Arndt v. Jefferson Standard Life Ins. Co.

• Decision Date: 11 December 1918
• Docket Number: 513.
• Citation: 97 S.E. 631,176 N.C. 652
• Parties: ARNDT v. JEFFERSON STANDARD LIFE INS. CO.
• Court: North Carolina Supreme Court

97 S.E. 631

176 N.C. 652

ARNDT v. JEFFERSON STANDARD LIFE INS. CO.

No. 513.

Supreme Court of North Carolina

December 11, 1918

Appeal from Superior Court, Catawba County; Cline, Judge.

Action by David Franklin Arndt against the Jefferson Standard Life Insurance Company. Judgment for defendant, and plaintiff appeals. Affirmed.

Where a letter had been read in evidence, it was not objectionable to require plaintiff, a witness, to testify on cross-examination as to whether he had received the same and to answer questions resulting in no more than repeating what was in the letter.

The action was brought by the plaintiff to recover damages of the defendant on account of an alleged fraud of the agents of the Greensboro Life Insurance Company. Plaintiff alleged that in December, 1906 the agents of the Greensboro Life Insurance Company induced him to apply for a policy of life insurance for $1,000, by making the following false representations:

First that after carrying a policy for two years, if he should become dissatisfied with it he would have the option to make surrender of same and receive from the company all moneys he had paid to it under said contract, without interest (the interest being offset by the temporary protection to plaintiff under the policy); and, second, that after paying in premiums as much as $700, he would not be required to pay any other or further sum on account of said contract, but that it would become a paid-up policy.

A policy was subsequently issued by the Greensboro Life Insurance Company on the plaintiff's life, bearing date March 1, 1907; but whether the policy was delivered through the mail or by an agent of the Greensboro Life Insurance Company does not appear. The plaintiff, at the time he applied for the policy, was 53 years of age, and could read and write. He paid nine annual premiums upon the policy, his last premium being paid in March, 1915. This action was commenced in June, 1917. Plaintiff testified, that "a good long time before he started suit" he found out that the policy was not what he thought it was, and he wrote to the company in March, 1914, and inquired how many more premiums he would have to make before he had a paid-up policy, and the company replied under date of March 10, 1914 advising him that his policy was "a whole-life contract," and that he would have to pay premiums as long as he lived. In the following year, after having received this information, he paid another premium.

The defendant has assumed the liabilities of the Greensboro Life Insurance Company.

The court nonsuited the plaintiff, and he appealed.

W. A Self, of Hickory, for appellant.

Brooks, Sapp & Kelly, of Greensboro, and W. C. Feimster, of Newton, for appellee.

WALKER, J. (after stating the facts as above).

First. This assignment of error is based upon the refusal of the court to admit in evidence the letter of another person to the company, which purported to have been sent by D. W. Cochrane to the plaintiff, and is untenable, for two reasons: First, it was not identified. Plaintiff did not attempt to prove the signature of D. W. Cochrane, by whom the letter purports to have been written, but merely offered the letter in evidence without any proof of its genuineness. Letters are not admissible until satisfactory proof has first been made of their authenticity. Lockhart on Evidence, § 96. In the case of Beard v. Railroad, 143 N.C. 136, 55 S.E. 505, this court said:

"While it is well settled that, where it is shown that a letter was addressed, stamped, and mailed, there is a presumption that it was received by the addressee, it cannot be that the receipt of a letter purporting to be signed by a person is any evidence that it was written by such person. No authorities are cited to sustain the exception."

See, also, Woody v. Spruce Co., 175 N.C. 545, 95 S.E. 905; Tyson v. Joyner, 139 N.C. 69, 51 S.E. 803, and cases cited therein. In the second place, even if the authorship of the letter had been properly proven, it was not competent as evidence in this case, and, besides, was offered by the plaintiff for the purpose of proving that D. W. Cochrane was general agent of Greensboro Life Insurance Company, and therefore was merely an offer to prove agency by the alleged declarations of the agent himself. That such declarations are not admissible to prove agency is well settled. Daniel v. Railroad, 136 N.C. 517, 48 S.E. 816, 67 L. R. A. 455, 1 Ann. Cas. 718.

