Aetna Life Insurance Company v. John Moore

• Decision Date: 22 December 1913
• Docket Number: No. 33,33
• Citation: 231 U.S. 543,34 S.Ct. 186,58 L.Ed. 356
• Parties: AETNA LIFE INSURANCE COMPANY, Petitioner, v. JOHN T. MOORE, Administrator of John A. Salgue, Deceased
• Court: U.S. Supreme Court

231 U.S. 543

34 S.Ct. 186

58 L.Ed. 356

AETNA LIFE INSURANCE COMPANY, Petitioner,

v JOHN T. MOORE, Administrator of John A. Salgue, Deceased.

No. 33.

Argued November 3, 1913.

Decided December 22, 1913.

Messrs. A. L. Miller, M. D. Jones, George S. Jones, Walter Defore, Wallace Miller and Charles H. Hall Jr. for petitioner.

Messrs. Minter Wimberly, Jesse Harris, and Alexander Akerman for respondent.

[Argument of Counsel from pages 544-547 intentionally omitted] Mr. Justice McKenna delivered the opinion of the court:

Action on a life insurance policy for $6,000, issued upon the life of John A. Salgue, the intestate of respondent. It was tried to a jury, resulting in a verdict and judgment for respondent. The judgment was affirmed on writ of error to the circuit court of appeals by a per curiam opinion. This certiorari was then granted.

The questions in the case are based on certain statements made by Salgue, which, it is contended by petitioner (herein called the insurance company), became a part of the policy and constituted warranties.

The following are the material provisions of the policy and the application:

'This policy of insurance witnesseth: That the AEtna Life Insurance Company, in consideration of the statements, answers, and warranties contained in or indorsed upon the application for this policy, which application is copied herein and made a part of this contract, and in further consideration of the annual premium . . . hereby insures the life of John A. Salgue . . .

'This policy is issued and accepted subject to the conditions, provisions, and benefits printed on the reverse of this page, which are hereby referred to and made a part hereof. . . .

'Conditions, provisions, and benefits which are made a part of this policy:

'Section 1. This policy shall not take effect until the first premium hereon shall have been actually paid during the lifetime and good health of the insured. . . .

'Section 7. All agreements by said company are signed by one of its executive officers. No agent or other person not an executive officer can alter or waive any of the conditions of this policy, or make any agreement binding upon said company.'

Copy of the application:

'Being desirous of insuring my life with the AEtna Insurance Company, I do hereby declare and warrant that I am in good health, of sound body and mind, and that the following statements signed by me are full, correct, and true; and that I have no knowledge or information of any disease, infirmity, or circumstance not stated in this application which may render insurance on my life more hazardous than if such disease, infirmity, or circumstance had never existed; and I do hereby agree that the declarations and warranties herein made, and the answers to the following questions, together with those signed by me on the second page of this application, shall be the basis and form part of the contract (or policy) between me and the said company, and that if the same be in any respect untrue, said policy shall be void; and I further agree that the insurance hereby applied for shall not be binding upon said company until a policy has been issued, nor until the amount of premium as stated therein has been received by said company, or its authorized agent, during my life-time and good health, and a receipt given therefor, signed by an executive officer of said company; and I further agree that no statement or declaration made to any agent, examiner, or other person, and not contained in this application, shall be taken or considered as having been made to or brought to the notice or knowledge of said company, or as charging it with any liability by reason thereof; and I understand that all policies and agreements made by the said AEtna Life Insurance Company are signed by one or more of its executive officers, and that no other person can grant insurance or make any agreement binding upon said company.'

The application also contained questions addressed to the insured by the examining physician, and the answers by him, among others, as follows:

'14. What are the names and residences of all the physicians whom you have personally employed or consulted during the last five years?'

Answer: 'Dr. James T. Ross, Macon, Georgia.'

'16. Has any proposal or application to insure your life been made to any company, association, or agent on which a policy of insurance is now pending? Or has any such proposal or application ever been made for which insurance has not been granted, or on which a policy or certificate of insurance was not issued in full amount, and of the same kind as applied for? If so, state particulars and the names of all such companies, associations, or agents.'

