Travelers Insurance v. Melman

Digges, L, delivered the opinion of the Court. During the year 1922 Louis Bridge was employed as an insurance agent by the Travelers Insurance Company, a corporation, of Hartford, Connecticut^ duly authorized to do- business in the State of Maryland. This agent had authority to- solicit insurance, take applications, deliver poli ⁴⁶¹ cies, and to collect first premiums. In the course of his employment he, after repeated solicitation, succeeded in obtaining an application on June 16th, 1922, from Harry Melman, whose residence and place of business was in Baltimore City, for a policy of insurance upon the life of Harry Melman in the sum of $6,000.

The form of this policy was a ■ twenty-year endowment, the beneficiary to' be Anna Mel-man, the wife of the applicant. Subsequent to the application the applicant was duly examined and passed by the medical examiner of the company. A contract of insurance in the form applied for was duly executed'by the insurance company at its home office in Hartford, Conn., sent to the general agent of the company in Baltimore, Md., and by that office turned over to Louis Bridge, the agent, for the purpose of delivery to the insured, Harry Melman, and collecting the premium due thereon. After receiving this fully executed policy from the general agent of the company, the agent, on Monday, July 17 th, 1922, delivered the policy to the insured at his home, but did not actually receive the money for the first premium due on said policy at the time of delivery.

The first premium due was the sum of $56.45, being the amount due quarterly as provided in the contract. On Friday, July 21st,, 1922, Harry Melman, the insured, was suddenly stricken with- appendicitis and immediately taken to a hospital in Baltimore City, where he was then operated on. His condition grew worse from the time of the operation, culminating in his death on Sunday, July 23rd, at about 11 o’clock A. M. On Saturday, July 22nd, while her husband was in the hospital, and after the operation, 'his wife, Anna Melman, the beneficiary, sent her check for $56 in payment of the premium on the policy. The check was as follows: “Baltimore, Md., July 22, 1922, Ho. 738.

Ades Brothers, Bankers. Pay to the order of the Travelers Insurance Company $56.00. Pifty-six 00/100 Dollars. Por Harry Melman policy.

Mrs.- Anna Melman.” ⁴⁶² This check was deposited by the company in regular course at the Merchants Rational Bank, Baltimore, and duly paid by the bank upon which it was drawn. On Tuesday, July 25th, the company sent the following letter to the insured: “July 25, 1922. Mr. Harry Melman, 2453 Druid Hill Ave., Baltimore, Md. Dear Sir: Re: Life Policy Ro. 828513. We are in receipt of your check this morning in the amount of $56.00.

We wish to'advise that the premium on the above contract is $56.45, so there is a difference due of $.45, which it will be necessary for you to let us have so that we may complete our records. Trusting you will give the above your prompt attention, I am, yours very truly, C. H. Judin, Cashier.” On the following day, July 26 th, the following letter was sent by the company: “July 26, 1922. Mrs. Anna Melman, 2453 Druid Hill Ave., Baltimore, Md. Dear Madam: I am attaching hereto our cheek Ro. 20955 dated July 26th in the amount of $56.00 representing the return of money which you tendered us under date of July 24th as an intended payment of policy Ro. 828513. We have no record of this policy having ever been in force and consequently there is no premium due on it.

Very truly yours, C. H. Judin, Cashier.” On the following day, July 27, a second letter was sent by the company to Mrs. Melman, reading as follows: “July 27, 1922. “Mrs. Anna Melman, “2453 Druid Hill Ave., “Baltimore, Md. “Dear Madam: “Re: Life Policy Ro. 828513. “I am enclosing herewith 45 cents in coin made up of one quarter, one dime and two nickels. This money was left on the counter in our office yesterday by a person who stated that he was acting as your messenger. ⁴⁶³ “At that time I informed your messenger that there was nothing due the Travelers Insurance Company from you, and we, therefore, refused to accept any moneys which you might tender us; regardless of this, your messenger walked out and left the 45 cents on our counter. “As stated above, there is nothing due the Travelers Insurance Company from you and consequently I am returning the money herewith. “Yours very truly, “0. H. Judin, “Cashier.” After the death of the insured, demand was made upon the company by Mrs. Anna Melman, the beneficiary named in the policy, for settlement, which was refused, and the non-payment of the amount stated in the policy resulted in the beneficiary (the appellee) bringing suit in the Superior Court of Baltimore 'City against the company to recover the amount of insurance stated in the policy, with interest. This case was tried by a court and jury and resulted in a verdict and judgment for the appellee, plaintiff below, for the sum of $5,560.

It is from that judgment this appeal is taken. There are three exceptions contained in the record: the first to the court’s ruling in rejecting four prayers offered by the appellant at the close of the testimony offered on behalf of the plaintiff, the object of these prayers being to have the court direct a verdict for the defendant. These same prayers were again offered by the appellant at the conclusion of the whole testimony, together with two other prayers, designated defendant’s fifth and sixth prayers; and at the same time the defendant moved to strike out all testimony which was admitted subject to exception relating to statements made by Louis Bridge to Harry Mélman and any agreement made by said Bridge that said policy should be in force before payment of first premium. The lower court again refused the defendant’s reoffered, first, second, third and fourth prayers,' granted the defendant’s fifth ⁴⁶⁴ prayer, refused the defendant’s sixth prayer, and overruled the defendant’s motion to strike out the testimony; and these rulings constitute the third bill of exception.

