Court Opinion

ID: 3931226
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:56:31.554619+00
Date Added: 2024-06-11T07:43:03.586362
License: Public Domain

The trial court correctly rendered judgment for defendant, regardless of jury findings because the material facts of this record are largely undisputed and conclusively demonstrate that no policy of insurance had ever issued on the life of plaintiff's husband or was in force at time of his death. These are the facts, stated in chronological order:
On September 12, 1942, Aurelio Vela made application to Southland Life Insurance Company through W. L. Scheig, a soliciting agent of the company at Robstown, Texas, for an ordinary life policy in amount of $5,000, to be issued on payment of quarterly premiums. In the application Vela stated his age as 41 years and birth date as April 20, 1901. Other provisions of the application contained the following: "(2) That the policy or policies issued in consequence thereof shall constitute the entire contract of insurance and the company shall not be bound in any way by any promise or statement made by or to any agent, or other person, unless such promise, statement, or information be reduced to writing and submitted to the company and made a part of the contract" (similar to Articles 4732 and 5063, Vernon's Ann.Civ.St.); "(3) That there shall be no liability hereunder until a policy shall be issued and manually delivered to me and accepted by me during my lifetime and continued good health, and the first premium thereon shall be actually paid to and accepted by the company or by its duly authorized agent * * *." This application was received by the home office at Dallas on September 16, 1942.
The company declined to issue a $5,000 policy, also to issue any policy upon the rate set out in the application, but, instead, issued a policy for $2,500, rated "Table B" which was a higher rate than requested. The policy so issued was numbered 260,555 (the one referred to in plaintiff's petition) and dated September 18, 1942. In part, the instrument stated: "This policy is issued at age forty-one in consideration of *Page 220 
the payment, in advance, of the quarter annual premium of Twenty Two and 33/100 Dollars and of the further payment of a like amount upon the 18th day of each September, December, March and June thereafter until the death of the insured." "In witness whereof, The Southland Life Insurance Company has caused this policy to be executed as of the 18th day of September, 1942, the date on which it becomes effective and from which Loan and Surrender Values will be computed." On other pages the policy provided in language of the statute that the same and application should constitute the entire contract between the parties, etc; also that "No agent is authorized to modify this policy or in the event of lapse to reinstate it or to extend the time for paying a premium. Only the President, Vice-President, Secretary, Actuary, or Assistant Secretary has the power on behalf of the Company to modify this or any contract of insurance and then only in writing at the Home Office of the Company, and the Company shall not be bound by any promise or representation heretofore or hereafter made by any other person."
Above policy was mailed about September 23, 1942, to Joe Kubena, a soliciting agent of Southland at Robstown, the accompanying invoice stating that unless the policy was delivered before October 23, 1942, it was to be returned for cancellation. Kubena's agency contract offered in evidence, included the provision: "It is agreed that under no circumstances shall a policy be delivered unless the applicant is in good health at the time of such delivery, and the first premium as required by the terms of the policy is duly settled for * * *"; further "* * * the Agent is not authorized to make, alter, or discharge contracts; to waive forfeitures, to name an extra rate for a special risk, nor to incur any liability or expense whatever on behalf of the Company."
According to Kubena, between date of receipt of the policy in September and October 19, he made several attempts to collect the first premium and effectuate delivery, but was unable to do so. In fact it was his testimony that the policy was never delivered, he allowing Mrs. Vela to have it only to "look over." Finally on October 19, Vela paid Kubena $5, taking the latter's personal receipt written on a piece of paper. Mrs. Vela (beneficiary and agent of deceased) testified that the policy was in her possession from October 19 to the 26th, but made no explanation as to why, under what condition, or for what reason it was left with her without payment of the monthly premium of $7.44. At any rate, on the latter date she paid Kubena $2.44, who receipted for the sum on another piece of paper. Testimony of Mrs. Vela is here quoted:
"Q. What happened on October 26, 1942? A. He went to collect from me the rest of the money.
"Q. Who is `he'? A. Joe Kubena.
"Q. And what happened at that transaction — what did he say to you, and what did you say to him? A. He sent for the money, and then I changed my mind, and instead of paying him three dollars — I mean for three months, I was supposed to pay for three months — I paid him two pesos and 44 centavos (meaning $2.44). * * *
"Q. Now, what did Mr. Kubena tell you would be necessary to be done with the policy, so far as the monthly payments were concerned — as to the monthly payments? A. He told me I could not hold the policy because it was to be paid differently — do you understand, Senor — it was to be paid differently. * * *
"Q. And did you give him the policy? A. Si, Senor, — yes.
