Dean v. Nationwide Life Ins. Co.

• Decision Date: 23 June 1975
• Docket Number: No. 11741,11741
• Citation: 536 P.2d 1122,96 Idaho 772
• Parties: Norman D. DEAN, Plaintiff-Respondent, v. NATIONWIDE LIFE INSURANCE COMPANY, an Ohio Corporation, Defendant-Appellant.
• Court: Idaho Supreme Court

Page 1122

536 P.2d 1122

96 Idaho 772

Norman D. DEAN, Plaintiff-Respondent, v. NATIONWIDE LIFE INSURANCE COMPANY, an Ohio Corporation, Defendant-Appellant.

No. 11741.

Supreme Court of Idaho.

June 23, 1975.

William A. Stellmon of Ware, Stellmon & O'Connell, Lewiston, for defendant-appellant.

Reed Clements of Clements & Clements, Lewiston, for plaintiff-respondent.

SHEPARD, Justice.

This is an appeal by an insurance carrier from a judgment in favor of an insured after a denial of coverage under a group medical insurance policy. The amount of the judgment is not questioned but only the issue of liability under the policy. The primary question on this appeal is the insurance carrier's contention that the insured failed to disclose a health condition on his application for insurance, which condition later necessitated coronary bypass surgery.

On September 19, 1972 plaintiff-respondent Norman Dean, on behalf of himself and his wife, submitted an application to appellant Nationwide Life Insurance Company for coverage under a group medical insurance policy. That application was accepted by the company on October 25, 1972 with coverage to become effective on November 1, 1972. Following that acceptance, Dean allowed an existing medical insurance policy to expire without renewal. At the time of Dean's application for coverage on September 19, 1972 he was a 57 year old farmer in the Grangeville, Idaho area, was an active sportsman and apparently in vigorous health. The pertinent portions of the application provide:

'THE INFORMATION PROVIDED BELOW IS AN UP-TO-DATE RECORD OF HEALTH HISTORY, TO THE BEST OF MY KNOWLEDGE AND BELIEF, FOR ME AND ANY DEPENDENTS FOR WHOM APPLICATION FOR INSURANCE IS BEING MADE.

'1. Have you (or any of your dependents) been hospitalized, consulted with or been treated by a physician for any of the following (answer yes or no). * * *

'Heart or Blood Disorders

'2. Do you (or any of your dependents) have, or have any of you had, any disease, disability, or deformity or other physical or mental disorder not mentioned above?'

So far as Dean himself is concerned, each of the above questions was answered 'No.' Insofar as Dean's wife is concerned, it was indicated that she had had two surgeries, the most recent being for the removal of a gall bladder in 1964, and that she suffered from high blood pressure for which she was taking medication and being treated by a particular doctor in Grangeville, Idaho.

Upon trial, plaintiff's proof consisted of the unchallenged and uncontradicted testimony of Dean and his physician. The only proof submitted by the defendant was the testimony of its claims manager. On September 23, 1971 Dean consulted a physician and in the course of a physical check-up complained to the physician of chest pains following heavy exertion. A battery of tests, including electrocardiogram, exercise cardiogram, chest x-ray, cholesterol test and several other blood tests, were administered, all of which indicated that Dean had no coronary disorder and he was so advised by the physician on October 25, 1971. No diagnosis was made by the physician, nor a consulting specialist who reviewed the results of the tests and no medication or treatment of any kind was prescribed, ordered or taken by Dean.

In April, 1973, Dean again consulted his physician regarding a gastrointestinal irregularity. The physician inquired as to the continued existence of the prior chest pains and Dean responded that he still experienced the pains. A second group of tests similar to those of September 1971 was performed and all again proved negative. At that time a coronary specialist suggested the performance of an 'angiogram.' That procedure involves the insertion of a catheter through the femoral artery into the area of the heart after which dye is injected through the catheter to reveal the coronary vessels. The physician testified that said procedure involves certain risks, including those of stroke or death. Dean acquiesced in the performance of said procedure and it was performed during hospitalization.

The argiogram procedure indicated the existence of coronary atherosclerosis (a type of arteriosclerosis) and the necessity for coronary bypass surgery. Coronary surgery was performed. It is the costs of such surgery, together with attorney fees which were sought in Dean's action.

Nationwide rejected Dean's claim for benefits under the policy. Suit was instituted thereon, trial was held, and thereafter the trial court made findings of fact. The above set forth facts are reflected in the trial court's findings and those findings are supported by uncontroverted evidence.

Appellant Nationwide raises two issues upon appeal. First, it contends that Dean's answers to the questions contained in the application were misleading, if not fraudulent. The trial court determined that Dean had answered the questions in the application truthfully based upon his knowledge at the time of preparation of the application. Nationwide argues that I.C. § 41-1811 affords it ground for avoiding the policy. That statute provides:

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