Mitchell v. AARP LIFE INSURANCE PROGRAM

• Citation: 779 A.2d 1061,140 Md. App. 101
• Decision Date: 04 September 2001
• Docket Number: No. 968,968
• Parties: Curtiss B. MITCHELL v. AARP LIFE INSURANCE PROGRAM, NEW YORK LIFE INSURANCE CO.
• Court: Court of Special Appeals of Maryland

779 A.2d 1061

140 Md. App. 101

Curtiss B. MITCHELL v. AARP LIFE INSURANCE PROGRAM, NEW YORK LIFE INSURANCE CO.

No. 968, Sept. Term, 2000.

Court of Special Appeals of Maryland.

September 4, 2001.

Curtiss B. Mitchell, Forestville, for appellant.

Stefan A. Hagerup (Adkin, Gump, Strauss, Hauer & Feld, L.L.P., on the brief), Washington, DC, for appellee.

Argued before HOLLANDER, SONNER and ADKINS, JJ.

HOLLANDER, Judge.

In this case, we must determine whether Curtiss B. Mitchell, appellant, is the beneficiary of a valid contract of life insurance issued by the "AARP Life Insurance Program, New York Life Insurance Company" ("New York Life"),¹ appellee. On September 17, 1999, after New York Life refused to pay appellant the death benefit of $15,000 allegedly due under the life insurance policy that he procured for his late father, George Mitchell,² appellant filed suit in the Circuit Court for Montgomery County. Appellee subsequently moved for summary judgment on January 31, 2000, claiming that no life insurance coverage existed when George died, and therefore appellant was not entitled to the insurance proceeds. The trial court granted summary judgment to New York Life on March 28, 2000. On April 10, 2000, appellant filed a motion to alter or amend, which was denied on May 22, 2000.

Appellant, who is pro se here, as he was below, presents two questions for our consideration. We have combined and rephrased them as follows:

Did the trial court err in granting appellee's motion for summary judgment?

For the reasons that follow, we shall affirm.

FACTUAL BACKGROUND³

George, appellant's father, was born on June 5, 1926. On February 12, 1999, appellant obtained a Durable Power of Attorney over the affairs of his seventy-three year old ailing father, who was then hospitalized due to his failing health. Over the next several days, appellant contacted several life insurance companies in an unsuccessful attempt to obtain life insurance for his father.

According to appellant, the "AARP New York Life Insurance Program had come to [his] attention during one of his visits with his father through a piece of their promotional literature which advertised prompt insurance coverage after the applicant had met a simple three step process...." Mitchell noted that the program was targeted for seniors, and was "very alluring." Mitchell asserts in his brief that "[e]nrollment and coverage was advertised as almost instantaneous after completion of [the] three step process." Because appellee's life insurance plan seemed "very practical and commonsensical" and was "designed for the benefit of seniors, [with] a very low rejection rate ...," appellant and his father "desired immediate coverage...." On behalf of his father, appellant contacted New York Life by telephone on February 28, 1999, to obtain assistance with the application form, titled "Request for Group Insurance."

Appellant alleged that he spoke with an agent of appellee about "expeditiously processing a policy of life insurance on his ailing father." He informed appellee's customer service representative that he was ready to complete the application "right then," but needed assistance with the form. According to Mitchell, the insurer's agent helped him with the application, but appellant was unable to identify the particular person with whom he spoke.

The insurance application form contains a section labeled "Coverage Amount Requested." Appellant initially sought $25,000 in coverage, the maximum amount offered. The "insurer's agent" advised him, however, that the age of his father precluded George from obtaining life insurance in that amount. As a result, appellant selected coverage of $15,000, the highest coverage available to George, based on George's age. Appellant named himself as the sole beneficiary of the requested policy.

Section B of the Application is titled "Payment Options," and contains two options for payment. "Option 1," titled "Automatic Premium Payment," authorizes monthly or quarterly withdrawals from a bank account. "Option 2," titled "Periodic Premium Billing," contains two more choices. In one, the applicant seeks to be billed, while the other indicates that payment is enclosed. Appellant selected Option 2 and checked the box that reads: "So coverage can take effect as soon as possible, I enclose a check for my first payment in the amount of _____." In the blank, the application contains the handwritten amount of $151.80.