"Q. What — what did he say he was going to do with the policy, if anything? A. He told me that he was going to return it to the company — do you see — Senor?
"Q. Did he say why he was returning it to the company, Mrs. Vela? A. Because he was arranging differently — the monthly payments — for the premium — do you understand me?
"Q. And now, Mrs. Vela, what did you tell him with regard to giving him the policy at that time — what did you say about the monthly payments — the monthly premium? A. I told him to bring me another policy. I told him that I had decided — that I had decide on a similar policy but which I would pay by the month, because it *Page 221 
seemed to me to be a little less money — do you see?"
On November 23, Kubena mailed the policy and money order for $7.44 to the home office, with letter reading: "Enclosed you will find my money order for $7.44 to change from quarterly to monthly basis policy No. 260555, Aurelio Vela." The letter and contents were received at Dallas November 25, the money never being credited to premium, but placed in a suspense account, Mr. Candler of the Policy Department promptly writing Kubena the following letter, dated November 30: "Dear Mr. Kubena: We are in receipt of settlement in the amount of $7.44, covering one monthly premium on the above numbered policy. The policy was returned to us with the request that it be reissued with mode of premium payment changed from quarterly to monthly. This policy was originally issued under date of September 18. If one monthly premium is applied on the policy, premiums would be paid until October 18 and the policy would now be in a lapsed state. However, no advance in the date of this policy can be made unless we receive correct evidence of health completed by Mr. Vela. The date of birth of this insured was given as April 20, 1901, on the original application. Any advance in the date of this policy beyond October 19, 1942, would cause a change in insurance age from 41 to 42. If the date of this policy is advanced to October 19 at insurance age 41, it will be necessary for us to have settlement covering another monthly premium to keep the re-issued policy out of its grace period when released. Please have the enclosed health certificate completed by Mr. Vela. If a policy dated October 19 at an insurance age of 41 is desired, settlement covering another monthly premium should accompany the enclosed health certificate. If a current dated policy at insurance age 42 is desired, no additional settlement will be required. Please advise us with regard to this matter when the completed health certificate is returned."
The next communication to the company was a post card from Aurelio Vela dated November 27, received at the home office November 30, saying: "Please write to me about my policy No. 260555 on which agent sent money some time ago." In response, Mr. Candler wrote Vela on December 4, stating in part: "Under date of November 30, we wrote our representative, Mr. Joe H. Kubena, at some length with regard to this policy, requesting that he discuss with you a proposed change. If Mr. Kubena has not yet seen you with regard to this matter, I am sure that he will within the next few days." Mrs. Vela testified that neither she nor her husband made any attempt to see Kubena with respect to this letter, because they had left Robstown about December 1st, going to San Antonio where they stayed until Vela's death on December 12. After receipt of the post card from Vela, Mr. Candler again wrote Kubena quoting the language of the post card and enclosing a copy of letter written to Vela of December 4th, stating further: "If you have not yet contacted Mr. Vela with regard to change outlined in our memo of November 30, please do so immediately."
On December 17, 1942 the company was advised by plaintiff of her husband's death; in answer, making an absolute and unequivocal denial of liability; at the same time writing Kubena of the facts, accompanied by check for $7.44, with instructions that it be returned to Mrs. Vela as a refund. She could not be located at that time, her attorneys much later declining to accept it. The company also made a formal tender.
Appellee heard nothing further in connection with the matter until nearly two years after the death of Vela (November 3, 1944), when it received a letter from appellant's counsel demanding full payment under the alleged policy. It is to be noted in this connection that the Velas did not furnish the health certificate referred to in Candler's letter of November 30; also that the policy was never changed at the home office, was never reissued as requested; and, in fact, the very policy (260,555) sued on, at all times after its return by Kubena, was retained in the files of the home office, stamped "Not Taken."
The facts as above narrated simply boil down to this: To Vela's application of September 18 for a $5,000 policy, premiums quarterly, the company made a counter proposal by issuing to him a $2,500 policy on a like basis. On Kubena's demand (about *Page 222 
October 26) for premium payment, the policy was returned to him with request for "another policy" with premium payable "differently" or monthly. Such request and policy being forwarded to the company, its letter of November 30 (of which the Velas had notice) outlined the conditions incident to issuance of a monthly payment policy, including requirement of a new health certificate. Thus the matter stood at Vela's death and, without necessity of argument, the conclusion irresistibly follows that no contract of insurance was thereby consummated.
