94 P. 1 (Mont. 1908), Weidenaar v. New York Life Ins. Co.

Citation:94 P. 1, 36 Mont. 592
Opinion Judge:SMITH, J. HOLLOWAY, J.
Attorney:Hartman & Hartman, for appellant. Walrath & Patten, for respondent.
Judge Panel:Holloway, J., dissenting. BRANTLY, C.J., concurs.
Case Date:February 25, 1908
Court:Supreme Court of Montana

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94 P. 1 (Mont. 1908)

36 Mont. 592




Supreme Court of Montana

February 25, 1908

         Appeal from District Court, Gallatin County; Thos. C. Bach, Judge.

         Action by John Weidenaar against the New York Life Insurance Company to recover money paid on an insurance premium note. From a judgment for plaintiff, and an order denying a motion for a new trial, defendant appeals. Reversed.

         Holloway, J., dissenting.

         Hartman & Hartman, for appellant.

         Walrath & Patten, for respondent.

         SMITH, J.

         The complaint in this action contains the following allegations: That on December 21, 1904, one W. J. McBride was a duly authorized and acting general agent and agency director of the defendant company in the state of Montana, with office at Butte, and as such had the authority to appoint agents of the defendant to solicit applications for insurance in the state. That on said date the defendant, through and by its said general agent, W. J. McBride, and one J. Sam. Castleberry, who at the time was an agent duly authorized by McBride to take such application, solicited and took plaintiff's application for a policy of life insurance in the sum of $5,000. That on the date of the taking of said application Castleberry induced plaintiff to execute to him and one E. E. Saunders, for the use and benefit of defendant, and in payment of the first premium on the policy, a certain promissory note for $462.30, bearing date December 21, 1904, due four months after date, payable to said Castleberry and Saunders, at the National Bank of Gallatin Valley, with interest at 8 per cent. per annum from date until paid, and defendant at said time, through its said agent Castleberry, delivered to plaintiff its receipt for said promissory note, wherein it was provided that in case plaintiff's application was not accepted by the company no policy should be issued, and the promissory note should be canceled and returned to plaintiff. That the application was forwarded by Castleberry to the general agent McBride, at his office in Butte, and the same was thereupon subscribed by McBride as the agent of defendant. That on the 13th day of March, 1905, defendant notified plaintiff that his application was rejected, but neither defendant, nor McBride, nor McBride, nor Castleberry, had returned or offered to return the note. That on the 23d day of December, 1904, Castleberry negotiated, sold, and assigned the note

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to the National Bank of Gallatin Valley, and on the 24th day of July, 1905, plaintiff paid the same, amounting to $383.90. That defendant, prior to the payment of the note by plaintiff, had refused on demand to pay the same, and has not paid to plaintiff any part of the sum so paid by him to the bank.

