Carlson v. Travelers Ins. Co.

Decision Date14 December 1970
PartiesSven R. CARLSON et al., as administrator and administratrix, etc., Appellants, v. The TRAVELERS INSURANCE COMPANY, Respondent.
CourtNew York Supreme Court — Appellate Division

Lloyd L. Rosenthal, Poughkeepsie, for appellants.

Miller, Ouimette & Moran, Poughkeepsie (Kenneth J. Burke, Poughkeepsie, of counsel), for respondent.

Before CHRIST, P.J., and RABIN, HOPKINS, MUNDER and BENJAMIN, JJ.

BENJAMIN, Justice.

In this action the plaintiffs seek to recover under a group accident and health insurance policy which had covered their intestate, Anna Carlson. Anna developed septicemia and toxic poisoning after the performance upon her of an illegal abortion and she died intestate on December 3, 1958. The plaintiffs are the administrators of her estate.

The defendant issued the insurance policy on May 15, 1956, insuring the employees of the Western Printing & Lithographing Co., Anna's employer. By the terms of the policy the defendant agreed to pay such employees for certain hospital and medical expenses incurred on account of accidental bodily injury or bodily sickness or disease in accordance with certain formulas. The premiums on the policy were duly paid. Anna thereafter became ill from sickness and bodily disease and became a patient in legally constituted hospitals from November 4, 1958 until her death on December 3, 1958. Damages are sought in the amount of $8,213.02.

The defendant, pursuant to CPLR 3123, served notices upon the plaintiffs to admit the truth of certain facts and the genuineness of certain papers. Thereby, the plaintiffs were called upon to admit that certain named persons who were not physicians had performed an illegal abortion on Anna on November 1, 1958, that she was hospitalized as the result of the abortion and that the named persons were subsequently charged and pled guilty to the crimes of conspiracy, manslaughter and abortion. The plaintiffs never responded to the notices.

Prior to the commencement of the action, the defendant offered to pay the plaintiffs a total of $117.50, as it viewed the claim as one arising under the maternity portion of the policy rather than under the bodily sickness or disease provisions, which offer much wider coverage.

The autopsy report concluded: 'Subsequent to an abortion septicemia and Toxic nephrosis developed which ultimately lead to this patient's death.'

Special Term granted the defendant's motion for summary judgment on the ground that public policy bars recovery on a contractual claim arising from an illegal act. It also held that the failure to affirmatively plead the illegality did not bar the assertion of that defense.

The facts set forth in the defendant's notices to admit should be deemed true for the purposes of this appeal. CPLR 3123 provides for the service of a notice to admit. In discussing the applicability of this section to motions for summary judgment, the following has been noted: 'CPLR 3212 states as the test for granting a motion for summary judgment that of 'directing judgment,' and requires the motion to be denied if facts are shown 'sufficient to warrant a trial.' For the purpose of ruling on a motion for summary judgment, the court at Special Term is in the same position as a trial court. It should, therefore, consider implied admissions' (3 Weinstein-Korn-Miller, N.Y.Civ.Prac. par. 3123.14). I agree that such admissions should be considered, particularly as the plaintiffs, by the their brief, appear to have waived any objection to the consideration of such facts.

I also believe that the defense of illegality may be raised by the defendant despite its failure to affirmatively plead that defense.

Subdivision (b) of CPLR 3018 provides that affirmative defenses such as illegality must be pleaded if they are such as 'if not pleaded would be likely to take the adverse party by surprise.' This was not such an issue. The plaintiffs were well aware of the fact that Anna had submitted to an illegal abortion. The failure to affirmatively plead the defense of illegality will not necessarily prevent the assertion of that defense, particularly if an issue of public policy has been raised (cf. Dodge v. Richmond, 10 A.D.2d 4, 16, 196 N.Y.S.2d 477, 487--488; 3 Weinstein-Korn-Miller, N.Y.Civ.Prac., §§ 3018.16, 3018.18).

Special Term based its holding of a violation of public policy were the claim to be allowed on Jacob v. Prudential Ins. Co., of America, 256 App.Div. 884, 9 N.Y.S.2d 27, affd. 281 N.Y. 623, 22 N.E.2d 177. In Jacob the assured died as the result of a puncture of her uterus during the course of an illegal abortion. In a terse decision the Fourth Department held that abortion was a heinous crime 'and that a recovery on the policy is, therefore, against public policy.' The value of Jacob as authority in the instant case is doubtful, since there the insurer had paid out the ordinary death benefits. The issue in the case was simply whether recovery could be had under the double indemnity provision, which became operative in the event of death by accidental means.

This court had a similar problem in Udisky v. Metropolitan Life Ins. Co., 264 App.Div. 890, 35 N.Y.S.2d 1021, in which the assured had died as the result of an attempted escape from a jail in Connecticut. Again, the dispute involved only an attempt to recover the double indemnity portion of the life insurance policy. We were not called upon to rule on the basis of the illegality involved...

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    ...in this case, since the defendant can claim no surprise from the application of this doctrine (see, CPLR 3018; Carlson v. Travelers Ins. Co., 35 A.D.2d 351, 316 N.Y.S.2d 398). Moreover, the plaintiff moved orally to amend her pleadings to conform to the proof, and, in any event, the court m......
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