Appeal from the District Court of the United States for the Northern District of Illinois, Eastern Division; Phillip L. Sullivan, Judge.
Before MAJOR, KERNER, and MINTON, Circuit Judges.
Plaintiff sued defendant to recover upon a policy issued upon the life of James E. Rintoul, her husband. The case was tried by the court who made special findings of fact, pronounced its conclusions of law thereon, and rendered judgment in favor of defendant. Plaintiff appealed.
The policy involved was issued on June 25, 1931, plaintiff being named as beneficiary therein. The policy was delivered to the insured who paid the first semiannual premium, thus continuing the policy in force (including the period of grace) until January 25, 1932. No other premium was ever paid. The policy contained certain provisions for waiver and for payment of disability benefits.
Plaintiff claimed that insured became totally disabled on July 26, 1931, but lacking knowledge of the existence of the policy and because of insured's total and permanent mental and physical disability, it was not reasonably possible to give notice of disability within the time required by the policy, and that as soon as it was reasonably possible so to do, plaintiff, on June 7, 1935, gave written notice of insured's total disability. Insured died on June 21, 1935. Suit was commenced in 1941.
Defendant, in support of the judgment, insists that insured was required to file written notice of claim within one year of the due date of the first premium in default. On the other hand, plaintiff, in arguing for a reversal, contends that insured was entitled to a waiver of premiums because of insured's total and permanent disability in July, 1931. In other words, that it is the fact of disability - and not proof thereof - which entitles plaintiff to recover.
In the District Court and here, defendant questioned that insured was totally disabled in July, 1931, or at any time prior to his death. In our disposition of the case we shall assume, but not decide, that insured was totally disabled, since we believe that to arrive at a decision we have but to examine and consider the provisions of the policy.
The pertinent provisions of the policy relating to the waiver of premiums are as follows:
"1. Waiver of Premiums. - The Company will waive the subsequent premiums, if any, as they shall become due during the continuance of such disability beginning with the premium the due date of which next succeeds the date of commencement of such disability; provided, however, that no premium shall be so waived the due date of which is more than one year prior to the date of receipt at the Head Office of the Company of written notice of claim * * *.
"2.Monthly Income. - The Company in addition will pay, during the continuance of such total disability, to the assured or, if such disability is due to or accompanied by mental incapacity, to the beneficiary under the policy, a monthly income of one per cent of the face amount of the policy for each completed month of such disability beginning with the fourth such month and ceasing with the last payment preceding the maturity of the policy; * * *.
"Premium in default at time claim is made.
"If any premium on said policy is in default at the time written notice of claim is received by the Company at its Head Office, the above benefits will not be granted unless such notice is so received within one year of the due date of the first premium in default and unless the total disability for which claim is made commences either prior to the due date of the first premium in default or within the days of grace of the first premium in default * * *."
Contracts of insurance, like other contracts, must be construed according to the terms which the parties have used, to be taken and understood, in the absence of ambiguity, in their plain, ordinary and popular sense, Bergholm v. Peoria Life Ins. Co., 284 U.S. 489, 52 S. Ct. 230, 76 L.Ed 416 and while the failure to give notice or to make proof within a specified time in accordance with the terms of a policy, as a general rule, does not operate as a forfeiture of the right to recover, yet where the policy in express terms makes the giving of notice a condition precedent, a failure to comply with the terms of ...