Case Name: RACHEL OWENS, Administratrix, v. NORTH STATE LIFE INSURANCE COMPANY et al.
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1917-04-18
Citations: 173 N.C. 373
Docket Number: 
Parties: RACHEL OWENS, Administratrix, v. NORTH STATE LIFE INSURANCE COMPANY et al.
Judges: 
Reporter: North Carolina Reports
Volume: 173
Pages: 373–377

Head Matter:
RACHEL OWENS, Administratrix, v. NORTH STATE LIFE INSURANCE COMPANY et al.
(Filed 18 April, 1917.)
1. Insurance, Life — Premium Jiotes — Payment—Stipulations.
Tlie stipulation on tlie form of note given for a premium of life insurance that the policy shall be void if the note is not paid at maturity is a valid one, and a recovery on the policy contract will be denied when the note has not been paid accordingly, unless the insurer has waived this provision.
2. Insurance, Life — Premium Jiotes — Interest.
A premium note for life insurance at 6 per cent interest draws that rate from its date unless otherwise specified (Rev., sec. 1915).
3. Same — Tender—Grounds for Refusal.
Where the money for the face value of a premium note without interest from its date has been tendered the' insurer, before maturity, who refuses to receive it, stating that the insured, who was then sick, must first get well enough to come and arrange it himself, the failure to tender the interest on the note as well as the principal will not avail as a defense for the insurer, in an action against it upon the policy since matured by the death of the insured, the refusal being based upon an entirely different statement.
I. Insurance, Life — Forfeiture—Premium Jiotes — Tender—Judgments — Deduction.
A valid tender made for the payment of a premium note for life insurance before its maturity is for the purpose of saving a forfeiture, and when refused by the insurer it is not required to be kept good pro Jiao vice,. in the sense that the money must always be ready and available, as in cases where the stopping of interest or court costs, etc., are involved; and it is sufficient if the principal of the note and proper interest is deducted from the amount of the recovery on the policy in the Superior Court.
r>. Judgments — Verdict—Interpretation — Insurance, Life — Premium Note— Tender.
While the verdict of the jury must, as a general rule, establish the facts required to support the judgment, it may be interpreted and allowed significance by reference to the pleadings, testimony, and charge of the court; and where upon an issue as to tender of payment for a premium note for life insurance the jury has responded “Yes,” and in the principal sum of the note, leaving off 65 cents interest, and in applying the principle referred to: Held, the verdict was sufficient to support a judgment in the plaintiff’s favor, especially as the issue was inadvertently answered under the direction of the court.
6. Insurance, Life — Forfeiture—Jiotes—Statutes.
Semble, our statute, Gregory’s Supplement, 4779a, would prevent a forfeiture under a life insurance policy, within a year, under the circumstances of this case.
Civil actiow, tried before Winston, J., and a jury at October Term, 1916, of OuMberlaND.
The action was to recover' the amount of an insurance policy for $1,000 issued by the company on James Holiday Owens, husband of administratrix. It was proved or admitted that such a policy was issued on 23 August, 1915, the company taking a note for premium, $42.37, payable 1 November, 1915, said note containing the specification, “at the rate of 6 per cent per annum,” and the stipulation, further, that the policy should become “null and void” if the note was not paid at maturity. That payment of the note had been postponed by agreement to 1 'December, 1915; that in latter part of November, 1915, the insured was taken ill with pneumonia, and died therefrom on 6 December, 1915.
Plaintiff alleged and testified that about 1 December, 1915, or just before, by direction of her husband, she brought the money for the premium note to the officers of the company and offered to pay same to the general manager, telling him that her husband was sick at home at the time; that the officer refused to receive the money, saying that “her husband would have to wait till he got well and come and see about it himself, etc., and witness then put the money in one of the banks of the city. There was evidence also offered to show that there was a deposit in the bank for James Holiday Owens of $70 on 27 November, 1915.
Defendant company denied liability, claiming that the policy was forfeited by reason of nonpayment of the premium note, and in support of the plea the manager testified that plaintiff had never made any tender of thisl $42.37 nor had ever been tó his office when he was there, and that she had never seen him at any time before the trial.
On issues submitted the jury rendered the following verdict:
Did Rachel Owens, for her husband, James Holiday Owens, tender to the defendant company or to its agents prior to 1 December, 1915, any sum of money in payment of the premium note due 1 December, 1915; and if so, what sum did she tender? Answer: “Yes; $42.37.”
Judgment on the verdict for plaintiff, and defendant excepted and appealed.

Opinion:
IloKE, J.
Both the policy and the premium note contain the provision that the contract of insurance shall be null and void unless the premium note is paid, and our cases hold that such-a stipulation is valid, and unless the note is paid as promised, or the payment is in some way waived by the company, a recovery on 'the policy cannot be had. Murphy v. Ins. Co., 167 N. C., 334. In that ease the position as it prevails in this jurisdiction is stated as follows: "The delivery of a life insurance policy absolute and unconditional is a waiver of tbe stipulation for a previous or contemporaneous payment of tbe first premium; and where tbe insurer bas received tbe insured's note' for tbe payment of tbis premium upon condition tbat tbe policy shall be avoided unless tbe note is paid at maturity, tbe condition will be upheld unless tbe time for its payment bas been postponed by valid agreement or tbe stipulation, made for tbe benefit of tbe company, bas in some way been waived by it, or tbe company bas so acted in reference to tbe matter as to induce tbe policyholder, in tbe exercise of reasonable business prudence, to believe tbat prompt payment is not expected and that for-, feiture on tbat account will not be insisted upon."
