Cassady v. United Insurance Company of America

• Decision Date: 05 February 1974
• Docket Number: No. HS 73-C-4.,HS 73-C-4.
• Citation: Cassady v. United Insurance Company of America, 370 F.Supp. 388 (W.D. Ark. 1974)
• Parties: Kenneth L. CASSADY, Plaintiff, v. UNITED INSURANCE COMPANY OF AMERICA, Defendant.
• Court: U.S. District Court — Western District of Arkansas

370 F. Supp. 388

Kenneth L. CASSADY, Plaintiff, v.UNITED INSURANCE COMPANY OF AMERICA, Defendant.

No. HS 73-C-4.

United States District Court, W. D. Arkansas, Hot Springs Division.

February 5, 1974.

COPYRIGHT MATERIAL OMITTED

Gary R. Gibbs, Hot Springs, Ark., for plaintiff.

Phillip Carroll, of Rose, Barron, Nash, Williamson, Carroll & Clay, Little Rock, Ark., for defendant.

OPINION

JOHN E. MILLER, Senior District Judge.

On March 5, 1973, plaintiff, Kenneth L. Cassady, commenced this action against United Insurance Company of America for recovery on a policy of insurance issued by defendantAugust 28, 1967, insuring the plaintiff for loss of life, limb, sight or time, resulting solely from bodily injury, or for loss of time by illness and other specified benefits.

The material and relevant portion of the policy involved herein, Part Three, provides:

"The Company will pay, except as provided in Part Four and Part Seven from the first treatment of the attending physician at the rate of the Weekly Benefit stated in the Schedule on Page 4, if the Insured suffers `Such Sickness' which shall wholly and continuously disable the Insured so as to prevent him from performing every duty pertaining to his occupation and cause him to be confined inside the house under the regular care and attendance of a legally-qualified physician or surgeon, during the period of such disability.This benefit is not payable during any period for which the Hospital Residence Benefit is payable.

"The term `confined inside the house' is hereby defined as confinement of the Insured continuously inside the house because of `Such Sickness,' except that the right of the Insured to recover under the policy shall not be defeated because he visits his physician for treatment or goes to a hospital for treatment when such treatment cannot be administered in the Insured's home.

* * * * * *

"The maximum benefits payable under this Part Three, including Hospital Residence Benefits provided under Part One, will be thirty (30) weeks during any policy year for any sickness or sicknesses."

(The schedule on page 4, referred to above, provides for payment of weekly benefits of $42.00 for disability.)

The case was tried to the court without the intervention of a jury on January 22, 1974.Prior to the trial the attorneys for the parties had each served and submitted trial briefs.At the conclusion of the evidence the court suggested to the attorneys that if either of them desired to submit to the court additional or supplemental briefs containing a discussion of the evidence that they should do so within ten days.Such supplemental briefs have been received by the court and considered along with the original briefs, the record and the testimony of the witnesses, together with the exhibits thereto.

In the supplemental brief of plaintiff, he states that the primary issues in the case are:

1.Whether or not the plaintiff was "disabled and confined to the house" within the meaning of the terms as construed by the courts.

2.Whether the defendant's discontinuance of payments to the plaintiff constitutes an anticipatory breach.

3.Is the plaintiff entitled to recover a 12 percent penalty and a reasonable attorney's fee.

4.Has the defendant intentionally and maliciously inflicted mental anguish upon the plaintiff by its wrongful denial to pay the benefits due under the policy, and if so, is plaintiff entitled to recover for this intentional tort.

5.Do the facts justify the imposition by the court of punitive damages upon the defendant for the intentional tort of malicious infliction of mental anguish.

The defendant in its supplemental brief states that the principal issue is whether plaintiff, since September 7, 1971, has been continuously confined inside the house under the regular care and attendance of a legally qualified physician or surgeon, and steadfastly denies any liability.On page 1 it states:

"If the insured has been prevented by sickness from performing every duty pertaining to his occupation and if he has been confined inside the house under the regular care and attendance of a legally qualified physician during the period of his disability, the policy provides that he is entitled to recover $42.00 a week for a maximum of 30 weeks each policy year ($1,260.00 per policy year).Since September 7, 1971, two full policy years have gone by and as of the date of trial, 137 days of the third policy year (194/7 weeks) had expired.Based upon 19 full weeks, the maximum accrual of weekly benefits would be $798.00.Thus, the most that the plaintiff could expect to collect from United would be 79 weeks at $42.00 per week for a total of $3,318.00, less the $294.00 which has been paid for a net total of $3,024.00."

