still less is hardship an excuse. Thus where the payment of a premium by a certain day is made an express condition of the continuance of insurance, illness or insanity of the insured will not excuse his delay in payment. 24 A number of courts have refused to apply this principle in cases involving impossibility of performing a condition in a policy because of war.25 There are, however, contrary decisions. 26 And if the cases allowing recovery are to be supported they must rest, as Mr. Justice Bradley of the United States Supreme Court rested them, on equitable relief from forfeiture. 27 States Life Ins. Co., 64 N. Y. 304. Inability to prove compliance with the condition is, therefore, fatal to recovery. In McGowin v. Menken, 223 N. Y. 509, 119 N. E. 877, it appeared that an insurance policy was issued on the life of T, payable on his death to his wife "if living," otherwise to his estate. Both T and his wife were lost by the sinking of the Lusitania. As there is no presumption in the common law of survivorship where two persons perish in a common disaster, and as it could not be proved that the wife survived her husband, his estate was held entitled. 24 Klein v. New York Life Ins. Co., 104 U. S. 88, 26 L. Ed. 662; Thompson v. Knickerbocker Life Ins. Co., 104 U. S. 252, 26 L. Ed. 765; Pitts v. Hartford, etc., Ins. Co., 66 Conn. 376, 34 Atl. 95, 50 Am. St. Rep. 96; Hipp v. Fidelity, etc., Ins. Co., 128 Ga. 491, 57 S. E. 892, 12 L. R. A. (N. S.) 319, Grand Lodge v. Jesse, 50 Ill. App. 101; Scheiber v. Protected Home Circle, 146 Ill. App. 574; Sleight v. Supreme Council, 121 Iowa, 724, 96 N. W. 1100; Home Ins. Co. v. Wood, 139 Ky. 657, 72 S. W. 15; Yoe v. Benj. C. Howard, etc., Assoc., 63 Md. 86; McCann v. Supreme Conclave, 119 Md. 655, 87 Atl. 383, 46 L. R. A. (N. S.) 537; Wheeler v. Connecticut L. Ins. Co., 82 N. Y. 543, 37 Am. Rep. 594; Brotherhood of R. Trainmen v. Dec, 101 Tex. 597, 111 S. W. 396. 25 Hamilton v. New York Mutual Life Ins. Co., 9 Blatch. 234; New York Life Ins. Co. v. Clopton, 7 Bush, 179, 3 Am. Rep. 290; Statham v. New York Life Ins. Co., 45 Miss. 581, 592; Mutual Benefit Life Ins. Co. v. Hillyard, 37 N. J. L. 444, 18 Am. Rep. 741; Cohen v. New York Mutual Life Ins. Co., 50 N. Y. 610, 10 Am. Rep. 522; Manhattan Life Ins. Co. v. Warwick, 20 Gratt. 614, 3 Am. Rep. 218. 28 Tait v. New York Life Ins. Co., Fed. Cas. 13,726; Worthington ". Charter Oak Life Ins. Co., 41 Conn. 372; Dillard v. Manhattan Life Ins. Co., 44 Ga. 119, 9 Am. Rep. 167. 27 In New York Life Ins. Co. v. Statham, 93 U. S. 24, 24, 32, he said: "The truth is, that the doctrine of the revival of contracts suspended during the war is one based on consideration of equity and justice, and cannot be invoked to revive a contract which it would be unjust or inequitable to revive." Though refusing to allow recovery on the policy, the court enforced a quasi-contractual right to the surrender value of the policy, though no such right was reserved in the contract. The opinion reads: "The question then arises, Must the insured lose all the money which has been paid for premiums on their respective policies? If they must, they will sustain an equal injustice to that which the companies would sustain With these cases of impossibility to perform a condition in a life insurance contract may be compared cases under building contracts, or for sale at a valuation, where an architect or valuer whose judgment was a condition precedent to liability is prevented by death or otherwise, without fault of the promisor, from complying with the condition. It will be seen that wherever it is possible to avoid a harsh result by construction, courts have adopted that course. But no ordinary principles of construction will explain all the cases where relief has been given.28 by reviving the policies. At the very first blush, it seems manifest that justice requires that they should have some compensation or return for the money already paid, otherwise the companies would be the gainers from their loss; and that from a cause for which neither party is to blame. The case may be illustrated thus: Suppose an inhabitant of Georgia had bargained for a house, situated in a northern city, to be paid for by instalments, and no title to be made until all the instalments were paid, with a condition that, on the failure to pay any of the instalments when due, the contract should be at an end, and the previous payments forfeited; and suppose that this condition was declared by the parties to be absolute and the time of payment material. Now, if some of the instalments were paid before the war, and others accruing during the war were not paid, the contract, as an executory one, was at an end. If the necessities of the vendor obliged him to avail himself of the condition, and to resell the property to another party, would it be just for him to retain the money he had received? Perhaps it might be just if the failure to pay had been voluntary, or could, by possibility, have been avoided. But it was caused by an event