It was objected for defendant (1) tbat tbe tender of tbe premium note, established by tbe verdict in tbis instance, will not avail tbe plaintiff for tbe reason tbat it was not for tbe full amount, as, per contract, tbe note bore interest from date. (2) Tbat tbe tender was not kept good.
Under our statute, Revisal sec. 1952, tbis note, we think, bore interest from date. "While a note for tbe payment of money ordinarily draws interest from tbe time it is due, tbis statute enacts that "When an instrument provides for payment of interest without specifying tbe date from which it runs, it draws interest from date," and tbe stipulation in tbe note, "at tbe rate of 6 per cent," is a sufficient expression to bring •the same within tbe statute, and tbe tender in the exact terms of tbe issue is not a valid tender, in tbat it did not include the interest; but it is well understood tbat when a tender is made, purporting to be tbe full amount, and there is an absolute refusal to accept on a specified ground that is untenable, tbe obligee is concluded and will not be beard to allege other and different ground for bis refusal. Moynahan v. Moore, 9 Mich., 9; Brady v. Wells, 88 Neb., 554; 3 Elliott on Contracts, sec. 1971; 3 Paige on Contracts, sec. 1426. In Moynaharis case it was held: "that objection made at tbe time of tbe tender precludes all others, and if tbat is not well grounded the tender will be held good." In Brady v. Wells: "When a tender is refused without objection to tbe sufficiency of tbe amount, but on other grounds, tbe tender will be considered waived." On the facts in evidence and as accepted by tbe jury, this tender was refused on the ground tbat "insured would have to wait till he got well and could come and see about it himself," and it is not now open to defendant to maintain that the interest, about 60 cents at most, was not included in tbe amount. And as to tbe second reason, tbat tbe tender was not "kept good": Tbe usual office of a tender is to stop interest and save costs,, and when it is relied upon for such purpose it must be "kept good," and in case of suit instituted it is usually required that tbe sum admitted to be due shall be paid into court. Parker v. Beasley, 116 N. C., 1. But tbe principle bas no necessary application when, under tbe stipulations of .a contract, a tender is required to save a forefeiture. When such a tender is once properly made within tbe time, and refused, it fills its purpose and pro hac vice tbe alleged forfeiture is prevented. Rosenweig v. Kalichman, 106 N. Y., Supp., 860; Parker v. Gurtatowki, 129 Ga., 623; Ashley v. Telephone Co., 25 Mont., 286; Travelers Ins. Co. v. Pulling, 159 Ill., 603; 28 A. and E. Enc. (2d Ed.), p. 40, citing Denison v. Mason's Accident Ins. Co., 59 N. Y., App. Div., 294.
A like principle prevails here and elsewhere when a proper tender is made of a debt secured by a mortgage on property. Such a tender relieves tbe encumbered property; it is held to satisfy tbe conditions of tbe mortgage, and thus prevents a foreclosure.
Intestate, therefore, was not bound to keep tbe tender good in tbe sense that be should always have tbe money in evidence. Tbe forfeiture was prevented when be made tbe proper tender within tbe time or such tender was waived by tbe company, and tbe insured having died before any other premium became due, plaintiff's recovery on tbe policy will be sustained.
As a matter of fact, tbe attempted forfeiture for nonpayment of this note being unavailing for tbe reasons stated, and intestate having meantime died, bolding a valid policy against tbe company, there was no obligation to make further tender. When be undertakes, however, to seek affirmative relief on tbe policy by reason of this tender, be is required to "keep it good" in tbe sense that tbe court will reduce the policy by the amount of tbe premium due. To that extent be is required to keep bis tender good, and, on tbe facts presented, this is tbe correct significance of tbe term, and tbe position bas been allowed defendant in tbe judgment rendered.
It is earnestly urged that while tbe verdict shows a tender of the principal sum, tbe facts on which tbe alleged waiver is based, are not established by tbe verdict, and for that reason a new trial should be awarded; but, on the record, this objection also must be overruled.
It is well understood here that while a verdict must by a general rule establish tbe facts required to support tbe judgment, such verdict may be interpreted and allowed significance by reference to the pleadings, tbe testimony, and tbe charge of tbe court. Reynolds v. Express Co., 172 N. C., 487.
In tbe present case plaintiff claimed and testified that she tendered tbe amount of tbe premium note to tbe general manager of tbe defendant company prior to tbe time it was due under tbe existent agreement, and tbe tender was refused on tbe ground tbat tbe busband was then sick and would have to get well and make tbe tender in person. Defendant alleged and testified that no tender whatever w,as made, and tbat be bad never seen tbe plaintiff before in bis life. His Honor fully stated these opposing positions, and by reference to tbe testimony, tbe argument, and tbe charge it is olear tbe jury have accepted tbe plaintiff's version of tbe occurrence, to wit, tbat a tender was made and refused on tbe ground stated. Indeed, tbe issue and verdict established tbe tender of tbe amount of tbe premium note, and tbe amount, $42.37, fixed in response to a positive direction of tbe court to tbat effect, was evidently an inadvertence of tbe judge, and should not be allowed to destroy tbe effect of tbe tender. If there was room for difference about tbat small amount of interest — 65 cents, at most — it would seem tbat our statute, Gregory's Supplement to Pell's Eevisal, sec. 4779a, would prevent a forfeiture within a year unless tbe claimant was properly informed of tbe exact amount due, where it should be paid, and to whom payable.
Considering tbe facts in evidence, we have no hesitation in bolding tbat on tbe verdict, correctly interpreted, there has been no forfeiture of tbe policy, and the judgment for same, less the unpaid premium, must be affirmed.
No error.