Keiper v. Equitable Life Assur Society of United States

• Decision Date: 01 February 1908
• Docket Number: 107.
• Parties: KEIPER v. EQUITABLE LIFE ASSUR. SOCIETY OF UNITED STATES.
• Court: U.S. District Court — Eastern District of Pennsylvania

159 F. 206

KEIPER v. EQUITABLE LIFE ASSUR. SOCIETY OF UNITED STATES.

No. 107.

United States Circuit Court, E.D. Pennsylvania.

February 1, 1908

Lewis B. Mathias, Wm. L. Kinter, and J. Claude Bedford, for plaintiff.

George D. Hay, B. Gordon Bromley, and Thomas De Witt Cuyler, for defendant.

HOLLAND District Judge.

This suit was instituted on a policy of life insurance issued by the defendant company on December 28, 1906, on the life of John F. Finney. It is the company's form of 20- year 5 per cent. gold bond, and the claim of the plaintiff under a certain condition therein contained, is for the sum of $32,500. The defense is (1) that decedent suffered from serious illness or disease other than those incident to childhood; (2) he concealed information in regard to his past history and health which was material to the risk; (3) and that he knowingly concealed these facts with the intention of deceiving the defendant.

The decedent was examined for insurance by Dr. Caskin, the defendant's physician, on October 9, 1906, who asked him all the questions contained in the company's 'Medical Examiner's Report,' and noted his answers, all of which were read to Finney before he signed it. In this examination he is reported to have answered that he never was afflicted with malaria, loss of consciousness, indigestion jaundice, or any serious disease, injury, or infirmity. He also answered that he had not been, either directly or indirectly, concerned in the manufacture or sale of any kind of alcoholic beverage, and had never traveled in tropical countries, and that he had always lived in Pennsylvania. Subsequently, on October 10, 1906, the insured signed a formal written application for the insurance, which contained, inter alia, the following statement:

'I hereby agree that this subscription, and the contract of sale hereby applied for taken together, shall constitute the entire contract between the parties hereto; that all the statements herein are warranted to be true; that this contract shall not take effect until the first installment has been paid during my good health. I have not been declined or postponed by any life company or received a policy different in form from the one originally applied for, nor have I been intemperate, or had any serious illness or disease, except diseases incident to childhood, and there is no history of consumption or insanity in my family; i.e., among parents, brothers or sisters, uncles or aunts.'

The application also contained the following:

'Note.-- If applicant has ever been declined or postponed by any life company, or received a policy different from the form originally applied for, or been intemperate, or had any serious illness or disease other than childhood diseases, or if there is any history of insanity or consumption in applicant's family-- among parents, brothers, sisters, uncles or aunts-- state particulars here.'

To this there was no answer. The policy was preceded by a two months and eighteen days term assurance which issued as of the date of the application, upon which the premium of $298.23 was paid. On December 28, 1906, a policy issued to which was attached the foregoing application, and a further premium of $2,524.74 was paid. The Medical examiner's report, however, was not so attached. The insured died on March 18, 1907, of what was termed in the proof of death, 'Acute gastritis and collapse of central nervous system.'

At the trial of the case it appeared (1) he had malaria fever in 1875; (2) he had lived and traveled in Peru in 1875 and 1876 where he had an attack of chagres fever; (3) he conducted a restaurant in 1878-1880 in connection with which liquors were sold; (4) he suffered from pains in his stomach resulting from indigestion in 1888 and 1889; (5) and again in 1897, 1901, and 1904 he had attacks of indigestion and neuralgia of the stomach, the most severe of which occurred in 1901 when he became unconscious for some time and the attending physician was unable to diagnose the real trouble, but there was a complete recovery. The decedent did not inform the insurance company of these facts, nor did it know of their existence until after his death. It further appeared that Finney, with the exception of being troubled with what one of the physicians called a lazy stomach, which at its best was slow in the digestion of food, and which when overtaxed caused him a great deal of pain and suffering, was a vigorous and healthy man. He was short and of stocky build, and on the 9th day of October, 1906, the examiner of the defendant company found him to be in perfect health, and after a careful examination, especially directed to the condition of the vital organs and to the general health, so reported to the company before the policy was issued. The application was made part of the policy, as required by the Pennsylvania act of May 11, 1881, Sec. 1 (P. L. 20). It contained the statement, which is warranted to be true, as we have seen, that he (the decedent) never 'had any serious illness or disease except those incident to childhood, and there was no history of consumption or insanity in his family; that is, among parents, brothers or sisters, uncles or aunts.'

