Case Name: Kate O'Brien, as Administratrix, Respondent, v. The Prudential Insurance Co. of America, Appellant
Court: New York Court of Common Pleas
Jurisdiction: New York
Decision Date: 1895-04
Citations: 12 Misc. 127
Docket Number: 
Parties: Kate O’Brien, as Administratrix, Respondent, v. The Prudential Insurance Co. of America, Appellant.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 12
Pages: 127–131

Head Matter:
Kate O’Brien, as Administratrix, Respondent, v. The Prudential Insurance Co. of America, Appellant.
(New York Common Pleas
General Term,
April, 1895.)
To effect a cancellation of a policy which provides that the company may cancel it without notice in case of a default of payment of premiums some affirmative act on the part of the company is required.
In an action upon a policy of life insurance which is claimed by the company to have been canceled for nonpayment of premiums, the correspondence between the plaintiff’s attorney and the company in relation to the return of the plaintiff’s premium receipt book, which had been delivered to the company with the proofs of death, is competent to show that the book had been in the company’s possession for a certain length of time; that it was claimed to have contained certain entries, and that when it was returned the attention of the company was called to the fact that there appeared to be an erasure of such entries.
Appeal from a judgment in favor of plaintiff, entered upon the verdict of a jury, and from ap order denying a motion for a new trial.
The action was brought to recover on two policies of life insurance, each for $270, issued, respectively, March 7 and August 8, 1892, at a weekly premium of twenty-five cents each, on the life of John J. O’Brien, who died on December 7, 1893., The defense was failure to pay premiums for ten weeks up to November 23, 1893, when payment of the arrears was refused, and thereupon the policies were lapsed for such nonpayment. The jury found for the full amount of the policies.
Wm. 0. Campbell, for appellant.
Blackwell Brothers, for respondent.

Opinion:
Daly, Oh. J.
The question upon the appeal is one of fact, as to which the jury has found in favor of the plaintiff upon sufficient evidence. It is undisputed that the premiums were in arrears for ten weeks on November 23, 1893, when Zahner, the assistant superintendent of the company, called on Mrs. O'Brien. He was not the regular collecting -agent, but called because the premiums were long in arrears. The company had issued six or more policies on the lives of plaintiff's family; these two on her husband's life, one on her father's, and others upon other members of the family. Mr. Zahner asked what she could do that week; if she could settle her father's that week, or, in consequence of his age, it would be lapsed. She told him to come the following day, and then she settled eight weeks of arrears on her father's policy and asked him how much longer she could run on the other policies, to which he answered two or three weeks.
Within two weeks one of the collecting agents, named Pfennig, called and received five dollars and receipted for ten weeks' premiums for her husband's policies; this was the day before her husband died, and she had no knowledge, at the time of' the payment, that he was in danger of death. Such was the plaintiff's testimony, and although Zahner denied that he agreed to extend her time on the policies in suit, and testified that he notified her that they would be lapsed, he admitted receiving a part of the arrears on her father's policy, and that he "let it go" without canceling because she paid within a few weeks; and he admitted that he had authority to do that for the company. There was a dispute as to whether the five dollars paid to Pfennig on the sixth of December was tendered back to her shortly after the death of her husband or not until March 8, 1894.
There was a fair question for the jury upon the evidence as to whether Zahner had not extended the time of payment of the premiums of these policies for a period which had not expired when the insured died; and as to whether he was not duly authorized to do so. He swore that he had authority to extend the time upon her father's policy, and the verdict should not he disturbed upon that question. The question of fact was also submitted on the defense that the policies "were both duly lapsed " for the nonpayment of premiums.
Each policy provides that it shall be void if the premiums are not paid according to its terms; and provides that if, for any reason, the premium is not collected by the agent when due, it shall be the duty of the policyholder, before the said premium shall be in arrears four weeks, to bring or send said premium to the home office, or to the company's agent; and, in event of a failure to perform this duty, the company may cancel this policy without notice to any person or persons interested therein. This requires some affirmative act on the part of the company to effect a cancellation of a policy. Brady v. Prudential Ins. Co., 9 Misc. Rep. 6; 39 N. Y. Supp. 44.
It is claimed by defendant that cancellation was effected in this case on Bovember 27, 1893, which was before the death of the insured; that it was effected in the usual course of business in the following manner; a lapsed policy schedule was made out on Bovember 23, 1893, at the company's office, sighed by Pfennig as agent and Zahner as assistant superintendent, giving a list of six policies and the " Actual date of last payment shown in Policyholder's Beceipt Book " as October 23, 1893 ; that this schedule was sent to the home office of the company, where it was received on Bovember 24, 1893, and a " Lapse register," reciting the same facts as to last date of payment of premiums, returned to the agent. Documents bearing all the formal evidence of regularity were produced by defendant to show that this was done; and yet the uncontradicted evidence of the defendant's collecting agent, Pfennig, shows that the entry of payment of premium due October 23, 1893, was not written on the policyholder's receipt book, until December 6,1893, the date that he received the five dollars from Mrs. O'Brien and receipted in her book for it.
When the policyholder's book was returned by the company (to whom it was delivered immediately after the death of the assured) the last entry of payment of premiums appearing in it was for the premium due October 23, 1893; plaintiff testified that there were three subsequent entries of payments which Pfennig made on it when he received the five dollars on December sixth, and that they were rubbed out. Pfennig's entries at that time commenced October thirteenth, which paid the premium due September eleventh, and the last entry must have been of December sixth, paying the premium due November thirteenth. An erasure of the three last entries would leave the last payment as of October 23, 1893, four weeks prior to the date of the " Lapsed Schedule " of November twenty-third, and thus bring the .cancellation apparently within the terms of the four-weeks clause quoted above, though not so in fact, for the next payment would not be due until October thirtieth, and the four weeks would not be up on November twenty-third. In view of the evidence, amounting to demonstration, that the, defendant's documents were false, no court would disturb the finding of the jury against the claim that the alleged cancellation of the policy was effected before the death of the assured.
The defendant excepted to the admission of the correspondence between the company and the plaintiff's attorney with respect to his demands for the plaintiff's premium receipt book (which had been delivered to the company with the proof of death of the insured), and which plaintiff claimed had been altered by the erasure of the last three entries made by Pfennig. If the letters of plaintiff's attorney were offered as proof of the facts recited therein, they would have been inadmissible, so far as defendant's reply did not admit such facts and they were unsupported by the evidence in the case. Waring v. U. S. Tel. Co., 4 Daly, 233.
But the correspondence was material to show that the book had been in the possession of the defendant a certain length of time; that before it was returned the plaintiff's attorney claimed that it contained certain entries, and that when it was returned he called attention to the fact that there appeared to be an erasure of such entries. This evidence was material and competent to prove the time when the attention of both parties was directed to the condition of the book and when it was restored to the plaintiff's possession. As to the statement of fact in the letters that there were apparent erasures, the book itself was produced and the jury liad the best evidence upon that point, and the letters tended to show the erasures were not made after plaintiff regained possession of it. And nothing was stated in the letters that was not proved by competent evidence. The material fact stated, that the book originally contained entries of receipts by Pfennig which had been erased, was hardly a matter of dispute upon the evidence, Pfennig testifying: "I guess I credited the whole five dollars on that book," which would have required ten entries of fifty cents each, whereas the book showed but seven; and while he said: " There are none that are gone," he reiterated that he gave plaintiff receipts for five dollars on the same book on the same day. It clearly appears, therefore, that the defendant could not have been injuriously affected by the admission of the letters.
Judgment and order affirmed, with costs.
Bischoff and Pryor, J J., concur.
Judgment and order affirmed, with costs.