Case Name: John J. Brady, as Administrator, etc., Resp't, v. The Prudential Insurance Company of America, App'lt
Court: New York Court of Common Pleas
Jurisdiction: New York
Decision Date: 1894-06-04
Citations: 59 N.Y. St. Rep. 659
Docket Number: 
Parties: John J. Brady, as Administrator, etc., Resp’t, v. The Prudential Insurance Company of America, App’lt.
Judges: 
Reporter: New York State Reporter
Volume: 59
Pages: 659–659

Head Matter:
John J. Brady, as Administrator, etc., Resp’t, v. The Prudential Insurance Company of America, App’lt.
(New York Common Pleas, General Term,
Filed June 4, 1894.)
Insurance—Life—Cancellation of policy.
A provision in a policy that, in default of payment of premiums when due or within four weeks thereafter, the company should be at liberty to cancel the policy without further notice, implies that, until affirmative action is taken, the policy is to remain in full force and effect.
Appeal from a judgment of the district court in the city of New York, for the fifth judicial district, rendered by the justice, without a jury, in favor of the plaintiff. Action to recover upon a policy of life insurance.
William 0. Campbell, for app’lt; James A. Donegan, for resp’t.

Opinion:
Bischoff, J.
The policy sought to be enforced in this action was one issued upon payment of weekly premiums and concededly the last premium was paid June 6th, 1892. The insured died August 9th, 1892 without having tendered the premiums in arrear; nor were such premiums tendered to the defendant Company at any time after the insured's death. The main question litigated in the court below was whether, or not, the policy was in force at the time of the insured's death. The policy expressly provided, among other things, that payment of the weekly premiums should be made on Monday of each week to the Company's collector, but that if any premium should remain uncollected on the day of maturity it should be incumbent upon the insured to pay the premium at the Company's Home-office, or to its authorized agent, within four weeks thereafter, in default of which the company should be at liberty to cancel the policy without further notice. The defendant did not cancel the policy until August 15th, 1892, six days after the insured's death. We are of the opinion that the foregoing provisions of the policy fairly imply that affirmative action was to be taken by the defendant company to cancel the policy and that until such action be had the policy was to remain in full force and effect. Cook on Life Ins. § 98, p. 181; Scheu v. Grand Lodge Independent Forresters, 17 Fed. Rep. 214. Until such affirmative action was had the insured could not have successfully resisted payment of the defaulted premium if such payment was insisted upon by the defendant. It was optional with the defendant to cancel the policy. Hence the insured was in no position to urge as a defense to a demand for payment of the premium that the contract of insurance had expired. Accordingly the policy must be deemed to have been in force at the time of insured's death, when it matured, and the beneficiary's right to payment of the sum insured accued. The subsequent attempt of the defendant to cancel the policy could not enable it to escape liability. The conclusion reached renders futile any discussion of the question whether, or not, the policy in question is affected by the provisions of chap. 341, Laws of 1876, as amended by chap. 321, Laws of 1877.
The judgment should be affirmed, with costs.
Giegerich, J., concurs.