Hundley v. Metropolitan Life Insurance Co., 205 N.C. 780 (1934)

Jan. 24, 1934 · Supreme Court of North Carolina
205 N.C. 780


(Filed 24 January, 1934.)

Insurance R. c: M e — Where liability under policy begins six months after proof of disability action instituted prior thereto is premature.

Where an insurance policy provides for payments to insured according to the stipulations in the policy six months after receipt of due proof of insured’s disability as defined by the policy, a suit on the policy brought prior to the expiration of six months after the furnishing of due proof is premature and should be dismissed, and this result is not affected by insurer’s denial of liability on the ground that insured had not become totally and permanently disabled during the life of the policy.

Civil action, before Moore, Special Judge, at May Special Term, 1933, of ROCKINGHAM.

On 1 January, 1920, the Metropolitan Life Insurance Company issued a group one-year renewable term policy of insurance No. 726-G on the lives of employees of the Riverside and Dan River Cotton Mills, of Danville, Virginia. Sam II. Hundley, husband of the plaintiff, had been an employee of said mills for sometime and a serial certificate No. 6719 was issued to him as such employee. Mrs. Mamie Hundley, the plaintiff, was named beneficiary in the certificate. The master .policy was renewed from time to time until its cancellation on 31 August, 1930. Sam H. Hundley died on 24 May, 1931, and on 20 October, 1931, the plaintiff filed with the insurance company an affidavit reciting the death of said Sam II. Hundley, and that “for some years prior to 31 August, 1930, the said Sam H. Hundley had been in bad health and was only able to work intermittently, and that on or about 25 August, 1930, the said Sam H. Hundley had a severe attack and was unable to report for work two days during the week of 25 August, 1930, and that the said Sam H. Hundley became permanently disabled while in the employ of the Riverside and Dan River Cotton Mills before reaching the age of sixty. That ... he was permanently disabled to work and that he was thereby on or about 25 August, 1930, permanently, continuously and wholly prevented from pursuing any and all gainful occupation by reason of his then disabled condition,” etc. The defendant admitted that it had received this notice.

It was alleged in the complaint that the certificate held by the deceased was for the sum of $1,500, and the plaintiff asked to recover said sum with interest from 24 May, 1931.

The defendant admitted the issuance of the group policy and its renewal from time to time until the cancellation on 31 August, 1930, and also that the deceased employee held the serial certificate referred to. *781It denied that tbe employee bad ever been permanently and totally disabled during tbe life of tbe policy.

When tbe case was called for trial in tbe Superior Court tbe defendant demurred ore tenus upon tbe ground that tbe complaint failed to state a cause of action. Tbe trial judge witbbeld tbe ruling upon tbe demurrer and tbe trial proceeded. Tbe policies of insurance were offered in evidence and there was abundant testimony tending to sbow tbat tbe employee became totally and permanently disabled prior to tbe cancellation of tbe group policy, and was continuously disabled until the time of bis death on 24 May, 1931.

At tbe conclusion of plaintiff’s evidence the trial judge sustained a motion of nonsuit, and also tbe demurrer ore tenus.

From judgment so pronounced, tbe plaintiff appealed.

P. T. Stiers for plaintiff.

Smith, Wharton & Hudgins for defendant.

BeogdeN, J.

Tbe serial certificate issued to Sam H. Hundley by tbe defendant contained tbe following provision: “Any employee insured under this plan, who shall become wholly and permanently disabled while in our employ, before reaching tbe age of sixty, either by accident, injury or disease, and is thereby permanently, continuously and wholly prevented from pursuing any and all gainful occupation, will be regarded as a claimant by tbe Metropolitan Life Insurance Company. Six months after tbe receipt of due proof of such disability, tbe insurance company will begin making payments of tbe amount of insurance under any one of tbe following plans at tbe option of tbe person insured,” etc.

An analysis of tbe foregoing clause in tbe policy discloses tbat in order to recover, the plaintiff must offer competent evidence tending to show: (a) permanent disability as defined before age sixty; (b) due proof of such “disablement”; (c) tbat six months have elapsed since furnishing such proof, and tbat there has been a failure to pay. Tbe record discloses tbat summons was issued on 3 November, 1931. Tbe wording of tbe contract clearly specifies tbat tbe company shall not begin to make payments until six months after tbe receipt of tbe proof. Obviously, payment could not be enforced before tbe lapse of six months, and hence it follows tbat tbe action was prematurely brought. It is not deemed relevant to discuss tbe meaning of tbe six months’ clause or for what reason it was inserted in tbe contract. It is there in plain English. Nor is tbe fact tbat tbe defendant denied liability material for tbe reason tbat tbe parties bad contracted to postpone payments until six months after tbe receipt of proof.