Ellis v Reliastar Life Insurance Co., (03-535) 05/04/2004

Appeal by plaintiff from order entered 23 January 2003 by Danny E. Davis in Haywood County District Court. Heard in the Court of Appeals 18 March 2004.

Brown, Ward & Haynes, P.A., by Mark L. Jenkins, for plaintiff- appellant.

Wells, Jenkins, Lucas & Jenkins, P.L.L.C., by Ellis B. Drew, III, and Halleland, Lewis, Nilan, Sipkins & Johnson, by Tracey L. Galinson, for defendant-appellee.

    CALABRIA, Judge.

    Patricia A. Ellis (“plaintiff”) appeals the 23 January 2003 order of the trial court granting Reliastar Life Insurance Company's (“defendant”) motion for summary judgment. Plaintiff asserts the trial court erred because the life insurance contract was ambiguous as to notice issues and genuine issues of material fact remain. We disagree and affirm the order of the court.
    In 1977, a $25,000.00 term life insurance policy was taken out for the life of plaintiff's husband, William F. Ellis (“Mr. Ellis”), naming plaintiff as the beneficiary. The policy provided for premiums to be paid on 1 May and 1 November of each year. Thecontract further provided for renewal of the policy as follows: “[t]his policy may, prior to the Insured's attainment of 75 years of age, be renewed for a new Term Period by payment of the applicable premium on or before the premium due date or during the grace period.” The contract similarly provided for exchange of the policy: “[t]he Owner may exchange this policy within 31 days following the semi-annual premium due date coinciding with or next following the Insured's attainment of age 75. . . .” Mr. Ellis, the insured, turned seventy-five on 23 December 1998. No action was taken in May 1999, which was the next premium due date following Mr. Ellis' attainment of age seventy-five and pursuant to the contract the appropriate time for the insured to renew or exchange the policy. In fact, the final premium paid under the contract was in November 1998. On 22 June 2000, Mr. Ellis died. Thereafter, plaintiff sought payment under the insurance contract. Defendant denied the claim, and plaintiff filed suit in September 2001.
    Plaintiff argued to the trial court that defendant had failed to provide her notice of termination of the contract and therefore should be required to pay plaintiff pursuant to the contract. Defendant, on the other hand, asserted the contract plainly provided the option to renew or exchange the policy, and that because the insured chose not to do so, the contract terminated. Defendant asserted no further notice was required. Defendant moved for summary judgment, which the trial court granted. Plaintiff appeals.    Plaintiff asserts the contract was ambiguous as to whether defendant was required to notify the insured of the option to renew or exchange the policy. We cannot agree. An insurance policy is a contract and “its provisions govern the rights and duties of the parties thereto.” Brown v. Lumbermens Mut. Casualty Co., 326 N.C. 387, 392, 390 S.E.2d 150, 153 (1990). “'As with all contracts, the goal of construction is to arrive at the intent of the parties when the policy was issued.'” Id. (quoting Woods v. Insurance Co., 295 N.C. 500, 505, 246 S.E.2d 773, 777 (1978)). “'An ambiguity exists when the language used in the policy is susceptible to different, and perhaps conflicting, interpretations.'” City of Greenville v. Haywood, 130 N.C. App. 271, 275, 502 S.E.2d 430, 433 (1998) (quoting McLeod v. Nationwide Mutual Ins. Co., 115 N.C. App. 283, 290, 444 S.E.2d 487, 492 (1994)). In the present case, the policy language plainly provided for the insured, at the end of the term when the insured reached the age of seventy-five, to either exchange or renew the policy. The contract did not provide for further notice, and plaintiff cannot avail herself of such a provision by claiming the contract's silence created an ambiguity. There is no ambiguity on this issue; plaintiff was not entitled to further notice of the option to exchange or renew the policy. Accord Lineberger v. Trust Co., 245 N.C. 166, 173, 95 S.E.2d 501, 505 (1956) (holding an insured was not entitled to further notice of his option to convert an insurance policy upon termination of his employment because the contract was unambiguous and he was charged with knowledge of the plain terms of the policy).     Plaintiff further asserts the contract was ambiguous as to how an insured is to provide notice to defendant of intention to renew or exchange the policy. Defendant argues this issue was not raised before the trial court, and therefore may not properly be considered on appeal. Indeed, this Court's review is limited to those issues properly presented to the lower court and preserved for appeal. N.C.R. App. P. 10(b)(1) (2004). Moreover, our review is limited to the record on appeal. N.C.R. App. P. 10(a) (2004). The record reveals nothing to demonstrate this issue may be considered on appeal. We note, however, even taking the facts in the light most favorable to plaintiff, there is no indication plaintiff ever attempted to notify defendant in order to renew or exchange the policy. Accordingly, even were we to utilize Rule 2 of the North Carolina Rules of Appellate Procedure to waive the appellate rules, we cannot foresee any issue of material fact raised in this case regarding how an insured was to take advantage of the policy provisions.
    Affirmed.
    Judges McGEE and STEELMAN concur.
    Report per Rule 30(e).

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