Houston v. New York Life Ins. Co.

• Decision Date: 28 October 1930
• Docket Number: 22374.
• Court: Washington Supreme Court
• Parties: HOUSTON v. NEW YORK LIFE INS. CO.

292 P. 445

159 Wash. 162

HOUSTON v. NEW YORK LIFE INS. CO.

No. 22374.

Supreme Court of Washington, En Banc.

October 28, 1930

Appeal from Superior Court, King County; William J. Steinert, Judge.

Action by Laura A. Houston against the New York Life Insurance Company. From a judgment in favor of defendant notwithstanding the verdict, plaintiff appeals.

Reversed and remanded, with directions.

J. L. Corrigan, of Seattle, for appellant.

Wright & Catlett, of Seattle, for respondent.

PARKER J.

The plaintiff, Mrs. Houston, seeks recovery upon a $3,000 reinstated life insurance policy issued by the defendant insurance company, insuring, for her benefit, the life of her husband, Edson Kell Houston, now deceased. A trial upon the merits in the superior court for King county, sitting with a jury, resulted in a judgment rendered by that court denying Mrs. Houston recovery, notwithstanding the general verdict of the jury awarding her recovery for the full amount of the policy. From this disposition of the cause in the superior court, Mrs. Houston has appealed to this court. The judgment was by the trial judge apparently rested upon the ground that the special finding of the jury in answer to the second interrogatory submitted to it, hereinafter quoted, is inconsistent with the general verdict, and conclusively determines that Houston, with intent to deceive the company made false statements as to his health in his application for reinstatement of the policy, and thereby induced the company to reinstate the policy, thus entitling the company to judgment denying recovery upon the policy notwithstanding the verdict, as a matter of law.

The briefs of counsel are directed largely to the question of whether or not the judgment can be sustained upon that ground. The facts controlling of that question, we think, may be fairly summarized as follows: On April 8, 1927, the company issued to Houston its insurance policy insuring his life for the benefit of Mrs. Houston. He then paid premium on the policy up to July 16, 1927, when, by its terms, the first annual preminum thereon became due. He did not pay that annual premium, and, because of such nonpayment, the policy by its terms lapsed and became ineffective. On October 18 1927, Houston applied to the company for reinstatement of the policy, filling out and signing one of the company's blank applications for reinstatement, wherein he answered questions therein as follows:

'1. Are you now, to the best of your knowledge and belief, in the same condition of health as you were when this Policy was issued? (If not, give details.) Ans. Yes.

'2. Within the past 24 months have you had any illnesses or have you consulted or been treated by any physician or physicians? (If so, give full details including nature, date, and duration of each illness, the name of each physician, and the dates of consultation or treatment.) Ans. Apr. 1st, 1927, one week with grippe. Dr. Ellis, Ketchikan, made one call. * * *

'I hereby certify that the foregoing answers are full, complete and true, and agree that the Company believing them to be true shall rely and act thereon.'

This application, accompanied by the required payment of premium for reinstatement, was soon thereafter received by the company, and the policy accordingly reinstated. On November 27, 1928, Houston died. On December 5, 1928, due proof of Houston's death was furnished to the company. On February 5, 1929, the company, claiming to have discovered that Houston had falsely answered the above-quoted questions in his application for reinstatement of the policy, with intent to deceive the company and thereby induce it to reinstate the policy, refused to make payment of the insurance to Mrs. Houston, but tendered back to her the amount of premiums paid upon and since the reinstatement of the policy. She refused to accept such return of the premiums, and commenced this action. Upon the trial, the issue was whether or not Houston falsely answered the above-quoted questions in his application for reinstatement of the policy, with intent to deceive the company. There was evidence tending to show that about September 6, 1927, Houston had consulted Dr. Beeson and complained of pains and tenderness around the appendix of some ten days' duration, and had been advised by the doctor that he should have an operation. We shall presently further notice this evidence in connection with another branch of our inquiry. The jury rendered a general verdict as follows:

'We, the Jury in the above entitled Cause, do find for the plaintiff in the sum of Three Thousand and no/100 Dollars ($3,000.00) with interest at 6% from November 27th, 1928.'

The jury also made two special findings as follows:

'We, the Jury in the above entitled cause, do make the following special finding in answer to the following interrogatory:

'Interrogatory No. 1. Was the insured, Edson Kell Houston, on October 18, 1927, to the best of his knowledge and belief in the same condition of health as he was on the 8th day of April, 1927, the date when the policy was issued?

'Answer: Yes.

'We, the Jury in the above entitled cause, do make the following special finding in answer to the following interrogatory:

'Interrogatory No. 2. Did the said Edson Kell Houston, on or about September 6, 1927, consult Dr. J. B. Beeson of Ketchikan, Alaska, and at that time complain of pains and tenderness around the appendix of about ten days' duration and receive from Dr. Beeson a diagnosis of sub-acute appendicitis and advice that he should have an operation?

'Answer: Yes.'

We first inquire, is the jury's special finding, in the form of its answer to interrogatory No. 2, conclusive that Houston made false answer in his application for reinstatement of the policy, with intent to deceive the company? Manifestly, the general verdict, standing alone, negatives any such conclusion. This view has additional support in the jury's special finding in the form of its answer to interrogatory No. 1. It is not enough to avoid the insurer's liability upon a policy that untrue statements are made in the application for the insurance or reinstatement thereof; but, to avoid such liability, there must be accompanying such untrue statements an intent on the part of the applicant to deceive the company. Hence, in order that the jury's special finding in its answer to interrogatory No. 2 become conclusive against Mrs. Houston's claim of recovery upon the policy, that special finding must be held to mean that, in making the untrue statements by Houston in his application for reinstatement of the policy, he did so with intent to deceive the company. Plainly we think this special finding does not, in terms, or inferentially, so decide, and that therefore it has no controlling force upon the general verdict. Manifestly, standing alone, the general verdict determined that and every other issue in favor of Mrs. Houston's claim of recovery. In McCorkle v. Mallory, 30 Wash. 632, 71 P. 186, 187, Judge Mount, speaking for the court, said: 'Where a special verdict is susceptible of two constructions, one of which will support the general verdict and the other will not, that construction will be given the special verdict which will support the general verdict.'

In Gaudie v. Northern Lumber Co., 34 Wash. 34, 74 P. 1009, 1011, Judge Hadley, speaking for the court, made similar observations as follows: 'A special finding must be irreconcilably inconsistent with the general verdict before the latter can be set aside and the former substituted in its place.'

In Campbell v. Jones, 73 Wash. 688, 691, 132 P. 635 637, adhering to this view of the law, we quoted with approval from 2 Thompson on Trials (2d Ed.) § 2693, as follows: 'The court will not strain the language of the special findings to override the general verdict. If possible, they will be interpreted so as to support the verdict rather than overturn it. No presumption will be made in their favor; 'nor will they control the general verdict, unless they are invincibly antagonistic to it''--citing also, in addition to our above-noticed decisions, Mercier v. Travelers' Ins. Co., 24 Wash. 147, 64 P. 158, and Cameron v. Stack-Gibbs Lumber Co., 68 Wash....