Fraternal Aid Union v. Miller

• Court: Oklahoma Supreme Court
• Writing for the Court: SHACKELFORD, C. PER CURIAM.
• Citation: Fraternal Aid Union v. Miller, 234 P. 357, 1925 OK 173, 106 Okla. 277 (Okla. 1925)
• Decision Date: 03 March 1925
• Docket Number: 13607.
• Parties: FRATERNAL AID UNION v. MILLER.

234 P. 357

106 Okla. 277, 1925 OK 173

FRATERNAL AID UNION v. MILLER.

No. 13607.

Supreme Court of Oklahoma

March 3, 1925

Syllabus by the Court.

Where a party makes application to an insurance carrier for insurance against death or disability, and it is agreed in the application that the answers made to questions asked in the application are warranties of truthfulness, and by the terms of the contract of insurance the application is made part thereof, and the policy of insurance is based upon the application, the answers made to questions asked in the application constitute warranties of truthfulness, and untruthful answers would have the effect of rendering the policy of insurance void, and an action cannot be maintained thereon for death or disability resulting directly or indirectly from conditions which by the answers are warranted not to exist.

Where a policy of life insurance is issued upon an application which by the terms of the instrument is made a part of the contract of insurance, and the answers to questions asked in the application are made warranties of truthfulness, and the insured further agrees for herself and for her beneficiary that the policy of insurance shall be void if any of the answers are untrue, and the question is asked, "Are you pregnant?" and is answered in the negative, the answer constitutes a warranty that the applicant is not pregnant at the time of making the application, and untruthfulness of the answer will render the policy of insurance void if death results directly or indirectly from a state of pregnancy existing at the time of making the application, and an action upon the policy cannot be maintained.

Where in such a contract of insurance, the insured waives all benefits provided by the laws of the order in case of death or disability resulting directly or indirectly from existing pregnancy, the risks incident to existing pregnancy are excepted from the contract, and, as against death or disability resulting from existing pregnancy, there is no contract of insurance; and such waiver is a complete defense where the death or disability results from pregnancy existing at the time of making the application.

Commissioners' Opinion, Division No. 4.

Appeal from District Court, Tulsa County; W. B. Williams, Judge.

Action by Jesse G. Miller against the Fraternal Aid Union upon an insurance contract issued by defendant to Ruby Pearl Miller in which the plaintiff was made beneficiary. Judgment for plaintiff, and defendant appeals. Reversed, with directions.

Mason & Honnold and M. H. Merrill, all of Tulsa, for plaintiff in error.

F. E Riddle and F. G. Viger, both of Tulsa, for defendant in error.

SHACKELFORD C.

The plaintiff in error, the Fraternal Aid Union, defendant below, will be referred to herein as the defendant, and the defendant in error, Jesse G. Miller, plaintiff below, as the plaintiff.

On the 24th of April, 1919, the defendant issued a life insurance policy to Ruby Pearl Miller in the sum of $2,000, payable to Jesse G. Miller, her husband, as beneficiary, in the event of her death. Ruby Pearl Miller died on the 12th of June, 1919. For reasons that will hereinafter appear the defendant declined to pay the policy. The plaintiff, named as beneficiary in the policy, filed his petition in the superior court of Tulsa county on the 7th of August, 1920, suing the defendant for the amount fixed as payable upon the death of the insured. The application for membership and for benefit certificate, the medical examination, and the policy of insurance are all attached to and made a part of the petition. The defendant answered, admitting its corporate capacity, the issuance of the benefit certificate, the death of Ruby Pearl Miller, the plaintiff's relationship to her, and refusal to pay the insurance provided in the certificate. Further answering, the defendant pleaded that the party to whom the certificate was issued, when applying for membership, and in answer to the question, "Are you pregnant?" answered "No," when in truth and in fact the applicant was at that time pregnant, and the answer so made was false; and that the applicant contracted and agreed that her statements and answers made for the purpose of becoming a member of the order and having issued to her a benefit certificate were true statements and warranties; and for further defense pleaded that in the contract the applicant for membership waived all benefits under the laws of the order in case of death or disability resulting from pregnancy existing at the time of making application, in the following language:

