Aloe v. Mutual Reserve Fund Life Ass'n

• Decision Date: 20 December 1898
• Citation: 49 S.W. 553,147 Mo. 561
• Parties: ALOE v. MUTUAL RESERVE FUND LIFE ASS'N.
• Court: Missouri Supreme Court

49 S.W. 553

147 Mo. 561

ALOE v. MUTUAL RESERVE FUND LIFE ASS'N.

Supreme Court of Missouri, Division No. 2.

December 20, 1898.

LIFE INSURANCE — APPLICATION — WARRANTIES — BREACH.

1. An application for insurance in a mutual assessment company warranted the answers to be true, and stated that the application and the by-laws were to be a part of the contract, which was to be void if any of the answers of the application were untrue. The by-laws provided that every application should be a warranty, and that the concealment of any fact or an untrue answer should avoid the membership. The policy stated that insured was received as a member in consideration of the answers and agreements of the application, which was made a part of the contract. Held, that the answers in the application were warranties.

2. Where the answers in an application for insurance are warranties, an untrue answer avoids the policy, even if not material to the risk.

3. An application for a policy warranted that the applicant had not been treated by any physician for 30 years; that his application for insurance had been rejected by two companies; that he had certain other insurance; that for 12 months last past he had been in good health, had not visited any place for his health, and no physician had given an unfavorable opinion concerning it. It was shown that during the 30 years preceding he had been repeatedly treated by physicians; that his application for insurance had been rejected by six companies, instead of two; that his statement as to other insurance omitted one policy; that within 12 months he had been treated by physicians, and medical examinations had disclosed traces of albumen in his urine; that he had visited a foreign country for his health, and consulted physicians there; that several physicians who had examined him with reference to life insurance had rejected him. Held, that the policy was void because of a breach of the warranties.

Appeal from St. Louis circuit court; Leroy B. Valliant, Judge.

Action by Isabella Aloe against the Mutual Reserve Fund Life Association. There was a judgment for plaintiff, and defendant appeals. Reversed.

Wm. C. &. Jas. C. Jones, for appellant. Noble & Shields, for respondent.

BURGESS, J.

The defendant is a corporation incorporated under the laws of the state of New York, and under its charter its business is limited to insurance on the assessment plan; and, having complied with all the requirements of our laws, it is authorized to transact business in this state on that plan. This suit is based upon a policy of insurance issued by the defendant on the 13th day of October, 1890, on the life of Albert S. Aloe, in the sum of $5,000, payable to the plaintiff, who is the wife of said Albert. The application for the policy was in writing, and signed by the insured on the 3d day of October, 1890, at the city of St. Louis, Mo., and by him forwarded to defendant, at its home office, in the city of New York. On January 30, 1893, Albert S. Aloe died, and after making proofs of loss as required by the terms of the contract, and defendant's refusal to pay the amount of the policy, this suit was instituted. The petition is in the usual form in such cases. The answer admitted the plaintiff's case, and then pleaded affirmatively breaches of warranty in the application for the insurance, and fraudulent statements inducing the issue of the certificate. The breaches of warranty and false answers alleged by defendant related to the then physical condition of insured, to prior rejections of insured for insurance, unfavorable opinions of physicians in connection therewith, consultation and treatment by physicians, and change of climate by insured for his health, and other insurance not disclosed by Aloe in his application. Issue was joined by reply, denying the new matter in defendant's answer. The trial was before the court and jury, and resulted in a verdict and judgment in favor of plaintiff for the full amount of the policy, from which, after an unsuccessful motion for a new trial, defendant appeals.

