Oliver v. Mut. Life Ins. Co. Of N.Y.

• Decision Date: 15 June 1899
• Citation: 97 Va. 134,33 S.E. 536
• Court: Virginia Supreme Court
• Parties: OLIVER. v. MUTUAL LIFE INS. CO. OF NEW YORK.

33 S.E. 536

97 Va. 134

OLIVER.

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

Supreme Court of Appeals of Virginia.

June 15, 1899.

LIFE INSURANCE—APPLICATION—AGREEMENT AS TO DELIVERY OF POLICY—EFFECT.

An applicant's "express agreement in his written application that the policy should not take effect until the first premium was paid, and the policy delivered during his continuance in good health, created a condition precedent to the company's liability, notwithstanding the soliciting agent verbally agreed, in the presence of a general agent of the company, that the policy would be delivered as soon as issued, and the company delayed delivery after it was issued to determine whether a material warranty given in the application was false; it being conceded that the soliciting agent had no authority to bind the company to issue the policy, or make a binding contract of insurance between it and the applicant, and it not appearing that the company unnecessarily delayed delivery in bad faith.

Error to law and chancery court of city of Norfolk.

Action by Ida E. Oliver against the Mutual Life Insurance Company of New York. There was a judgment in favor of defendant, and plaintiff brings error. Affirmed.

Edward R. Baird, Jr., for plaintiff in error.

Cole & Shultice, for defendant in error.

CARDWELL, J. The case presented upon this writ of error to a judgment of the court of law and chancery of the city of Norfolk is a sequel of the case of Insurance Co. v. Oliver, 95 Va. 445, 28 S. E. 594; but, as the judgment of the lower court was reversed by this court on the former hearing, because of the error in excluding the testimony of a witness, M. S. Stringfellow, the decision then made has no bearing upon the question now before us, though the record presents the same state of facts as appeared at the former hearing, except as modified by the testimony of that witness.

The case is as follows: Charles R. Oliver on the 22d of September, 1894, at Norfolk, Va., made to the Mutual Life Insurance Company of New York, defendant in error, through M. S. Stringfellow, its soliciting agent, an application for two policies of insurance upon the life of the applicant, —the one for the sum of $3,000 for the benefit of Ida E. Oliver, his wife, and the other for $2,000 for the benefit of Kate Oliver, his sister. The applications were forwarded from the Norfolk office to the company's Southern office, in Baltimore, whence they were sent to the home office, in New York, where they were received on October 1st, and put into the regular channel for examination and acceptance or rejection. They were accepted, and on October 2d the policies were issued and sent from the home office of New York to the Southern office, in Baltimore, and forwarded to the local office in Norfolk, where they were received on October 4th, and given to the soliciting agent to be delivered to the applicant. While the agent was away from the company's office for the purpose of delivering the policies, but before they or either of them were actually delivered, because the agent had not then seen the applicant, instructions were received at the Norfolk office, by wire, to hold the policies for further instructions. The soliciting agent who procured the application, and who had taken the policies for the purpose of delivering them to the applicant, was recalled to the Norfolk office, where the policies were kept until the 19th day of October, three days after the death of the applicant, who was shot while hunting on October 16th.

The application in this case for the policy of insurance, as usual with all life insurance contracts, is by the, terms of the policy made a part of it, and forms an integral part of the contract between the insurer and the insured, and it contains the following stipulations immediately following the statements and answers made to the interrogatories propounded in the application, namely: "I also agree that all the foregoing statements and answers, as well as those I make to company's medical examiner in continuation of this application, are by me warranted to be true, and are offered to the company as a consideration of the contract which I hereby agree to accept as issued by the company in conformity with this application, and which shall not take effect until the first premium shall have been paid, and the policy shall have been delivered, during my continuance in good health."

There was contained in the application the question, "What has been your former habits of drinking wine, spirits, or other malt liquors?" to which the applicant, Oliver, replied "moderately"; and after making and mailing the policies to the company's office at Norfolk, Va., to be delivered to Oliver, the company at its home office, in New York, received two reports contradictory of the answer made by the applicant just stated, and it was by reason of the receipt of this information that the company sent its telegram instructing its agent at Norfolk not to deliver the policies until further instructions, it being the purpose of the company to make investigation with the view of ascertaining whether or not the answer made by the applicant as to his habits of drinking wine, etc., was true or untrue.

It further appears that the defendant in error had in use what is called, in connection with life insurance, a "binding receipt"; that is, a receipt which is given to the applicant for the first premium to the company when the application is made out and forwarded, the effect of which is that the applicant stands insured from the date of his application, if the same is accepted and a policy issued by the company. At the time that Oliver filled out and signed the application for the policies of insurance on his life it was suggested to him by the soliciting agent taking the application, or perhaps by the general agent of the company at Norfolk, that...