Mutual Life Ins. Co. of New York v. Allen

• Decision Date: 16 November 1911
• Citation: 174 Ala. 511,56 So. 568
• Parties: MUTUAL LIFE INS. CO. OF NEW YORK v. ALLEN.
• Court: Alabama Supreme Court

56 So. 568

174 Ala. 511

MUTUAL LIFE INS. CO. OF NEW YORK v. ALLEN.

Supreme Court of Alabama

November 16, 1911

Appeal from Circuit Court, Dallas County; B. M. Miller, Judge.

Action on a policy of insurance by Lula T. Allen against the Mutual Life Insurance Company of New York. Judgment for plaintiff and defendant appeals. Reversed and remanded.

Tillman Bradley & Morrow and Mallory & Mallory, for appellant.

Pettus Jeffries, Pettus & Turner, for appellee.

MAYFIELD J.

Appellee sued appellant on an insurance policy. The original policy was issued October 26, 1902, insuring the life of Walter E. Allen, the husband of the plaintiff. The policy lapsed for nonpayment of premiums; but on December 21, 1907, at the request of the insured, the policy was renewed, or reinstated, for the reduced amount of $2,500; the original amount being $5,000.

When the case was here on former appeal (reported in 166 Ala. 159, 51 So. 877), it was ruled that the court properly sustained the demurrers to certain pleas which set up statements, made in the application for the reinstatement of the policy, as warranties or guaranties, for the reason that it was not alleged that such agreements were not plainly expressed in the policy, as provided by sections 4572 and 4579 of the Code. On the last trial the defendant seems to have withdrawn the pleas referred to, but left a great number of those discussed in the former opinion, which set up false and fraudulent representations, and filed in addition thereto nine other pleas, numbered from 41 to 50, inclusive. The trial court sustained demurrers to all the special pleas, except those numbered 28, 31, 32, 33, and 34, upon which the trial was had.

Plea 27, after setting out the terms of the policy, the application by the insured for a reduction of the amount of the annual premium, the granting of such application, and the terms upon which granted, and averring a forfeiture of the policy under the application for reinstatement, averred that the insured, in his application for reinstatement, guaranteed that his health had been good at all times since his examination for the original policy; that he had not consulted a physician since that time; that the defendant, upon the faith of such guaranty, reinstated the policy; that such representation was untrue, the health of the insured not having continued good; that at the time he made it he had a serious affection of the heart which increased the risk of loss upon the policy, which fact was unknown to the insurance company at or before the time of the reinstatement of the policy, but was known to the assured; that, had the company known that the assured suffered from such disease of the heart, it would not have reinstated the policy.

Plea 28 was in effect the same as plea 27, except that the misrepresentation set up in that plea is averred to be the statement of the assured, in his application for reinstatement, that he had not consulted a physician, etc., it being alleged that such representation was false, was known to be false by the assured at the time he made it, and was intended to deceive the company; that it did deceive the company and induce it to execute the contract of insurance; that the assured represented that he had not consulted a physician, whereas the proof showed that he had done so, during the time inquired of, and that the physician informed him that he was suffering from a serious valvular affection of the heart; that such misrepresentation was as to a matter which increased the risk of loss to the company.

Plea 29 was practically the same as plea 28, and averred that the representation by the assured that he had not consulted a physician was false; that the assured knew it was false; and that the company did not, and was thereby induced to reinstate the policy.

Plea 30 was the same as 29, with the additional averment that the false representation by the assured was made by him with the intention of deceiving and inducing the company to reduce the policy, and that he did thereby so deceive and so induce the company to reduce the premium and to reinstate the policy.

Plea 31 avers, as a defense to the action, as follows: "That, prior to and as a part of the negotiations for the execution and the procurement of the contract here sued on the said Walter E. Allen falsely and fraudulently represented to this defendant that his health was good, and defendant avers that said representation was false; that the health of said Walter E. Allen at said time was not good, but that he was suffering from serious heart trouble. And defendant avers that at the time of said false representation the said Walter E. Allen knew that said representation was false; that he made the same to the defendant with the intent to deceive the defendant, and with the intent that it should be acted upon by the defendant, and to induce the defendant to execute the contract here sued on; that said representation was not known by the defendant to be false, and did deceive the defendant, and did induce the defendant to execute the contract here sued on."

Plea 32 is the same as plea 31, with this averment added: "Defendant avers that said misrepresentations were as to a matter that increased the risk of loss under said policy."

Plea 33, as a further defense to the action, avers: "That prior to and as a part of the negotiations for the execution and the procurement of the contract here sued on, the said Walter E. Allen falsely and fraudulently represented to this defendant that he had not, between the time of his last examination for said policy of insurance, to wit, the 26th day of October, 1902, and the time of making said application for establishing or restoring said policy, to wit, December 21, 1907, consulted a physician, and defendant avers that said representation was false; that the said Walter E. Allen had between said dates consulted a physician. And defendant avers that at the time of said false representation the said Walter E. Allen knew that the same was false; that he made the same to the defendant with intent to deceive the defendant, and with the intent that it should be acted upon by the defendant, and to induce the defendant to execute the...