Lueders' Ex'r v. Hartford Life & Annuity Ins. Co.

• Decision Date: 05 May 1882
• Parties: LUEDERS' EX'R v. HARTFORD LIFE & ANNUITY INS. CO. [1]
• Court: U.S. District Court — Eastern District of Missouri

12 F. 465

LUEDERS' EX'R v. HARTFORD LIFE & ANNUITY INS. CO. ^[1]

United States Circuit Court, E.D. Missouri.

May 5, 1882

This was a suit by the executor of J. H. Lueders upon five certificates of insurance, in the sum of $1,000 each, issued by the Hartford Life & Annuity Insurance Company upon the life of said Lueders. The petition declared the certificates as simple contracts of insurance, and asked judgment upon each certificate for the maximum amount named therein. The defendant answered that said certificates were null and void because of certain concealments on the assured's part and because the answers contained in his application in reference to his health were false. And the answer set up a provision of the certificates sued on by which it was provided that if there should be any concealment misrepresentations, or false statements made in the application on which said certificates issued, said certificates should be null and void. Plaintiff in reply denied the allegations of the answer, and alleged that the assured had concealed nothing and made no false representation, but had, in reply to questions contained in the application, stated the truth to the defendant's agent who took his application; that the answers contained in said application had been written therein by defendant's agent; and that if false answers had been inserted it was without the applicant's knowledge. The application upon which the certificates sued on were issued contained, among others, the following questions and answers:

'(12) Do you now possess a sound constitution and good health? Yes.

'(19) How long is it since you were attended by a physician, or have professionally consulted one? About six weeks ago. For what disease? Liver complaint. Have you fully recovered therefrom? Yes.'

The following declaration was appended to the application:

'It is hereby declared and warranted that the foregoing answers and statements are full, complete, and true; and it is agreed that this declaration and warranty shall form the basis of the contract between the undersigned and the Hartford Life & Annuity Insurance Company, and are offered to said company as a consideration of the contract applied for, and are hereby made a part of the certificate to be issued on the application,' etc.

The application was signed by the applicant.

The certificates sued on each contained the following clauses 'In consideration of the representations, agreements, and warranties made in the application herefor, and of the admission fee paid, and of the sum of $10 to be paid to said company, to create a safety fund as hereinafter described and of 25 cents to be paid monthly for expenses, and of the further payment, in accordance with the conditions hereof, of all mortuary assessments, does hereby issue this certificate of membership in its safety-fund department to J. H. Lueders, of St. Louis, county of St. Louis, state of Missouri, with the following agreements:

'That said company will deposit said sum of $10, when received, with the trustee named in a contract made with it, (of which a copy is printed herein,) as a safety fund, in trust for the uses and purposes expressed in said contract, and shall at the expiration of five years from July 1, 1879, if said safety fund shall then amount to $300,000, or whenever thereafter said sum shall be attained, make a semi-annual division of the net interest received therefrom by it, pro rata, among all the holders of certificates in force in said department at such times, who shall have contributed five years prior to the date of any such division, their stipulated proportion of said fund, by applying the same to the payment of their future dues and assessments. * * *

'Said company further agrees that if at any time after said fund shall have amounted to $300,000, or after five years from January 1, 1880, if that amount shall not have been attained before that date, it shall fail by reason of insufficient membership or shall neglect, if justly and legally due, to pay the maximum indemnity provided for by the terms of any certificate issued in said department, and such certificate shall be presented for payment to said trustees by the legal holder thereof, accompanied by satisfactory evidence as hereinafter provided of its failure to pay, after demand upon it within the time herein stipulated for limitation of action, then it shall be the duty of said trustee to at once convert said safety fund into money, and divide the same (less the reasonable charges and expenses for the management and control of said fund) among all the holders of certificates then in force in said department, or their legal representatives, in the proportion which the amount of each of their certificates shall bear to the amount of the whole number of such certificates in force; and that in such event it shall file with said trustee a correct list under oath of the names, residences, and amounts of the certificates of all members entitled to participate in such division. * * *

'The evidence referred to above to be either certification of said insurance company's president or secretary that a claim is justly and legally due, and that payment thereof has been demanded and refused, or the duly-attested copy of a final judgment obtained thereon in any court of competent jurisdiction, satisfaction of which has been neglected or refused for the period of 60 days from date. * * *

'Upon the death of the member aforesaid while this certificate is in force, all the conditions hereof having been conformed to by said member, and on the receipt by the president or secretary of said company of satisfactory proofs of such death, an assessment shall be made upon the holder of all certificates in force in said department at the date of such death, according to the table of graduated assessment rates given herein, as determined by their respective ages, and the number of such certificates in force at the date of such death, and the sum collected thereon, (less 10 cents per member for costs of collection,) shall be paid: provided, however, that in no case shall the payment upon this certificate in the event of such death exceed $1,000, (less $15 as a post mortem contribution to said safety fund.) * * *

'The application on the faith of which this certificate issued is hereby referred to and made a part of this contract.'

The case came up for trial April 11, 1882, and was tried before a jury.

The plaintiff introduced the certificates sued on in evidence. Defendant introduced the application, and evidence tending to prove that the assured had liver complaint at the time he made the application and knew it. Plaintiff offered oral evidence in rebuttal tending to prove that the assured had told the examining physician of the defendant, when his application was taken, that he had liver complaint; that said physician had examined assured and had himself inserted the answers contained in the application; and that the assured had signed the application supposing it contained the answers given by him. Defendant objected that the only admissible evidence as to what answers had been given to the questions contained in the application was the application itself; but the objection was overruled.

George M. Stewart and Paul Bakewell, for plaintiff.

Frank K. Ryan, for defendant.

TREAT, D.J., (charging jury orally.)

This case differs in some respects from the cases ordinarily submitted to juries concerning life-insurance policies. If you should find for the plaintiff, as there are five of these so-called certificates or policies, you will necessarily find for her in the sum of $5,000, with interest at the rate of 6 per cent. per annum from December 15, 1881; that is, 90 days after the proof of death.

Now shall the plaintiff recover? The primary contest is that the deceased made a false statement concerning a disease which he then had and which contributed to his death, to-wit, the so-called liver complaint. The answer to the question, as recorded in the application, is: 'Had liver complaint six weeks ago; am well now. ' If he had not recovered from the liver complaint, and if he actually made that answer, and died of that disease within the short period named, the plaintiff here has no right to...