"I hereby waive all benefits paid under the laws of the order, in event of my death or disability resulting directly or indirectly from my being pregnant at this time,"

-and that the death of Ruby Pearl Miller was caused directly or indirectly from pregnancy existing at the time the application was made, and the contract of insurance issued and delivered, and that the member was not insured against death resulting from existing pregnancy; that death from existing pregnancy was excepted from the contract; and alleges that the death of Ruby Pearl Miller was caused directly or indirectly from pregnancy existing at the time application for membership was made by her. A copy of the constitution of the Aid Union is attached as an exhibit to the answer and made a part thereof. The reply of plaintiff denies generally every allegation of affirmative defense, and specifically denies that the insured made any false or fraudulent answers or representations to secure the benefit certificate, and further alleges that, if the answers given were inaccurate and untrue, that the matters were well known to the defendant, and the certificate was issued with full knowledge thereof, and the monthly dues accepted by the defendant.

The cause was transferred to the district court of Tulsa county and tried to a jury on the 28th of March, 1922, resulting in a verdict and judgment for the plaintiff for the principal sum fixed in the policy of insurance. The defendant prosecutes appeal and submits its assignments of error under the following propositions:

(1) "The trial court erred in overruling the motion of the defendant to direct a verdict in favor of the defendant and against this plaintiff."

(2) "Existing pregnancy may be made an excepted risk in a contract of life insurance; an agreement by the applicant waiving all beneficial rights if death resulted directly or indirectly from pregnancy existing is valid."

(3) "Error in the instructions of the court."

(4) "Error of the court in refusing the defendant's requested instructions."

Upon the trial of the cause it was shown that Ruby Pearl Miller had applied to the local lodge of the Fraternal Aid Union for membership in the order or society, passed the medical examination, and a benefit certificate of insurance was issued and delivered to her insuring her life for the sum of $2,000, and that the plaintiff, Jesse G. Miller, her husband, was made beneficiary in the policy of insurance, and it was dated April 24, 1919, and that Ruby Pearl Miller, the insured member, paid two monthly premiums and died on the 12th of June, 1919. The proof offered conclusively shows that her death was caused either directly or indirectly from pregnancy which existed at the time she made her application for membership in the order. The application for membership, the medical examination, the insurance policy, and the constitution and by-laws of the order were all introduced in evidence. In the benefit certificate, and as a part of the contract between Ruby Pearl Miller and the defendant, is the following recital:

"This certificate is based upon the application of the member to whom the same is issued, and the medical examination accompanying the same, and said application with said medical examination, the articles of incorporation, the constituton and laws of the association now and hereafter adopted, and this certificate constitute the agreement between the Fraternal Aid Union and said member," etc.

The application for membership is divided into two parts or sections, both signed by Ruby Pearl Miller. In the first part is the statement:

"I hereby apply for membership in Stella Lodge No. 638 of the Fraternal Aid Union and a benefit certificate upon my life in the sum of $2,000. Plan of certificate, whole life. Payments to be made monthly, and warrant my answers to the following questions to be literally true."

Here follows the personal history of the application signed by her. In the second part follow many questions as to the personal conduct and intimate history of the applicant, and as to her physical condition, and among other questions asked is the following question and answer thereto: "Are you pregnant?" "No." Then, after a few other questions and answers, not necessary to set out, is the following recital:

"I hereby waive all benefits paid under the laws of the order, in event of my death or disability resulting directly or indirectly from my being pregnant at this time."

Then, after several paragraphs not necessary to quote here, is the following agreement:

"I hereby agree and declare that all statements and answers made by me to obtain membership are warranties and in all respects full, literally true, and complete. * * * I hereby agree for myself and my beneficiary or beneficiaries if any one or more of such answers or statements are false, untrue or fraudulent, the benefit certificate which may be issued to me shall be null and void and of no effect, and all payments made on account thereof shall be forfeited."

This part of the application is also signed by Ruby Pearl Miller. The examining physician reporting the medical examination of the applicant was not called as a...