WHERE THERE IS NO VISION, THE PEOPLE PERISH. ENRIQUEZ v.

SUN LIFE Insurance/Perfction Page |1

Republic of the Philippines Joaquin Ma. Herrer, that on this occasion, Mr. Herrer mentioned his application for a life annuity, and that he said that
SUPREME COURT the only document relating to the transaction in his possession was the provisional receipt. Rafael Enriquez, the
Manila administrator of the estate, testified that he had gone through the effects of the deceased and had found no letter of
notification from the insurance company to Mr. Herrer.
EN BANC
Our deduction from the evidence on this issue must be that the letter of November 26, 1917, notifying Mr. Herrer that
his application had been accepted, was prepared and signed in the local office of the insurance company, was placed
G.R. No. L-15895 November 29, 1920
in the ordinary channels for transmission, but as far as we know, was never actually mailed and thus was never
received by the applicant.
RAFAEL ENRIQUEZ, as administrator of the estate of the late Joaquin Ma. Herrer, plaintiff-appellant,
vs.
SUN LIFE ASSURANCE COMPANY OF CANADA, defendant-appellee. Not forgetting our conclusion of fact, it next becomes necessary to determine the law which should be applied to the
Jose A. Espiritu for appellant. facts. In order to reach our legal goal, the obvious signposts along the way must be noticed.
Cohn, Fisher and DeWitt for appellee.
Until quite recently, all of the provisions concerning life insurance in the Philippines were found in the Code of
Commerce and the Civil Code. In the Code of the Commerce, there formerly existed Title VIII of Book III and Section
MALCOLM, J.: III of Title III of Book III, which dealt with insurance contracts. In the Civil Code there formerly existed and presumably
still exist, Chapters II and IV, entitled insurance contracts and life annuities, respectively, of Title XII of Book IV. On
the after July 1, 1915, there was, however, in force the Insurance Act. No. 2427. Chapter IV of this Act concerns life
This is an action brought by the plaintiff ad administrator of the estate of the late Joaquin Ma. Herrer to recover from
and health insurance. The Act expressly repealed Title VIII of Book II and Section III of Title III of Book III of the code
the defendant life insurance company the sum of pesos 6,000 paid by the deceased for a life annuity. The trial court
of Commerce. The law of insurance is consequently now found in the Insurance Act and the Civil Code.
gave judgment for the defendant. Plaintiff appeals.

While, as just noticed, the Insurance Act deals with life insurance, it is silent as to the methods to be followed in order
The undisputed facts are these: On September 24, 1917, Joaquin Herrer made application to the Sun Life Assurance
that there may be a contract of insurance. On the other hand, the Civil Code, in article 1802, not only describes a
Company of Canada through its office in Manila for a life annuity. Two days later he paid the sum of P6,000 to the
contact of life annuity markedly similar to the one we are considering, but in two other articles, gives strong clues as
manager of the company's Manila office and was given a receipt reading as follows:
to the proper disposition of the case. For instance, article 16 of the Civil Code provides that "In matters which are
governed by special laws, any deficiency of the latter shall be supplied by the provisions of this Code." On the
MANILA, I. F., 26 de septiembre, 1917. supposition, therefore, which is incontestable, that the special law on the subject of insurance is deficient in
enunciating the principles governing acceptance, the subject-matter of the Civil code, if there be any, would be
controlling. In the Civil Code is found article 1262 providing that "Consent is shown by the concurrence of offer and
PROVISIONAL RECEIPT Pesos 6,000 acceptance with respect to the thing and the consideration which are to constitute the contract. An acceptance made
by letter shall not bind the person making the offer except from the time it came to his knowledge. The contract, in
Recibi la suma de seis mil pesos de Don Joaquin Herrer de Manila como prima dela Renta Vitalicia solicitada por such case, is presumed to have been entered into at the place where the offer was made." This latter article is in
dicho Don Joaquin Herrer hoy, sujeta al examen medico y aprobacion de la Oficina Central de la Compaia. opposition to the provisions of article 54 of the Code of Commerce.

