Life Ins. Co. of Ga. v. Lawler

• Decision Date: 02 December 1954
• Docket Number: No. 18754,18754
• Citation: Life Ins. Co. of Ga. v. Lawler, 211 Ga. 246, 85 S.E.2d 1 (Ga. 1954)
• Parties: LIFE INSURANCE COMPANY OF GEORGIA v. Lillian L. LAWLER.
• Court: Georgia Supreme Court

Page 1

85 S.E.2d 1

211 Ga. 246

LIFE INSURANCE COMPANY OF GEORGIA v. Lillian L. LAWLER.

No. 18754.

Supreme Court of Georgia.

Dec. 2, 1954.

Syllabus by the Court.

1. Where the defense to an action on a policy of insurance imputes fraud to the insured in obtaining the policy, and where the fact of its perpetration is otherwise issuable under the evidence, proof of the insured's good character is relevant and admissible for consideration by the jury in determining the preponderance of evidence in regard to such defense; yet the testimony of witnesses who are uncontradicted and who are not otherwise impeached or discredited, and who swear positively to facts sustaining the defense of fraud, should not be discarded by the jury merely because of the insured's previous good character. In such a case evidence of the insured's good character alone is not, as against the other evidence, sufficient to make the question of his fraud in procuring the policy an issue of fact for determination by the jury so as to prevent the direction of a verdict in faovr of the insurer upon such defense.

2. In the circumstances of this case and for the reasons stated in the correcsponding division of the opinion, the Court of Appeals erred in holding that the trial judge committed reversible error in admitting in evidence the testimony of a physician that a mole is sometimes a pre-cancerous type when there was no evidence that the insured had a mole.

J. Lon Duckworth, Jason B. Gilliland, Atlanta, John W. Davis, Summerville, Charles T. Culbert, Rome, for plaintiff in error.

Robert L. Royal, E. J. Clower, Rome, for defendant in error.

CANDLER, Justice.

On April 24, 1950, Life Insurance Company of Georgia issued a policy of insurance on the life of Albert LaFayette Lawler. Mrs. Lillian L. Lawler, the insured's wife, was the beneficiary named therein. The policy lapsed for non-payment of premiums, and on November 24, 1951, Lawler applied in writing for its reinstatement. So far as it is material to a consideration of the questions presented to this court for decision, the company's printed form of application, which the insured used, called for the following information: '6. Name all symptoms, diseases or disorders for which you have consulted a physician or other practitioner during the last five years. Give dates and particulars. If none, so state.' And '7. Have you ever had a surgical operation or been a patient in a hospital or sanitarium? If so, explain fully.' To each of these questions he answered, 'No.' On the information which the applicant furnished, the insurer reinstated his policy on November 29, 1951; and he died on July 13, 1952, from a heart attack. After more than 60 days had elapsed since proofs of the insured's death were submitted to the insurer, the beneficiary brought suit on the policy. The defendant pleaded not indebted; and further, that the quoted representations which the insured made for the purpose of effecting a reinstatement of his policy were knowingly false; that, in consequence of the incorrect information which the insured gave, it was misled as to material facts respecting the risk; and that the insured's false and fraudulent misrepresentations induced it to reinstate his policy, which it would not have done had it been correctly apprised of his physical condition. With the filing of its answer, the defendant paid into the registry of the court $116.50, an amount equal to the premiums which the insured had paid to it; also, a consent for its withdrawal at any time by the plaintiff.

On the trial, the defendant's counsel admitted execution of the policy, that it was reinstated on November 29, 1951, that proper proofs of death were duly filed, that demand for payment of the policy was made by the beneficiary, and that the defendant had refused to pay the amount stated in the policy. Dr. T. H. Moss testified for the plaintiff, that, during March, 1951, he saw and talked to the insured in a professional capacity; that the insured was them having severe pain in his epigastrium and in his stomach region; and that, because of its ulcerated condition, he removed by surgical operation about four-fifths of the insured's stomach on March 19, 1951. Guy Johnson, Harry Bond, and Tom Teat testified for the plaintiff that the insured was a man of good character. S. R. Parris testified for the defendant that he had worked for the insurer since 1947; that he filled out the insured's application for the reinstatement of his lapsed policy; that he specifically asked the insured to answer questions 6 and 7 of the application; that he correctly put down the answer to each of those questions; and that, after the application was fully filled out, the applicant read it and then signed it. There was no evidence showing or tending to show that the defendant had any knowledge of the falsity of the information imparted by the insured's reinstatement application until after his death. On motion therefor, a verdict for the defendant was directed by the court. On grounds which will be dealt with in the opinion, the plaintiff timely moved for a new trial, her amended motion for which was denied, and she sued out a writ of error to the Court of Appeals. That court reversed the trial court, Lawler v. Life Ins. Co. of Georgia, 90 Ga.App. 481, 83 S.E.2d 281; and, on application therefor, we granted the writ of certiorari.