beyond the control of either party,-an event which made it unlawful to pay. In such case, whilst it would be unjust, after the war, to enforce the contract as an excutory one against the vendor, contrary to his will, it would be equally unjust in him, treating it as ended, to insist upon the forfeiture of the money already paid on it. An equitable right to some compensation or return for previous payments would clearly result from the circumstances of the case. The money paid by the purchaser, subject to the value of any possession which he may have enjoyed, should, ex æquo et bono, be returned to him. This would clearly be demanded by justice and right. "And so, in the present case, whilst the insurance company has a right to insist on the materiality of time in the condition of payment of premiums, and to hold the contract ended by reason of non-payment, they cannot with any fairness insist upon the condition, as it regards the forfeiture of the premiums already paid; that would be clearly unjust and inequitable. The insured has an equitable right to have this amount restored to him, subject to a deduction for the value of the assurance enjoyed by him whilst the policy was in existence; in other words, he is fairly entitled to have the equitable value of his policy." 28 See, as to impossibility of performing a dependent promise, infra, § 838. § 809. Impossibility of performing conditions subsequent. If a condition subsequent in the law of property is void, or impossible to be performed, the estate, having vested, remains undisturbed. 29 If a true condition subsequent may be found in the law of contracts the rule should be the same; and it is true that in a sale on credit with a right reserved to return the goods and thereby divest liability for payment of the price, the buyer remains liable though it becomes impossible without his fault to perform the condition. The risk of accidental loss is on him.30 It should be observed, however, that here the condition divesting the promisee's right is to be performed by the promisor. Moreover, though a debt arises when title to the goods passes, it is not generally true that a right of action would arise until the lapse of a reasonable time for determining whether the buyer wished to return the goods. In effect he binds himself in the alternative, either to pay or to return the goods. If one alternative becomes impossible the obligation becomes single. Where, however, a right of action becomes vested under a contract which provides that suit must be brought within a certain time, the case is not so clear. Whether the right of action is cut short depends on the action or failure to act of the promisee. Even in such a case, however, it has been held that where a right of action has once vested (as on an insurance policy) the impossibility of suing within the time prescribed in the policy will prevent the condition from operating to divest the insured's right 29 Doe v. Church Wardens, 6 Q. B. 107; Scovill v. McMahon, 62 Conn. 378, 26 Atl. 479, 21 L. R. A. 58, 36 Am. St. Rep. 350; Morse v. Hayden, 82 Me. 227, 19 Atl. 443; Mutual Benefit Life Ins. Co. v. Hillyard, 37 N. J. L. 444, 470, 18 Am. Rep. 741. 30 Foley v. Felrath, 98 Ala. 176, 13 So. 485, 39 Am. St. Rep. 39; Strauss Saddlery Co. v. Kingman, 42 Mo. App. 208; Chase v. Union Stone Co., 63 How. Pr. 336; Carter v. Wallace, 32 Hun, 384. See also Plunger Elevator Co. v. Day, 184 Mass. 130, 68 N. E. 16. A contrary decision is Head v. Tatterall, L. R. 7 Ex. 7. In Chase v. Union Stone Co., supra, goods had been purchased with the privilege of exchange at any time, and it was held that where the buyer returned them in the exercise of his privilege and they were destroyed by fire in transit, the loss was his, as the property had not yet revested in the seller. Compare with this case Lyons v. Stills, 97 Tenn. 514, 37 S. W. 280, where the court held the death of a pony which was the subject-matter of the bargain did not prevent the buyer from exercising a right provided for therein of rescinding in case of dissatisfaction. of action.31 Such a condition, however, though a true condition subsequent so far as concerns a right of action on the promise may, it seems, be made by the contract a condition precedent of a particular suit. There seems no reason why parties may not promise to perform, only if action is brought within a certain time. Bringing the suit within this time is then a condition of the plaintiff's right to recover. He has indeed a right of action as soon as the necessary facts occur which enable him to bring suit; but for the enforcement of the particular suit that he brings the fact that the time limit has not elapsed is a necessary element. It seems a question of construction whether in a given contract the parties have provided merely that a right of action shall cease or have provided that it is a necessary prerequisite of any action which may be brought that it shall be brought within a given 31 Semmes v. Hartford Insurance Co., 13 Wall. 158, 20 L. Ed. 