Jones v. United States

• Decision Date: 05 June 1940
• Docket Number: No. 11534.,11534.
• Citation: 112 F.2d 282
• Parties: JONES v. UNITED STATES.
• Court: U.S. Court of Appeals — Eighth Circuit

112 F.2d 282 (1940)

JONES v. UNITED STATES.

No. 11534.

Circuit Court of Appeals, Eighth Circuit.

June 5, 1940.

J. A. Tellier, of Little Rock, Ark., for appellant.

Thomas E. Walsh, Atty., Department of Justice, of Washington, D. C. (Sam Rorex, U. S. Atty., and George W. Hendricks, Atty., Department of Justice, both of Little Rock, Ark., Julius C. Martin, Director, Bureau of War Risk Litigation, Wilbur C. Pickett, Sp. Asst. to the Atty. Gen., and Fendall Marbury, Sp. Attorney, Department of Justice, all of Washington, D. C., on the brief), for appellee.

Before GARDNER and WOODROUGH, Circuit Judges, and MOORE, District Judge.

MOORE, District Judge.

Plaintiff brought suit against the United States to recover on four twenty-year payment war risk insurance policies issued on the life of her husband, Grady Furth Jones, a soldier in the World War. Plaintiff, beneficiary in the policies, sued in her capacity as executrix and as beneficiary, for the reason that part of the benefits under the policies accrued during the life of the insured.

The answer of the defendant charged fraud in obtaining the reinstatement of the policies in that the application contained false statements and material misrepresentations upon which the Government relied in reinstating the insurance.

The case was tried on the sole issue of fraud in the reinstatement of the insurance and, at the close of the evidence, both the plaintiff and the defendant filed separate motions for directed verdicts in their respective behalfs. The trial court overruled the motion of the plaintiff and sustained the motion of the defendant. Judgment having been entered upon the directed verdict, plaintiff appeals.

The evidence for the plaintiff disclosed that the insured was a soldier in the World War and was honorably discharged; that while in service he contracted for war risk term insurance and was issued a certificate thereof in the sum of $10,000; that he permitted his term insurance policy to lapse shortly after his discharge in 1919; that on April 1, 1926, upon the reinstatement and conversion of term policy the Government issued to the insured four twenty-year payment life insurance policies, each in the sum of $2,500, which policies insured deceased against total and permanent disability and death. All premiums were paid in cash on the four policies until after the insured became permanently and totally disabled. The insured was rated as being totally and permanently disabled by the Veterans Administration as of September 4, 1929, which condition continued until his death on February 17, 1935; that as of May 11, 1932, the insured was both totally and permanently disabled from active pulmonary tuberculosis.

In his application for reinstatement of the insurance, made on March 22, 1926, the insured answered questions 6, 10 and 11 as follows:

Question No. 6: "Are you at present suffering from any disability which is the result of an injury or disease, or of an aggravation thereof, suffered or contracted in the active military or naval service during the World War? (If so, give full details, as to the nature of such disability, disease or injury, where and when contracted, and what treatment, if any, is being received at this time.)" Answer: "No."

Question No. 10: "Have you contracted any disease or suffered any injury since lapse of this insurance? If so, state full particulars, date, name and address of physician, if one attended you." Answer: "No."

Question No. 11: "Have you consulted a physician in regard to your health since lapse of this insurance? If so, state full particulars, date, name and address of physician." Answer: "Yes. Examination for life insurance with New York Life, Dr. V. McCammon was examinor, Arkansas City, Arkansas."

On August 1, 1929, the insured made application under oath for disability compensation in which he stated that he had been suffering from tuberculosis since December, 1918, and was treated at an infirmary in England; by doctors on the ship returning to the United States and since his discharge from the service by Dr. J. W. Francis, from March, 1922, to February, 1927. In an affidavit made by the insured in support of his application and in testimony given by him in November, 1933, before a special board in connection with his claim for restoration of his compensation which had been cut off by the Economy Act, he stated that shortly after starting to work as timekeeper and pay-master for a lumber company on January 1, 1919, he "began feeling badly" and suffered from loss of weight, loss of appetite, on account of which he consulted and was treated by Dr. Francis, the physician for the company for which the insured worked; that the physician first prescribed medicine for him, but later, after "a thorough examination", advised him to leave the climate at once; that the doctor had given him this advice in 1920 or 1921 and had expressed the view that he, Jones, had "something the matter with his lungs". The affidavit of the insured fixed the summer of 1924 as the time when the doctor advised him to leave the climate and in that affidavit stated that the doctor advised him at that time that he had tuberculosis. This condition continued during 1925 and 1926 and he "continued to consult the doctor when he was feeling badly."

