Metro. Life Ins. Co. v. Somers

• Citation: 45 A.2d 188
• Decision Date: 07 January 1946
• Docket Number: No. 148/486.,148/486.
• Parties: METROPOLITAN LIFE INS. CO. v. SOMERS et al.
• Court: New Jersey Court of Chancery

45 A.2d 188

METROPOLITAN LIFE INS. CO.

v.SOMERS et al.

No. 148/486.

Court of Chancery of New Jersey.

Jan. 7, 1946.

Suit by the Metropolitan Life Insurance Company against Marie Ann Somers and another to cancel two insurance policies sold and delivered by the complainant to Samuel Somers during his lifetime, and to discharge complainant from any liability under such policies to the beneficiaries named therein.

Decree for complainant.

Syllabus by the Court.

1. Applications for life insurance policies provided that they were not to become effective until accepted by the Company ‘during the lifetime and continued insurability of the applicant.’ Between the date of said applications and the delivery of the policies, applicant had visited three doctors, who had diagnosed his condition as probable carcinoma of the upper right apex of the lung.

Held, that it was the duty of the applicant under the insurance contract terms to have advised the insurer of his visits to the three doctors, and his failure so to do, under the facts of this case, entitled complainant to rescind, and further, that insured having signed an application for amendment to one policy, wherein he ratified the statements in his original application for insurance ‘as of the date’ of said original application, in the latter of which he stated he had no ailment of the lungs and had not consulted any physician, was under a duty to advise the insurer of his consultations with doctors on three different occasions between the date of the original application and the delivery of the policies, and that his failure so to do entitles complainant to a decree rescinding the policies.

2. If, while insurer deliberates applications for insurance, the applicant therefor discovers facts which make portions of his statements in the original application no longer true, the most elementary spirit of fair dealing calls for a full disclosure.

Cassman & Gottlieb, of Atlantic City, for complainant.

Cole & Cole, of Atlantic City, for defendants.

SOOY, Vice Chancellor.

The bill in this cause is filed to cancel two insurance policies sold and delivered by complainant to one Samuel Somers during his lifetime and to discharge complainant from any liability under said policies to the beneficiaries named therein.

Prior to the filing of the bill of complaint defendants had instituted suits at law against complainant seeking a recovery under said policies. These suits were enjoined pending determination of the issues raised on complainant's bill.

Facts.

Samuel Somers made in writing two separate applications for life insurance policies from complainant. These applications were both dated March 10, 1944, and each contained the following questions and answers:

‘11. Have you ever had any ailment or disease of

‘(b) The Heart or Lungs? No.

‘(c) Have you ever had Diabetes, Pleurisy or Pneumonia? No.

‘(f) Have you ever had any Surgical Operation? No.

‘(g) Have you consulted a physician for any ailment or disease not included in your above answers? No.’

‘13. What clinics, hospitals, physicians, healers or other practitioners, if any, not named above, have you consulted or been treated by within the past five years? If none, so state. None.’

Each of the foregoing applications also contained Provision 4, as follows: ‘4. The Company shall incur no liability under this application until it has been received, approved, and a policy issued and delivered, and the full premium specified in the policy has actually been paid to and accepted by the Company during the lifetime and continued insurability of the applicant, in which case such policy shall be deemed to have taken effect as of the date of issue as recited on the first page thereof, except that if the applicant pays in cash to the Company, on the date this application is signed an amount equal to the full first premium on the policy applied for and if this application is approved at the Company's Home Office for the class, plan and amount of insurance herein applied for, then the policy applied for shall be in force from the date of the application.’

The two policies applied for were written and dated April 7, 1944, and delivered to the insured on April 10, 1944, at which time the first aggregate premiums were paid in cash.

On April 10, 1944, and before the delivery of either policy, Mr. Somers also signed an application for amendment to one policy asking for a change of plan of insurance with respect to that one policy, this change having been made necessary by reason of the refusal of complainant to issue the kind of policy originally applied for. In this application for amendment the insured, over his signature, said: ‘These amendments and declarations are to be considered as a part of the said application and subject to the agreements, covenants, and statements therein contained. The said application, together with these amendments, is to be considered as the basis of and as a part of the contract of insurance. The said application, as amended, is correct and true, and I hereby ratify and confirm the statements therein made as of the date hereof.’

The evidence at final hearing disclosed that Mr. Somers had consulted a physician prior to March 10, 1944, to wit, a Dr. Durham on November 16, 1943, and on December 9, 1943, and that his ailment at the time of these visits was diagnosed by the doctor as a cold. Complainant admits that had it known of these visits to Dr. Durham and that the diagnosis was a mere cold it would have issued the policies without question or further investigation. The evidence further disclosed, however, that on March 30, 1944, eleven days before the policies were delivered, Mr. Somers was examined by a Dr. Sweeney, at which time he complained of a stiffness in the upper right lung and shoulder which had persisted for the past three or four months and which ached more when he was working. Mr. Somers told Dr. Sweeney that he had been treated by a doctor for this condition for several months, ‘three or four months,’ without relief. Dr. Sweeney examined Mr. Somers at this time and hearing rales in the right apex of the lung, resorted to the use of the fluoroscope, through which he discovered a dense region in the right apex of the lung, whereupon Dr. Sweeney recommended that an X-ray be taken, not, however, divulging to Mr. Somers that he was suspicious that carcinoma might be the trouble. He did advise Mr. Somers, however, that the condition was probably an adhesion in the lung.

Dr. Bradley made an X-ray examination of Mr. Somers on March 31, 1944, with a diagnosis as follows: provisional carcinoma of the right lung, and suggested a bronchoscopy and X-ray examination be made. Dr. Sweeney received the report from Dr. Bradley, as did Dr. Durham, Mr. Somers' family physician. Dr. Durham made a fluoroscopic examination and immediately got in touch with a Philadelphia physician for the purpose of having the bronchoscopy and X-ray examination made by Dr. Jackson in Philadelphia. This examination was made by Dr. Jackson in Philadelphia at Temple University on April 18, 1944, and resulted in a confirmation of the diagnosis of Doctors Sweeney, Bradley and Durham.

Dr. Durham, at the time of Mr. Somers' visit to him on April 3, 1944, at which time Dr. Durham had Dr. Bradley's diagnosis, told Mr. Somers that he had some trouble in his right lung but he did not tell Mr. Somers the nature thereof and particularly did not tell him that it was probably a cancerous growth. From the time of these examinations aforesaid, Mr. Somers was treated for his condition until his death from that cause in the following September.

Other doctors, Dr. Martsolf and Dr. Clark, testified as to statements made by Mr. Somers to them, Dr. Clark at the time he made his medical examination before the issuance of the policies, and Dr. Martsolf as of the time when Mr. Somers entered the hospital for treatment two days before his death. Mr. Somers, in his statement to Dr. Clark at the time of the medical examination before the issuance of the policies, said that he had not lost any weight within a given period. Mr. Somers in his statement to Dr. Martsolf said that he had lost weight over a period of a year and...