ly advice of his old friend and believing in | ments were made Ruley was not indebted to his good faith and sound judgment, rather than as the result of an understanding examination into the character of the investment. Under such circumstances, Springer is not entitled to rescind his contract of membership of the corporation and become a creditor of the company. It should be noted, too, that Springer does not undertake to give McMillan's statements accurately, for he confessed that he didn't understand part of it. Indeed, the alleged statements as to the security of the investment were so extraordinary that a doubt naturally arises whether they were made, especially in view of Springer's frank disclaimer of having really understood the remarks of his friend. But even assuming that they were made in just the form Springer testified to, and with no explanation, still they were not representations on which Springer had a right to rely, and he had an equal opportunity to verify them. His failure to do so does not give him a right to be changed from a partner in the enterprise to a creditor. Pearce v. Carter, 3 Houst. 385. The master was right in excluding the claim. (3) Exceptions to the disallowance by the master of the claim of Elizabeth C. Ruley, executrix of William W. Ruley, deceased. the company; that these payments were applied to the company's contingent fund; and that they were charged on the cash books of the company as "advance acct. delinquent contingent fund account," or "pmts. on contgt. fund of delinquent stock pmts.," or "back pmts. on stk.," or "a/c back paymts.” The check for $500 credited on the claim is dated November 9, 1908, and the voucher, in pursuance of which this check was issued, had indorsed thereon "a/c return of contingent fund advances," was signed by one Williams, assistant treasurer, and marked "Approved" by William W. Ruley as president. The entry of the check in the cash book is "Return of advance, voucher #8654." The reports of the company for the years 1907 and 1908 to the Insurance Commissioner of Delaware show that Ruley, as president, made the affidavits as to their correctness, and that the liability of the company for the payments made by Ruley is not referred to therein. The testimony of one Smith, who was secretary of the company during the period covered by this claim, is that there was considerable money due from delinquent subscribers to stock and that the money received from Ruley was put in the contingent fund to offset payments due at that time; that he assisted Ruley in making up the reports to the Insurance Commissioner for 1907 and knew that the money paid to William W. Ruley, during his lifetime, the company by Ruley, which at that time filed a claim against the defendant com- amounted to $5,000, did not appear in the pany, and at his death his executrix was sub-report as a liability of the company to Rustituted as claimant. The claim is for $6,700, made up of items of "cash" amounting to $7,200 with a credit thereon of $500. The record relating to this claim consists of minutes of meetings of the board of directors, cash books, vouchers, checks and ledger cards of the company, reports of the company filed with the Insurance Commissioner of the state of Delaware for the years 1907 and 1908 and testimony of witnesses. The minutes of the board of directors show that Ruley was president of the company prior to and dur-par; that the contingent fund was not kept ing the period covered by the claim; that he resigned as such president on March 16, 1909, and as a director two days later; that on May 12, 1909, he presented a claim to the board of directors, which is a duplicate of the one filed by him in this cause, except that the items in the claim presented to the board The master recommended the disallowance of directors were charged as "advance on of this claim and exceptions thereto were a/c of delinquent contingent fund a/c," in- taken on behalf of the receivers and Ruley. stead of "cash" as in the claim filed herein, The receivers excepted because the master and the credit entered as "Amt. refunded," did not find as a fact that the payments instead of "Cash," and that the board of di- made by Ruley to the company constituted a rectors, after consulting counsel for the com- voluntary contribution. Counsel for Ruley pany, refused to pay the claim on the ground filed a number of exceptions, but their genthat no contract had been entered into by the eral exception and the exception filed by the company with Ruley concerning these pay-receivers are the only ones considered. ments. The books of the company show that on the dates set forth in the claim filed the respective amounts were received by the com ley. The testimony of the assistant treasurer was that Ruley promptly paid his stock subscriptions; that at the time the payments stated in the claim were made Ruley was not indebted to the company; that Ruley took an active part in the preparation of the company's report to the Insurance Commissioner of Delaware for the year 1908, and that he (the assistant treasurer) assisted Ruley; that the contingent fund was the excess amount received from the sale of stock above separate and apart from the general assets of the company; and that item "Net received for surplus fund from capital stock" in the report to the Insurance Commissioner for 1908 was greater by $6,700 by reason of Ruley's payments, which were included therein. Herbert H. Ward and William W. Porter, for receivers. Caleb E. Burchenal and Ran THE