Lewis v. New York Life Ins. Co.

• Decision Date: 17 February 1919
• Docket Number: No. 13124.,13124.
• Citation: 209 S.W. 625,201 Mo. App. 48
• Parties: LEWIS v. NEW YORK LIFE INS. CO.
• Court: Missouri Court of Appeals

209 S.W. 625

201 Mo. App. 48

LEWIS v. NEW YORK LIFE INS. CO.

No. 13124.

Kansas City Court of Appeals. Missouri.

February 17, 1919.

Appeal from Circuit Court, Jackson County; Joseph A. Guthrie, Judge.

Action by Lulu M. Lewis against the New York Life Insurance Company. Judgment for plaintiff, and defendant appeals. Reversed.

Lathrop, Morrow, Fox & Moore, of Kansas City, for appellant.

Chas. M. Howell, Langsdale & Howell, and Jos. S. Brooks, all of Kansas City, for respondent.

TRIMBLE, J.

Plaintiff held a policy of insurance on the life of her husband, W. Dudley Lewis, wherein, upon his death, the defendant agreed to pay an income of $50 per month for at least 20 years, and throughout her life if she lived longer than that. She brought this suit in Jackson county, Mo., to recover the monthly sums accruing up to the time the petition was filed, aggregating $300. Verdict and judgment were in her favor, and defendant appealed to the Supreme Court. There it was held that the constitutionality of the statute under which service was obtained was not an open question at the time the appeal was taken, and that the amount of the judgment fixed the amount involved so as to bring it within the pecuniary limit of our jurisdiction, and therefore the case was transferred to this court. 201 S. W. 851, 852.

The answer, after admitting the issuance of the policy, the death of the insured, and the identity of plaintiff as the beneficiary, set up that the policy was rescinded because certain answers of insured to questions in his application, constituting the basis of the insurance contract, were false, fraudulent, or untrue; that said answers were not full, complete, or true, but misrepresented or concealed the true facts in reference to the matters referred-to in said questions, which were material to the risk and upon which statements and representations the defendant relied in entering into said contract, and that but for said false, fraudulent or untrue statements and representations defendant would not have entered into said contract. The answer further pleaded that the policy was a Colorado contract, and the cause of action, if any, arose under and depended upon the laws and decisions of the courts of that state; that under them a misrepresentation or concealment material to the risk, made in response to specific inquiries upon which the insurer relies to its injury, voids the policy at the insurer's option, if said misrepresentations or concealment were either false or fraudulent, or both, in fact or in law; that the law of the Colorado courts is that a warranty, whether or not material to the risk, if untrue or fraudulent, voids the policy at the option of the insurer. Plaintiff's reply admitted that defendant made an attempted rescission or cancellation of the policy, but denied the laws and decisions of Colorado to be as claimed, and denied all other issuable matters alleged in the answer.

The application was signed December 5, 1912, the policy was issued December 30, 1912, was delivered shortly after noon on January 6, 1913, and insured died some 10 days later. After being notified of his death. defendant at once investigated, and, tendering back the premium received and all interest thereon, rescinded, or sought to rescind the contract on the ground above stated.

At the trial, plaintiff introduced the policy and rested. The defendant then undertook to make out its defense. The questions and the answers thereto, relied upon to justify the rescission, are not in dispute, and are as follows:

"8. Has any life insurance company ever examined you, on an application for insurance or for any other reason, without issuing a policy? (If so, state name of company). A. No.

"9. Have you ever had or suffered from any of the following diseases? Answer `Yes' or `No' to each part of this query below. Give explicit answers and particulars in each case.

"(a) Of the brain or nervous system? A. No.

"(b) Of the heart or lungs? A. No.

"(c) Of the stomach or intestines, liver, kidneys or bladder? A. No.

"(d) Of the skin, middle ear or eyes? A. No.

"(e) Rheumatism, gout or syphilis? A. No.

"10. Have you consulted any physician for any ailment or illness not mentioned above? A. Yes. Eczema. One attack; spring of 1912; two months duration; of mild severity; results perfect. Physician consulted and his address: Robert M. Pollock, Rocky Ford, Colorado."

