Thompson v. Metropolitan Life Insurance — 128 A.D. 420

Majority

p. 420

William H. Thompson, Appellant, v. Metropolitan Life Insurance Company, Respondent.

Fourth Department,

November 25, 1908.

Headnote

Insurance — policy incontestable except for fraudulent misstatement — defenses — facts not constituting fraud as matter of law.

Where the statements of an application upon which a policy of life insurance is issued are not warranties and the policy provides that'it shall be incontestable after two years, except for fraud or misstatement of age, an insurer not claiming any misstatement as to age can only defend upon the ground that other misstatements in the application were fraudulent.

In an action to recover on such policy the insured, a laborer of limited intelligence, cannot be held to have made fraudulent misstatements as a matter of law, because he did not when admitting to the insurer's agent that he was subject to fits apprise him of the fact that the fits were epileptic. Under the circumstances the question of fraud was for the jury.

McLennan, P. J., dissented.

Appeal by the plaintiff, William. H. Thompson, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Cayuga on the 21st day of May, 1906, upon the dismissal of the complaint by direction of the court after a trial at the Cayuga Trial Term, and also from an ordér entered on the 19th day of July, 1908,'denying defendant’s motion for a new trial made upon the minutes.

P. McLaughlin, for the appellant.-

John L. Hunter, for the respondent.

On August 15, 1901, the defendant issued its policy of insurance upon the life of David H. Thompson whereby it agreed to pay to the plaintiff the sum of $192 upon the death of the insured, if he complied with tha conditions of the policy agreement. The premium was fifteen cents each week and had been paid regularly to the time of the death of the insured, October 9, 1903. This, action is brought upon the insurance agreement to recover the sum stated and the defendant lias answered, charging that the insured was guilty of fraud in procuring the policy.

p. 421

The policy was founded upon the application of the insured, although the statements contained in it are not warranties, and the policy expressly provides that the same shall be incontestable after two years, except “ for fraud or misstatement of age.” As there is no claim of any misstatement of age, and more than two years elapsed after the issuance of the policy before the death of the insured, the only defense available to the defendant is that of fraud, and that is the defense set forth in its answer.

The policy provides that “no obligation is assumed by the company,” unless at the time the policy is issued “ the insured is alive and in sound health,” and a like stipulation is embodied in the application signed by the insured. The insured at the time of the ■ issuance of the policy and from early boyhood was afflicted with epilepsy. The agent who procured the application to be signed and filled out knew the insured. Several witnesses testified that the insured informed this agent that he was subject to fits. One witness testifies: “ He told the agent at that .time about the kind of fits they were. I don’t know whether or not he told the agent how often he had the fits. He said he had fits; he didn’t tell what kind or how often- he had them. He spoke about his having fits ; sometimes he would have them one week and sometimes once.a month. I think he did tell the agent he had them once a week or once a mouth ; speaking of it quite often; I can’t remember just exactly. I told him that, and I think Dave told him too, but I won’t be positive. He told him he had them quite a number of years. I don’t know as he told him the number of years. I also told him he had had them for a number of years. I didn’t say how many. He had them sometimes once a week, and sometimes he wouldn’t have them in two or three months or four.” And this is substantially the testimony of the others. The agent solicited David Thompson for this insurance on at least two occasions, and each time was advised of the affliction 'from which he was suffering. The agent, however, insisted that Thompson was a proper subject for insurance, and the latter yielded to his persuasions, as lie desired to be insured.

The agent procuring the insurance was not sworn, and there.is no controversy over the fact that he was apprised that Thompson was subject to fits. The contention of the defendant is that the insured did not disclose the .precise kind of fits from which he was suffering.

p. 422

The insured was a laboring man of limited mental capacity, and he would not be expected to distinguish the exact nature of his malady, and the proof is not satisfactory that he did fully comprehend it. We must bear in mind that the charge is that he was perpetrating a fraud on the defendant. His acquaintances generally knew of his affliction. The seizures came on suddenly and at times when he was on the street and in the presence of others. He could not conceal them if he would. It at least was for the jury to determine whether he honestly revealed his condition to the agent, who stood in place of the company. (Sternaman v. Met. Life Ins. Co., 170 N. Y. 13 .) . ■

It was not for the court to decide as matter of law that the insured was guilty of fraud in that he did not give the proper medical name of his malady to the agent. (Foote v. Leary,. 103 App. Div. 517 .)

As was said in Gray v. Richmond Bicycle Co. ( 167 N. Y. 348 , 359).: “ Questions of fraud, above all others, are for the jury, and we think it was error for the trial court to withdraw the case from them, because there is a foundation in the- evidence for a conclusion either way that would not shock the sense of a reasonable man.” He described the marked features of the disease and the frequency of the seizures and the. agent accepted him as a satisfactory applicant notwithstanding the disclosures made.

In the questions put by the medical inspiector of the defendant to David IT. Thompson this appears: “ Q. Has said life ever been under treatment in any dispensary, hospital or asylum or been an inmate of any almshouse or other institution? A. Ho.” The. only proof of the incorrectness of- this answer is contained in the statement of the plaintiff to the company after the death of tlie insured, as follows: “Q. Had deceased ever been an inmate of or received treatment at any hospital, dispensary or other institution ? If so, give full particulars? • A. Yes, about eight years but do not remember what for,” and the plaintiff testified that he did not answer this inquiry.

■ Again, it is to be noted that the only escape from liability by the defendant is that the insured made a fraudulent misstatement. The bare statement of the plaintiff referred to is not sufficient to sustain the imputation of fraud.. In any event, the facts should have been presented to the jury bearing upon the fraudulent char

p. 423

acter of this charge and of the answer given. If it was not dishonest, the time for raising it as a defense has passed.

The judgment and order should be reversed and a new trial granted, with costs to the appellant to abide event.

All concurred, except McLennan, P. J., who dissented, and Robson, J., not sitting.

Judgment and order reversed and new trial ordered, with costs to appellant to abide event.

Cases cited

Sternaman v. Metropolitan Life Insurance 170 N. Y. 13 N.Y. 1902-02-25 p. 422
Gray v. Richmond Bicycle Co. 167 N. Y. 348 N.Y. 1901-06-04 at 359 p. 422