Massachusetts Protective Ass'n, Inc. v. Ferguson

• Decision Date: 25 March 1929
• Docket Number: 29291
• Parties: MASSACHUSETTS PROTECTIVE ASS'N, Inc., v. FERGUSON et ux
• Court: Louisiana Supreme Court

121 So. 863

168 La. 271

MASSACHUSETTS PROTECTIVE ASS'N, Inc., v. FERGUSON et ux

No. 29291

Supreme Court of Louisiana

March 25, 1929

Appeal from Tenth Judicial District Court, Parish of Natchitoches J. F. Stephens, Judge.

Suit by the Massachusetts Protective Association, Incorporated against Elijah P. Ferguson and wife, in which defendant named asserted a reconventional demand. Judgment for defendant named in reconvention rejecting plaintiff's demands, and plaintiff appeals.

Affirmed.

Hawthorn & Stafford and John L. Pitts, Jr., all of Alexandria, for appellant.

J. Fair Hardin, of Shreveport, for appellee.

OPINION

ROGERS, J.

This suit was filed on May 29, 1923, by the Massachusetts Protective Association, Inc., against Elijah P. Ferguson and his wife, to obtain the cancellation of a certain health and accident policy issued by the plaintiff in favor of the defendant Ferguson on February 23, 1921. The principal sum under the policy is $ 5,000, and it provides for a weekly indemnity of $ 50 during total disability for a maximum period of 60 weeks.

Plaintiff predicates its action for the cancellation of the policy on the alleged false statements contained in the assured's application therefor when he said that he never had any sickness or ailment involving his lungs, although, as a matter of fact, at that time and prior thereto, these organs were affected by tuberculosis; and, further, when he failed to disclose that he was and had been a sufferer from chronic dysentery.

Defendant denies that he had made any false statements in his application for thepolicy, and avers that all his statements therein were made in good faith. As additional defenses, he pleads that the policy, having been issued without any medical examination, was governed by the provisions of Act 97 of 1908, under which plaintiff must be held to have waived its right to cancel the contract on the grounds alleged in its petition; and, further, that plaintiff was estopped to deny the validity of the policy by paying him certain indemnities that had accrued thereunder and by accepting premiums thereon after his disability had arisen.

Defendant, in reconvention, sets up his total disability, beginning November 1, 1921, from pulmonary tuberculosis, and the continuance of such disability for more than the maximum of 60 weeks. He prays for judgment for $ 3,000 as the indemnity due him under the terms of the policy, and, additionally, for a like sum and for reasonable attorney's fees as penalties under the provisions of Act 310 of 1910.

The court below rejected plaintiff's demands, and gave defendant Ferguson judgment in reconvention for $ 3,000, disallowing, however, his claim for double indemnity and attorney's fees. Plaintiff appealed from the judgment, and defendant answered the appeal, asking that the amount of the judgment be doubled and that he be allowed attorney's fees.

The questions and answers appearing in Ferguson's application for the policy that are pertinent to plaintiff's charge of fraud and deception are as follows, viz.:

"12. Have you ever had any sickness or ailment involving the heart, brain, kidneys or lungs or any form of rheumatism? No."

"14. What sickness or accidents have you had during the past 5 years. What physicians have you consulted during that period? Influenza, 1918, 3 days. Army.

"(b) Are you now in sound health and bodily condition? Yes."

At the inception of the trial of the case, defendant objected to all testimony seeking to rescind the policy for the alleged misrepresentations, on the ground that plaintiff was legally estopped under the provisions of Act 97 of 1908. The objection was overruled, and the testimony admitted.

The evidence in the record shows that the defendant Ferguson, who is 39 years of age, served in the United States Army for the greater part of the World War, receiving his discharge in August, 1919. In the following month he went to work for the Sinclair Oil Company as a tool dresser in the Homer oil field. He continued in this employment for about a year, leaving it in the latter part of 1920 to do similar work for one George O. Baird. Defendant was working for Mr. Baird on February 15, 1921, at Athens, La., when the policy herein was issued. In May, 1921, defendant filed a small claim under its provisions for rectal trouble, which claim, after some correspondence between the contracting parties, was paid; and the company attached a rider to the policy continuing it in force, but absolving itself from all liability for any disease of the rectum. Defendant continued working for Mr. Baird until August or September, 1921. Due to pulmonary tuberculosis, he became disabled in the month of November, 1921. A claim for the disability was seasonably presented to the defendant company, and, after an extensive correspondence, was disallowed. Subsequently, the company instituted the present suit to annul the insurance contract.

The policy was issued without any medical examination of the insured. Plaintiff has not shown, nor attempted to show, any collusion between its local agent and the defendant to dispense with such examination in order to permit the latter to reap the benefit of the legislative act. In this respect, the testimony shows that in the afternoon of the day on which the application was signed, while defendant was visiting the drug store of Nat A. Martin, in the village of Athens, he was introduced by Mr. Martin, the proprietor of the establishment, to the local agent of the plaintiff company. After some conversation between the parties, the company's agent suggested to defendant the advisability of his taking out an indemnity policy. The suggestion was favorably received and acted upon by the defendant, because, as he testified, he realized he was engaged in a dangerous occupation and might at any moment be accidentally hurt. A physician having his office in the drug store was present at the time, and there were several other physicians residing in the village, so that it would have been an easy matter to have had the defendant medically examined if the general business custom of the company demanded it, or if such examination was specifically required in the case of the defendant.

Plaintiff's charge of fraud and deception must rest entirely, therefore, upon the alleged knowledge of defendant that at the time he signed the application for insurance he was afflicted with pulmonary tuberculosis and his concealment of that fact, and his further concealment of the fact that he was also a sufferer from chronic dysentery.

The application which plaintiff was required to sign does not specifically require information concerning the disease known, generically, as dysentery. The only ailments inquired about are a constitutional disease and ailments involving certain vital organs of the human body. Defendant had no reason to believe, when he made application for the policy herein, that he had not fully recovered from an attack of dysentery which he suffered while serving in the army. If he recalled that illness at all, in...