Greguhn v. Mut. of Omaha Ins. Co. - 23 Utah 2d 214, 461 P.2d 285 (Sup.Ct. 1969)

Rule:

The decisions of a number of the states permit an insured to recover a money judgment for the present value of future payments based upon the insured's life expectancy. However, the great majority of decisions permit recovery under a disability policy only of installments accrued and unpaid. The doctrine of anticipatory breach is not ordinarily extended to unilateral contracts. In unilateral contract for the payment in installments after default of one or more, no repudiation can amount to an anticipatory breach of the rest of the installments not yet due.

Facts:

Plaintiff insured had two policies covering him against loss arising from sickness or accident. Defendant insurers paid benefits for a while after the insured had a work-related accident. After defendants’ failure to further perform, plaintiff instituted the present actions. The trial court found in favor of the plaintiff. The court calculated the amount due under the terms of the policies together with interest to the time of trial. In addition thereto, the court found that the defendants had repudiated their contracts of insurance and concluded that the plaintiff was entitled to a lump sum judgment for future benefits which would accrue under the terms of the policies. The court received evidence as to the life expectancy of the plaintiff and based thereon calculated and made a finding as to future benefits. Defendants sought review of the judgment, arguing that the evidence failed to show that the insured was totally disabled and that his disability did not result from the accident alone exclusive of all other causes.

Issue:

1. Did the evidence fail to show that the plaintiff’s disability resulted proximately from the accident? 
2. Did the court err in granting an award for future disability under the doctrine of anticipatory breach?

Answer:

1) No. 2) Yes.

Conclusion:

The court partially affirmed and remanded with instructions. The court held that there was no dispute in the evidence that the disability resulted proximately from the accident and that the nondisabling and dormant condition of the plaintiff's back was precipitated into a disabling condition by the accident. However, the insurers took the insured in the condition they found him when they issued his policies. The court, however, held that it was error to grant an award for future disability under the doctrine of anticipatory breach. The insurers were obligated to make the payments, but in a unilateral contract for the payment in installments after default of one or more, no repudiation amounted to an anticipatory breach of the rest of the installments not yet due.