for its falsehood and fraud, and a penalty of $5,000 is imposed upon the beneficiary named in the policy, because the insured “trusted in the truth of the company’s representations.
It is undoubtedly true that a written contract is presumed to express the agreement of the parties, but this is not a conclusive presumption, and the exceptions to the rule are as well understood and clearly defined as the rule itself. No writing, however solemn, can be made a vehicle for fraud, or convert a mistake into verity. The case at bar, upon the facts found, falls within the well-defined exception to the rule, as shown by all the authorities. No apology is made for demonstrating the truth of this assertion by somewhat extended quotations from controlling authorities.
In Insurance Co. v. Wilkinson, 13 Wall. 222, 20 L. Ed. 617, the insured had signed and delivered to the insurance company an application for a life policy, in which the agent of the company had written down a false answer to a question which the insured had declined to answer. The insured, without knowing that the agent had written down an answer to this question, signed the application without reading it, and it was made the basis of the policy which was issued. The company made the same contention in that case that the company makes in the case at bar, namely, that parol evidence could not be admitted to prove the facts, and that the insured was conclusively bound by the contents of his written application. But the supreme court held that the act of the agent in writing down the answer was to be imputed to the company, and that it could not estop the insured from showing the facts by parol evidence by its own fraudulent act, though he had signed the application without reading it. In delivering the unanimous judgment of the court, Mr. Justice Miller said:
“Passing then to the second branch of the case: The defendant excepted to the introduction of oral testimony regarding the action of the agent, and to the instructions of the court on that subject, and assigns the ruling of the court as error, on the ground that it permitted the written contract to he contradicted and varied by parol testimony. The great value of the rule of evidence here invoked cannot be easily overestimated. As a means of protecting those who are honest, accurate, and prudent in making their contracts, against fraud and false swearing, against carelessness and inaccuracy, by furnishing evidence of what was intended by the parties, which can always be produced without fear of change or liability to misconception, the rule merits the eulogies It has re*882celved. But experience has shown that in reference- to these very matters the rule is not perfect. The written instrument does not always represent the intention of both parties, and sometimes it fails to do so as to either; and, where this has been the result of accident.or mistake or fraud, the principle has been long recognized that under proper circumstances, and in, an appropriate proceeding, the instrument may be set aside or reformed, as best suits the purposes of justice. A rule of evidence adopted by the courts as a protection against fraud and false swearing, would, as was said in regard to the analogous rule known as the ‘Statute of Frauds,’ become the instrument of the very fraud it was intended to prevent, if there did not exist some authority to correct the universality of its application. * * * . It is in precisely such cases as this that courts of law in modem times have introduced the doctrine of equitable estoppels, or, as it is sometimes called, ‘estoppels in pais.’ The principle is that, where one party has by his representations or his conduct induced the other party to a transaction to give him an advantage which it would be against equity and good conscience for him to assert, he would not, in a court of justice, be permitted to avail himself of that advantage. And, although the cases to which this principle is to be applied are not as well defined as could be wished, the general doctrine is well understood, and is applied by courts of law as well as equity where the technical advantage thus obtained is set up and relied on to defeat the ends of justice or establish a dishonest claim. It has been applied to the precise class of cases of the one before us in numerous well-considered judgments by the courts of this country.”
In Insurance Co. v. Hearne, 20 Wall. 494, 22 L. Ed. 398, the terms of the policy weré agreed upon by letter. The policy issued varied from the agreement. The insured accepted and retained it without reading it, and the company contended that, having done so, he was bound by its provisions, although they differed from the terms of the agreement; but the court said:
“The policy was intended to put the contract in a more full and formal shape. The assured was bound to read the letters of the company in reply to his own with care. It is to be presumed he did so. He had a right to assume that the policy would accurately conform to the agreement thus made, and to rest confidently in that belief.”
The company in that case seems not to have thought of the expedient of calling the policy, which varied from the terms of the agreement, a “counter proposition.”
