New York Life Ins. Co. v. Rankin

• Decision Date: 25 May 1908
• Docket Number: 2,581.
• Citation: 162 F. 103
• Parties: NEW YORK LIFE INS. CO. v. RANKIN.
• Court: U.S. Court of Appeals — Eighth Circuit

162 F. 103

NEW YORK LIFE INS. CO. v. RANKIN.

No. 2,581.

United States Court of Appeals, Eighth Circuit.

May 25, 1908

Syllabus by the Court

Under the reformed system of pleading in the state of Missouri, a cause of action upon a policy of insurance and a cause of action upon a compromise agreement respecting the claim under the policy may be joined in distinct counts of the same petition, where the counts are not inconsistent in matter of fact, and it appears therefrom that the plaintiff asserts but a single right of recovery, which is so stated and described in the two counts as to enable him to recover upon the policy or the compromise agreement, as one or the other may prove to be the true basis and measure of his right.

Unaccepted offers to compromise claims or to purchase peace are inadmissible in evidence at the trial of controversies over the claims to which they appertain, and should not be permitted to affect the rights of the parties or to influence the results of the trials.

The declarations of the general solicitor of an insurance company are inadmissible against the company, both when they are merely the expression of his personal opinion and when they relate to features of the company's business having no necessary connection with the duties of its law officer, and respecting which it is not otherwise shown that he is authorized to make admissions on its behalf.

While errors not assigned in conformity with the rule on that subject will not ordinarily be considered, a plain error may be noticed, when justice requires it, though it be not so assigned.

When evidence is erroneously admitted in circumstances when it is calculated to affect the determination of other questions than the one in respect of which it is admitted, the error is not cured by the mere elimination of that question; and, to cure the error, the court should plainly inform the jury that such evidence is entirely withdrawn from their consideration.

In the cross-examination of a witness, it is not permissible to assume as true a damaging state of facts, without any reason to believe that there is a foundation of truth for it.

Edward O'Bryan and Frederick N. Judson (John F. Green, on the brief), for plaintiff in error.

Frederick H. Bacon, for defendant in error.

Before VAN DEVANTER and ADAMS, Circuit Judges, and RINER, District judge.

VAN DEVANTER, Circuit Judge.

March 15, 1898, the New York Life Insurance Company issued a policy upon the life of George A. Kimmel, of Arkansas City, Kan whereby, in consideration of certain premiums to be paid to it, the company agreed to pay to Edna E. Kimmel, a sister of the insured, the sum of $5,000 and an additional sum equal to the total premiums received, if the insured should die before March 15, 1918. July 30, 1898, the insured disappeared. March 9, 1903, the sister assigned the policy to Lucien E. Wood, as receiver of the First National Bank of Niles, Mich., who was succeeded in that position by George C. Rankin. After the disappearance the sister and the assignee paid the premiums as they fell due, including the one for the year beginning March 15, 1903. March 22, 1904, the receiver, as assignee of the policy, commenced an action against the insurance company; the petition being in two counts.

The first count declared upon the policy in the usual way alleging that the insured died on or about August 1, 1898. The second count, after stating the issuance of the policy, its terms, and the payment of the premiums, declared upon a compromise agreement by stating that the insured disappeared on or about August 1, 1898; that differences thereafter arose between the parties respecting the death of the insured and the liability of the defendant under the policy, the plaintiff claiming that the insured was dead, and had died about the time of his disappearance, and the defendant claiming that the death was not established; that on March 1, 1904, 'by way of a full settlement, satisfaction, and compromise,' the parties agreed that the death of the insured would be arbitrarily assumed to have occurred on March 1, 1904, and that, upon the delivery to the defendant of certain releases, it would forthwith pay to the plaintiff $5,987.71 in full satisfaction of the latter's claim under the policy; that the releases so required were duly procured and delivered to the defendant; and that it had then refused to pay the sum so agreed upon or any part thereof. The first count concluded with a prayer for a judgment for $7,736, the amount of the policy and the premiums received; and the second concluded with a prayer for a judgment for $5,987.71, the sum agreed upon in the alleged compromise. In its answer the defendant admitted the issuance of the policy, denied all the other allegations of the petition, and alleged that, if any such compromise agreement was made, it was procured by fraud, in this: that for the purpose of inducing the defendant to enter into such an agreement the assignee of the policy had presented to the defendant a large number of affidavits and so-called proofs of death, which contained many false statements as to the circumstances in which the insured disappeared, and as to his financial condition, character, business, and social habits, and from which there was fraudulently omitted many facts and circumstances tending to show that he was not dead, but had absconded and concealed himself to escape exposure and punishment for crimes which he had committed; that the defendant was deceived by, and made to rely upon, these false and fraudulent affidavits and so-called proofs of death; and that it would not have entered into any such agreement, except for the fraud so perpetrated and practiced upon it. In his reply the plaintiff denied the new matter contained in the answer, and alleged that the affidavits and proofs therein referred to had been presented to the defendant in August, 1900, and remained with it thereafter; that when they were presented the defendant was requested not to assume that they were conclusive, but to make an independent investigation; that the defendant had reasonable opportunity and ample time to investigate the facts; and that in entering into such compromise agreement it acted with full knowledge of them and without any concealment or fraud on the part of the plaintiff or his predecessors in interest. The trial resulted in a verdict and judgment for the plaintiff upon the first count, and the defendant prosecutes this writ of error.

The first ruling brought to our attention is the denial, at the beginning of the trial, of a motion by the defendant to require the plaintiff to elect upon which of the two counts in the petition he would proceed; the contention being that they were inconsistent. There was no error in this. The two counts were not inconsistent in matter of fact, because all that was alleged in either could be proven without disproving anything alleged in the other. This is frankly conceded; but it is urged that they were inconsistent in matter of law, because a right to recover upon the policy under the first count could not coexist with a right to recover upon the compromise agreement under the second count. It is true that the two rights could not coexist; but the petition, rightly interpreted, did not assert the contrary, but only that the plaintiff had a right of recovery-- a single right, which was so stated and described in the two counts as to enable him to recover upon the policy or the compromise agreement, as the one or the other might prove to be the true basis and measure of his right. Assuming that this was done in good faith and not without reasonable cause-- and at the beginning of the trial such an assumption could have been reasonably indulged-- it was not only unobjectionable, but sanctioned by common-law procedure and by the settled practice in the courts of Missouri and other states under the reformed Code. 1 Chitty, Pleadings (16th Am. Ed.) *424 et seq.; Little v. Blunt, 13 Pick. (Mass.) 473, 476; Bliss, Code Pleading (3d Ed.) Sec. 120; 1 Bates, Code Pleading (1908 Ed.) 495; Thompson v. Minford, 11 How.Prac. (N.Y.) 273; Birdseye v. Smith, 32 Barb. (N.Y.) 217; Brownell v. Pacific R.R. Co., 47 Mo. 239, 243; Brinkman v. Hunter, 73 Mo. 172, 178, 39 Am.Rep. 492; Rinard v. Omaha, etc., Co., 164 Mo. 270, 284, 64 S.W. 124; Roberts v. Quincy, etc., Co., 43 Mo.App. 287.

The next matter which claims our attention relates to rulings permitting the plaintiff's attorney, when testifying as a witness, to give in detail the conversations and correspondence had between himself and the defendant's general solicitor, before the suit was commenced, in the course of an unsuccessful attempt to effect a compromise agreement. Part of his testimony, which is said to have been particularly objectionable, was as follows:

'I spoke to Mr. Hubbell (meaning defendant's general solicitor) about the efforts that had been made by the Pinkertons (meaning a

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