Court Opinion

ID: 9624678
Source: CourtListenerOpinion
Date Created: 2023-08-22 07:13:23.145151+00
Date Added: 2024-06-11T18:05:52.601128
License: Public Domain

Evans, Judge,
dissenting. The policy of insurance in this case provided for payment of premiums by a specified date, and for an additional grace period. However, immediately prior to death of the insured, the insurance company had been accepting monthly premiums at a later time than was allowed by the grace period. The policy had no language therein specifying the actual effect of failure to pay premiums promptly, simply stating: "Failure to pay any premium when due constitutes a default in premium.” It was not stated whether this suspended the insured’s rights to payment of benefits under the policy, or rendered the policy void, as is recited in many insurance policies. The evidence in this case shows a custom and course of dealing between the insurer and the insured whereby premiums were accepted after the expiration of the date of grace. The majority opinion relies upon the case of Gulf Life Ins. Co. v. Yearta, 63 Ga. App. 43, supra, as authority for a contrary finding. But the Yearta case, supra, was by a two judge court, one judge dissenting, and was directly in conflict with the earlier cases of National Life &c. Ins. Co. v. Lain, 51 Ga. App. 58 (2) (179 SE 751) and Sovereign Camp W. O. W. v. Milton, 51 Ga. App. 301 (2) (180 SE 253). Under the rule of stare decisis the earlier precedent is binding and must be followed and this is especially true where the more recent case relied on is by a divided court.
The majority opinion suggests that the language in the contract of insurance which stated "that only the president, vice-president or secretary had the authority to waive, change or alter any conditions of the policy and then only in writing,” rendered the insurance company’s agent impotent to bind the company by a course of dealing in collecting the premiums after the grace period had expired. But, as was held in Adams v. Washington Fidelity Nat. Ins. Co., *6848 Ga. App. 753 (1) (173 SE 247), despite such language "the provisions of the policy may be changed by the conduct of the company, through its authorized agents, amounting to a waiver of the provisions of the policy, which, when accepted and acted upon by the insured, amount to a change of the contract. A provision of a policy may be altered by a course of dealings between the insurer, through its authorized agent, and the insured, which amounts to a waiver of a deviation from its terms.” The second headnote of the Adams case, supra, is almost on all-fours with the case sub judice as to the facts respecting the collection of premiums.
It is important to note that the policy of insurance in the case sub judice had no language therein as to the effect of default in paying premiums, simply stating: "Failure to pay any premium when due constitutes a default in premiums.” In this connection, Life Ins. Co. of Va. v. Wood, 101 Ga. App. 661, 662 (115 SE2d 240) held: "While it is true that where a policy of insurance . . . requires, on pain of forfeiture, that payment be made in a certain way, and payment although made is not made in that way, a forfeiture may result, yet the language of insurance policies must be construed in favor of the insured and a forfeiture will never be presumed, but must be spelled out in precise language or the mere noncompliance with the policy provisions will not forfeit a policy.” (Emphasis supplied).
The majority opinion cites Sovereign Camp W. O. W. v. Hart, 187 Ga. 304 (200 SE 296), but that case is readily distinguishable from the case sub judice, in that same was a fraternal benefit association wherein the certificate very specifically spelled out that "if the member fails to make any such payment (of dues or assessments) on or before the last day of the month he shall thereby become suspended; his beneficiary certificate shall be void.” Justice Duckworth, speaking for the court states (p. 309): ". . . it may be stated as a general rule that where an insurer, by his custom and course of dealing with the insured, in receiving without objection premiums and assessments past due, *69when he could have insisted upon a forfeiture of the policy, has induced the belief on the part of the insured that premiums or assessments will be received by the insurer within a reasonable time after their maturity, the insurer cannot subsequently claim a forfeiture of the policy because another premium or assessment was not paid on the date due, the payment being made within a reasonable time thereafter.” (Emphasis supplied).
I would affirm the lower court in refusing to grant defendant’s motion for summary judgment.