In the charge, at the trial of the cause, the court submitted three questions of fact to the jury, upon which they were requested to pass: (1) Did the insured ever have any serious illness prior to that which caused his death? (2) Did the insured in his answer to the questions in the medical examination, or his warranty in his application, which was incorporated in the policy, that he had never had any serious illness, suppress any fact material to the risk? (3) Even if insured did suppress no fact material to the risk, did he fraudulently fail to disclose the existence of any illness or suppress any information with the intent to deceive the defendant? The jury answered all these inquiries in the negative, and returned a verdict in favor of the plaintiff for the amount claimed. A motion and reasons for a new trial were duly filed as well as a motion for judgment non obstante veredicto. The latter motion is authorized by the Pennsylvania Act of 1905 (P.L. 286), which provides that, whenever a point requesting binding instructions has been declined, the party presenting it may move the court for judgment non obstante veredicto upon the whole record.

The defendant's first point was refused. It was a request for binding instructions as follows: 'Under all the evidence in the case the verdict must be for the defendant. ' For reasons hereinafter stated, it will appear that the questions as to the seriousness of prior ailment, the materiality of any concealed information, and the intent of the decedent in failing to state this fact, if not material, were properly submitted to the jury, and this motion must be overruled.

There are 19 reasons assigned why the defendant should have a new trial, 8 of which are errors alleged to have been committed by the court in charging the jury, 7 in affirming plaintiff's points, and 4 in refusing to affirm certain points of the defendant. The errors assigned to the charge of the court raise the single question as to whether it was the duty of the court, as a matter of law, to determine these three questions in favor of the defendant instead of submitting them to the jury, but the facts and circumstances in this case require that this question be resolved against its contention. All three were properly referred to the jury, as will appear upon a reference to them in their order.

First. Was the defendant entitled to have the court give binding instructions to the jury to find that the decedent had, prior to the issuing of the policy, 'serious illness and disease other than those incident to childhood'? If the jury should have been so instructed, then this defendant would be entitled, under the Pennsylvania act, to judgment in its favor notwithstanding the verdict. The application for the policy in question, signed by the decedent, has been incorporated into and made part of the contract, and 'all the statements and answers therein are warranted to be true.' He therefore warranted, as contained in that application, that he had never 'had any serious illness or disease except those incident to childhood,' and the defendant contends that the evidence adduced at the trial, together with all the inferences properly drawn from it, is insufficient to support a verdict for the plaintiff, so that the court was bound to direct a verdict in its favor. Hews v. Equitable Life Assurance Society, 143 F. 850, 74 C.C.A. 676. The decedent had warranted as true that he had not suffered from any 'serious illness or disease except those incident to childhood,' and by this he is bound, but the plaintiff urges that the evidence establishes the truthfulness of this warranty. The evidence to establish that the decedent had been seriously ill for a long time prior to the issuing of the policy is substantially as follows: That he had charges fever in 1875 while traveling in Peru, South America; attacks of indigestion or dyspepsia in 1888, 1889, 1895, and 1897; and a severe stomach trouble, resulting in a loss of consciousness, in 1901. Dr. Hughes, a specialist of Philadelphia, was called in, who said that 'Finney was partially conscious only,' 'almost unconscious,' and 'in an exceedingly weak state,' 'thought he was going to die,' 'symptoms were pain in the abdomen,' 'collapse with extreme weakness and almost complete unconsciousness.' 'The pulse was weak; he was rather white; a little yellowish; there was a suspicion of jaundice;' 'the whites of his eyes were colored a little yellow.'

'Q. Did you arrive at any conclusion as to what the cause of his trouble was? A. I thought the first time I saw him...