Section D is titled "Statement of Health." It asks the applicant if he or she has had "treatment for or consulted a physician about ... emphysema...." On the form, the word "emphysema" is circled. Appellant also checked "yes" to a question asking if the applicant had been admitted to a hospital in the past two years, adding that George suffered from "Chronic Obstructive Lung Disease & Tracheobronchitis," for which he had "nebulizer treatments, intravenous fluids & antibiotics."

Section E of the Application contains the following pre-printed statement:

I understand that insurance will be effective on the date of the certificate, provided my premium is received during my lifetime and within 31 days of such Insurance Date. I understand that premium payment for insurance does not mean there is any coverage in force before the effective date as specified by New York Life, and that benefits may be denied during the first two years if material facts have been misstated here. I represent that I am an AARP member, and that, to the best of my knowledge and belief, the information on this request is true and complete.

(Emphasis added). Appellant signed the application as follows: "George C. Mitchell/Curtiss Mitchell P.O.A.," and dated it "2/20/99."

At his deposition on January 17, 2000, appellant said he believed the application constituted the "Certificate" referred to in Section E of the application. He explained that he "filled it out, sent [his] money ... and no one told [him] that this was not a certificate." He "point[ed]" to a number on the application, "5189624," to support his assertion. Appellant also indicated at his deposition that the text of the application provided that the insurance would be effective "[o]n the date of the certificate." At the summary judgment hearing, however, Mitchell acknowledged that he never received a certificate from appellee.

Appellant claimed that, after completing the application, he asked appellee's customer service representative what he should do to assure immediate life insurance coverage for George. Mitchell contends that appellee's agent advised him to mail the completed application, along with a power of attorney and the premium payment, to appellee's corporate office. Accordingly, Mitchell mailed the application, a copy of the power of attorney, and a check dated March 4, 1999, in the amount of $151.80, in payment of the first premium. It is undisputed that New York Life received the documents on March 9, 1999; the application is stamped "Mar 09 1999." Moreover, appellee deposited appellant's check on that date.

George died the next day, March 10, 1999, at approximately 6:30 a.m. At about 8:00 a.m., appellant contacted New York Life to advise of his father's death. At his deposition, appellant said that he "never asked for the $150,000 death benefit."

On March 11, 1999, appellant again contacted New York Life. He was informed that the application had not been processed or reviewed prior to George's death, and therefore the policy was not in effect at the time of George's demise. Several days later, appellee returned the premium payment of $151.80 to appellant, with a letter advising that appellee had not approved the insurance application prior to George's death, and thus appellant was not entitled to the death benefit under the policy. In support of its motion for summary judgment, appellee submitted several documents, including: an affidavit from Daniel J. Rice, the Director of Underwriting for New York Life's AARP Operations, located in Tampa, Florida; a copy of the power of attorney submitted by Mitchell; excerpts from appellant's deposition; a copy of the insurance application completed by Mitchell; and an excerpt from New York Life's Underwriting Guidelines. Rice averred in his affidavit that the Underwriting Department had not reviewed George's application by the time he died, nor had New York Life issued a conditional receipt or a premium receipt to George. Rice stated that, as a result, appellee did not approve coverage for George, and no insurance certificate had been issued.

Appellant asserted in his opposition to the summary judgment motion that New York Life's brochure advertised an easy application process that would permit coverage at the "earliest possible date." Moreover, he argued that, in his conversation with New York Life's agent, "the terms and conditions for a policy of Life Insurance on the beneficiary's ailing father's life were set out and mutually agreed upon, and those representations merged with the brochure's representations to form a binding temporary contract." Appellant also claimed that appellee's agent advised him that if he completed "the Enrollment Form, executed a Durable Power of Attorney, and made out a check for the first premium payment in the sum of $151.80, and mailed the documents to New York Life, he would have a contract for preliminary and temporary insurance coverage for his father." Accordingly, appellant followed the instructions, and the first premium payment of $151.80 was deposited by New York Life on March 9, 1999, one day prior to George's death.

Although appellant did not include an affidavit with his opposition, he signed it under oath. In further support of appellant's opposition, he submitted the New York Life brochure, his check for the first premium payment, and the first page of his letter of June 8, 1999, to A.J. Goergen, a corporate vice president of New York Life, in which appellant described the events that...