Ritter v. Mutual Life Insurance

delivered the opinion of the court.

This action was brought against the Mutual Life Insurance Company of New York on six policies of life insurance, each bearing date November 10, 1891, one for $20,000, one for $15,000, and four for $10,000 each. There was a verdict in its favor, upon which judgment was entered, and that judgment was affirmed in the Circuit Court of Appeals. 28 IT. S. App. 612,

“In consideration of the application for this policy, which is hereby made a part of this contract, the Mutual Life Insurance Company of New York promises to pay at its home office in the city of New York, unto William M. Bunk, of Philadelphia, in the county of Philadelphia, State of Pennsylvania, his-executors, administrators or assigns, twenty thousand dollars, upon acceptance of satisfactory proofs at its home office of the death of tie said William M. Bunk during the continuance of this policy, upon the following condition, and subject to the provisions, requirements and benefits stated on the back of this policy, which are hereby referred to and' made part hereof. The annual premium of seven hundred and eighty-two dollars shall be paid in advance on the delivery of this policy, and thereafter to the company, at its home office in the city of New York, on the tenth day of November in every year during the continuance of this contract. In witness whereof,” etc. The “provisions, requirements and benefits” thus made part of the policy will be referred to hereafter.

The assured died October 5, 1892, all premiums falling due previous to his death having been paid. It is not disputed that he took his own life.

In the affidavit of defence filed by the insurance company, it is stated that at or about the time of the execution of the policies in suit, Bunk held policies upon his life to the extent of $815,000 issued to him by other companies; that during the year 1892 he effected additional insurance to a considerable amount, the total amount at or about the time of his death being $500,000; that prior to taking the additional insurance of $200,000, he was indebted in a very large amount by reason of the improper use of moneys entrusted to him in a fiduciary and in a quasi-fiduciary capacity; that he was without resources of his own sufficient to meet the amount of that indebtedness; that he was confronted with the fear of being convicted of .breach .of twist, and was desirous to protect pecuniarily those whom he had injured; that he deliberately determined to commit suicide for the purpose of escaping the

The affidavit of defence also contained the following statements :

“ The policies óf insurance sued upon contain a reference to the application therefor, which is made a part of the contract of insurance. A copy of this application is hereto attached, which, it is prayed, may be taken as a part of this affidavit. Under the advice of counsel the. defendant avers that this application is a part of said contract, and that the contract of insurance was a contract made in the State of New York, and to be interpreted by, and in accordance with, the laws of that State.

“ The policies of insurance sued upon were delivered to the said Eunk upon the faith of an independent contract entered into by him, embodied in the said application, to the effect that if such policies should be granted, he, the said Eunk, did, * warrant and agree . . . that I will not die by my own act, whether sane or insane, during the said period of two years ’ — said period of two years dating from the 6th day of November, 1891.

■ “ The said Eunk did, within the period of two years, commit a breach of said contract by killing himself, as has been before stated, in the way and manner above recited. By reason of the, breach of said contract, and only by reason of such breach, the policy of insurance matured, and damages occasioned by such breach are equivalent in amount to that demanded under ■the policies.”

Each of the applications for policies signed by the assured and attached to the affidavit of defence contained the following :

“ I hereby warrant and agree . . . not to engage in any ■specially hazardous occupation or employment during the next two years following the date of issue of the policy for which application is hereby made, and also not to engage in any ' military or naval service, in time of war, during the continuance of the policy, without first obtaining permission from this company ; I also warrant and agree that I will not die by my own act, whether sane or insane, during the said period of two years.”

