Fidelity Mut. Life Ass'n v. Harris

Decision Date11 June 1900
Citation57 S.W. 635
PartiesFIDELITY MUT. LIFE ASS'N v. HARRIS et al.
CourtTexas Supreme Court

Action by the Fidelity Mutual Life Association against W. T. Harris and others to cancel a life insurance policy. A judgment in favor of defendants was affirmed by the court of civil appeals, and plaintiff brings error. Reversed.

R. C. Milliken and Perkins, Gilbert & Hall, for plaintiff in error. Morris & Crow and Felix J. McCord, for defendants in error.

WILLIAMS, J.

Plaintiff brought this action to cancel a policy for $5,000 issued upon the life of W. T. Harris, upon the ground that it was obtained through a fraudulent conspiracy between Harris and one Mattox, by means of false representations and warranties, and upon the further ground that it was a wagering contract. Plaintiff tendered back all premiums paid upon the policy. Harris died pending the suit, and Mattox, as executor of his will, defended the action, and, by cross petition, sought to recover upon the policy. A judgment of the district court in favor of the defendant for the amount of the policy having been rendered, and, upon appeal, affirmed by the court of civil appeals, this writ of error is prosecuted from the judgment of that court.

Plaintiff in error is a corporation created under the laws of Pennsylvania, has its domicile in Philadelphia, and conducts its business there. Harris resided in Texas. His application for insurance and the first premium were delivered in Texas to a traveling soliciting agent of the company, and were by him forwarded through the state agent to the company's office in Philadelphia, and were there accepted by it. The policy was then executed and forwarded to the state agent at Dallas, and was delivered by him to the soliciting agent, and was by the latter transmitted to Harris. The policy did not, in express terms, name the place for payment of future premiums, or of the loss in case it should occur. It recited, however, that the contract was made in consideration of the payment of the premiums "to the said association," and that payment of loss will be made after receipt of proofs of loss "at its office in the city of Philadelphia," and "upon presentation and surrender of the policy, properly receipted." It further provided that premiums shall not be considered paid "unless receipt shall be given therefor, signed by the president and treasurer, and countersigned by the agent or person to whom payment is made," and that the policy "shall not be binding until delivery during the lifetime and good health of the applicant, and until the first payment due hereon has been made." The application provided, "The policy issued hereon shall not become binding on the association until the first payment due thereon has been actually received by the association or by its authorized agent during my lifetime and good health." By a statute of Pennsylvania, it was provided: "Section 1. Be it enacted," etc., "that hereafter whenever the application for a policy of life insurance contains a clause of warranty of the truth of the answers therein contained, no misrepresentation or untrue statement in such application made in good faith by the applicant shall effect a forfeiture or be a ground of defense in any suit brought upon any policy of insurance issued upon the faith of such application, unless such misrepresentation or untrue statement relate to some matter material to the risk." The application and the policy contained provisions sufficient, in the absence of such a statute, to make the statements in the application warranties, and to avoid the policy if any of such statements were untrue. The misrepresentations relied on by plaintiff to avoid the policy were the following: First, the applicant at the date of his application, February 4, 1893, was in good health, and free from any and all diseases, sicknesses, ailments, and complaints, trivial and otherwise; second, that he had never had or been afflicted with any sickness, disease, ailment, injury, or complaint, except as hereafter stated, the exception being that he had pneumonia about 15 years before, lasting 6 or 8 days, from which his recovery was perfect; third, that the last physician whom he had consulted, or who had prescribed for him, was Dr. Sam Hart, about 3 years previously, for an attack of la grippe, which was trivial and of only a few days' duration; fourth, that he had not consulted, or been prescribed for by, any other physician or medical man during the last 10 years; fifth, that he signed the application in his own proper handwriting. The application also provided that no verbal statement, to whomsoever made, should modify the contract, or in any manner affect the rights of the association, unless reduced to writing, and presented to and approved by its officers at the home office, no agent or examiner having any authority to make or alter contracts or waive forfeitures, and that the application should be the sole