The policy provides that in consideration of the answers, statements, and agreements contained in the application for the policy of insurance, which are made part of the contract, and of the payment of $40 as admission fee, etc., Albert S. Aloe is admitted to membership in the association. In the application the assured was asked a number of questions, which he answered in writing. Those being material to the issues involved in this litigation, and the answers thereto, are as follows: "No. 9. Has the applicant now any insurance on his life? If so, where, when taken, for what amounts, and what kinds of policies? Answer. Germania, N. Y., endowment; issued about 1880, $2,500; Washington Life, endowment about 1878, $4,500; Conn. Mutual 10-year plan, about 1875, $2,500; paid up, Bay State, $5,000. No. 10. Has any proposal to insure the life of the applicant ever been postponed or declined? If so, by what company or association, and for what reason? Answer. Yes; N. Y. Life and Conn. Mut., about six years ago, on account of traces of albumen. No. 11. Q. (a) Has any proposal or application to insure the life of the applicant, or for membership, ever been made to any company, association, or agent, upon which a policy or certificate of membership has not been received by you, in person, for the full amount and kind, and at the rate, applied for? Answer. Yes; as above. Q. (b) Have you any insurance on your life, or membership in any company or association, not mentioned in answer to the above question? Answer. Mo. Masonic, $5,000; Legion of Honor, $2,000. No. 12. Has any physician given an unfavorable opinion on the life of the applicant with reference to life insurance or otherwise? If so, state particulars. Answer. As above. No. 13. Has the applicant ever had illness, local disease, injury, mental or nervous disease, or infirmity? If yes, state nature, date, duration, and severity of attack. Answer. No. No. 14. (a) How long since you consulted or was attended by a physician? Answer. (a) Not since over thirty years. No. 15. Have you ever used externally or internally any patent, proprietary, or other medicines, within the past two years? If so, and for what disease? Answer. No." "No. 17. Have any facts regarding your past health or present condition been omitted? Answer. No."

The application is in three parts, and in part 2 of said application, being answers of the said Albert S. Aloe to questions by the medical examiner, he warranted that his answers written to the questions therein propounded were his answers, and were full, complete, and true, and that the same should be made a part of the contract of his certificate of membership or policy of insurance in the defendant association, and that he was the person who signed the application aforesaid, and was examined as therein stated. And in that part of said application the following questions were put to the said Albert S. Aloe, to which he made the following answers, respectively: "(2) Is the applicant now, and has the applicant been, in good health through all the past twelve months, and free from all diseases, weakness, or infirmity? Answer. Yes." "(7) Has change of climate or location ever been sought or advised, or have you visited any place for the benefit of, or on account of, your health? If so, when, where, and for what? Answer fully. Answer. No." "(11) Has the applicant ever had any illness, local disease, injury, mental or nervous disease or infirmity, or ever had any disease, weakness, or ailment of the head, throat, lungs, heart, stomach, liver, kidneys, bladder, or any disease or infirmity whatever? If yes, state nature, date, duration, and severity of attack. Answer. No."

The by-laws of defendant association provide that: "Only such persons as are in good health, who shall pass a rigid medical examination, and be approved by the medical director, or his deputy, and the executive committee, or its duly-appointed representative, may become members of the association, subject to all the requirements of membership set forth in the constitution or by-laws, and the application for, and certificate of, membership. Every application for membership must be in writing, and shall be and constitute a warranty as to all matters stated therein, and must answer satisfactorily all questions set forth in the form of application adopted by the executive committee. If at any time any person secures membership in this association by concealing any fact, or if the statements in his application for membership are in any respect untrue, or if any of the conditions or provisions upon which the certificate of membership is issued are violated, or if any of the conditions or provisions of the certificate of membership or of the constitution or by-laws are violated, then and in every such case such membership shall at once cease and determine, and the certificate shall be null and void, and all payments made thereon forfeited to the association. But the executive committee shall have the power to reinstate a delinquent member at any time within one year for good cause shown, and upon satisfactory evidence of good health, and upon payment of all delinquent dues and assessments."

Upon the trial it was stipulated between the parties that the defendant company is a mutual life insurance company, organized under the laws of the state of New York, and that the contract of insurance sued on is a contract of insurance on the assessment plan, within the meaning of the laws of Missouri. With respect to the statement by Aloe to the effect that he had not consulted or been attended by a physician for over 30 years at the time he made application for the insurance, the evidence showed that he had been repeatedly treated by physicians during that time, and on several occasions had his urine examined, and that some of the physicians were of the opinion that he had albuminuria....