Second. This exception is sufficiently answered by what we have said under the first assignment of error. The plaintiff had not qualified himself to swear to the signature of Mr. Cochrane. In fact, he testified that he had never seen him but once in his life, and that was on the occasion of his applying for the policy. He had never seen him write, and had never even seen a signature admitted to be his, so far as the evidence discloses. He was simply not qualified to testify to the genuineness of the signature.

Third. This objection is addressed to the refusal of the court to allow the plaintiff to testify as to Mr. Ervin's declaration with respect to Mr. Cochrane's relations to the Greensboro Life Insurance Company. It would seem to be too clear for argument that it is not permissible to prove agency in this way. It was hearsay, or the unsworn declaration of a third party, not qualified to bind the defendant. 1 Greenleaf, Ev. § 99.

Fourth. Defendant was allowed to ask plaintiff, on cross-examination, if he did not receive a letter from defendant under date of March 10, 1914, advising him that his policy was a whole-life contract, and that he would have to pay premiums as long as he lived; and plaintiff excepted to the admission of this testimony. It was clearly competent, and material, for the purpose of showing that plaintiff paid a premium after he acquired this information, and waited for more than three years thereafter before instituting this action. The letter was read to the court and jury, and then the witness, who was the plaintiff, was asked if he received the letter, which he admitted, and if it did not notify him of the true nature of his policy, which he also admitted, and then stated that, after being thus informed as to the contents of the policy, he paid a premium a year afterwards. We can see no possible objection to this evidence. It was merely repeating what was in the letter.

The real question in the case is whether, upon the admitted facts, the defendant is liable to the plaintiff in damages to the amount of premiums paid by the latter, with interest thereon.

The contract of insurance is plainly worded, and there is no difficulty in ascertaining its meaning by reading it. It is a printed policy, there being no handwriting on it, except the signatures of the officers, and they are easily read. The plaintiff testified that he could read print and sign his name, and yet he kept the policy in his possession for about nine years without even looking at it himself or asking any one to do so for him. He stated that his apprehension was not aroused until he was told by a friend, Dr. Bandy, who held two similar policies, that they did not read as represented by the plaintiff to him, so as, in effect, to become paid-up policies when $700 in premiums had been paid upon each of them. Without reading his policy, as far as appears, he wrote to the company, inquiring as to "how many more payments he would have to make, until his policy would be paid-up," to which the company replied at once that his policy was a "whole-life" one, and that he would have to pay premiums as long as he lived. This, he says, did not correspond with the representation of D. W. Cochrane, the agent, which was made to him at the time he was solicited to take the insurance, and which induced him to enter into the contract.

We are of the opinion that plaintiff was guilty of negligence in not reading his policy. While the agent, according to plaintiff's testimony, which must be taken as true, misrepresented the contents of the policy, as to when it would be paid-up, there was no fraud, trick, or artifice resorted to at the time the policy was delivered, in order to prevent the plaintiff from reading it, and he kept it for nine years without doing so. Floars v. Insurance Co., 144 N.C. 232, 56 S.E. 915, 11 L. R. A. (N. S.) 357, citing Upton v. Tribilcock, 91 U.S. 45, 23 L.Ed. 203; Bostwick v. Insurance Co., 116 Wis. 392, 89 N.W. 538, 92 N.W. 246, 67 L. R. A. 705. See, also, Clements v. Insurance Co., 155 N.C. 57, 70 S.E. 1076; Wilson v. Insurance Co., 155 N.C. 173, 71 S.E. 79. In the Clements Case, the court, quoting from Floars v. Insurance Co., supra, said:

"There is also strong authority for the position that on the facts of this case the relief sought would not be open to plaintiff even if there had been a mutual mistake in the preliminary bargain, and by persons with full power to contract, for the reason that plaintiff accepted the policy with the alleged stipulation omitted without having read same, and held it without a protest for three months"--citing Upton v. Tribilcock, supra.

But however this may be, the plaintiff, after he had been fully and explicitly informed, as to the true contents of his policy, and that it contained no such provision as the one he stated, that the agent had represented to him was in it, kept his policy for some time without reading it, and without making any complaint to the company, and actually paid the next maturing premium, about a year after he had received the information from the company itself. This was a waiver of any fraud...