basis of the contract. The policy issued and delivered to Harris had a copy of the application annexed to it, on which, in large, red letters, was this caution: "Review the declarations made by you as given in this copy of your application, and, if any error has been made, advise the president of the association." The evidence as to the truth and materiality of some of these representations conflicted. The plaintiff adduced evidence sufficient to show that, for several years prior to the date of the application, Harris had been in bad health, suffering from affections of the throat or bronchial tubes or lungs, or all of them; that the attack of la grippe was a severe one, and that Harris never recovered from it, but that, as a consequence of it, consumption developed, and existed when the application was made, and finally caused his death in September, 1894. Harris, whose deposition was taken before his death, admitted that the attack of la grippe was a severe one, and the evidence is practically uncontradicted that its effects lasted for a considerable time, in 1890 and 1891; but, at the same time, his evidence and that of other witnesses for the defendant tended to show that his recovery was complete in the early part of 1891, and that his health was good from then until the date of the application and for some time after, and that the disease of which he died originated in the summer of 1893, from causes unconnected with any previous infirmity. Dr. Sam Hart was the physician who first treated him for this illness in 1890. But subsequently, during that year and 1891, Dr. V. T. Hart, Dr. Cochrane, Dr. Dobbins, and Dr. Goldsmith also treated and prescribed for him. Plaintiff also introduced the testimony of two other physicians who testified that they had been consulted by and prescribed for him, but as to this it may be conceded that there was a conflict of evidence. Harris also testified that Dr. V. T. Hart and Dr. Cochrane merely filled the place of his regular attendant, Dr. Sam Hart, during his absence. And it may be also conceded that, if they had been the only physicians who were not mentioned by him, his answer would have been substantially true, and not material to the risk. It is, nevertheless, a conceded fact that both Dr. Dobbins and Dr. Goldsmith were consulted with and prescribed for him during the early part of 1891, while he was still suffering from la grippe or its effects. Dr. Goldsmith testified that he found Harris suffering from catarrhal bronchitis, such as is generally considered la grippe, and treated him once and prescribed for him once afterwards. Did not consider his sickness serious, and treated him no further. Dr. Dobbins testified that he treated Harris from about February 1 until April 1, 1891. Found him confined to his bed, emaciated, and coughing freely, and he was not a sound man physically. Thought he either had consumption in its incipiency, or would have it as a sequel of la grippe. When he last saw him, about the 1st of April, he had improved some, but was not a sound man. The witness further stated that he gave the treatment gratuitously, at the solicitation of the Masonic order of which he and Harris were members; but his evidence shows, and Harris admits, that his services were accepted. It appears that the agent who took the application for insurance wrote the answers, and did not read them to Harris after they were reduced to writing. There is evidence that, as given by Harris, the answers were true, except those as to his last physician, and those whom he had consulted within 10 years. He did not mention other physicians, but said to the agent that he had sometimes obtained medicines from drug stores, and perhaps had a physician for colds or malarial attacks of the common kind; and this statement the agent did not consider material, and did not insert in the application. The company, in issuing the policy, acted solely upon the written application, with no knowledge of any verbal statements made by Harris to the agent. The view taken of the case renders it unnecessary to state the facts upon which the claim that the policy was a wagering one is based.

The trial court held (correctly, we think) that the validity of the policy must depend upon the statements in the written application, regardless of any oral communications made by Harris to the soliciting agent. Upon this point we need only refer to the following authorities: Fitzmaurice v. Insurance Co., 84 Tex. 61, 19 S. W. 301; Insurance Co. v. Fletcher, 117 U. S. 530, 6 Sup. Ct. 837, 29 L. Ed. 934.

The plaintiff in error contends that the contract was made in Texas, and that its effect should be determined by the laws of this state, and that, as the representations were made warranties by the policy, and some of them, at least, were untrue, the policy is avoided, without regard to their materiality. Defendant in error contends that the Pennsylvania statute governs the case,...

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