In Palmer v. Insurance Co., 54 Conn. 488, 509, 510, 9 Atl. 248, the court say:
"But if the underwriter solicits a person to purchase of him indemnity against loss by fire; and if they unite in making a written contract of all the terms, conditions, and stipulations which are to become a part of, or in any way affect, the contract; and if the underwriter promises to make and sign a copy thereof, and deliver it, as the evidence of the terms of his undertaking; and if a material and variant condition is by mistake Inserted, and the variant contract is delivered, and the stipulated premium is received and retained, — the court will not hear the claim that he is entitled to the benefit of the variant condition, when the other party had neither actual nor imputed knowledge of the change. In his promise to make and deliver an accurate copy, there is justification before the law for the omission of the other party to examine the paper delivered, and for his assumption that there is no designed variance. A man is not, for his pecuniary advantage, to impute it to another, as gross negligence, that the other trusted to his fidelity to a promise of that character. The rule of law that no person shall be permitted to deliver himself from contract obligations by saying that he did not read what he signed or accepted is subject to this limitation, namely, that it is not to be applied in behalf of any person who by word or act has induced the omission to read.”
*883In Hay v. Insurance Co., 77 N. Y. 235, Chief Justice Church, speaking for the court of appeals, said:
“It was bad faith on the part of the defendant to change so radically the terms of the policy, and deliver it as a policy simply renewing the old one, without notice of the change. A party whose duty it is to prepare a written contract, in pursuance of a previous agreement to prepare one materially changing the terms of such previous agreement, and deliver it as in accordance therewith, commits a fraud which entitles the other party to relief, according to the circumstances presented. * * * Policies of fire insurance are rarely examined by the insured. The same degree of vigilance and critical examination would not be expected or demanded as in the case of some other instruments. It is found that the plaintiff did not in fact examine the policy until after the fire, when, for the first time, he was informed of the peculiar' terms of the provision.”
In Bidwell v. Insurance Co., 16 N. Y. 266, the court said:
“That, the contract of insurance agreed to be made by the defendants was such in its terms as the plaintiffs have alleged in their complaint, has been found by the judge, and is conclusive upon us. The fact on which the appellants rely — that the policy actually made out was in the plaintiffs’, hands for a considerable time, and until after the loss had occurred — was a circumstance to be weighed by the judge, as bearing upon the truth of the- plaintiffs’ allegation that the policy did not pursue the contract. It has undoubtedly been considered by the judge, and his judgment has been given, notwithstanding that circumstance, in favor of the plaintiffs. There is no rule of law which fixes the period within which a man may discover that a writing does not express the contract which he supposed it to contain, and which bars him of relief for delay in asserting his rights, short of the period fixed by the statute of limitations.”
In Institution v. Burdick, 87 N. Y. 40, the court of appeals said:
“It has certainly never been announced as the law In this state that the mere omission to read or know the contents of a written instrument should bar any relief by way of a reformation of the instrument on account of mistake or fraud. It is the general rule that where a written instrument fails to conform to the agreement between the parties, in consequence of the mutual mistake of the parties, however induced, or the mistake of one party and fraud of the other, a court will reform the instrument so as to make it conform to the actual agreement between the parties.”
The court then cites the case of Botsford v. McLean, 45 Barb. 478, where, in a transaction, one of the parties was to execute four notes, bearing interest. He executed and delivered four notes, but only two of them bore interest. The payee, without reading the notes, accepted them and put them away. The court proceeds:
“The vendor, seeing that two of the notes were on interest, assumed that the other two were also on interest, and accepted the same, believing that all wore properly drawn. The purchasers, knowing that two of the notes were so drawn as not to bear interest, purposely abstained from calling the vendor’s attention to the fact. It was held that there was a mistake on one side, and fraud upon the other, and that the two notes should be reformed so as to conform to the actual agreement between the parties; and the decision was affirmed in this court in 1870. In that case there was a certain degree of negligence in not reading the two notes. It is said by the learned counsel for the plaintiff, in the argument before us, that there was artifice used in that case to induce the plaintiff to believe that the two notes were drawn with interest, —that artifice being in drawing and placing before the plaintiff the first two notes, payable with interest, by which the payee was thrown off his guard; but that circumstance was not the basis of that decision, and does not distinguish that case from this. There was nothing there to prevent the payee from reading the notes, and he had abundant opportunity to do so. If he had *884read them, the mistake and fraud would have been discovered. There was at most, in substance, the representation that the two notes were drawn with interest; and, if that was false, the means were at hand for its easy and ready detection. So in this case. Mrs. Burdick intrusted Martin to draw the deed, and he was bound to have it drawn so as to express the agreement between the parties; and, when he brought and delivered the-deed to her, it was, in effect, a representation to her that the deed had been so drawn. She was not bound to assume that he might be practicing a fraud upon her or representing a falsehood, and she cannot be charged with negligence in believing confidently that he was acting in good faith and telling the truth. In omitting to read the deed, she was no more in fault than the plaintiff was, in the case above cited, in omitting to read the two notes. It is certainly not just that one who has perpetrated a fraud should be permitted to say to the party defrauded, when he demands relief, that he ought not to have trusted or believed him. * * * If the rule were otherwise, the unwary and confiding, who need the protection of the law the most, would be left a prey to the fraudulent and artful practices of evil doers.”
