Molstead v. Reliance Nat. Life Ins. Co., 8964

• Court: United States State Supreme Court of Idaho
• Writing for the Court: Hamilton, Coeur; SMITH; TAYLOR
• Citation: 83 Idaho 458,364 P.2d 883
• Parties: Joyce MOLSTEAD, Plaintiff-Respondent, v. RELIANCE NATIONAL LIFE INSURANCE COMPANY, a corporation, Defendant-Appellant.
• Docket Number: No. 8964,8964
• Decision Date: 12 September 1961

Page 883

364 P.2d 883 83 Idaho 458 Joyce MOLSTEAD, Plaintiff-Respondent,
v.
RELIANCE NATIONAL LIFE INSURANCE COMPANY, a corporation, Defendant-Appellant. No. 8964. Supreme Court of Idaho. Sept. 12, 1961.

[83 Idaho 460]

Page 884

C. J. Hamilton, Coeur d'Alene, James L. Barker, Jr., Salt Lake City, Utah, for appellant.

Thomas A. Mitchell, Coeur d'Alene, for respondent.

[83 Idaho 461] SMITH, Justice.

Respondent brought this action for recovery under two insurance policies which appellant issued to her as of April 10, 1957, covering hospital and surgical expenses in the event of accident or illness. She sought to recover expenses, allegedly covered by the policies, of $473.23 incurred in obtaining treatment for a broken hip which she accidently sustained September 15, 1958, and attorney's fee under I.C. § 41-1403.

Appellant in its answer admitted that respondent sustained personal injury, but denied its liability in the premises; it affirmatively alleged that respondent in applying for the insurance materially and falsely represented that she was free from any physical defect and 'completely corrected' from an attack of polio which she suffered during 1952; that had appellant known that respondent could not walk without using a brace, appellant would not have issued the policies; and that the false representations vitiated the policies.

Trial before the court without a jury resulted in judgment for respondent. Appellant appealed from the judgment. Thereafter, upon respondent's motion, the trial court entered an order requiring appellant to pay $300 attorney's fee to respondent, should she prevail upon the appeal. Appellant also appealed from that order.

Appellant, in asserting error committed by the trial court in finding for respondent, maintains that the policies are voidable because respondent knowingly made material false representations in her applications therefor. Appellant's assignments of error require a review of the evidence, in order to ascertain its sufficiency to sustain the trial court's findings and judgment.

[83 Idaho 462] During 1952, respondent suffered an attack of polio which left her with a residual disability; she used a brace and crutches to walk. On April 2, 1957, two of appellant's agents, Mr. Halonen as appellant's regional supervisor, with ten years' insurance experience, and Mr. Vens, as a soliciting agent under Halonen's supervision, solicited respondent for the insurance. At that time

Page 885

both respondent and her mother advised the agents concerning the polio which had left respondent with the residual disability. Nevertheless, at the solicitations of the agents, respondent applied for the two policies on forms of application furnished. Each agent participated in filling in an application.

Question No. 6 in both applications reads:

'Are you and all other members of the Family Group to be insured now in good health and free from any physical or mental defect?'

to which the answer appears, 'Yes.'

Question No. 9 reads:

'Have you, or any member of the Family Group to be insured, received medical or surgical advice or treatment within the past three years? ..... If answer is 'yes,' give details below:'

Below the question appears the information that in '1952' respondent suffered 'polio'; that she had been treated by 'Dr. Wood', and that she was 'completely corrected.'

Question No. 11 reads:

'Do you authorize any physician or hospital to furnish the company with your complete medical history?'

To which the answer appears, 'Yes.'

Respondent's testimony relating to Question No. 9 appears:

'Q. Examine the application and state whether or not there are any entries or alterations on that application which were made after you signed the application. A. My weight has been changed from 114 to 124 and the terms 'completely corrected' down in Number 9 has been added.'

Respondent testified that when she received the policies some two or three weeks after the initial solicitation, she noticed that those changes had been made in the application form attached to each policy.

In brief summary the evidence is in dispute as to whether respondent was in the living room of her home at the time the agents Vens and Halonen arrived, or whether after their arrival she came into the room using her crutches and brace; also, as to whether the agents saw her using crutches, and saw the brace; also as to whether the agents filed in the answers to Questions Nos. 6 and 9 in respondent's presence, or at a later date.

The evidence is undisputed regarding the fact that appellant's agents were advised of respondent's 1952 attack of polio; also that [83 Idaho 463] respondent furnished the name of an attending physician in Coeur d'Alene who had treated her; nor did the agents deny that respondent furnished to them the names and residences of five other attending physicians; nor did they deny having informed respondent that appellant had insured a man who used a wheelchair, who appeared in worse physical condition than respondent.

The evidence does not appear to be in dispute on the point that appellant's agents indicated that they would check with physicians regarding respondent's condition; nor that she had given her consent in the premises by her affirmative answer to Question No. 11 in the application.

Moreover the evidence is undisputed regarding the fact that respondent, at the time of the insurance solicitation, had recovered from the attack of polio, although with the residual disability; and that her cause of action did not stem from sickness, but from an injury accidently sustained during the second 12-month term of the policies 'renewable at the option of the...