At the trial below the defendant offered ip evidence Hunk’s application for insurance. This was objected to on the ground that the application was not attached to the policy, and under an act of the General Assembly of Pennsylvania approved May 11, 1881, could not, for that reason, be considered as part of the contract, or be admitted in evidence. The defendant, by counsel, stated at the time that the paper was not offered for the purpose of making it as an “ application ” part of the contract, but to prove that an independent, collateral, contemporaneous agreement was entered into by which Hunk stipulated that he would not die by his own act, whether sane •or insane, during the period of two years. The objection to this evidence was sustained, Judge Butler, who presided at the trial in the Circuit Court, observing: “ The representation ' or statement or agreement, call it by whatever name you •choose, is in my estimation a part of the application for insurance, and it constitutes a condition on which the policy was applied for and obtained, as much so as any representation contained in the paper itself, and it is therefore by the statute excluded by reason of the fact that a copy was not attached to the policy. . . . The statute intended that the policy shall exhibit on its face, or the policy in connection with whatever it refers to shall exhibit to the insured the conditions on which he holds the policy. The object of this would be to limit the policy of insurance, to qualify it, to make it available only in case the party lived up to this contract.”

The statute of Pennsylvania to which reference was made is in these words: “That all life and fire insurance policies upon the lives or property of persons within this Common

Whether the Circuit Court erred in excluding the application which, by the terms of the contract, constituted the consideration of the company’s promise to pay, is a question that need net be considered. If error was committed in this particular, it. was one for tho benefit of the plaintiff in the action; for, if the application had been admitted in evidence as part of the contract of insurance, the agreement and warranty of the assured not to die by bis own act, whether sane or insane, within two years from the date of the policy, would have precluded any judgment against the insurance company. Travellers' Ins. Co. v. McConkey, 127 U. S. 661 , 666. Upon this writ of error therefore we must assume that the contract of insurance contained no such agreement or warranty by the assured, nor any express condition avoiding the policy in case of suicide. Besides, the defendant does not insist that this court should determine the rights of the parties upon the basis that the application of Rank constituted part of the contract of insurance. It may be added that we do not wish to be understood as expressing any opinion upon the question whether the Circuit Court erred either in its construction of the Pennsylvania statute of 1881, or in applying that statute to the policies here in suit.

At the trial in the Circuit Court, the plaintiff submitted the following points:

2. The evidence was not sufficient to warrant the jury in finding that the deceased entered into the contracts of insurance with the intention of committing suicide.

3.. The evidence upon the part of the defendant did not warrant any inference of fact constituting a defence in law to the plaintiff’s right to recover the amount due upon the policies.

4. Th8 mere fact that the insured committed suicide did not, standing alone, avoid the policies, there being no condition in them to that effect.

5. If one whose life is insured intentionally kills himself when his reasoning faculties are so far impaired by insanity that he is unable to understand the moral character of his act, even if he does understand its physical nature, consequence and effect, such teii-destruction will not of itself prevent recovery upon the policies.

The company submitted the following points as the basis of instructions to the jury

1. There could be no recovery by the estate of a dead man of the amount of policies of insurance upon his life, if he takes his own life designedly, whilst of sound mind.

2. If the jury found that Bunk committed suicide when he was of sound mind, being morally and mentally conscious of the act he was about to commit, of its consequences, and of its nature, with the deliberate intent to secure to his estate' and to his creditors, the amount of the policies sued upon,, there could be no recovery.

3. If the jury found that Bunk obtained the policies of insurance sued upon at a time when he was insolvent and an embezzler, with the intent thereby to secure, in case of his death, from the defendant, a fund with which to pay those to whom he was indebted, and whose property he had embezzled, and subsequently committed suicide, whilst of sound mind, with the deliberate intent to carry out this scheme^ there could be no recovery.

The court disaffirmed the plaintiff’s first, second and third points without comment. It disaffirmed the plaintiff’s fourth point relating to the effect upon the rights of the assured of suicide, standing alone, and affirmed the defendant’s first, point relating to the same matter.

