Anzano v. Metropolitan Life Ins. Co. of New York, supra. The burden is upon the party invoking the estoppel to prove all of the elements, and the failure to prove any one or more of them is fatal to this defense. Ibid. It is obvious that the Beneficiaries failed to sustain this burden.
It cannot be seriously urged that the Insured either had no knowledge of the facts or no opportunity to ascertain them. It seems reasonably clear that the Insured, as well as the Insurer, had knowledge, or was chargeable with knowledge, that the dividends purportedly available on Policy No. '587 had been previously applied to the payment of premiums on Policies Nos. '050 and '051, and were, therefore, not in fact available. But, even if we resolve this question in favor of the Insured and assume that he had no knowledge of the facts, it cannot be denied that he was afforded adequate opportunity to ascertain them and protect his rights under the policy. The Insurer, having discovered the mistake, informed the Insured of it on November 24, 1931 and again on December 5, 1931, and on each of these occasions requested a payment of the premium; the Insured, however, having thus acquired knowledge of the mistake, did nothing to protect his rights under the policy until on or about December 18, 1931, when he executed and delivered to the Insurer the note in question.
It is equally apparent that the failure of the Insured to pay either the premium or the note cannot be attributed to his alleged reliance on the receipt. This failure was due to either his inability to meet the payment or his gross negligence, and we are inclined to believe from the evidence before us that it was the former. The irremediable prejudice suffered by the Insured was due solely to his own conduct. The argument urged in the brief, that the Insured was illiterate and ignorant, is not supported by the evidence.
The Beneficiaries, invoking the statute,
R.S. 17:34-16, N.J.S.A. 17:34-16, the pertinent provisions of which are incorporated in section 3 of the policy, contend that the termination of the policy was illegal and void because of the failure of the Insurer to give the Insured notice of such termination, as required by the statute. The legal effect of the note is determinative of the question raised by this contention. If, as the Beneficiaries contend, the note evidenced a loan on the policy and a promise to repay it on or before the due date, January 4, 1932, the termination of the policy was illegal and void in the absence of the required notice; but if, as the Insurer contends, the note was an extension of time for the payment of the premium, the termination of the policy upon the Insured's default was legal and valid. Cf. Paul v. Columbian Nat. Life Ins. Co., infra. The answer to the question must be found in the agreement and the circumstances surrounding its execution.
The case upon which the Beneficiaries rely, Paul v. Columbian Nat. Life Ins. Co., 125 N.J.L. 350, 15 A.2d 636, is distinguishable from the present case on its peculiar facts. It appears from the facts recited in the opinion (1) that the insurer advanced to the insured a loan on the policy of insurance and accepted as security for its repayment an assignment of the policy; (2) that the agreement was the usual policy loan agreement in which the statutory provisions were incorporated; (3) that the loan value of the policy was not exhausted, although the premium due was slightly in excess of it; (4) that the insured, in addition to the policy loan agreement, executed and delivered to the insurer a promissory note for the balance of the premium; (5) that the provisions of the note, especially with reference to the required statutory notice, were in direct conflict with the provisions of the policy loan agreement. These facts clearly support the court's conclusion that the transaction represented a loan on the policy, and that a forfeiture was, therefore, prohibited in the absence of the statutory notice.
The facts in the present case will not support a conclusion that the note evidenced a loan on the policy. It is the opinion of the court that the note was an extension of time for the payment of the premium, and, upon the failure of the Insured to make such payment on or before the due date, January 4, 1932, the policy of insurance lapsed. Hudson v. Knickerbocker Life Ins. Co. of New York, 28 N.J.Eq. 167; Kansas City Life Ins. Co. v. Freeman, 5 Cir., 120 F.2d 106; State Life Ins. Co. v. Spencer, 5 Cir., 62 F.2d 640; Lincoln Nat. Life Ins. Co. v. Hammer, of Ft. Wayne, Ind., 8 Cir., 41 F.2d 12; Wastun v. Lincoln Nat. Life Ins. Co. of Ft. Wayne, Ind., 8 Cir., 12 F.2d 422; Lefler v. New York Life Ins. Co., 8 Cir., 143 F. 814; Robnett v. Cotton States Life Ins. Co., 148 Ark. 199, 230 S.W. 257; Cf. Thompson v. Insurance Company, 104 U.S. 252, 26 L. Ed. 765; Iowa Life Ins. Co. v. Lewis, 187 U.S. 335, 23 S. Ct. 126, 47 L. Ed. 204. A mere reading of the note in its entirety, without resort to a consideration of the facts and circumstances surrounding its execution, amply supports this conclusion. The intent of the parties is clearly expressed therein in the following language: 'That if this note is not paid on or before the day it becomes due, it shall thereupon automatically cease to be a claim against the maker, and said Company shall retain said cash as part compensation for the rights and privileges hereby granted, and all rights under said policy shall be the same as if said cash had not been paid nor this agreement made, except only that the time within which the owner may make a choice of benefits after lapse, as provided in said policy, is hereby extended for three months after the due date of this note, but no longer.' (Emphasis by the Court). It is reasonably clear that upon the failure of the Insured to pay the note at maturity, his liability thereon ceased and his rights under the policy terminated. This was undoubtedly the intent of the parties, as clearly expressed in their agreement.
Any doubt as to the nature of the transaction is dispelled upon consideration of the facts and circumstances surrounding it. These facts and circumstances are fully stated in the findings of fact and need not be repeated. There is nothing in either the note or the facts and circumstances surrounding its execution that supports the interpretation urged by the Beneficiaries.
The other arguments advanced by the Beneficiaries seem tenuous and, although fully considered, do not require discussion.
Conclusions of Law.
I. The payment of the premium in question was a condition precedent to the continuance of the policy and the right of recovery thereon. The policy lapsed upon the failure of the Insured either to make payment of the premium on or before the due date or within the period of grace, or to make payment of the note at or before maturity.
II. The premium note was in fact an extension of time for the payment of premium, and upon the failure of the Insured to pay the note at maturity, the policy lapsed.
III. The defendant was not estopped to deny payment.
IV. Judgment in favor of the defendant and against the plaintiff shall be entered forthwith.