CHANCELLOR. The claim of Eliz-1 of the company, part of the money so paid abeth C. Ruley, executrix of William W. Ru- by Ruley, the natural inference is that the ley, for $6,700 having been disallowed by relation of debtor and creditor arose. The the master, several exceptions to his find- repayment of part, or at least the receipt of ing were taken by the claimant, and the payment of such money by one advancing it, receivers have also filed exceptions. In view is consistent only with the original intention of the conclusion reached, it will be unneces- of a loan and not a contribution or gift. sary to consider any of the exceptions of the claimant, except the general one to the disallowance of the claim, and the exceptions of the receivers to the effect that the master should have found that the payments made by Ruley to the company were gifts or contributions to the company. [10] The basis of the claim is that at the time Ruley paid the moneys to the company there was money due the company from the stockholders who were in arrears in their payments due on their stock to which they subscribed, the names of these delinquent stockholders not having been disclosed by the proofs. Part of the moneys due from such stockholders was payable to the contingent fund intended for use in extending and maintaining the business of the company. Ruley paid to the company moneys on several occasions, and the moneys so received were treated in the entries upon the cash books of the company as "advances" by Ruley on account of such arrears due from said delinquent stockholders. I consider that this applies to all the moneys paid by Ruley to the company, as contained in the proof of claim, although the language of all the entries is not equally specific upon this point. It appears, then, that on the books of the company, Ruley not being then indebted to the company, advanced at various times moneys which were due to it from certain undisclosed and unidentified shareholders of the company. Standing alone, entries of that kind indicated an expectation on the part of Ruley that he would be repaid the moneys so advanced, and such an expectation is inconsistent with the gift. One of the meanings of the word "advance" is "a loan" and the use of the word quite naturally imports a reimbursement and the relation of debtor and creditor may be implied from the use of the word. 1 Cyc. 966; Laflan & Rand Powder Co. v. Burkhardt, 97 U. S. 110, 117, 24 L. Ed. 973. The entries of the original advances and the repayment of part thereof were shown by the books of the company. These books were open to inspection by the officers and directors and were audited by a special auditor, whose duty it was to make reports thereon to the directors, and the legal effect of these entries was presumably known to all. It is of no consequence, then, that there was no other entry on the books showing specifically that Ruley was a creditor of the company to the extent of the advances because these entries in the cash book show that fact. For the same reason it is of no consequence that there is no averment proved that Ruley actually reported to the board of directors these particular advances. There are circumstances in evidence both for and against the above conclusion, and these are discussed fully in the master's report and in the briefs submitted, but after weighing them all carefully my mind comes back to the evidence of intention as shown by the actual, undisputed entries on the books. These entries show the payment of moneys to the company (a fact not disputed) and also show that the payments were advances to the contingent fund of the company, Ruley not being then indebted to the company, and show subsequent payments to him of money expressly stated to have been paid on account of money advanced by Ruley to the contingent fund. [11] As before stated, I am of opinion that the legal effect of the transactions between Ruley and the company, respecting the money, was to constitute not a gift bat a loan. [12] If Ruley had brought an action of assumpsit against the company to recover the moneys so paid, I believe that the evidence would warrant a verdict for the plaintiff for the full amount of his claim. The action of assumpsit is equitable in its nure, and recovery may be had in such action whenever one person is equitably entitled to money in the hands of another. The promise of repayment is in such cases. In addition to this it appears that on November 9, 1908, a check was drawn to the order of Ruley for $500, approved by him as In Burton v. Wharton, 4 Har. 296, 298, it president, signed by one Williams, assistant was said of the action of assumpsit for mon treasurer, checked by the cashier and the ey had and received, in a suit to recover voucher with it says that it was a payment from a defaulting vendor part of the pur"on account return of contingent fund ad-chase price paid: "The principle of this acvances," and Ruley received the money re- tion is that it is not according to equity andı paid by the check. This payment appears good conscience that the defendant shall re on the cash book of the company. When tain the money." The court in Guthrie Ruley paid into the treasury of the company Hyatt, 1 Har. 446, said: money which he did not owe to it (calling it "The action of assumpsit has been likene an advance on account of the contingent to a bill in equity. Whenever a man has in fund), and afterwards repaid to himself as his hands money belonging to another which promises or the law can raise an implied | mium shall be optional with the insurer and promise to pay it, it may be recovered in this form of action." The same principle is more broadly stated in Wright v. Wright, 2 Har. 350, 352, thus: "It is a general principle, that if a person receives money belonging to another, and has no legal or equitable right to retain it, the law deems this to be so much money had and received to the use of the owner, and raises a promise by implication from the person receiving it to pay it over." [13] The right of the claimant to be repaid money advanced to the company should not be less highly respected in a court of equity, than in a court of law having regard to principles of justice and right. shall not be a waiver of forfeiture or of any of Cent. Dig. §8 1041-1070; Dec. Dig. § 392.