'The plaintiff’s fifth point was affirmed, the court, however, accompanying its affirmance of that point with some observations to be presently referred to. ■

It'will be observed that the plaintiff’s first and second points assumed that the evidence was not sufficient to warrant a finding that the assured entered into the contracts of insurance with the intention either to defraud the company or to, commit suicide. The court rightly refused to so instruct the jury. When the last policies were taken out by Bunk he was carrying insurance on his life for an amount large enough to require annual premiums of about $12,000. His income, so far as the record shows, was inadequate to meet such a burden. And yet, in 1891, he largely increased the insurance on his life, and added about $8000 to the sum to be paid annually for. premiums. Besides these facts, it appeared that on the day before his death he avowed that his debts must be paid, and that they could only be paid with his life. That avowal was in a letter written to his partner, in which he said that he had deceived the latter, and could only pay his debts with his life. That letter concluded : “ This is a sad ending of a promising life, but' I deserve all the punishment I may get, only I feel my debts must be paid. This sacrifice will do it, and only this. I was faithful until two years ago. Forgive me. Don’t publish this.” On the same day he wrote to his aunt, to whom he was indebted in a large sum, saying, among other things: “ Forgive me for the disgrace I bring upon you, ■ but it is the only way I can pay my indebtedness to you.” In addition, he left for the guidance of his executor a memoran

In view of these and other facts established by the evidence, the court did not err .in disaffirming the first and second of plaintiff’s points. We may add that, under the charge to the jury, it became unnecessary for them to inquire whether the policies were taken out with the intention of defrauding the insurance company or of committing suicide. The court said to the jury: “What constitutes insanity, in the sense in which we are using the term, has been described to you, and need not be repeated. If this man understood the consequences and effects of what he was doing or contemplating, to himself and to others, if he understood the wrongfulness of it, as a sane man would, then he was sane, so far as we have occasion to consider the subject; otherwise he was not. Here the insured committed suicide, and, as the evidence shows, did it for the purpose, as expressed in his communication to the executor of his will, as well as in letters written to his aunt and his partner, of enabling the executor to recover on the policies, and use the money to pay his obligations. I therefore charge you that if he was in a sane condition of mind at the time, as I have described, able to understand the moral character and consequences of his act, his suicide is a defence to this suit. The only question, therefore, for consideration is this question of sanity. There is nothing else in the case. That he committed suicide, and committed it with a view to •the collection of this money from the insurance companies and having it applied to the payment of his obligations, is not controverted, and not controvertible. It is shown by his own. declaration, possibly not verbal, but written. The only question, therefore, is whether or not he was in a sane condition of mind, or whether his mind was so impaired that he could not, as I have described, properly comprehend and understand the character and consequences of the act he was about to commit. In the absence of evidence on the subject he must be presumed to have been sane. The presumption of sanity is not overthrown.by the act of committing suicide. Suicido

It thus appears that the case Was placed • before the jury upon the single issue as to the alleged insanity of the assured at the time he committed suicide, and with a direction to find for the plaintiff if the assured was insane at that time, and for the company if he was then of sound mind.

Assuming that the jury obeyed the instructions of. the court, thpir verdict must be taken as finding that the assured was not insane at the time he took his life. ¥e must then inquire whether the observations of the trial court on the subject of insanity were liable to objection.

We have seen that the plaintiff asked the court to instruct the jury that if the assured intentionally killed himself when his reasoning faculties were so far impaired by insanity that he was unable to understand the moral character of his act, even if he did understand its physical nature, consequence and effect, such self-destruction would. not of itself prevent recovery upon the policies.

This was the only instruction asked by the plaintiff which undertook to define insanity, and, as before stated, it was given by the court. But in giving it the court said: “We must understand what is meant and intended by the term ‘ moral character of his act.’ It is a point which has been used by the courts, and is correctly inserted in the term; but it is a term which might be misunderstood. We are not to enter the domain of metaphysics in determining what constitutes insanity, so far as the subject is involved in this case. If Mr. Hunk understood what he was doing, and the consequences of his act or acts, to himself as well as to others — in other words, if he understood, as a man of sound mind would, the consequences to follow from his contemplated suicide, to himself, his character, his family and others, and was able to comprehend the wrongfulness of what he was about to do, as a sane man would — then he is to be regarded by yon as sane. Otherwise he is not.” Substantially the same obser

