Fidelity & Casualty Co. v. Phelps

• Decision Date: 04 April 1933
• Docket Number: No. 3429.,3429.
• Parties: FIDELITY & CASUALTY CO. OF NEW YORK v. PHELPS et ux.
• Court: U.S. Court of Appeals — Fourth Circuit

64 F.2d 233 (1933)

FIDELITY & CASUALTY CO. OF NEW YORK v. PHELPS et ux.

No. 3429.

Circuit Court of Appeals, Fourth Circuit.

April 4, 1933.

Harriet L. French and D. E. French, both of Bluefield, W. Va. (French, Easley, Easley & French, of Bluefield, W. Va., on the brief), for appellant.

George Richardson, Jr., of Bluefield, W. Va. (Albert S. Kemper, Jr., of Bluefield, W. Va., on the brief), for appellees.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

NORTHCOTT, Circuit Judge.

This suit in equity was brought in the District Court of the United States for the Southern District of West Virginia to cancel a life and accident insurance policy issued on December 3, 1923, to one J. Frank Phelps, in which policy his wife, Hettie G. Phelps, was named as beneficiary.

The bill was filed in October, 1931, by appellant (who will be here referred to as plaintiff), and a motion was made to dismiss the bill as being insufficient. Answer of appellees (who will here be referred to as defendants), was filed, and, after the court below overruled the motion to dismiss, a hearing was had in February, 1932. A number of witnesses were examined in person. Depositions of two witnesses were read. In September, 1932, the trial judge filed an opinion finding for the defendants, and entered a decree dismissing the bill, from which action this appeal was brought.

The bill alleged that, in order to secure the policy in question, the defendant, J. Frank Phelps, made a statement in the application for said policy, signed by him in December, 1923, that he was in sound condition mentally and physically, and that said statement that said defendant was "in sound condition mentally and physically" was untrue at the time that it was made. The bill further alleged that the said defendant was not in a sound condition physically at the time he made the statement, because at that time "he was then and had been blind, or practically blind, in his left eye since his youth, which he well knew at the time of making said application."

The policy as originally issued was for the period of one year, and was extended each year by a certificate issued by the plaintiff company which provided as follows: "Provided that the assured, upon the date first above mentioned (and which is the renewal date) is in sound condition mentally and physically, except as stated in the policy."

The premiums were paid each year, and the last renewal of the policy was December 3, 1928.

The terms of the policy included payment of weekly indemnity of $50 a week and $15,000 in the event of death resulting directly and exclusively from accident, with a further proviso that, in the event of an accident while in a private conveyance, the indemnity and life insurance should be doubled.

In June, 1929, the said J. Frank Phelps was injured in an automobile accident while he was driving alone in his automobile engaged in his occupation as salesman. The car left the road running over a bank, and the said defendant, the only witness to the accident, testified that the accident happened because of a defect in the mechanism of the car. The injuries resulted in the alleged total disability of insured.

Phelps filed claims for double indemnity and the plaintiff paid him in all $10,871.20 prior to the institution of this suit. Plaintiff's bill, in addition to praying for the cancellation of the policy, prayed for judgment for the amount paid under the policy, less premiums. The policy provided that the insured should submit to an examination by any medical adviser of the company, and during an examination it developed that defendant J. Frank Phelps had defective vision in his left eye from early childhood, and that defendant accompanied by his wife, went to Richmond, Va., where he was examined by eye specialists who found the vision of the left eye to be bad and, expressed by them in technical terms, to be twenty-two hundred (20/200). The two eye specialists who examined the defendant claimed that he told them that he had had this defect of vision in his left eye, and at the plaintiff's request said it was caused, so his mother had told him, by a "rising." It is also admitted that said defendant was cross-eyed from infancy, but he testified that this defect had been largely remedied by a pair of glasses fitted for him by an eye specialist when he (the defendant) was twenty or twenty-one years old. Defendant denied the statement attributed to him by the doctors.

Expert witnesses, who were eye specialists, testified that defendant J. Frank Phelps had, when they examined him, what they termed "absence of binocular single vision," and that from that fact they concluded his trouble existed from early childhood, because, as one of them said, it was from that time (two to three years of age) that single vision with the two eyes is established. One witness further testified that it was "not likely" that, if defendant had fairly normal eyesight and used his eyes until he was fifty years of age, he would after that acquire the double vision found existing. It is a significant fact that none of the experts testified that the condition of Phelps' left eye could not have been caused by the injuries resulting from the accident.

The defendant J. Frank Phelps testified that he was fifty-eight years old, and that he had been engaged in various activities all his life, doing many things that demanded good eyesight; that, other than being somewhat cross-eyed, he had never been conscious of any defect in his sight in either eye until after the accident; that the last time he had had glasses fitted was in the year 1920 or 1921; and that he was wearing the same glasses at the time of the accident and also had them on at the trial. It was proven that the lenses of these glasses were practically the same for both eyes, and the optometrist who fitted the glasses testified that he remembered the occasion, and was satisfied that, if there had been any marked difference in the vision of defendant's two eyes, he would have noticed it and remembered it, and that he always tested each eye of a patient separately.

The insured further testified that he had never had any trouble driving his automobile, and had never had an accident driving before the time he was injured, and that at the time he stated that he was in a sound condition mentally and physically he thought he was in such sound condition and knew nothing to the contrary.

A number of witnesses testified as to working with the defendant and not being aware of any defect in his vision.

Both of the defendants testified that the vision of the left eye of the insured had only become bad after the accident.

The following excerpt from the evidence of one of the doctors who was a witness for the plaintiff is illuminating:

"Question, `You can state, though, Doctor, just what conclusions you and Dr. Hill reached in regard to his left eye?' Answer, `I concluded, taking in various factors in the history of the case, the presence of central scotoma, the absence of any objective findings, that the man had always had poor vision in the left eye.'"

"Q. 23. `What do you mean by "poor vision."'? A. `Slightly sub-normal vision.'

"Q. 24. `Do you mean defective vision?' A. `Defective vision.'

"Q. 25. `What conclusion did you reach as to the cause of this?' A. `I concluded that this was either a congenital defect, that is, existing prior to birth or shortly subsequent to...