Answer: 'None.'

'19. Has any physician expressed an unfavorable opinion upon your life with reference to life insurance?'

Answer: 'No.'

'21. Have you ever had any of the following diseases? Answer 'yes' or 'no' opposite each. If 'yes,' state the date, duration, and severity of illness. . . . Disease of the heart?'

Answer: 'No.'

'23. Are you subject to dyspepsia, dysentery, or diarrhoea?'

Answer: 'No.'

'24. Have you had during the last seven years and disease or severe sickness? If so, state the particulars of each case and the names of the attending physicians.'

Answer: 'No.'

There was discussion between Salgue and the examining physician in regard to the condition of Salgue's heart. His first statement was that he did not have heart disease, though he had been told he had. The physician explained to him the symptoms of the disease, and he replied that he did not have any of them and never had been treated for heart trouble. He had, he further said, consulted two doctors, Little and Winchester, and one of them told him he had heart disease 'and scared him so.' The other told him that he did not have any signs of it. And the recollection of the physician was that Salgue referred to Dr. Ross as having treated him for something several years previously. At the end of the discussion the physician put down the answer 'No.' He also reported that Salgue's respiration was 'full, easy, and free. O. K., and that 'auscultation' did not 'indicate enlargement or disease of the heart of any kind.'

There was testimony to the effect that about June 15, 1905, and prior to the application to the AEtna, Salgue applied to the local agent of the Penn Mutual Insurance Company at Macon for a policy of $6,000. The company's medical examiner refused to pass him, telling him that he had heart disease, and advising him to see his family physician, Dr. McAfee. Salgue consulted Dr. McAfee, and was informed by him that he had heart disease.

The contentions of the insurance company are based (1) upon a request for the direction of a verdict in its favor; (2) the denial of requests for special instructions. We may confine our consideration to the special requests.

There was controversy as to whether Salgue had heart disease. We have seen the various opinions of the examining physicians. Salgue was a strong man physically and his strength was illustrated by instances. At one of his examinations he easily picked up and removed a large box of melons without any effect on his heart action. An effort of strength on another occasion was immediately detrimental, causing an aneurism which progressively developed and produced a rupture of the blood vessel and his death. By the advice of his physician he had quit work and had gone to a resort called Indian Springs. He remained there about ten days, and on his way home died suddenly on the cars.

It is not necessary to give at length the charges requested. They embrace the propositions (1) that the application and its statements, warranties, and covenants became part of the contract of insurance, and that any variation from them whereby the nature, extent, or character of the risk was changed, would affect the policy, whether the statements were made by the applicant in good faith, not knowing they were untrue, or made wilfully of fraudulently. And so also as to the answers to the questions put to Salgue as to his health, freedom from heart disease, the physicians he had consulted, the applications for insurance which he had made which were rejected or not accepted. (2) Under the terms of the policy the application constituted part of it, the answers to the questions were covenanted and warranted, and Salgue was bound thereby without regard to his good faith in making them; or that they were representations material to the risk by which he was bound without regard to his good faith, and that therefore the answers, if untrue, would make the policy void. (3) The provisions of the policy that no statement or declaration made to an agent, exam- iner, or any other person, and not contained in the application, shall be taken or construed as having been made to or brought to the knowledge of the company, or as charging it with any liability by reason thereof, was binding on Salgue. So also the limitations on the powers of the agents and of what may have been said to them or by them. And further, that if the answers in the application were incorrect, it was Salgue's duty to report them as incorrect to the company, and, failing to do so, he was presumed to have accepted his policy upon the faith of them. It was therefore immaterial what may have been said by or to the agent or to the medical examiner which was not reduced to writing and presented to the officers of the company at the home office.

The charge of the court was very long,—too long even to attempt to condense. It was antithetical to the special requests made by the insurance company. Applying certain general principles which it expressed, the court said:

'To make them distinctly applicable to your duty, you are instructed that you must determine from all the facts, first, did Salgue make a misrepresentation or concealment of a fact of which he had knowledge? If he did not, the defense on this point...