The application was immediately forwarded to the head office of the company at Montreal, Canada. On November 26, If no mistake has been made in announcing the successive steps by which we reach a conclusion, then the only duty
1917, the head office gave notice of acceptance by cable to Manila. (Whether on the same day the cable was remaining is for the court to apply the law as it is found. The legislature in its wisdom having enacted a new law on
received notice was sent by the Manila office of Herrer that the application had been accepted, is a disputed point, insurance, and expressly repealed the provisions in the Code of Commerce on the same subject, and having thus left
which will be discussed later.) On December 4, 1917, the policy was issued at Montreal. On December 18, 1917, a void in the commercial law, it would seem logical to make use of the only pertinent provision of law found in the Civil
attorney Aurelio A. Torres wrote to the Manila office of the company stating that Herrer desired to withdraw his code, closely related to the chapter concerning life annuities.
application. The following day the local office replied to Mr. Torres, stating that the policy had been issued, and called
attention to the notification of November 26, 1917. This letter was received by Mr. Torres on the morning of December The Civil Code rule, that an acceptance made by letter shall bind the person making the offer only from the date it
21, 1917. Mr. Herrer died on December 20, 1917. came to his knowledge, may not be the best expression of modern commercial usage. Still it must be admitted that its
enforcement avoids uncertainty and tends to security. Not only this, but in order that the principle may not be taken
As above suggested, the issue of fact raised by the evidence is whether Herrer received notice of acceptance of his too lightly, let it be noticed that it is identical with the principles announced by a considerable number of respectable
application. To resolve this question, we propose to go directly to the evidence of record. courts in the United States. The courts who take this view have expressly held that an acceptance of an offer of
insurance not actually or constructively communicated to the proposer does not make a contract. Only the mailing of
acceptance, it has been said, completes the contract of insurance, as the locus poenitentiae is ended when the
The chief clerk of the Manila office of the Sun Life Assurance Company of Canada at the time of the trial testified that acceptance has passed beyond the control of the party. (I Joyce, The Law of Insurance, pp. 235, 244.)
he prepared the letter introduced in evidence as Exhibit 3, of date November 26, 1917, and handed it to the local
manager, Mr. E. E. White, for signature. The witness admitted on cross-examination that after preparing the letter and
giving it to he manager, he new nothing of what became of it. The local manager, Mr. White, testified to having In resume, therefore, the law applicable to the case is found to be the second paragraph of article 1262 of the Civil
received the cablegram accepting the application of Mr. Herrer from the home office on November 26, 1917. He said Code providing that an acceptance made by letter shall not bind the person making the offer except from the time it
that on the same day he signed a letter notifying Mr. Herrer of this acceptance. The witness further said that letters, came to his knowledge. The pertinent fact is, that according to the provisional receipt, three things had to be
after being signed, were sent to the chief clerk and placed on the mailing desk for transmission. The witness could not accomplished by the insurance company before there was a contract: (1) There had to be a medical examination of
tell if the letter had every actually been placed in the mails. Mr. Tuason, who was the chief clerk, on November 26, the applicant; (2) there had to be approval of the application by the head office of the company; and (3) this approval
1917, was not called as a witness. For the defense, attorney Manuel Torres testified to having prepared the will of had in some way to be communicated by the company to the applicant. The further admitted facts are that the head
WHERE THERE IS NO VISION, THE PEOPLE PERISH. ENRIQUEZ v. SUN LIFE Insurance/Perfction Page |2
office in Montreal did accept the application, did cable the Manila office to that effect, did actually issue the policy and
did, through its agent in Manila, actually write the letter of notification and place it in the usual channels for
transmission to the addressee. The fact as to the letter of notification thus fails to concur with the essential elements
of the general rule pertaining to the mailing and delivery of mail matter as announced by the American courts, namely,
when a letter or other mail matter is addressed and mailed with postage prepaid there is a rebuttable presumption of
fact that it was received by the addressee as soon as it could have been transmitted to him in the ordinary course of
the mails. But if any one of these elemental facts fails to appear, it is fatal to the presumption. For instance, a letter
will not be presumed to have been received by the addressee unless it is shown that it was deposited in the post-
office, properly addressed and stamped. (See 22 C.J., 96, and 49 L. R. A. [N. S.], pp. 458, et seq., notes.)

We hold that the contract for a life annuity in the case at bar was not perfected because it has not been proved
satisfactorily that the acceptance of the application ever came to the knowledge of the applicant.lawph!l.net

Judgment is reversed, and the plaintiff shall have and recover from the defendant the sum of P6,000 with legal
interest from November 20, 1918, until paid, without special finding as to costs in either instance. So ordered.

Mapa, C.J., Araullo, Avancea and Villamor, JJ., concur.

Johnson, J., dissents.