A-12224, FEBRUARY 1, 1926, 5 COMP. GEN. 564

A-12224: Feb 1, 1926

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INSURANCE - REINSTATEMENT WHERE AN APPLICATION FOR REINSTATEMENT OF TERM INSURANCE IN DUE FORM AS PRESCRIBED BY THE REGULATIONS OF THE VETERANS' BUREAU IS DEPOSITED IN THE UNITED STATES MAIL IN THE LIFETIME OF THE INSURED. THE FACT THAT THE ENVELOPE CONTAINING THE APPLICATION AND NECESSARY PREMIUMS TO EFFECT REINSTATEMENT WAS RETURNED FOR POSTAGE BY THE POSTAL AUTHORITIES. THE FACTS IN THE CASE ARE AS FOLLOWS: ROGER W. HE WAS DISCHARGED FROM THE SERVICE JUNE 17. WAS EACH TIME. PREMIUMS WERE PAID TO INCLUDE THE MONTH OF MARCH. WHO IS THE BENEFICIARY OF THE POLICY. FENLAW WHICH SHOWS THAT HE WAS ACCIDENTALLY DROWNED. WHICH SHOW THAT THE INSURED'S CONDITION OF HEALTH WAS EXCELLENT UP TO THE DATE OF HIS DEATH.

A-12224, FEBRUARY 1, 1926, 5 COMP. GEN. 564

VETERANS' BUREAU, INSURANCE - REINSTATEMENT WHERE AN APPLICATION FOR REINSTATEMENT OF TERM INSURANCE IN DUE FORM AS PRESCRIBED BY THE REGULATIONS OF THE VETERANS' BUREAU IS DEPOSITED IN THE UNITED STATES MAIL IN THE LIFETIME OF THE INSURED, THE FACT THAT THE ENVELOPE CONTAINING THE APPLICATION AND NECESSARY PREMIUMS TO EFFECT REINSTATEMENT WAS RETURNED FOR POSTAGE BY THE POSTAL AUTHORITIES, DOES NOT PRECLUDE CONSIDERATION OF THE APPLICATION FOR REINSTATEMENT LATER FORWARDED TO THE VETERANS' BUREAU SUBSEQUENT TO THE DEATH OF THE INSURED, BUT THE INSURANCE MAY BE CONSIDERED AS HAVING BEEN REINSTATED AND PAYMENTS THEREUNDER AUTHORIZED, IF THE EVIDENCE OF RECORD ESTABLISHES THE VALIDITY OF THE APPLICATION FOR REINSTATEMENT.

COMPTROLLER GENERAL MCCARL TO THE DIRECTOR, UNITED STATES VETERANS' BUREAU, FEBRUARY 1, 1926:

CONSIDERATION HAS BEEN GIVEN YOUR LETTER OF DECEMBER 5, 1925, PRESENTING A MATTER AS FOLLOWS:

THERE HAS BEEN PRESENTED TO THIS BUREAU FOR PAYMENT ON AN INSURANCE CONTRACT THE CLAIM OF MRS. BIRDIE FENLAW, BENEFICIARY OF THE YEARLY RENEWABLE TERM INSURANCE ISSUED TO THE LATE ROGER W. FENLAW.

THE FACTS IN THE CASE ARE AS FOLLOWS:

ROGER W. FENLAW, WHILE A MEMBER OF THE ACTIVE MILITARY SERVICE, APPLIED FOR $10,000 WAR-RISK INSURANCE. HE WAS DISCHARGED FROM THE SERVICE JUNE 17, 1919, THE LAST PREMIUM BEING DEDUCTED ON THE MAY 19, 1919, PAYROLL. THE INSURANCE FROM TIME TO TIME LAPSED FOR NONPAYMENT OF PREMIUMS SUBSEQUENT TO THE DATE OF DISCHARGE AND ON SUCH OCCASIONS, WITH THE EXCEPTION OF THE INSTANCE NOW IN CONTROVERSY, WAS EACH TIME, UPON APPLICATION, DULY REINSTATED. ON JUNE 22, 1920, HE MADE A FORMAL APPLICATION FOR A CHANGE OF BENEFICIARY OF HIS INSURANCE TO HIS WIFE, MRS. BIRDIE FENLAW. HE ALSO REQUESTED THAT THE RECORDS OF THE BUREAU BE CORRECTED TO SHOW HIS NAME AS FENLAW INSTEAD OF FENLOW. PREMIUMS WERE PAID TO INCLUDE THE MONTH OF MARCH, 1923. THE INSURED DIED JUNE 19, 1923. THE WIDOW, WHO IS THE BENEFICIARY OF THE POLICY, HAS FORWARDED A CERTIFICATE COPY OF THE PROCEEDINGS OF AN INQUEST IN CONNECTION WITH THE DEATH OF MR. FENLAW WHICH SHOWS THAT HE WAS ACCIDENTALLY DROWNED. SHE ALSO SUBMITTED AFFIDAVITS OF ONE JOHN A. DAVENPORT AND HARRY A. LOGSDON, M.D., WHICH SHOW THAT THE INSURED'S CONDITION OF HEALTH WAS EXCELLENT UP TO THE DATE OF HIS DEATH. THE WIDOW, IN ADDITION TO THE ABOVE, SUBMITTED AN AFFIDAVIT IN WHICH SHE STATES THAT AFTER THE DEATH OF HER HUSBAND SHE FOUND AMONG THE MAIL AT HIS OFFICE A SEALED ENVELOPE ADDRESSED TO THE VETERANS' BUREAU UPON WHICH WAS STAMPED THE FOLLOWING: "RETURNED FOR POSTAGE.' THIS SEALED ENVELOPE SHE DID NOT OPEN, BUT FORWARDED THE SAME IN ANOTHER, BUT LARGER ENVELOPE, BY REGISTERED MAIL TO THE BUREAU. THE ENVELOPE FIRST REFERRED TO WAS UNOPENED WHEN RECEIVED IN THE BUREAU. THE UPPER RIGHT HAND CORNER OF THE ENVELOPE THERE IS A SMALL SQUARE WITH MUCILAGE ON IT. THERE IS ALSO IN THIS UPPER RIGHT HAND CORNER A CANCELLATION STAMP. THE ENVELOPE CONTAINED AN APPLICATION FOR REINSTATEMENT, WITH THE NAME OF THE INSURED SIGNED IN THE LOWER RIGHT HAND CORNER, AND WAS DATED JUNE 14, 1923. THIS APPLICATION IN THE LOWER LEFT HAND CORNER CONTAINS THE SIGNATURE OF WADE SWIFT, AS WITNESS. IN THE ENVELOPE WERE TWO CHECKS DRAWN TO THE ORDER OF THE TREASURER OF THE UNITED STATES, EACH IN THE AMOUNT OF $7.30. THE CANCELLATION STAMP BEFORE REFERRED TO ON THE UPPER RIGHT HAND CORNER OF THE ENVELOPE CONTAINS THE DATE, JUNE 14, 1923, THIS PART OF THE STAMP BEING UPSIDE DOWN AS WELL AS THE STAMP WHICH STATES THE ENVELOPE IS RETURNED FOR INSUFFICIENT POSTAGE. THE CIRCUMSTANCES SURROUNDING THE SIGNING OF THE APPLICATION FOR REINSTATEMENT UNDER DATE OF JUNE 14, 1923, AND THE MAILING THEREOF ARE SHOWN IN THE VARIOUS AFFIDAVITS AND DOCUMENTS SUBMITTED BY CLAIMANT AND ARE SUBMITTED HEREWITH.

ON OCTOBER 1, 1924, IN THE LIGHT OF THE EVIDENCE THEN BEFORE ME, I DISAPPROVED AND DISALLOWED THIS CLAIM, BUT HAVING BEEN CONVINCED BY THE ADDITIONAL EVIDENCE WHICH CLAIMANT HAS SINCE SUBMITTED, AS HEREINAFTER APPEARS, I HAVE CHANGED MY RULING.