*] [Ed. Note.-For other cases, see Insurance, In the absence of fraud, an insured, by signing an application, accepting a policy, and bringing suit thereon, will be held to have had notice of, to have understood, and to have agreed ed in the application and in the policy. to the terms, limitations, and conditions contain [Ed. Note. For other cases, see Insurance, Cent. Dig. §§ 219-230; Dec. Dig. §. 136.*] 3. INSURANCE (§ 388*)-IMPLIED WAIVER AS TO DEFAULT IN PAYMENT OF PREMIUMS-INSURER'S COURSE OF CONDUCT. An insurer's course of conduct may afford a basis for a reasonable excuse in defaulting a premium when due and a ground of the insured's reliance that forfeiture will not be asserted, but a course of action which is no more than will not have that effect. action within the express terms of the policy, [Ed. Note.-For other cases, see Insurance, Cent. Dig. §§ 1026-1040; Dec. Dig. § 388.*] 4. INSURANCE (§ 146*)-INSTRUCTION-PROVISIONS OF CONTRACT CONSTRUED. A policy of accident insurance should be ble meaning and effect to all its provisions if interpreted by its context so as to give a sensi [14] Undue weight was given to the actual misstatements in the reports made to the Insurance Commissioner by the company, which reports were sworn to by Ruley, and to a certain extent the literal effect of those reports was inconsistent with the existence at the time the reports were made of an indebtedness by the company to Ruley, its president. But, without justifying the making of erroneous reports, it is only fair to note that there were other inaccuracies in these reports which indicate that the reports were intended for a specific purpose, viz., to sat-possible, and so as to avoid rendering portions isfy the Insurance Commissioner, and not as an accurate statement of all the affairs of the company, Clearly the making of the reports by Ruley was not intended as a waiver or relinquishment by him of any rights he had against the company by reason of having made advances of money to the company. The receipt of repayment in part of his advances clearly negatives a waiver or relinquishment of any right. of it contradictory and inoperative by giving effect to some clauses to the exclusion of others, and it is the duty of the court to construe it so as to give effect to and harmonize every part. [Ed. Note.-For other cases, see Insurance, MIUMS-REINSTATEMENT INSURER'S LIABIL- A policy of accident insurance provided for a monthly payment to the insured upon total loss of time from an accident which should wholly, and continuously from its date, disable him from any business or occupation, and if injury the date of the accident, prevent him from pertherefrom should wholly and continuously, from I am constrained, therefore, to disagree with the conclusions of the learned master, and find that as Ruley, or his representative, could have maintained an action of assump-forming duties pertaining to his occupation. sit based on an implied agreement to repay the money advanced by him, the claim made by him and prosecuted by his executrix should be allowed. The general exception to the disallowance of the claim will be sustained and the exception of the receivers disallowed. (84 Vt. 510) CROSBY V. VERMONT ACCIDENT INS. CO. Premiums were required to be paid in advance on or before the first day in each month during the continuance of the policy, and on each of such payments the plaintiff was insured from the date of the contract until the first day of the next calendar month; the acceptance of past due premiums being made optional with the company, and not in any case to be a waiver of forfeiture, but to have the same effect as if a new application had been made and a new policy issued on the day following such acceptance. Each of the payments on the policy for the four months from February was made after the first day of the month and after an accident on June 5th, the insured on June 7th sent the premium (Supreme Court of Vermont. Addison. July for that month which was accepted June 8th in 31, 1911.) 1. INSURANCE (§ 392*)-WAIVER OF RIGHT TO FORFEIT-ACCEPTANCE OF PREMIUMS-PROVISIONS OF POLICY. The provisions of a policy of accident insurance that premiums are to be paid on or before the first day of each month; that the payment of a premium after the date specified on the receipt shall not continue insurance after the date for payment of the next monthly premium; that the acceptance of any past due pre ignorance of the accident. Held, in an action on the policy, that, construing its provisions together, it had lapsed from June 1st until its renewal on June 8th, and that as to the accident which occurred during that time the plaintiff was not insured. [Ed. Note.-For other cases, see Insurance, Cent. Dig. 88 1056-1070; Dec. Dig. § 392.