1. In the application to this court for the writ of certiorari, it is alleged that the Court of Appeals erred in holding: 'In an action by a beneficiary on an insurance policy, where the company defends on the ground that the insured in an application for reinstatement of policy answered certain questions falsely and fraudulently which materially affected the risk, evidence of the good character of the insured is alone sufficient to authorize a jury to find that no fraud was committed, even as against the uncontradicted tesimony of an insurance agent as to facts which if true necessarily established the fraud.' To clear the way for such a ruling, the Court of Appeals, by the concurring vote of five of its six judges, reviewed and overruled a decision holding to the contrary in Henderson v. Jefferson Standard Life Ins. Co., 39 Ga.App. 609(2), 147 S.E. 901, which was prepared for the Second Division of that Court by Judge Bell and in which Presiding Judge Jenkins and Judge Stephens concurred. In overruling the Henderson case--if, under section 2 of an act which the legislature passed in 1945, Ga.L.1945, p. 232, it could be legally reviewed and overruled by the concurrence of five judges when the other judge of that court was not participating because of his disqualification; and in making its own decision in the instant case, the Court of Appeals relied largely upon the rulings of this court in several criminal cases where evidence of the defendant's good character was introduced; and, also, upon the ruling of this court in German American Mutual Life Ass'n v. Farley, 102 Ga. 720, 29 S.E. 615, 624. Farley's case, as we view it, affords no support for the overruling of Henderson's case or for the ruling here complained of. In the Farley case, as shown by the statement of facts preceding the opinion, the insured stated in his application for a policy that he had been rejected for insurance only by the Penn Mutual Life Insurance Company, and the defendant relied on the falsity of that representation for its defense; but, on the trial of the case, a general agent of the company testified that he filled out the insured's application, that he then personally knew the applicant had been rejected for insurance by several other companies, and that the insured did not represent to him that he had been rejected for insurance only by the company mentioned in his application. There was also undisputed evidence that the president of the company, about three months before the death of the insured, was told that he had been rejected for insurance by other companies when he made his application to it for insurance; and, notwithstanding this, the insurer accepted monthly premiums from the insured up to the date of his death. There, as in the instant case, testimony was introduced which showed the insured to be a person of good character. Farley, as executor of the insured's estate, recovered a judgment for the full amount of the policy, and this court in affirming the judgment said: 'If these representations warranted to be true were any part of the inducement to the defendant to enter into its engagement, upon learning that they were false it should immediately have repudiated the contract, and then offered to rescind. When it accepted the premiums with a knowledge that the representations were untrue, it elected to affirm the contract, notwithstanding such untrue representations; and having received from [the insured] McArdle in his lifetime the money in satisfaction of the installments due, paid in pursuance of and in accordance with the contract of insurance, it is, after his death, estopped to deny the validity of the contract under which it received his money.' But, in another division of the opinion in Farley's case, this court also said: 'We think the issue in this case involved directly the character of the assured. He was charged with having perpetrated a gross fraud upon the insurance company. Evidence of his good character was admissible to rebut any inference unfavorable to him which might have been deduced from the evidence offered against him.' That this statement as to the probative value which the jury may place upon good character evidence was purely obiter dictum, is clearly demonstrated by the testimony in Farley's case to which we have heretofore alluded. Estoppel by conduct, and not the sufficiency of good character evidence alone to rebut positive and uncontradicted evidence of fraud, was the ground upon which this court affirmed the judgment in Farley's case. Hence, the case in hand is not controlled...