As stated, the first four prayers' of the defendant were re-offered and were embraced in the third exception; therefore it becomes unnecessary to- consider the first exception to the ruling o-f the1 court in rejecting these same prayers. The second exception is to the ruling of the court on the evidence. ■ . The record discloses that the application for insurance contained the following: “That every declaration herein-above contained is true; and that the contract issued hereupon shall not take effect unless the first premium shall be actually paid while I am in good health”; that the entire application was inserted in and formed a part of the- executed policy; that among other provisions of the policy was, under the subhead “Modifications, etc.,” the following: “Mo agent can make, alter or discharge this contract or extend the time for payment of premiums, nor can this contract be varied or altered or its conditions waived or extended in any respect, except by the written agreement of the company, in compliance with the law of the state in which the contract is issued, signed by the President, or one of the Vice-Presidents of Secretaries, whose authority will not be delegated.” The last above quoted provision was contained in the executed policy, but was not in the application. The record further discloses that it was the common practice- of the company to execute policies for prospective purchasers of insurance, made out in their name, and deliver said policies to- the agents of the company who had solicited such insurance, with the authority to- the agent to- deliver the policy to the insured for inspection, provided the agent took from the insured what is called a policy inspection receipt, the- form of which receipt is: ⁴⁶⁵ “Policy Inspection Receipt. “Life Department, ........19 “Received of........., agent, of the Travelers Insurance Company, Hartford, Connecticut, Policy Ho. ......, upon my life, for inspection only.

This pol- „ icy shall not take effect or be in any way binding upon the company until the premium thereof is actually paid while I am in good health, and this receipt , exchanged for the premium receipt signed and countersigned as provided in the policy. * * * .” There is no' dispute that Harry Melman made application to the appellant through its agent, Bridge, for a twenty-year endowment policy in the sum of $5,000; that this policy was executed by the company, delivered to its agent Bridge, and by him delivered to Harry Melman on Monday, July 17th, 1922. What occurred at the time of delivery and subsequent thereto' is the subject of conflicting and directly contradictory testimony as adduced in behalf of the appellee and appellant respectively. According to the appellee’s witnesses, at the time of the delivery of this policy to Harry Melman by the agent Bridge, Melman had money sufficient to pay the premium, offered to do' SO' by putting his hand in his pocket and saying “I will pay it,” and was told by the agent, “You need not hurry; you are protected; you stand good for it.” This was the testimony of the appellee, and the daughter of the appellee testified that she saw Mr. Bridge talk to her father: “I only heard one ■conversation, that is, my father going to pay Mr. Bridge .and Mr. Bridge said he was all right and he should not hurry about paying him for the policy.” Another witness, the brother of the appellee, testified that on the evening the insured was taken to the hospital the agent Bridge and the witness went to the hospital together on a street car, and that on the street ear the agent Bridge said to the witness “that he (the agent) insured my brother-in-law lately and mentioned that he did not pay him yet, but he wanted to pay him when he delivered the policy to him, but you know your brother-in-law is good for the money; that’s what I ⁴⁶⁶ told him; he is insured and he is protected.” The agent Bridge positively denies what was testified to by the witnesses above quoted, and his version of what took place was that when he delivered the policy to Harry Melman on Monday he had Melman sign the usual form of policy inspection receipt, in which said receipt there was a provision that the policy was not to be binding upon the company until the first premium had been paid by the insured while in good health. The record further discloses that on Saturday, July 22nd, after Melman had been operated upon at the hospital, the agent Bridge went to- the home of the appellee and succeeded in getting in his possession the policy of insurance.

The means by which he secured the policy is also the subject of conflicting testimony; the testimony on behalf of the appellee- being that he received the policy from the brother of the appellee, to whom it had been deliver! .by her for safekeeping, by the use- of deception, in -that -the- agent asked to- be given the policy for the purpose of reading it, which was done, and while the brother of the appellee left the room to answer a call of his mother, the agent disappeared taking the policy with him; while the testimony of the agent Bridge is that, upon his visit to the home of the appellee on that day, he told the brother of the appellee that the policy was void and of no effect because the first premium had not been paid while Melman was in good health, and that thereupon the policy was voluntarily handed over to him, and that when he got the policy he -destroyed the policy inspection receipt which he- had previously taken from Melman. Which of the conflicting statements by the witnesses was the truth was a question which the jury was called upon to decide, and from their verdict it is evident that they saw fit to believe the plaintiff’s version of what occurred at the time of the delivery of the policy to Melman and the repossession of it by the agent of the company. Eor the- purposes of this appeal this Court is bound to assume as correct the questions of fact submitted to and decided by the jury. This being true, it presents the legal proposition as to whether or not such a case as made out by