         The defendant by answer denied that it ever solicited or took plaintiff's application for insurance; denied that either Castleberry or Saunders was its agent at any time mentioned in the complaint; and denied any knowledge or information sufficient to form a belief as to the transactions between Castleberry and Saunders and the plaintiff, or either of them, concerning the note. After admitting that Castleberry forwarded the application to McBride, and that McBride subscribed the same as general agent of the company, it alleged affirmatively that neither Saunders nor Castleberry was its agent, and that neither of them had ever been appointed, or "pretended to be appointed," or held out, by defendant or McBride, as an agent. It then proceeds: "(3) That shortly after the 24th day of December, 1904, an application for life insurance in the sum of $5,000 in the defendant company, purporting to be signed by plaintiff, was submitted at the office of defendant in the city of Butte, in the state of Montana, to said W. J. McBride, who was requested to submit the same to defendant for action, and for that purpose to sign his name thereto as agent. That said W. J. McBride was ignorant of any of the transactions with plaintiff alleged in the complaint to have been had by said Saunders and Castleberry, or either of them, and neither he or said company, or any of its officers or agents, ever had any knowledge of said alleged transactions until long after the application of said plaintiff for insurance had been declined, as hereinafter set forth. (4) That the said W. J. McBride, being in ignorance of such alleged transactions, and supposing and believing that said application was submitted in good faith and had been properly obtained, forwarded the same to the home office of this defendant in New York City, where the same was afterwards declined, and said plaintiff notified accordingly of such declination. That by said application, so signed by said plaintiff, the plaintiff made the following agreements therein contained and set forth: '(I) That no statements, promises, or information made or given by or to the person soliciting or taking this application for a policy, or by or to any other person, shall be binding on the company, or in any manner affect its rights, unless such statements, promises, or information be reduced to writing, and presented to the officers of the company, at the home office, in this application. *** (IV) That any payment in advance on account of premium shall be binding on the company only in accordance with the agent's or cashier's receipt therefor on the company's authorized form.' That a part of said application so signed by plaintiff reads as follows: 'Statement to be signed by applicant upon payment of the premium or any part thereof. Dated at _____, 1904. I hereby declare that I have paid to _____ dollars in cash, and that I hold his receipt for same corresponding in date and number with this application. [Signature of Applicant] __________.' And that all of said quoted language is in plain, clear print on said application so signed by said plaintiff. That the company's authorized form of receipt mentioned in said contract, as aforesaid, was attached to and a part of said contract at the time of said signature by plaintiff, and plaintiff failed to sign said statement above set out, or to fill the blanks in the same in any manner whatever, and the same was left entirely blank upon said application, and said authorized form of receipt was left attached to said application and entirely blank, although said receipt provides: 'Fourth. That the liability of the company under this receipt shall not exceed the sum declared by the applicant in his application to have been paid, and that this receipt is nonnegotiable, and cannot be assigned or transferred.' (5) And by reason of the premises defendant says that plaintiff is, and in good conscience and equity ought to be, concluded and estopped from in any way showing or alleging that this defendant is liable to him by reason of said note mentioned in the complaint, or by reason of any of the transactions in said complaint set forth."

         A reply was filed, putting in issue the affirmative allegations of the answer, and then alleging: "(1) That at the time the plaintiff signed an application for a policy of life insurance to be issued by the defendant company on the 21st day of December, 1904, as alleged in the plaintiff's complaint herein, the said J. Sam. Castleberry, as the agent of the defendant as alleged in the complaint herein, presented the said application to plaintiff for signature after all blanks therein had been filled out by the said Castleberry, and the said Castleberry thereupon stated to plaintiff the contents of said application. That the plaintiff is a foreigner by birth, to wit, a native of Holland. That the plaintiff is unable to read the English language to any extent at all, being able to read only simple matter when printed in large type, and does not write the English language more than to write his own name. That plaintiff, by reason of his lack of knowledge of the English language, was not able to read the application so prepared for his signature by the said Castleberry, and did not read the same, and that plaintiff was entirely dependent upon the statements of the said Castleberry as to the contents thereof. (2) That at the time of the signing of the said application by plaintiff as aforesaid the said Castleberry well knew that the plaintiff could not read the English language so as to be able to read the said application and know the

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contents thereof from such reading. That, if the said application so signed by said plaintiff as aforesaid contained any such provisions as are set forth in paragraph 5 of the further and affirmative defense set forth in said defendant's answer, or, if the said application had attached to it an authorized form of receipt with the provision numbered 4, as set forth in said paragraph 5 of said affirmative defense, the said Castleberry falsely and fraudulently, and with intent to deceive and defraud the plaintiff, concealed such facts from plaintiff. That the said Castleberry did not state to the plaintiff that the said application to be signed by plaintiff, and which was signed by plaintiff, as aforesaid, contained any such provisions as are set forth in said paragraph 5 of said affirmative defense contained in said defendant's answer; nor did the said Castleberry state to plaintiff that any such 'statement to be signed by the applicant upon payment of the premium, or any part thereof,' as is set forth in said paragraph 5 of said affirmative defense contained in defendant's answer, should be filled out and signed by plaintiff; nor did either the said Saunders or the said Castleberry request plaintiff to sign said statement; nor did either the said Saunders or the said Castleberry state to plaintiff that there was any authorized form of receipt attached to the said application, or state to plaintiff any of the provisions set forth in any such receipt;...

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