New York Life Ins. Co. v. Feicht

• Citation: 29 F.2d 318
• Decision Date: 02 July 1928
• Docket Number: No. 6015.,6015.
• Parties: NEW YORK LIFE INS. CO. v. FEICHT.
• Court: U.S. District Court — Northern District of Illinois

29 F.2d 318 (1928)

NEW YORK LIFE INS. CO. v. FEICHT.

No. 6015.

District Court, N. D. Illinois, E. D.

July 2, 1928.

Hamlin, Topliff & Cooper, of Chicago, Ill., for plaintiff.

H. B. Jerry, of Chicago, Ill., for defendant.

WILKERSON, District Judge.

This is a suit in equity to rescind for fraud the reinstatement of a policy of life insurance. The case has been reargued. Some authorities, particularly International Life Insurance Co. v. Mowbray (C. C. A. 7) 22 F.(2d) 952, which were not presented at the original hearing have been brought to the attention of the court.

The Illinois statutes provide:

"That from and after January 1, 1908, no policy of life insurance shall be issued or delivered in this state or be issued by a life insurance company organized under the laws of this state, unless the same shall provide the following: * * * (3) That the policy, together with the application therefor, a copy of which application shall be endorsed upon or attached to the policy and made a part thereof, shall constitute the entire contract between the parties and shall be incontestable after it shall have been in force, during the lifetime of the insured, for two years from its date, except for nonpayment of premiums * * * provided, that the application therefor need not be attached to or made a part of any policy containing a clause making the policy incontestable from date of issue." Smith-Hurd Rev. St. 1927, c. 73, § 261.

The policy in suit provides:

"The policy and the application therefor, copy of which is attached hereto, constitute the entire contract. All statements made by the insured shall in the absence of fraud, be deemed representations and not warranties and no such statement shall avoid the policy or be used in defense to a claim under it unless it is contained in the written application and a copy of the application is indorsed upon or attached to the policy when issued. * * *"

The policy further provides:

"This policy * * * shall be incontestable after two years from its date of issue except for nonpayment of premiums."

The policy contains the provision:

"This policy takes effect as of the 6th day of June, 1923, which date is the anniversary of the policy."

The policy further provides:

"If any premium is not paid on or before the day it falls due the policy holder is in default; but a grace of one month (not less than thirty days) subject to an interest charge of five per cent. per annum will be allowed for the payment of every premium after the first, during which time the insurance continues in force. * * *

"At any time within five years after any default, upon written application by the insured and upon presentation at the Home office of evidence of insurability satisfactory to the company, this policy may be reinstated * * * upon payment of arrears of premiums with 5 per cent. interest thereon from their due date."

The insured did not pay the premium due June 6, 1924, either when due or within 30 days from that date. On August 14, 1924, the insured executed and delivered the following:

"Application to New York Life Insurance Company (2) Home Office: 346 Broadway, New York, N. Y., for Reinstatement of Policy No. 8-483-286 Amount $5,000.00, which lapsed for nonpayment of premium due on the 6 day of June, 1924.

"I hereby apply for the reinstatement of the above numbered policy, and for the purpose of inducing said company to reinstate said policy and with the understanding that it will rely and act on what I here say, I represent to it that I am now, to the best of my knowledge and belief, in good health; that within the past twelve months I have not had any illness, nor consulted nor been treated by any physician, nor been prevented by illness or accident from continuously pursuing my customary occupation which is the same now as it was when I applied for said policy; that no life insurance company has within the past twelve months examined me either on, or in anticipation of an application for life insurance, or for the reinstatement of life insurance, without issuing or reinstating such insurance; and that no application for insurance on my life is now pending. (If there is any exception or qualification to the above, write it out here fully.)

"If the evidence of my insurability is satisfactory to the company and it has received in cash all sums the policy requires to be paid for reinstatement, then, and not until then, said policy shall be deemed reinstated. If said policy is not so reinstated, I agree to accept return of all sums paid in connection with this application, without interest. * * *"

He received from the company the following:

"Official Premium Receipt. New York Life Insurance Company. Home Office, 346 Broadway, New York, N. Y. Received the payment specified below.

                  ======================================================
                       Amount Due.    |  Policy Number.  |   Date Due
                                      |                  |
                  Premium     $155.70 |  8 483 286   A6  | 6 day of June
                  Interest on         |                  |   Year 1924
                  Loan or Note        | Gustav R. Feicht |
                  Or Int.        1.45 | 554 N Monticello |
                                      |   Ave            | Ill
                              _______ | Chicago Ill.     |
                              $157.15 |                  |
                  ------------------------------------------------------
                

"Darwin P. Kingston, President.

"Countersigned by E. J. Sailman Cashier Illinois Clearing-House."

Plaintiff seeks rescission of the reinstatement of the lapsed policy on the ground that the statements in the application for reinstatement, that the insured was then, to the best of his knowledge and belief in good health, and that the insured, within 12...