The plaintiff insists that the definition of insanity, as given by the trial court, was much narrower than was required or permitted by the decisions of this court. It is said that the impairment not only of the moral vision but also of the will, leaving the deceased in a condition of inability to resist the impulse of self-destruction, has been accepted by this court as describing a phase of insanity or mental unsoundness. One of the cases to which the plaintiff referred in support of this. view is Davis v. United States, 165 U. S. 373 , 378, which was a prosecution for murder. It was there held that' the accused was npt prejudiced by the following instruction given to the jury: “The term ‘insanity’ as used in this defence means such a perverted and deranged condition of the mental and moral faculties as to render a person incapable of distinguishing between right and wrong, or unconscious at the time of the nature of the act he is committing; or where, though conscious of it and' able to distinguish between right and wrong, and know that the act is wrong, yet his will, by which I mean: the governing power of his mind, has been otherwise than voluntarily so completely destroyed that his actions are not subject to it, but are beyond his control.” This was substantially what had been held by this court in previous cases. Life Ins. Co. v. Terry, 15 Wall. 580 ; Bigelow v. Berkshire Life Ins. Co., 93 U. S. 284 ; Insurance Co. v. Rodel, 95 U. S. 232 ; Manhattan Life Ins. Co. v. Broughton, 109 U. S. 121 ; Connecticut Life Ins. Co. v. Lathrop, 111 U. S. 612 ; Accident Ins. Co. v. Crandal, 120 U. S. 527 .

In Terry's ease, above cited, — which was an action upon a life policy declaring the policy void if the assured died by his own hand, — it became necessary to instruct the jury on the subject of insanity. The court said: “We hold the rule on the question before us to be this: If the assured, being in the possession of his ordinary reasoning faculties, from anger, pride, jealousy or a desire to escape from the ills of life, intentionally takes his own life, the proviso attaches, and there can be no recovery. If the death is caused by the voluntary

Recurring to the ruling of the court in the present case, it is not perceived that the plaintiff had any ground to complain that its definition of insanity was too strict or too narrow. His fifth point, in general terms, defined insanity as being a condition in which the reasoning faculties are so far impaired that the person alleged to be insane when committing self-destruction wras unable to understand the moral nature of his act, even if he understood its physical nature. This definition was not rejected. On the contrary, it was accepted, the court at the time making some observations deemed necessary to show what, in law, was meant by the words “ moral nature of his act.” By those observations, the jury were informed that if the assured understood what he was doing, and the consequences of his act or acts to himself and to others — that is, if he understood, as a man of sound mind would, the consequences to follow from his contemplated suicide, to himself, his character, his family and others, and was able to comprehend the wrongfulness of what he was about to do, as a sane man would — then he was to be regarded as sane; otherwise, not.

It is suggested that the attention of the jury should have been brought specifically or more directly to the fact that unsound ness of mind exists when there is an impulse to take life which weakened mental and moral powers cannot withstand— a condition in which there is no continued existence of a governing will strong enough to resist the tendency to self-destruction. But the words of the charge, although of a general character, substantially embodied these views. The court stated the principal elements of a condition of sanity as contrasted with insanity; What it said was certainly as specific as the instruction asked by the plaintiff. If the plain

No error of law having been committed in respect of the issue as to the insanity of the assured, it is to be taken as the result of the verdict that he was of sound mind when he took his life.

This brings us to the question whether the insurance company was liable — assuming that it was.not a part of the contract enforceable in Pennsylvania, that the assured should “ not die by his own áct whether sane or insane,” within two years from the date of the policy.