*] Exceptions from Addison County Court; Zed S. Stanton, Judge. For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key No. Series & Rep'r Indexes Action by Ferdinand M. Crosby against was paid when due. On June 5, 1909, the the Vermont Accident Insurance Company plaintiff then in default of payment of the on an accident insurance policy. Judgment premium for that month, was injured by for defendant, and plaintiff excepts. Af accident, resulting in his total and absolute firmed. disablement to work from the day of the in Argued before ROWELL, C. J., and MUN-jury until July 17th, and a partial disability SON, WATSON, HASELTON, and POWERS, JJ. Charles I. Button, for plaintiff. T. W. Moloney, for defendant. from the latter date until October 5, 1909. The money to make the June payment was sent by the plaintiff June 7th, but it was not received by the company until June 8th, on which day its receipt therefor was given. The plaintiff did not then inform the company, nor did the latter know at the time it received said payment and gave the receipt therefor that the plaintiff had been injured. About June 11th, it was notified by the plaintiff of his injury. WATSON, J. The policy in question was issued April 2, 1907. By its terms, premiums were to be paid by the insured, $1 in advance on or before the first day in each month during the continuance of the policy; and by such payment on delivery of the The plaintiff contends that by the compolicy the plaintiff was insured from 12 pany's acceptance of the past-due premiums o'clock noon of the day the contract was in the months of February, March, April, dated until 12 o'clock noon of the first day and May, respectively, 1909, as above statof the next calendar month. It is provided ed, he was led to believe that he might make in the policy "that the payment of any pre-payment of the premium at any time during mium after the date specified on the premi- the month for which it was due, and that um receipt shall not continue this insurance notwithstanding the premium for June was to a date later than the date for payment of the next monthly premium, nor shall the acceptance of any premium after it is due be construed as a waiver of any of the rights of the company under this contract;" also, "the policy is issued to and accepted by the insured subject to the following provisions: • Reinstatement. E. The acceptance of any past-due premium is optional with the company, and shall not in any case be a waiver of the forefeiture of this contract, but shall be construed to have the same effect as if a new application had been made and a new policy issued on the day following such acceptance." In the plaintiff's application for the insurance, which is made a part of the policy, he states: "I hereby apply for a policy of insurance to be based upon the following statements, all of which I hereby warrant to be complete and true; and in consideration of the company accepting monthly premiums, I hereby waive all notice (whether required by statute or not) (1) to pay such premiums, (2) of default in payment thereof, and (3) of forfeiture of the policy for nonpayment of such premium, and I agree if any of the such statements shall be untrue, or if said waiver of notice shall be inoperative, or if I fail to fulfill any agreement herein made, then, in either case, said policy and insurance shall be null and void;" and "I further agree to accept the policy subject to all its conditions, and to pay the monthly premiums of one and no/100 dollars in advance, without notice." The premiums were paid by the plaintiff according to the terms of the policy till February, 1909. For that month the payment was made on February 8th; for March, on March 6th; for April, on April 24th; for May, on May 28th; and for June, on June 8th. In July and in each month thenceforth overdue and unpaid at the time of the accident, the company is estopped from claiming that the policy was not then in force. Yet the record does not show such a course of conduct on the part of the company as gave the plaintiff just and reasonable ground to infer that a forfeiture would not be exacted. [1] The provisions of the contract respecting the payment of premiums at stated periods in advance, the effect of a default therein, the option of the insurer to receive past-due premiums and the effect of such acceptance, are material and reasonable between the insurer and the insured. [2] And in the absence of fraud or imposi tion, the plaintiff by signing the application, accepting the policy, and bringing suit on it, must be held to have had notice of, to have understood, and to have agreed to, the terms, limitations, and conditions contained in the application and in the policy. Grace v. Adams, 100 Mass. 505, 97 Am. Dec. 117, 1 Am. Rep. 131; Brown v. Mass. Mut. Life Ins. Co., 59 N. H. 298, 47 Am. Rep. 205. The plaintiff knew that unless he paid the monthly premium in advance on the date specified, the policy would lapse and he would be without protection by his own fault. He also knew the effect of the acceptance of past-due premiums by the company in the exercise of its optional right to be as expressly stipulated in the contract. [3] There is no doubt that the course of conduct by the insurer may be such as to afford a basis for a reasonable excuse for defaulting a premium when due. But to have that effect something more than 8 course of action within the express terms of the policy-such only as was had in this instance is required. It must be a course of