Dr. J. W. Francis, a witness for the Government, testified that the insured came to his office in the Spring of 1922 for examination and treatment, complaining of loss of weight, energy and appetite and of restless nights; that he found a rising temperature each afternoon and detected moist rales in the left lung by means of a stethescope; that he recommended a long vacation and prescribed rest and diet; that the insured returned to his office in the Fall of that year, when he found his condition practically the same as he had in the previous Spring, and continued treatment of the insured until the Spring of 1924, at which time the rales were more noticeable and the temperature increased. He then diagnosed the condition as active pulmonary tuberculosis, recommending a change of climate, rest and diet; that the insured continued to report to him from time to time until the summer of 1926, and that during that time the complexion of the insured had changed noticeably, his complaints were the same, his loss of weight was noticeable and he had a troublesome cough.

This witness testified that malaria was common in the country where the insured lived and that trouble had to be eliminated first in making the diagnosis; that the insured's symptoms were all consistent with the diagnosis of malaria except the moist rales, adding that "you do not have the lung complication with malaria; you do not have the moist rales, the breathing, you have with tuberculosis."

On cross-examination Dr. Francis identified his signature on a report of an examination made by him of the insured on December 30, 1925, in connection with an application for insurance with the New York Life Insurance Company dated January 1, 1926, in which this question appears, with the answer given by the witness:

Question: "Do you find any evidence of past or present disease of the lungs?" Answer: "No."

Four witnesses for the defendant identified affidavits executed by them in July and August of 1929 in support of the insured's claim for compensation. These affidavits contained statements to the effect that the insured had seemed to be in a run-down condition since 1924.

Dr. V. McCammon testified for the plaintiff, stating that he examined the insured in connection with the reinstatement of the assured's term policy and that in his examination he did not find any abnormality of the lungs of the deceased, and so stated in his report of the examination. He testified that he had known the insured for several years, had seen him frequently, several times a day and that in view of his familiarity with the physical condition of the insured, he did not believe the insured had tuberculosis at the time of the examination and did not develop it until some years later. He further testified that on August 31, 1929, he signed insured's application with the Equitable Life Insurance Company for disability benefits based on tuberculosis; that he never knew of the insured being sick until sometime in 1928 or 1929; that he saw no difference in his physical condition between 1919 and 1926 and that in filling out the application he did not ask the insured whether he had tuberculosis, relying upon his own knowledge.

Dr. A. C. Shipp, a witness for the plaintiff, testified that he was sixty years of age and had graduated from the University of Indiana School of Medicine in 1912; that he had an A. B. and an A. M. and in Pathology a Master's Degree and had done research work in a tuberculosis sanitarium in Asheville, North Carolina; had two years research work in the Department of Tuberculosis of the University of Indiana and Department of Pathology and for three years was a member of the faculty of the University of Arkansas teaching Pathology and Bacteriology in the Department of Medicine, and from 1917 on in the practice of medicine, diseases of the chest and diagnosis, and that he specialized in the treatment of tuberculosis to a marked degree.

Dr. Shipp further testified that he first saw the insured on April 23, 1932, to begin his examination which he completed on May 11, 1932, and made a report to the United States Veterans Bureau. He found active pulmonary tuberculosis, far advanced with cavitation in both lungs and subcervicular sounds, immediately under the collar bone on both sides. He testified that he had examined the testimony of Dr. Francis, which was part of the Government's evidence; that he had examined the method which Dr. Francis used to arrive at his conclusion that Grady Jones had tuberculosis prior to March 22, 1926, and that with the methods used as detailed by Dr. Francis — loss of weight, loss of appetite, loss of energy, his...