It is contended that the court erred in saying to the jury, as in effect it did, that intentional self-destruction, the assured being of sound mind, is i® itself a defence to an action upon a life policy, even if such policy does not, in express words, declare that it shall be void in the event of self-destruction when the assured is in sound mind. But is it not an implied condition of such a policy that the assured will not purposely, when in sound mind, take his own life, but will leave the event of his death to depend upon some cause other than wilful, deliberate self-destruction? Looking at the nature and object of life insurance, can it be supposed to be within the contemplation of either party to the contract that the company shall be liable upon its promise to pay, where the assured, in sound mind, by destroying his own life, intentionally precipitates the event upon the happening of which such liability was to arise?

Life insurance imports a mutual agreement, whereby the .insurer, in consideration of the payment by the assured of a named .sum annually or at certain times, stipulates to pay a

That the parties to the contract did not contemplate insurance against death caused by deliberate, intentional self-destruction when the assured was in sound mind, is apparent from the “ provisions, requirements and benefits ” referred to in and made part of the policy. They show that the policy was issued on the twenty-year distribution, plan, and was to be credited with its distributive share of surplus apportioned at the expiration of twenty years from the date of issue; that, after three full annual premiums were paid, the company

In the case of fire insurance it is well settled that although a policy, in the usual form, indemnifying against loss by fire, may cover a loss attributable merely to the negligence or carelessness of the insured, unaffected by fraud or design, it will not cover a destruction of the property by the wilful act of the assured himself in setting fire to it, not for the purpose of avoiding a peril of a- worse kind but with the intention of simply effecting its destruction. Much more should it be held that it is not contemplated by a policy taken out by the person whose life is insured and stipulating for the payment of a named sum to himself, his executors, admiriistrators.or assigns,

There is another consideration supporting the contention that death intentionally caused by the act of the assured when in sound mind — the policy being silent as to suicide — is not to be deemed to have been within the contemplation of the parties; that is, that a different view "would attribute to them a purpose to make a contract that could not be enforced without injury to the public. A contract,, the tendency of which is to endanger the public interests or injuriously affect the public good, or which is subversive of sound morality, ought never to receive the sanction of a court of. justice or be made the foundation of its judgment. If, therefore, a policy — taken out by the person whose life is insured, and in which the sum named is made payable to himself, his executors, administrators or assigns — expressly provided for the payment of the sum stipulated when or if the assured, in sound mind, took his own life, the contract, even if not prohibited by statute, would be held to be against public policy, in that it tempted or encouraged the assured to commit suicide in prder to make provision for .those dependent upon him, 'or to whom he was indebted.

Is the case any different in principle if such a policy is silent as to suicide, and the event insured against — the death of the assured- — is brought about by his wilful, deliberate act when in sound mind? Light will be thrown on this question by some'-of the adjudged cases, having more or less bearing upon the precise point now before this court for determination.

The plaintiff insists that the question just stated is answered irt the affirmative by the opinion in Life Ins. Co. v. Terry,

In N. Y. Mut. Life Ins. Co. v. Armstrong, 117 U. S. 591 , 600, which was an action by the assignee of a life policy, the defence, in part, being that the assignee murdered the assured in order to get the-benefit of the policy,. Mr. Justice Field, speaking for this court, said : “ Independently of any proof of. the motives of Hunter [the assignee],in obtaining the policy, and even assuming that they were just and.proper, he forfeited all rights under it, when, to' secure its immediate payment, he murdered the assured. It would be a reproach to

In Hatch v. Mutual Life Ins. Co., 120 Mass. 550 , 552, it , appears that a policy of insurance on the life of a married woman provided that “ if the said person whose life is hereby insured shall die by her own act or hand, whether sane or insane, the policy should be null and void.” It was in proof that the assured died by reason of a miscarriages produced by an illegal operation performed upon and voluntarily submitted to by her with intent to cause an abortion, and without any justifiable medical reason for such an operation. The court, observing that this voluntary act on the part of the assured was condemned alike by the laws of nature and by the laws of all civilized States, and was known by the assured to be dangerous to life, said: “We are of opinion that no recovery can be had in this 'case, because the act on the part of the assured causing death was of such a character that public polic}r would preclude the defendant from insuring her against its consequences; for we can have no question that a contract to insure a woman against the risk of her dying under or in consequence of an illegal operation for abortion would be contrary to public policy, and could not be enforced in the courts of this Commonwealth.” The report of the case shows that it was decided without reference to the questions raised by the special clauses of the policy.

