Case Title: Albright v. Southern Farm Bureau Life Ins. Co.

Citation: 

Docket Number: 

State: arkansas

Court: Arkansas Supreme Court

Date: 1997-03-24T00:00:00Z

Document:
Lynda ALBRIGHT v. SOUTHERN FARM BUREAU LIFE
INSURANCE COMPANY

95-1142                                            ___ S.W.2d ___

                    Supreme Court of Arkansas
                Opinion delivered March 24, 1997


1.   Civil procedure -- summary judgment -- proof required and
     pleadings considered. -- A party moving for summary judgment
     must show that there is no genuine issue as to any material
     fact and that the moving party is entitled to a judgment as a
     matter of law; pleadings, discovery responses, admissions, and
     affidavits, if any, are to be considered in the light most
     favorable to the nonmoving party.    
2.   Action -- plaintiff may not recover for same act in both
     contract and tort -- concurrent allegations may be pursued. --
     Although a plaintiff may not recover for the same act in both
     contract and tort and must ultimately choose among remedies
     sought, it is not wrong for concurrent allegations to be
     pursued.

3.   Action -- question existed that was not addressed in trial
     court's order -- summary judgment reversed and remanded. --
     Where it was clear that there was at least a question whether
     the contract required appellee to present its draft for the
     monthly premium in advance of August 5, 1990, a question not
     addressed in the trial court's order, there was ambiguity in
     the contract and a factual issue remaining as to the parties'
     intent; in addition, where the trial court failed to rule on
     whether the action should have been limited to contract in
     view of the fact that appellee's action or lack of it may have
     been nonfeasance as opposed to misfeasance, but instead stated
     that there was "no proof" of negligence on appellee's part,
     the supreme court was unwilling to make such a ruling in an
     appeal from a summary judgment; the case was reversed and
     remanded.


     Appeal from Garland Circuit Court; Tom Smitherman, Judge;
reversed and remanded.
     Neil V. Pennick and D. Scott Hickam, for appellant.
     Friday, Eldredge & Clark, by:  Fran C. Hickman, for appellee.

     David Newbern, Justice.
     This is an appeal from a summary judgment in favor of Southern
Farm Bureau Life Insurance Company (SFB).  The appellant, Lynda
Albright, sued SFB for the proceeds of a policy which insured the
life of her husband, Jerry Albright.  On the ground that a monthly
premium payment had not been made in the month prior to Mr.
Albright's death, SFB refused Ms. Albright's demand for payment
after the death of Mr. Albright.  She alleged SFB was negligent in
failure to submit a draft upon Mr. Albright's bank account at a
time, alleged to be specified in the insurance agreement, when
funds sufficient to pay the premium would have been present.  She
also alleged that SFB thereby breached the insurance contract.  In
awarding summary judgment to SFB, the Trial Court rejected the
contract claim, although it was not directly addressed.  The Court
also found "no proof" of negligence on the part of SFB.  We hold
there was sufficient evidence to present a genuine remaining issue
of material fact as to negligence and as to breach of contract and
thus that summary judgment should not have been granted.  Ark. R.
Civ. P. 56(c).
     On March 5, 1985, Mr. Albright purchased a life insurance
policy from SFB in the amount of $200,000.  In accordance with the
terms of the policty, Mr. Albright chose to make his premium
payments on a monthly basis.  The named beneficiary was Lynda
Albright.  
     Mr. Albright executed a document giving First National Bank of
Hot Springs authority to honor checks drawn on his account by SFB
to pay the policy as if he had personally drawn them.  The
authorization allowed Southern to draft the premium payment from
Mr. Albright's account electronically.  
     As will be explained more fully below, the policy provided
that the premium payments of $126.76 were to be made in advance of
the anniversary date of the policy.  In the case of monthly
payments, that meant the payments were to be on the day of the
month corresponding to the day of the month on which the policy was
issued.  According to testimony of an SFB official, Mr. Albright
could have chosen a different day of the month to have his account
charged, but he did not do so; therefore, the premium payments were
due on the fifth day of each month for the ten-year period provided
in the policy.
     August 5, 1990, fell on a Sunday.  The August 1990 draft
apparently was prepared by SFB on Monday, August 6, but it was not
submitted to the Bank until Tuesday, August 7, 1990.  The draft was
returned due to insufficient funds.   Funds sufficient to make the
premium payment were in the account through Monday, August 6, 1990. 
On Tuesday, August 7, however, the Bank debited Mr. Albright's
account $25.32 for payment of an order for printed checks, thus
reducing the balance below the amount needed to cover the monthly
SFB draft.  The Bank, which was made a defendant but later
dismissed from the litigation, allegedly chose to honor its draft
rather than the one from SFB.  The SFB draft was presented for
payment again on August 10, 1990, but was again returned due to
insufficient funds.
     On August 16, 1990, SFB issued a letter to Mr. Albright
informing him that the check for his premium was returned due to
insufficient funds and granting him fifteen days to make the
payment.  The letter also provided that, in the event the monthly
premium was not paid within fifteen days, Mr. Albright would be
required to pay the full annual premium.  On September 4, 1990, an
annual premium notice was prepared requesting payment of the annual
premium.  The premium was not paid.  On September 4, 1990, Mr.
Albright was admitted to a hospital where he remained until his
death on September 9, 1990.    
     A party moving for summary judgment must show that there is no
genuine issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.  Ark. R. Civ. P. 56(c). 
Pleadings, discovery responses, admissions, and affidavits, if any,
are to be considered in the light most favorable to the nonmoving
party.  Keller v. Safeco, 317 Ark. 308,