IF UPON REVIEW OF THE EVIDENCE SUBMITTED HEREWITH YOU AGREE WITH ME THAT THE APPLICATION FOR REINSTATEMENT WAS SIGNED BY ROGER FENLAW, AND WILL SO ADVISE ME, I DESIRE TO PAY THIS CLAIM.

UNDER THE LAW AND REGULATIONS APPLICABLE TO REINSTATEMENT IN SUCH A CASE AS THIS, IT WOULD APPEAR THAT THE REINSTATEMENT IN THIS CASE WAS AUTHORIZED IF APPLICATION THEREFOR WAS IN FACT MADE BY THE INSURED, IT BEING UNDERSTOOD THAT ALL OTHER REQUIREMENTS WERE COMPLIED WITH.

IT APPEARS ESTABLISHED THAT THE ENVELOPE WAS DEPOSITED IN THE UNITED STATES MAIL JUNE 14, 1923, WHILE THE INSURED WAS ALIVE, CONTAINING THE REGULAR FORM OF APPLICATION FOR REINSTATEMENT OF INSURANCE ISSUED BY THE VETERANS' BUREAU AND APPARENTLY PREVIOUSLY FURNISHED BY THE BUREAU TO THE INSURED WITH NOTICE OF NONPAYMENT OF THE APRIL AND MAY, 1923, PREMIUMS. THE APPLICATION WAS DATED JUNE 14, 1923, FILLED IN WITH TYPEWRITER, SIGNED AT THE END WITH THE NAME OF THE INSURED, AND WITNESSED BY ONE WADE SWIFT. THERE WERE INCLOSED WITH THE APPLICATION TWO CHECKS DRAWN BY MRS. ROGER FENLAW, WIFE OF THE INSURED, TO THE ORDER OF THE TREASURER OF THE UNITED STATES, EACH FOR $7.30, THE AMOUNT OF TWO MONTHS' PREMIUMS ON THE POLICY. THE WITNESS HAS SINCE ACKNOWLEDGED HIS SIGNATURE AND THAT OF THE INSURED AND MAKES OATH HE WAS IN THE OFFICE OF THE INSURED ON JUNE 14, 1923, WHEN THE APPLICATION FOR REINSTATEMENT WAS EXECUTED AND SIGNED. THE INSURED WAS DROWNED JUNE 19, 1923. THE ENVELOPE AND ITS CONTENTS HAD BEEN RETURNED UNOPENED TO THE SENDER BY THE POST OFFICE AUTHORITIES, STAMPED "RETURNED FOR POSTAGE," AND WITH THE DATE JUNE 14, 1923, AND WAS FOUND WITH OTHER MAIL BY THE WIDOW UPON HER RETURN TO THE OFFICE OF HER HUSBAND AFTER THE FUNERAL. MUCILAGE APPEARS ON THE ENVELOPE AT THE PLACE WHERE THE STAMP IS USUALLY AFFIXED, BUT THERE IS SUGGESTED IN THE RECORD THE QUESTION WHETHER IT IS NOT IN FACT, OVER THE CANCELLATION STAMP. VITAL, THE MATTER APPEARS POSSIBLE OF DEFINITE ASCERTAINMENT; BUT IT SEEMS NOT NECESSARILY INVOLVED. THE ENVELOPE AND CONTENTS WERE LATER FORWARDED UNOPENED IN ANOTHER ENVELOPE BY THE WIDOW TO THE UNITED STATES VETERANS' BUREAU.