The subject was considered by the Supreme Court of Alabama in Supreme Commandery &c. v. Ainsworth, 71 Alabama, 436, 446. Chief Justice Brickell, delivering the unanimous judgment of that court, said:

“In all contracts of insurance, there is an implied understanding or agreement that the risks insured against are such as the thing insured, whether it is property, or health, or life, is usually subject to, and the assured cannot voluntarily and intentionally vary them. Upon principles of public policy and morals, the fraud, or the criminal misconduct of the assured is,' in contracts of marine or of fire insurance, an

implied exception to the liability of the insurer. Waters v. Merchants' Louisville Ins. Co., 11 Pet. 213 ; Citizens' Ins. Co. v. Marsh, 41 Penn. St. 386 ; Chandler v. Worcester Mut. Fire Ins. Co., 3 Cush. 328 . Death, the risk of life insurance, the event upon which the insurance money is payable, is certain of occurrence; the uncertainty of the time of its occurrence is the material element and consideration of the contract. It cannot be in the contemplation of the parties, that the assured, by his own criminal act, shall deprive the contract of its material element; shall vary and enlarge the risk, and hasten the day of payment of the insurance money. The doctrine asserted in Fauntleroy's case, that death by the .hands of public justice, the punishment for the commission of crime, avoids a contract of life insurance, though it is not so expressed in the contract, has not, so far as we have examined, been questioned, though the case itself may have led to the very general introduction of the exception into policies. The same considerations and reasoning which support the doctrine seem to lead, of necessity, to the conclusion, that voluntary, criminal self-destruction, suicide, as defined at common law, should be implied as an exception to the liability of the insurer, or, rather, as not within the risks contemplated by the parties, reluctant as the courts may be to introduce by construction or implication exceptions into such contracts, which usually contain special exceptions.” Again : “ The fair and just interpretation of a contract of life insurance, made Avith the assured, is, that the risk is of death proceeding from other causes than the voluntary act óf the assured, producing, or intended to produce it; ” and that “ the extinction of life by disease, or by accident, not suicide, voluntary and intentional, by the assured, while in his.sens.es, is the risk intended; and it is not intended that; without the hazard of loss, the assured may safely commit crime.”

In support of 'the general proposition that the law will not enforce contracts and agreements that are against the public good, and, therefore, are forbidden by public policy, reference is often made to the case of The Amicable Society &c. v. Holland, 4 Bligh, N. S. 194, 211, known as Fauntleroy's case.

Referring to that case, Bunyon in his work on Life Insurance says: “Tt would render those natural affections which make every man desirous of providing for his family, an inducement to crime; for the ease may be well supposed of a person insuring his life for that purpose, with the intention of committing suicide. For a policy, moreover, to remain in force when death arose from any such cause would be a fraud

In Moore v. Woolsey, 4 Ell. & Bl. 243, 254, in which the question was as to the rights of an assignee under a policy providing that if the assured should die by duelling or by his • own hand, or the hand of justice, it should be void as to the personal representative of the assured, Lord Campbell, O. J., said that, “ if a man insures his life for a year, and commits suicide within the year, his executors cannot recover on the policy, as the owner of a ship who insures her for a year cannot recover upon the policy if within the year he causes her to be sunk: a stipulation that, in either case, upon such an event the policy should give a right of action, would be void.”

For the reasons we have stated, it must be held that the death of the assured, William M. Eunk, if directly and intentionally caused by himself, when in sound mind, was not a risk intended to be covered, or which could legally have been covered, by the policies in suit.

The case presents other questions, but they are of minor importance, and do not affect the substantial rights of the parties.

We perceive no error of law in the record, and the judgment is

Affirmed.

Me. Justice Peokham did not take part in the consideration or decision of this case.