Court Opinion

ID: 7164676
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:19:45.725314+00
Date Added: 2024-06-11T16:15:29.961010
License: Public Domain

On Rehearing.
LAND, J.
Plaintiff’s right to recover is •dependent on her maintaining the contention that the policy sued on was in full force and effect when the assured died, on December 30, 1900. The policy was issued on December 24, 1894, and was assigned to plaintiff on November 16, 1897.
The initial premium and the annual premiums maturing in 1895 and 1896 were paid. No other premiums were paid.
Plaintiff admits that she paid none, but testified that she received no notices that the premiums were to become due or were in arrears.
Hence her case rests on the assumption that the policy continued in force, though no premiums were paid after the year 1896.
Under the terms of the policy sued on, it was rendered null and void by the neglect to pay the premiums as they became due, and it was further stipulated that the policy should not be binding on the company “Until the amount of premium as stated therein shall be received by said company or some authorized Agent thereof, during the lifetime of the Party therein assured.”
Hence the mere execution of the. policy in the state of New York did not bind the company, and the contract was perfected by the payment of the initial premium by the assured to an agent of the company in the state of Louisiana.
The receipt covering the first premium stated that “this receipt to be valid must be countersigned by the agent receiving the premium,” and it was countersigned by the agent in New Orleans.
The New York insurance laws provide that no life insurance company doing business in the state of New York shall have the power to declare forfeited or lapsed any policy hereafter issued or renewed by reason of nonpayment of any annual premium or interest, or of any portion thereof, except as specially provided therein.
The provision referred to requires written or printed notice, stating amount of premium or interest due, the place of payment, and the person to whom payable, to be mailed to the address of the assured or the assignee.
In the case of Insurance Co. v. Cohen, 179 U. S. 262, 21 Sup. Ct. 106, 45 L. Ed. 181, the court held that the statute of New York does not apply to a policy issued by a corporation of New York in another state, in favor of a citizen of the latter state) but is applicable only to business transacted in the state of New York.
The court said:
“The insurance policy contained a stipulation that it should not be binding until the first premium had been paid and the policy delivered. The premium was paid and the policy delivered in the state of Montana. Under these circumstances, under the general rule, the contract was a Montana contract, and governed by the laws of the state.”
After discussing the insurance statute of New York, the court further said:
*891“These considerations lead to the conclusion that the statute of New York, directed as it is to companies doing business within the state, was intended to be, and is in fact, applicable only to business transacted within that state.”
The Supreme Court of the United States decided the Cohen Case on two propositions of law, to wit, first, that the place of the contract was where the premium was paid and the policy delivered; and, secondly, that the New York statute had no application to business transacted out of that state. Citing Assurance Society v. Clements, 140 U. S. 226, 11 Sup. Ct. 822, 35 L. Ed. 497, as to the place of the contract.
May on Insurance says: “And if the policy be sent to the agent for delivery on receipt of the premium the contract is completed at the agency.” Id. § 66.
The policy sued on was a Louisiana contract, since by its terms it was not binding on the company until the premium was received and the premium was paid to its agent in Louisiana, who thereupon countersigned the receipt and delivered the policy to the assured.
It- is, therefore ordered, adjudged, and decreed that our former judgment rendered herein be reinstated as the decree of the court.