Janneck v. Metro. Life Ins. Co.
| Citation | 162 N.Y. 574,57 N.E. 182 |
| Parties | JANNECK v. METROPOLITAN LIFE INS. CO. |
| Decision Date | 01 May 1900 |
| Court | New York Court of Appeals |
Appeal from supreme court, appellate division, Fourth department.
Action by Bertha Janneck against the Metropolitan Life Insurance Company. From a judgment and order of the appellate division (43 N. Y. Supp. 669) affirming a judgment in favor of plaintiff, and an order denying a new trial, defendant appeals. Affirmed.
Eugene Van Voorhis, for appellant.
George F. Yeoman, for respondent.
This action was brought upon a life insurance policy for $1,000, issued by the defendant on the 5th day of July, 1890, upon the life of one Charles Janneck, and payable to the plaintiff, the beneficiary therein named. The plaintiff recovered a verdict in the trial court, and the unanimous affirmance in the appellate division of the judgment thereon precludes us from looking into the evidence to see whether it supports the verdict. The only exceptions of sufficient importance to require discussion are those which arise upon the construction of the following clause of said policy: ‘Should the life insured be convicted of a felony, or become so intemperate as to impair his health, or to induce delirium tremens, said company shall have the unquestioned right, upon becoming satisfied of such fact, to terminate this contract immediately upon the tender to the party in interest of the legal reserve, as hereinbefore described.’ The defendant, acting upon information from which it became satisfied that the insured had become so intemperate as to impair his health, tendered to the beneficiary the legal reserve which had accrued upon said policy, and notified her in writing that the contract was terminated. The plaintiff refused to accept the legal reserve thus tendered, or to regard the contract as terminated, and periodically tendered to the defendant the premiums upon such policy as they became due until the death of the insured. Under these conditions the plaintiff contends, and the courts below have held, that the language of the policy above quoted did not give the defendant the arbitrary right to terminate the contract, and that such right depends upon the existence of the fact which is relied upon to terminate it. It cannot be denied that it was entirely competent for the parties to make a contract which the insurer would have the unquestioned right to terminate at will. Did they make such a contract? The answer to this question must be found in such a construction of the language used as will effectuate the fair intent and meaning of the contract. In considering insurance contracts courts should be guided by two cardinal rules of universal application. The first is that, when the language is clear and unequivocal, the contract should be enforced according to its terms, without regard to the equitable considerations which may be urged in avoidance of it. The second is that, when the language of an insurance contract is so ambiguous as to render it susceptible of two interpretations, it should be most strongly construed against the insurer, because the latter has prepared the contract, and is responsible for the language used. Kratzenstein v. Assurance Co., 116 N. Y. 59,22 N. E. 221,5 L. R. A. 799;Allen v. Insurance Co., 85 N. Y. 473;Herrman v. Insurance Co., 81 N. Y. 184. With these rules in mind, let us analyze the language above referred to: ‘Said company shall have the unquestioned right, upon becoming satisfied of such fact, to terminate this contract,’ etc. What fact? Obviously, the fact of conviction of a felony, or of such a degree of intemperance on the part of the insured as to impair his health.
The sentence begins, ‘Should the life insured be convicted of a felony, or become so intemperate as to impair his health or induce delirium tremens,’ etc. We think this language assumes the existence of the fact as an essential prerequisite to the exercise of the right reserved. Upon becoming satisfied of ‘such fact,’ and not otherwise, has the insurer the right to terminate the contract? Let us suppose that the insurer in a given case should be, or claim to be, satisfied that the insured had been convicted of a felony, and should thereupon terminate the policy. Suppose, further, that the insured had not been convicted at all, or had only been convicted of a misdemeanor. Could the insurer in such a case successfully maintain that it had properly exercised its right to terminate and cancel the contract? We think not. Let us assume that the insured had never even tasted intoxicating liquors, and that the insurer had information from which it became satisfied that the insured had become so intemperate as to impair his health, and thereupon the insurer had proceeded to cancel the policy. Can it be seriously urged that such cancellation would clearly be supported by the language of this contract? In answering this inquiry in the negative, we do not deny the right...
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