But the majority holds in effect that in the deal between Kubena, soliciting agent, and Mrs. Vela there was a delivery of the policy, its return to Kubena for "another policy" being pursuant to a mutual understanding for a change to monthly payments; the instrument going back to the company for a rider to such effect, as mere office routine. No testimony is cited relative to such an understanding or agreement; appellant's counsel only contending in his brief that Mrs. Vela asked Kubena to have the policy changed, not that the agent had changed it himself. Whatever be the state of the record, however, any agreement on part of Kubena to effectuate the policy on a monthly basis becomes inmaterial in view of express provisions of the contract and familiar statutes. Arts 4732, 5063, Vernon's Ann.Civ.St. In Southland Life Ins. Co. v. Statler, 139 Tex. 496, 163 S.W.2d 623, 630, notwithstanding an agreement by the soliciting agent changing annual premiums to quarterly, redating of policy and acceptance of the quarterly charge with assurance to Statler that it was immediately in force, the Supreme Court held that no contract of insurance resulted, saying: "It is the settled law of this State that under the above statutes a mere soliciting agent of a life insurance company has no power or authority to make any contract on behalf of his company, or to waive the terms of the policy or the application therefor. (Citing authorities). From the very nature of its business, a life insurance company such as this ought to know what insurance risks it has assumed; and any rule of law which would permit a mere soliciting agent of such a company to put in force oral contracts of life insurance would result in intolerable conditions, and make it impossible for such companies to conduct their affairs in accordance with the numerous regulatory statutes of this State."
Next, and with all due respect, I emphatically disagree with the majority conclusion that the company "letter of December 4, 1942, addressed to Mr. Vela in regard to the policy, constituted an acknowledgment on behalf of appellee of the policy's validity and constituted an effectual ratification of Kubena's transactions in regard to the delivery of the policy and the charge in the method of paying premiums." The letter just referred to is incomplete except in connection with that of November 30 to which it had reference and, far from constituting any evidence of waiver, ratification or estoppel, the communication of November 30 specifically declined to make the change asrequested; notifying all parties of the conditions precedent to issuance of a monthly payment policy, a prime requisite being another and current certificate of health.
In Denton v. Kansas City Life Ins. Co., Tex. Civ. App. 231 S.W. 436, 441, a somewhat similar letter from the general agents of the company to a local agent was held competent and admissible, the court saying: "It was the contention of the appellant that delivery of the policy to the local agent was delivery to the insured, and it was permissible for the companyto show what were the instructions to its agents before it finallyaccepted the proposal and effected a delivery." (Emphasis ours.) In Southland Life Ins. Co. v. Statler, supra, numerous letters passing between the company and its soliciting agent were held to conclusively refute the contention that the company had authorized such agent to bind it to an oral contract of insurance or "to waive, change, or alter any of the terms or conditions of the application or the policy." See also Supreme Court opinions of Railway Mail, etc., Ass'n v. Henry, 143 Tex. 89,182 S.W.2d 798 and Great Southern Ins. Co. v. Peddy, 139 Tex. 245,162 S.W.2d 652.
Neither was the letter of December 4, standing alone, any evidence of waiver or ratification. Beaty v. Southland Life Ins. *Page 223 
Co., Tex. Civ. App. 28 S.W.2d 895; Texas Life Ins. Co. v. Mansel, Tex. Civ. App. 105 S.W.2d 899.
Without further discussion, this dissent is intended to include and fully concur in appellee's counterpoints 3 and 4, each of which presents a complete answer and defense to appellant's cause of action as pled. (3) "The trial court correctly entered judgment for appellee because appellant having elected to sue on an alleged written policy of insurance and the application therefor (stated to contain the entire contract between the parties) providing for quarter annual premium payments and an effective date of September 18, 1942, as a matter of law cannot recover on an oral contract allegedly providing for a monthly premium and a different effective date." (4) "The trial court correctly entered judgment for appellee because appellant's pleadings for the undisputed facts show that (a) the alleged policy, if it was ever effective, was effective as of September 18, 1942, the date stated on the face of the policy; and (b) only one monthly premium was paid; therefore, the policy had lapsed before December 12, 1942, the date of the death of Aurelio Vela."