UNDER THE GENERAL RULE OF LAW WITH REGARD TO THE OFFER AND ACCEPTANCE OF A CONTRACT, TO THE EFFECT THAT DEPOSITING IN THE MAIL AN ACCEPTANCE OF AN OFFER MAKES THE CONTRACT, IT MAY BE ASSUMED THAT USING THE MAIL AS THE VEHICLE OF ACCEPTANCE REQUIRES THAT ALL NECESSARY TO BE DONE TO CARRY THE COMMUNICATION THROUGH THE MAIL SHOULD BE DONE AND THE AFFIXING POSTAGE IS SUCH A NECESSITY THAT IF A CONFLICT OF INTERESTS APPEARS OR THE OTHER PARTY MAY BE PREJUDICED, THEN THE FAILURE TO PREAFFIX POSTAGE MAY PRECLUDE THE SENDER FROM ASSERTING ANY RIGHTS. IN THE PRESENT CASE THE FACT THAT THE APPLICATION WAS "RETURNED FOR POSTAGE," WOULD HAVE TO BE ACCEPTED AS SHOWING THE POSTAGE WAS NOT THERE WHEN IT CAME TO MOVEMENT BY THE POSTAL SERVICE, AND IF INTERESTS OTHER THAN THE REINSTATEMENT WERE INVOLVED, IT MIGHT THUS BECOME IMMATERIAL WHETHER THE POSTAGE HAD BECOME DETACHED OR HAD NEVER BEEN PREAFFIXED. BE THAT AS IT MAY, WE CAN READILY SEE IN THIS CASE AN EXCEPTION TO THE CONTRACT RULE OF ACCEPTANCE BY MAIL OF AN OFFER. THE PRIMARY PURPOSE OF REINSTATEMENT OF THE INSURANCE WAS TO CONFER A BENEFIT UPON THE INSURED. THE GOVERNMENT, THE VETERANS' BUREAU, WAS COOPERATING WITH THE INSURED. NO ADVANTAGE TO THE ONE OR DISADVANTAGE TO THE OTHER WOULD BE ACCOMPLISHED BY THE RETARDING OF POSTAL DELIVERY BY FAILURE TO STAMP IN MAILING AND WE MAY REASONABLY CONCLUDE THAT THE MAILING FACTS DISCLOSED DO NOT PRECLUDE CONSIDERATION OF THE APPLICATION FOR REINSTATEMENT AS MADE.

YOUR LETTER IN THE CONCLUDING PARAGRAPH STATES THAT IF I AGREE WITH YOU THAT THE APPLICATION FOR REINSTATEMENT WAS SIGNED BY THE INSURED, YOU DESIRE TO PAY THE CLAIM. AS TO THE GENUINENESS OF THE SIGNATURE THERE APPEARS TO BE A DIFFERENCE OF OPINION AMONG THOSE TO WHOM IT WAS SUBMITTED, WITH CERTAIN KNOWN SIGNATURES, FOR EXPRESSION OF OPINION AS EXPERTS, BUT THERE IS FOR NOTING IN SUCH CONNECTION THAT IN THE KNOWN SIGNATURES OF THE INSURED THERE IS WIDE VARIANCE IN FORM. HOWEVER, THE FOLLOWING FACTS APPEAR TO BE CLEARLY ESTABLISHED: THE APPLICATION WAS SIGNED IN THE LIFETIME OF THE INSURED; THERE IS NO QUESTION OF HIS BEING IN EXTREMIS AT THE TIME, DEATH BEING BY DROWNING SOME DAYS LATER; AND A DISINTERESTED WITNESS GIVES THE FACTS ATTENDING THE EXECUTION AND MAILING. NO ADVERSE CONCLUSION IS TO BE DRAWN FROM THE FACT OF THE CHECKS OF THE WIFE HAVING PAID THE PREMIUM. SHE WAS AN INTERESTED PARTY AND WE MAY CONCLUDE HAD THE USUAL ANXIETY TO SEE THAT INSURANCE WAS MAINTAINED, AND PARTICULARLY BECAUSE OF PRIOR LAPSES. I FIND NO FACTS IN THE RECORD SUBMITTED UPON WHICH TO OBJECT TO PAYMENT BASED ON THE SIGNATURE TO THE APPLICATION.

THIS CASE IS TO BE DISTINGUISHED FROM CASES INVOLVING REINSTATEMENTS OF INSURANCE POLICIES UNDER SECTION 304 OF THE WORLD WAR VETERANS' ACT. SEE DECISION OF JANUARY 20, 1926, A-12487, 5 COMP. GEN. 503.