John Hancock Mutual Life Insurance Company Company William Warren

• Citation: 21 S.Ct. 535,45 L.Ed. 755,181 U.S. 73
• Decision Date: 08 April 1901
• Docket Number: No. 196,196
• Parties: JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, Plff. in Err. , COMPANY, Plff. in Err. , WILLIAM M. WARREN
• Court: United States Supreme Court

181 U.S. 73

21 S.Ct. 535

45 L.Ed. 755

JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, Plff. in Err., COMPANY, Plff. in Err., WILLIAM M. WARREN.

No. 196.

Argued and Submitted March 19, 1901.

Decided April 8, 1901.

This action was brought in the common pleas court of Delaware county, Ohio, on a policy of insurance issued September 27, 1895, by the John Hancock Mutual Life Insurance Company on the life of George E. Warren and for the benefit of William M. Warren. The insurance company resisted payment on the ground that the policy had been fraudulently obtained by the decedent, in that the answers made by him in his application made a part of the policy, and which were expressly warranted to be complete and true, the policy providing that if any of the statements were untrue it should be void, were false, and that he made them for the purpose of defrauding the insurance company, which would not have issued the policy had it known of the falsity of the answers.

Section 3625 of the Revised Statutes of Ohio provided that 'no answer to any interrogatory made by an applicant, in his or her clearly proved that such answer is wilfully recover upon any policy issued upon such application, or be used in evidence upon any trial to recover upon such policy, unless it be clearly proved that such answer is wilfully false and was fraudulently made, that it is material, and induced the company to issue the policy, and that but for such answer the policy would not have been issued; and, moreover, that the agent of the company had no knowledge of the falsity or fraud of such answer.' Rev. Stat. Ohio, 1894, p. 1899.

The trial judge charged the jury as follows: 'This law, being in force at the time this policy of insurance was taken out, is applicable to the policy of insurance involved in this case. And is applicable to the questions and answers in the application that by the terms of the policy are made express warranties, as well as those that are not.' The defendant duly excepted to that portion of the charge, and to other portions of the same purport. The defendant also requested the court to give the jury the following instruction: 'The policy or contract upon which this action is based, and the application made by George E. Warren for the same, constitute a warranty that all answers by said Warren contained therein are true; and if any one or more of said answers is untrue, though made without actual fraud, and under an innocent misapprehension of the purport of the questions and answers, no contract of insurance is thereby made, and the contract is void ab initio, and your verdict will be for the defendant.' The court declined to give this instruction, and defendant duly excepted.

The jury returned a verdict for the plaintiff, and judgment was entered thereon, which was affirmed by the circuit court, and finally by the supreme court of Ohio. John Hancock Mut. L. Ins. Co. v. Warren, 59 Ohio St. 45, 51 N. E. 546.

Messrs. George K. Nash, W. Z. Davis, and Louis G. Addison for plaintiff in error.

Messrs. John S. Jones, W. B. Jones, and F. M. Marriott for defendant in error.

Mr. Chief Justice fuller delivered the opinion of the court:

In State ex rel. Richards v. Ackerman, 51 Ohio St. 163, 24 L. R. A. 298, 37 N. E. 828, it was ruled that as foreign insurance companies and associations, whether incorporated or not, before commencing business in the state, were required to obtain a certificate of authority to do so, which conferred on the company or association receiving it the right and privilege of carrying on its business in the state, the privilege so conferred was a franchise. In the course of the opinion the court quoted with approval, from Spelling on Extraordinary Relief, as follows: 'Where, by statute, the legal exercise of a right, which at common law was private, is made to depend upon compliance with conditions interposed for the security and protection of the public, the necessary inference is that it is no longer private, but has become a matter of public concern, that is, a franchise, the assumption and exercise of which, without complying with the conditions prescribed, would be a usurpation of a public...