490; Earnshaw v. Sun Mutual Aid Society, 68 Md. 465, 12 Atl. 884, 6 Am. St. Rep. 460. In Stoneham v. The Ocean, Ry., etc., Insurance Co., 19 Q. B. D. 237, a policy of insurance covered death caused by accident happening within the United Kingdom, and was made subject to a condition that in case of fatal accident notice thereof must be given to the insurers within seven days. The assured was accidentally drowned within the United Kingdom. It was impossible to give notice within seven days. In an action on the policy, it was held that notice was not a condition precedent to the right to recover, and the insurers were liable. The court said (p. 239): "The policy is expressed to be made subject to certain conditions; the words are, not that these conditions shall be considered as conditions precedent to liability, but, 'Provided also that this policy shall be subject to the conditions indorsed hereon, which shall be considered as incorporated herein.' One of these conditions. provides that for the purpose of identify ing the assured notice shall be given in all cases of change of residence, occupation or name. That clause does not state that the giving of notice shall be a condition precedent to liability. It is followed by a condition [which states that for change of employment without notice] . . . this policy shall become absolutely void and the premium paid for the same shall be forfeited to the company. This clause shows that where the failure to comply with a condition is to exonerate the company from liability, the intention that the policy shall bear that construction is made clear by express words." So in Eliot National Bank v. Beal, 141 Mass. 566, 6 N. E. 742, a condition in a bond which provided "that no suit at law shall be brought or founded upon it, unless the same be commenced within the period of twelve months" after termination of the employment of one for whose faithful conduct the bond was given, was held excused by the death of a surety on the bond during the pendency of an action against him which compelled a new action to be brought after a lapse of twelve months. time. 32 Where a condition is precedent in effect and subsequent in form only, as in the case of a penal bond, impossibility of performing the condition will necessarily prevent liability on the promise, 33 for the reasons stated in the preceding section. § 810. Impossibility of performing the condition of a bond. It has been thought that in case of impossibility to perform the condition of a bond "the law has stuck at the merely formal view of a bond as a contract to pay the penal sum, subject to be avoided by the performance of the condition; accordingly if the condition is impossible either in itself or in law the obligation remains absolute." 34 In support of this statement cases are cited where the condition, at the outset, is evidently impossible, illegal or absurd— "If a man be bound in an obligation, &c., with condition 32 In Riddlesbarger v. Hartford Ins. Co., 7 Wall. 386, 19 L. Ed. 257; Brown v. Hartford Ins. Co., 7 R. I. 301; Wilkinson v. John Hancock Mutual Life Ins. Co., 27 R. I. 146, 61 Atl. 43; Wilson v. Ætna Ins. Co., 27 Vt. 99, it was held that the plaintiff must at his peril bring suit on an insurance policy in spite of supervening impossibility. In Wilkinson v. John Hancock Mutual Life Ins. Co., supra, at page 150, the court said, quoting from the earlier Rhode Island decision, "The statute of limitation has no application, in any of its provisions, to the clause in question; and, indeed, the only argument against the clause is that it sets up for the contract a different law of limitation from that which the statute imposes. We have held that the contracting parties have a right to do this in reference to a policy of fire insurance; and we know no right that we have, from consideration of general equity, to import into their contract qualifying terms, which they have not seen fit to adopt.' To the same effect are, McElroy v. Continental Ins. Co., 48 Kan. 200, 29 Pac. 478; 2 May Ins. (4th Ed.), p. 1150, sec. 483; Ward v. Penn. Fire Ins. Co., 82 Miss. 124, 33 Southern Rep. 841; Fey v. I. O. O. F. Mutual Ins. Soc., 120 Wis. 358, 98 N. W. Rep. 206, 209; Mead v. Phoenix Ins. Co., 68 Kans. 432, 75 Pac. 475, 104 Am. St. Rep. 412, 64 L. R. A. 79. While these cases are not exactly in point, we think they are instructive and direct us towards the conclusion at which we have arrived, viz: that the terms of the contract, taken in their ordinary sense, are binding; and hence, when the cause of action arises, when the sum specified in the contract becomes payable according to its terms, the beneficiary must procure suit to be brought by a person competent to sue, within two years thereafter, or the contract is ended." 33 Bacon, Abr. CONDITIONS (Q). See also Brown v. London, 30 L. J. C. P. (N. S.) 225; Gray v. Gardner, 17 Mass. 188; Brown v. Dillahunty, 4 Sm. & M. 713, 43 Am. Dec. 499. Cf. Rose v. McLeod, 2 Bay, 108. 34 Wald's Pollock on Contracts (3d ed.), 556. |