Schulman v. Federated Life Ins. Co., 59207

• Decision Date: 11 June 1980
• Docket Number: No. 59207,59207
• Citation: 268 S.E.2d 704,154 Ga.App. 479
• Parties: SCHULMAN v. FEDERATED LIFE INSURANCE COMPANY.
• Court: Georgia Court of Appeals

Page 704

268 S.E.2d 704

154 Ga.App. 479

SCHULMAN v. FEDERATED LIFE INSURANCE COMPANY.

No. 59207.

Court of Appeals of Georgia.

Argued Jan. 11, 1980.

Decided April 8, 1980.

Rehearing Denied April 30, 1980.

Certiorari Denied June 11, 1980.

James M. Poe, Glover McGhee, Atlanta, for appellant.

James B. Hamilton, Fayetteville, for appellee.

BIRDSONG, Judge.

Death benefits. Federated Life Insurance Co. issued a group life insurance policy on March 1, 1967 to employer members of the Georgia-Florida Hardware Association who elect to enroll their employees under the plan. The policy requires that to be eligible for the coverage, one must be a "full-time" employee, defined as working 30-40 hours per week for the employer. The policy provides that insurance coverage of an employee terminates "upon the first day of the month next following the date of termination of employment." The deceased Charles Schulman, whose death benefits are sought by his widow, was insured as a "full-time" employee of Dux-Mixture Hardware & Supply Co. Schulman's name was listed on each monthly premium billing sent by the company until July, 1977, when the name was crossed out as having died in June, 1977. The deceased Schulman was the brother of David Schulman, owner and president of Dux-Mixture. Apparently, since 1967, Charles Schulman also owned a hardware store, called Peters Hardware; the two businesses were somehow related but technically distinct. The brothers performed business services for each other; but the affidavit of David Schulman, in support of Schulman's motion for summary judgment and in opposition of the Federated Life Insurance motion for summary judgment, avers that Charles Schulman never worked for Dux Hardware as a "full-time" employee. " The affidavit of Boone, the claims supervisor for Federated Life Insurance, states that after Charles Schulman died, David Schulman stated to Boone that Charles Schulman had worked for Dux Hardware an average of 30-40 hours per week up until three or four months before his death. The trial court granted summary judgment to Federated Insurance Co., and denied summary judgment to the appellant. Held :

The appellee Federated Life Insurance Co. agrees that the incontestable clause of the policy prevents appellee from challenging the validity of the policy on any argument that Charles Schulman was not a "full-time" employee of Dux Hardware, inasmuch as the policy had been in force ten years at the time of Charles Schulman's death (see Code § 56-2509; and Gulf Life Ins. Co. v. Lanier, 114 Ga.App. 277, 151 S.E.2d 161). However, Federated says that it is undisputed that Charles Schulman ceased working for Dux Hardware three or four months before his death, and therefore he was ineligible for policy coverage as a matter of law. Appellant contends that since Charles Schulman was never a "full-time" employee, logically he could...