In Kister v. Insurance Co., 128 Pa. St. 553, 18 Atl. 447, the supreme court of Pennsylvania say:
“We cannot say that the law, in anticipation of a fraud upon the part of a company, imposed any absolute duty upon Kister to read his policy when he received it, although it would certainly have been an act of prudence on his part to do so. Insurance Co. v. Bruner, 23 Pa. St. 50; Insurance Co. v. Wilkinson, 13 Wall. 222, 20 L. Ed. 617. One thing is certain, however; The company cannot repudiate the fraud of its agent, and thus escape the obligations of a contract consummated thereby, merely because Kister accepted in good faith the act of the agent, without examination.”
In Gristock v. Insurance. Co., 87 Mich. 428, 49 N. W. 634, the supreme court of Michigan say:
“Plaintiff had a right to rely upon the assumption that his policy would be in accordance with the terms of his oral application. If the defendant desired to make it anything different, it should, in order to make it binding upon plaintiff, under the authorities in this state, have called his attention to those clauses which differed from the oral application.”
In Strohn v. Railway Co., 21 Wis. 562, the plaintiffs had a verbal agreement with the defendant railway company as to the terms of shipment of a quantity of freight. The freight was delivered to the railway company, and afterwards, upon demand, the company delivered to the plaintiffs bills of lading therefor. These bills of lading contained conditions of shipment inconsistent with the verbal agreement of the parties. The plaintiffs having received and retained these bills of lading without reading them or knowing their contents, the railway company insisted that they were bound by the conditions contained in the bills of lading, which had been received without objection. In answer to this contention, the court said:
“Having previously entered into a special verbal agreement, he may rightfully assume, in the absence of notice to that effect, that it is embodied in the paper or receipt, or at least that the receipt contains nothing contrary to it. It is in the nature, of a direct fraud or cheat for the company or its agents, after having entered into a verbal agreement, thus wrongfully to insert a contract of an entirely different character, and present it, to the party without directing his.attention expressly to it and procuring his assent. It is no answer for the company In such a case to say that the other party should have been more diligent and, watchful, and should have detected the fraud. So long as he is ignorant of the new conditions, and does not assent to them, the contract in writing is not consummated, and parol evidence may be received.”
*885And to the same effect is Boorman v. Express Co., 21 Wis. 154.
In McEIroy v. Assurance Co., 36 C. C. A. 615, 94 Fed. 990, 1000, the circuit court of appeals for the Ninth circuit say:
“It would certainly have been an act of prudence on his part to read the entire policy, but his neglect to do so cannot excuse the company for the default of the agent in not writing the contract in accordance with the representations made by the insured. The insured had a right to rely upon the agent’s performing his duty of making the contract in conformity with the information given, and the agent’s failure to do so, whether the result of a mistake or of a deliberate fraud, cannot operate to the prejudice of the insured. The contract of insurance is pre-eminently one that should be characterized by the utmost good faith on both sides.”
