Rideout v. Mars

Anderson, J.,

delivered the opinion of the court.

This is a hill by the appellant, W. “T. Rideout, as administrator of J. H. Rideout, deceased, against the appellee,-W. H. Mars; and from a decree in favor of the appellee,.the appellant prosecutes this appeal.

The decedent,- J. H. Rideout, as agent of the Union Central Life Insurance Company, effected a policy of insurance on the life of the appellee for twenty-five thousand dollars. The policy recites the payment of the first premium of nine hundred and fifty dollars. As a matter of fact, only three hundred dollars of this was paid. The decedent, for the purpose of inducing the appellee to take the insurance, with a view of promoting his own interest as a life insurance agent, by being able to show to others that he had written so large a policy, rebated to the appellee all of the first premium except three hundred,dollars, which appellant claims, under his contract of agency with the company, was its share of the premium; the balance being his commission. The appellee and his wife both testified (and the fact is undisputed) that the appellee was to pay and did pay only three hundred dollars of the first premium; the decedent giving him the balance. Cavett, the state agent for the Union Central Life Insurance Company, testified that the first premium was nine hundred and fifty dollars, of which his company’s share was three hundred dollars, which had been paid. However, he states, further, that decedent’s share of the first premium was only sixty per cent., which is less than the difference between three hundred and nine, hundred and fifty dollars. If the decedent was to, receive as his commission all of the premium except three hundred dollars, it is evident that it would amount to more than sixty per cent. We are therefore unable, from the record, to reconcile this testimony.

This suit was brought by the administrator of the decedent on the theory that the contract by which decedent rebated to the appellee his interest in the first premium *203 was void, because without consideration and against public policy. Section 2600, Code of 1906, is as follows: “No life insurance company doing business in Mississippi shall make any distinction or discrimination in favor of individuals of the same class and equal expectation of life in the amount of payments of premiums or rates charged for policies of life or endowment insurance, or in the dividends and other benefits payable thereon, or in any of the terms and conditions of the contract it makes, nor shall any such company or any agent thereof make any contract of insurance or agreement as to such contracts other than are plainly expressed in the application and policy issued thereon; nor shall any such company or agent pay or allow as inducements to insurance any rebate of premium payable on the policy or any special favor or advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or inducement whatever not specified in the policy contract of insurance. Whenever it shall appear to the satisfaction of the commissioner, after a hearing before him upon notice that any company, officer, agent, subagent, broker or solicitor has violated any provision of this section, he shall revoke the license of any such company or person to transact business in this state, and no other license shall be issued to any such company or person within one year after such revocation.”

The legislature, in passing this statute, recognized that a large and increasing proportion of the people of the state carry insurance on their lives, and that the companies engaged in the business of life insurance had been, and would probably continue, discriminating in favor of some of their patrons as against others. The purpose of the statute, as plainly expressed by its terms, is to secure to all persons equality in the burdens of, as well as in the benefits to be dérived from, life insurance. The paramount object is to conserve the public welfare. All persons of the same class and equal life expectancy *204 are to be treated exactly alike. Their contracts of insurance are to be the same. There is to be no difference, either in their premiums or in their dividends or other benefits. There is to be no contract except that expressed in the face of the application and. policy. No reduction or rebate is to be allowed-on any premiums. The public interest is made paramount to that of the individual.

The general rule undoubtedly, is that where parties are in pari delicto, the court will lend its aid to neither. However, there is a well-defined exception to that rule, which is that, where the paramount public interest demands it, the court will intervene in favor of one as ag’ainst the other. This principle is recognized in O’Connor v. Ward, 60 Miss. 1025 , where the court said: “But upon still another ground the demurrer should have been overruled. The rule appealed to by the defendant, that when parties are in pari delicto the court will lend its aid to neither, is subject to the exception that, where public interest requires its intervention, relief will be granted, though the result may be that the property will be resorted to, or a benefit derived by a plaintiff who is in equal guilt with the defendant.

In such cases the guilt of the respective parties is not considered by the court, which looks only to the higher right of the public; the guilty party to whom relief is granted being only the instrument by which the public is served. St. John v. St. John, 11 Ves. 535; Hatch v. Hatch, 9 Ves. 292; Morris v. MacCullock, 2 Eden 190; Roberts v. Roberts, 3 P. Wms. 65; Smith v. Bromly, Doug. 695; Browning v. Morris, Cowp. 790; Osborn v. Williams, 18 Ves. 379; W. v. B., 32 Beav. 574; Ford v. Harrington, 16 N. Y. 285 .”

The claim of the appellant is without any merit whatever, morally, because he is seeking to violate a contract made by his decedent. The interest of the general public, however, must prevail, which is that the appellee shall pay the same for his insurance as all others in his *205 class. The general good permits the estate of the decedent to receive something he was not morally entitled to, rather than appellee shall have insurance at a less premium than the uniform rate. According to the contract of insurance, the first premium was nine hundred and fifty dollars, which is the same rate all others in appellee’s class were required to pay." No other contract not expressed in the application or policy could be made. There was no consideration for the decedent’s agreement to rebate a' part of the premium. When the appellee accepted the policy, by virtue of the statute he agre'ed to pay, as the first premium, nine, hundred and fifty dollars. The law made him agree to pay that, whether he would or not. The courts will not hear any other contract than that written in the face of the application and the policy. The principle involved is analogous to that declared by the Supreme Court of the United States in T. & P. Ry. Co. v. Mugg, 202 U. S. 242 , 26 Sup. Ct. 628, 50 L. Ed. 1011 . It was held in that case that a contract between a common carrier and a shipper, by which the former agreed to ship goods for the latter at less than the rate fixed by the Interstate Commerce Commission, was illegal and void, and the carrier could recover from the shipper the difference between such contract rate and the legal rate, notwithstanding the contract, and whether the rate contracted for was known to the parties to be illegal or not. The principles involved in Bohn v. Lowery, 77 Miss. 426 , 27 South. 604 , and Woodson v. Hopkins, 85 Miss. 178 , 37 South. 1000 , 38 South. 298 , 70 L. R. A. 645, 107 Am. St. Rep. 275 , relied on by appellee, have no application to the facts of this case.

A decree would be entered here for the appellant, except for the apparent conflict in the testimony as to what was the decedent’s share of the premium. That this may be determined, the ease is reversed and remanded.

Reversed and remanded.