The contract provided that it should be deemed to be made and payable in the state of Colorado. The insurance was applied for there. The policy was delivered and the premium paid there; insured died there, and the tender of the premium in rescission was made there. It was therefore unquestionably a Colorado contract; and the rights of the parties thereunder are governed by the laws of that state. Liebing v. Mutual Life Ins. Co. (Sup.) 207 S. W. 230. Consequently the policy is not affected by the provisions of section 6937, R. S. 1909, which provides that no misrepresentation made in obtaining a policy shall be deemed material or render the policy void unless the matter misrepresented shall have actually contributed to the contingency or event on which the policy is to become due and payable.

To prove the misrepresentations or untrue statements contained in the above answers, the defendant introduced a number of physicians, of Rocky Ford, Colo. (where insured lived and died), and also two doctors of Excelsior Springs, Mo., where insured went for a short stay during three or four summers. This evidence covered a searching inquiry into the health and movements of insured over a period of 6 or 7 years next before his death; and the tendency of such testimony was to show that insured consulted the said doctors for personal ailments at various times commencing in February, 1906, and extending down to about a month before he died. While some of these consultations would seem to be for mere minor and temporary ills, yet others tend to show, and all of them might be regarded as showing, that insured was suffering with chronic nephritis, or inflammation of the kidneys, known to the laymen as Bright's disease, and that insured knew he had it. Of course, if he consulted a physician concerning himself, insured knew he had had such consultation even though he may not have known what the physician found. And in considering this case, we must bear in mind that the defendant is not seeking to defeat a recovery on the ground that insured died of a disease he had at and prior to the execution of the contract, and which he represented he did not have, but on the ground that, when defendant, for the purpose of ascertaining whether it would enter into the contract, asked the applicant whether he had ever had any disease of the stomach, liver, or kidneys or had ever had rheumatism and to give specific answers and particulars in each case the applicant replied that he had none of them; and, when asked if he had consulted any physician for any ailment or illness not mentioned above and, if within 5 years, to give name and address of physician consulted, applicant gave the name of one only, and he as having been consulted for eczema. These were matters about which the company was entitled to have full and frank answers, since the information sought to be elicited lay peculiarly within the applicant's own knowledge and was information important for the company to have in determining whether it would choose to enter into a contract insuring applicant's life.

Of course, a secret, insidious malady like Bright's disease of the kidneys might be wholly unknown to the applicant, and, if so, even if he did have it, his answer that he did not would not entitle defendant to rescind, unless perchance the applicant had warranted that he did not. But the applicant was bound to know whether he had consulted any physician and would be able to give the names of the physicians consulted, or, if he could not recall their names, to state that fact, and then the company would be in a position to determine for itself whether or not it would enter into the contract. The applicant ought not be permitted to withhold such information and yet nevertheless the beneficiary be allowed to recover, on the ground that the fact of such consultations and the ailments for which they were had were immaterial and had no influence on the question of whether the contract should be entered into, or did not result in causing the insured's death, since that would be depriving the company of its right to decide for itself whether it would take the risk of applicant's insurance. That would be permitting the applicant to decide for the company the important question of whether it would insure the applicant's life. Dr. Lawson, of Rocky Ford, insured's family physician, testified that in February and March, 1909, he treated insured for a short time and examined his urine, finding blood and albumen therein, but attributed it to a chill he had had and to an overdose of quinine he had taken to cure it. The doctor says he treated him briefly in 1907 for something—he could not remember what—possibly a cold. Also in June, August, and September, 1912, the doctor said he treated insured; and that in June of that year he examined his urine and found perhaps 1 per cent. of albumen, but told him that it was a matter of no consequence. He further testified that it was not true that it was of no consequence, yet he told him that for its psychic effect. On cross-examination he said that had he thought it a serious condition he would have so advised him. He treated him at this time for scabies, a skin disease, manifesting itself on the inner side of his legs but which yielded to local treatment, which it would not have done had it been caused in any way by disease of the kidneys. He testified that the presence of albumen in the urine at times might arise from various causes, and, unless it was a continuing manifestation, it did not necessarily indicate...