In Fitchner v. Association, 103 Iowa, 276, 72 N. W. 530, the supreme court of that state say:
“The insured ordinarily rely upon the agent to properly set out the facts in the applications, and Laub did as men usually do, in assuming that the defendant’s agent had done his duty. Stone v. Insurance Co., 68 Iowa, 737, 28 N. W. 47; McComb v. Insurance Co., 83 Iowa, 247, 48 N. W. 1038. The mere failure of the assured to read his application, or the copy of it in the policy, does not establish negligence. Hagan v. Insurance Co., 81 Iowa, 321, 46 N. W. 1114; Donnelly v. Insurance Co., 70 Iowa, 693, 28 N. W. 607; Boetcher v. Insurance Co., 47 Iowa, 253. Nor is the mere omission to read the policy negligence. Barnes v. Insurance Co., 75 Iowa, 11, 39 N. W. 122; Jamison v. Insurance Co., 85 Iowa, 229, 52 N. W. 185; Boetcher v. Insurance Co., supra. Laub had no reason to suppose the policy and application were drawn differently than understood.”
Citations to the effect of the foregoing might be multiplied indefinitely, but the excerpts quoted are enough to establish beyond all controversy that the doctrine of the majority is not the law. No verbal dexterity can weaken or evade the overwhelming force of these decisions. They conclude the question. Not one case cited by the majority is an authority on the facts of this case. Even the decision of this court when this case was here on a bill to reform the policy is not in point in this case, because some of the material facts found by the circuit court in this case, and which are conclusive upon this court now, were disputed and denied by this court in the equity case. In Insurance Co. v. Norwood, 16 C. C. A. 136, 69 Fed. 71, the question under discussion was decided by this court after full argument and consideration. The opinion in that case is exactly opposed to the opinion of the majority in this case, and yet the majority opinion nowhere refers to the Norwood Case. If the court intends to overrule the Norwood Case, it should have the courage and candor to say so. It is extremely unfair to the profession and the public for an appellate court to put forth two opinions, diametrically opposed to each other, without noticing the fact, and advising the profession which opinion they are to regard as the law of the court. The Norwood Case was cited and its doctrine approved by the circuit court of appeals for the Ninth circuit in McEIroy v. Assurance Co., supra, and also in the Sixth circuit in the case of Insurance Co. v. Fischer, 34 C. C. A. 503, 92 Fed. 500.
There is another ground upon which the case should be reversed, and the plaintiff in error awarded a new trial. The defendant in error is a New York corporation. A statute of that state in force at the time these policies were issued declares:
*886“No Forfeiture of Policy without Notice. No life corporation doing business in this state shall declare forfeited or lapsed any policy hereafter issued or renewed, and not issued upon the payment of monthly or weekly premiums, or unless the same is a term insurance contract for one year or less, nor shall any such policy be forfeited or lapsed by reason of non-payment, when due, of any premium, interest, or installment or any portion thereof, required by the terms of the policy to be paid, unless a written or printed notice stating the amount of such premium, interest, installment, or portion due thereof on such policy, the place where it should be paid, and the person to whom the same is payable, shall be duly addressed and mailed to the person whose life is insured, or the assignee of the policy, if notice of the assignment has been given to the corporation, at his or her last known post-office address, postage paid by the corporation, or by an officer thereof, or person appointed by it to collect such premium, at least fifteen, and not more than forty-five days prior to the day when the same is payable. The notice shall also state that unless such premium, interest, installment or portion thereof, then due, shall be paid to the corporation, or to a duly-appointed agent or person authorized to collect such premium, by or before the day it falls due, the policy, and all payments thereon, will become forfeited and void, except as to the right to a surrender value, or paid-up policy, as in this chapter provided. If the payment demanded by such notice shall be made within the time limited therefor, it shall be taken to be in full compliance with the requirements of the policy in respect to the time of such payment; and no such policy shall in any case be forfeited or declared forfeited or lapsed until the expiration of thirty days after the mailing of such notice. The affidavit of any officer, clerk, or agent of the corporation, or of any one authorized to mail such notice, that the notice required by this section has been duly addressed and mailed by the corporation issuing such policy, shall be presumptive evidence that such notice has been duly given.” Laws 1892, c. 690, art. 2, § 92.
In Baxter v. Insurance Co., 119 N. Y. 454, 23 N. E. 1048, 7 L. R. A. 293, the court of appeals of that state, speaking of this statute and its effect upon the policy of life insurance issued under it, said:
“This statute was part of the contract in question, and governed the rights and liabilities of the parties in precisely the same way and to the same extent as if all its terms and conditions had been actually incorporated into the policy.”