conduct on which the insured had a right to rely as giving him a just and reasonable not be asserted. Thompson v. Knickerbock- | time and not the accident that must occur er Life Ins. Co., 104 U. S. 252, 26 L. Ed. 765. during the life of the policy, when the plainIt is further contended that since the pol- tiff's warranty that he had not been disabled icy, by section 1, provides insurance against by accident or illness during the preceding total loss of time, and by section 2 against five years entered into the basis of the polpartial disability resulting from accidental icy. In the language of the federal Sumeans, it is the loss of time and not the ac- preme Court: "By every sound rule of concident that must occur during the life of struction, an instrument should be interthe policy; and consequently when the com- preted by the context, so as if possible to pany retained the premium for June after give a sensible meaning and effect to all its it learned that the plaintiff was suffering provisions; and so as to avoid rendering portotal loss of time from an accident, and tions of it contradictory and inoperative, by when later it accepted the premiums for giving effect to some clauses to the exclusion July, August, September, and October, if it of others." Ladd v. Ladd, 8 How. 10, 12 L be true, as the company claims, that the Ed. 967. And in Hydeville Co. v. Eagle Raileffect of receiving such premiums was the road & Slate Co., 44 Vt. 395, it is said to be same as though it had issued a new policy the duty of the court, if possible, to construe on June 8th the company became liable to an agreement so as to give effect to every pay for the total loss of time resulting from part, and from the parts a harmonious whole. the accident from which it knew the plaintiff [5] Applying these principles of construcwas then suffering, and would continue to tion it is certain that by a fair interpretation suffer, and can claim nonliability for only of the policy the bodily injuries insured the days intervening between the accident against under sections 1 and 2 must have and the reinstatement; that there is noth- resulted from an accident which occurred ing in the policy indicating that the acci- within the life of the policy. It is equally dent must occur within the life of the policy. certain that the meaning of the policy in this Section 1 provides for a payment of $25 to respect was not different after the reinstatethe insured "for a period not exceeding ment. Consequent on the nonpayment of twelve consecutive months, against total loss the premium June 1st, when due, the policy of time, resulting directly or independently lapsed and was thenceforth without force as of all the causes, from bodily injuries ef- a protection to the plaintiff or as an obligafected through external, violent, and acci- tion against the company. As to the plaindental means, and which wholly and con- tiff the contract ceased to exist. Under it tinuously, from date of accident, disable and he had no legal or equitable rights against prevent the insured from performing every the company, and could not have in the duty pertaining to any business or occupa- future unless the latter, in the exercise of its tion." By section 2, "or, if such injuries optional right, should accept the past-due shall wholly and continuously, from date of premium, thereby breathing new life into the accident, disable and prevent the insured contract. This the company did on June from performing one or more daily duties 8th, but by the express provisions of the pertaining to his occupation, or in the event policy it was not a waiver of the forfeiture of like disability, immediately following total-it was as if a new application had been loss of time, the company will pay the in- made and a new policy issued on the day folsured for the period for such partial dis-lowing the acceptance. That is, in effect it ability, not exceeding six consecutive months; became a new contract, giving new insurprovided the maximum period for ance, though under the former policy restored which indemnity shall be paid under para- to full vigor as of the day last named. It graphs 1 and 2, for any injury, shall not follows that the plaintiff was not insured exceed twelve consecutive months." against the results of the accident which oc[4] If any doubt exists regarding the in-curred during the lapse of the policy. Lantz tended construction of these two sections, in the respect named, viewed apart from the context, such doubt vanishes when we consider their provisions, as we must, in the light of, and in connection with, the other provisions of the contract. In the application the plaintiff stated and warranted it to be true that he had not been disabled by accident or illness during the then past five years; and the warranties and agreements in the application formed a part of the consideration of the contract. This statement and warranty must be not only ignored in the interpretation of sections 1 and 2 of the policy contended for by the plaintiff, but they are rendered contradictory to those sections; for how can it be said that it is the loss of v. Vermont Life Ins. Co., 139 Pa. 546, 21 1. (85 Vt. 35) STATE v. MERRILL (Supreme Court of Vermont. Chittenden. Aug. 9, 1911.) WITNESSES (§ 269*)-CROSS-EXAMINATION. In a prosecution for unlawfully selling ale to an Elks Club in a no-license city, a member and trustee of the club was called by the state and testified as to the character of the organi zation. On cross-examination he was asked what |