FINDINGS OF FACT

The evidence introduced at the trial contains no substantial material dispute.

The disability claimed by plaintiff began on September 7, 1971, and plaintiff began filing claims on September 24, 1971, for benefits under the policy.Between October 6, 1971, and December 16, 1971, the defendant paid seven of the claims, or a total of $294.00.After that date the defendant has continuously refused to make any further payments and has denied liability under the facts and provisions of the policy.

The plaintiff, Cassady, at the time of the trial was 50 years of age.He had earned his living and that of his family by physical labor.From 1959 to April 1971he worked as a linen route man for Howlett Linen Company of Hot Springs, at which time the Merritt Linen Company became the owner of the plant.Cassady continued to work in the same capacity until early August 1971, when he changed jobs and went to work for Craighead Linen Company.He had been working for the latter company for about three weeks when on August 31, 1971, he suddenly became exhausted and unable to continue.He called on Dr. Jerry Hoyt, a well qualified internist of Hot Springs, who upon examination found him suffering from a rather mild attack of angina pectoris.Dr. Hoyt examined him and continued to advise him regularly from time to time over the next few months and up to the present time.He was not confined continuously to his home but the doctor would not allow him to return to work.As a result of a Masters Two Step test, he was advised to take moderate exercise every day and remain outside as much as his condition permitted.

On January 3, 1972, Dr. Hoyt reported by letter the illness of Mr. Cassady to the defendant company, in which he said:

"Mr. Kenneth Cassady has been a patient of mine since September of 1971.In September of this year I ran a Masters Two Step and at that time he had a positive Masters.I have not allowed him to return to work.I have not seen him since December 7, 1971, but at that time he was still having angina.

"If you want more information on the man I can have him come into the office and run a Masters Two Step with continuous oscillscope monitoring.The charges for this would be $50.00."

Following the receipt of the report from Dr. Hoyt, the defendant on May 1, 1972, contacted Dr. Driver Rowland of Hot Springs.Dr. Rowland is a highly qualified physician and enjoys a large practice in Hot Springs.In the report of Dr. Rowland to the defendant of May 5, 1972, he stated:

"Present History: Since Sept., 1971, the patient has had intermittent chest pain.This is mainly precordial; it is described as a dull ache in his chest, such as a toothache.This appears mainly with exertion, but it tends to occur nocturnally after he has gone to bed and to sleep, frequently awakening him.This is questionably accompanied by bilateral arm pain.This pain, when it occurs, will frequently last for 12 to 24 hours.He also complains of being quite short of breath; he cannot walk up a 5% grade for a block without precipitating this pain.

"Past History: Five years ago he had a partial gastrectomy for peptic ulcer.Since then he has noted that he has been weak, and he cannot hold out to do any physical exertion.Approximately a year ago he had a fairly severe hemorrhage from his gastrointestinal tract.This was manifested by vomiting and melena; he has had no problems with this since.

"Up until September of 1971he was a route superintendent for a linen company in Hot Springs; he has not worked since September on the advice of his physician.

* * * * * *

"A resting electrocardiogram was interpreted as showing a normal sinus rhythm with a rate of 100.There was no shifting of the electrical axis of evidence of enlargement of either ventricle.There was no evidence of myocardial disease.The tracing was within normal limits.

"A double Master's Two-step Test was performed, and the patient was able to complete this in the allotted time without real difficulty, although towards the end of the test he complained of chest pain.This test was interpreted as positive, particularly in lead V4 where there was a 2 mm. depression of the S-T segment in the tracings made immediately and 3 minutes following exercise; the S-T segment had returned to normal in the tracing made 8 minutes following exercise."

The defendant replied to Dr. Rowland but the reply was not introduced in evidence.However, Dr. Rowland replied by letter to the defendant on May 22, 1972, in which he stated:

"In reply to your recent letter re the above Kenneth L. Cassady it was my impression from Mr. Cassady's history and physical examination that he probably did not have ischemic heart disease and the chest pain was arising from some other source.However, it is very difficult to ignore the fact that he did have a positive Master's Test.

"In regard to the prognosis in Mr. Cassady's case, if this patient does have ischemic heart disease, a reasonable estimate of his prognosis is unknown and not warranted at this time.

"As to my recommendations regarding physical activity, I see no reason why he should not attempt moderate physical activity."

Dr. Lyn Brewer Goodin, a psychiatrist, testified...