In that case the defendant was claiming a forfeiture of a policy for nonpayment of the premium when due. It was not shown by the insurance company that the notice required by this statute had been given. The court continues as follows:
“There was no proof given at the trial by either party to show whether this notice had been served or not. It is obvious that this statute, when imported into the contract, modified its conditions in very material respects. The duration and validity of the policy are not then dependent upon the payment of the premium on the day named therein, but upon the payment within thirty days after, the notice has been given. * * * The statute prescribes this notice as a necessary condition of forfeiture, and, unless it was served, the assured was not in default, because payment within thirty days after notice is to be taken as a full compliance with the conditions as to payment of the premiums. * * * Before defendant could raise any question in regard to the nonpayment of the August premium, It was necessary to show that it had complied with the statute by serving a notice, as this step was essential in order to put the- insured in default, or to raise any point based on his omission to pay. the last quarterly premium.”
See, also, De Frece v. Insurance Co., 136 N. Y. 151, 32 N. E. 556; Phelan v. Insurance Co., 113 N. Y. 147, 20 N. E. 827.
In Griffith v. Insurance Co., 101 Cal. 627, 36 Pac. 113; Johnson v. *887Insurance Co. (Iowa) 78 N. W. 905; Insurance Co. v. Dingley, 35 C. C. A. 245, 93 Fed. 153; Rosenplanter v. Society, 37 C. C. A. 566, 96 Fed. 721, — the same statute is considered, and the interpretation given it by the New York courts adopted.
The burden of proof to show that this notice was given rests upon the insurance company. It must show a strict compliance with the terms of the statute before it can assert a forfeiture. This is conceded by the defendant in error, and, in its answer claiming a forfeiture of the policies, it is alleged that notice was duly mailed to the insured at least 15 days, and not more than 45 days, before the premiums were due on the policies, in the form required by the statute. But there is no finding of fact to support this allegation. The only finding of fact on the subject reads as follows:
“(10) That not later than November 17, 1894, notice was sent to Frank E. McMaster of the coming due of the premiums on the policies issued to him by the defendant company, in accordance with the requirements of the statutes of the state of New York.”
It will be observed that there is a total failure to find the facts showing a compliance with the statute' by the company. One requirement of the statute is that the notice shall be sent “at least fifteen and not more than forty-five days prior to the day when the same is payable.” The only finding on the subject is “that not later than November 17, 1894, notice was sent.” But how much earlier than November 17, 1894, was it sent? It might have been sent the 1st of July, and this finding would be true. It is not upon such a finding that a court can declare a forfeiture. The rule is absolute and without an exception that the special findings of fact of the lower court must distinctly and specifically find every fact essential to support its judgment. Nothing can be supplied by intendment. The next clause of this finding, namely, that the “notice was sent to Frank E. McMaster of the coming due of the premiums on the policies issued to him by the defendant company in accordance with the requirements of the statute of the state of New York,” is fatally defective for the reason that it states a mere conclusion of law, and finds no fact whatever. The contents of the notice are not given, and the notice is nowhere set out. It was the duty of the lower court either to make the notice a part of its finding, or set out its contents specifically, so that this court could determine whether it was “in accordance with the requirements of the statute of the state of New York.” Under the New York statutes the forfeiture of a policy for the nonpayment of premiums does not depend, as we have seen, upon the nonpayment of the premiums according to the terms of the policy, but upon their nonpayment after the notice prescribed by the statute has been given. What that notice must contain to make it effectual will be seen by reference to the statute copied above, and its requirements need not be repeated here. See cases supra. The inadequacy of the finding on this point is forcibly illustrated by the facts disclosed in the record in the equity suit, now a part of the records of this court. A reference to that record discloses the fact that the notice which was given was fatally defective in at least two particulars. Rosen planter v. Society, 37 C. C. A. 566, 96 Fed. 721; Insurance Co. v. *888Dingley, 35 C. C. A. 245, 93 Fed. 153. It is to be regretted that the majority of the court have deemed silence the best method of disposing of the question of the sufficiency of this finding. The judgment of the circuit court should be reversed, and the case remanded, with instructions to grant a new trial.