Olson v. S. Sur. Co.

• Decision Date: 09 April 1926
• Docket Number: No. 37150.,37150.
• Citation: 201 Iowa 1334,208 N.W. 213
• Parties: OLSON v. SOUTHERN SURETY CO.
• Court: Iowa Supreme Court

201 Iowa 1334

208 N.W. 213

OLSON

v.SOUTHERN SURETY CO.^a1

No. 37150.

Supreme Court of Iowa.

April 9, 1926.

Appeal from District Court, Woodbury County; Miles W. Newby, Judge.

Action to recover upon an accident policy for the accidental death of Emil Olson. Verdict and judgment for plaintiff. The defendant appeals. Affirmed.Henderson, Fribourg, Hatfield & Fribourg, of Sioux City, for appellant.

A. H. Bolton, of Sioux City, for appellee.

MORLING, J.

I. In the application for the policy the insured answered “Yes” to the question, “Are your habits of life correct and temperate?” The insured answered “Yes,” also, to the question, “Do you understand and agree that, as * * * the above representations are made to induce the issuance of an insurance policy, should one or more * * * prove to be false, all right to recovery * * * shall be voided, * * * if such false answer were made with actual intent to deceive or materially affect the acceptance of the risk or the hazard? * * *” The defendant pleaded that the representation was false, and so known by the insured at the time, and made with the actual and fraudulent intent of deceiving it. Defendant asked for a directed verdict on this ground.

[1] The policy appears to have been issued July 30, 1923. Insured died December 21, 1923. He was admitted to the hospital December 13, 1923, suffering from bruises and acute alcoholism. The third day he developed traumatic pneumonia, which the physician said might have resulted from lowered vitality due to the injuries and subjecting the insured to infection from the pneumococcus present in practically every individual. The physician testified that the insured was robust, in good flesh, and showed no weakening of any particular organ because of liquor or other vices. The plaintiff, to whom insured had been married about 20 years, testified that she could not say that insured was a drinking man; had seen him when he had had a few drinks, but never when he did not know what he was doing and could not control himself; that from and before the date of the application insured had been home every night, was in good condition, and had not taken a drink for some time, to her knowledge; did not know of his taking a drink anywhere near that time. A stepson, who had lived in the same household between 15 and 20 years, testified that:

“Insured didn't use intoxicants to excess or as a habit; stayed home nights during that time. I never saw any evidence of intoxication about the home; he worked practically every day for the last 5 or 10 years. Before going into the soft drink parlor, he worked at the carpenter trade. * * * I have seen insured when he was drinking, but never when he was unable to take care of himself; * * * could stand a good deal of liquor.”

Jorgenson, referred to later, called by defendant, testified:

That he had known insured 25 years; that they had taken a drink together now and then. “I don't believe I have ever seen that man drunk. When I was up at your office, I told you that Emil Olson was an exceptionally heavy drinker, and constantly under the influence of liquor.”

Police officers testified to having seen him under the influence of liquor; “not regular, but he was a man that always worked where liquor was sold; he was a bartender for years;” had had trouble at the saloons where he worked. A former member of the board of supervisors, who had known insured about 30 years and lived about a block from him, and saw him about every day, testified:

“Whether within the last 5 years he used intoxicating liquors is more than I know. I never saw him drunk. I never saw him take a drink. I visited his home, was intimate with the family, belonged to the same church. When Emil was a young man, he used to go to our church quite often, and to our Sunday school.”

Another witness testified that he used to visit back and forth every week or two for a long time at insured's home; saw him quite often 2 or 3 years ago; never saw him under the effects of intoxicating liquor; saw him take a drink down town; did not know whether he stayed home nights.

The insurance agent, who delivered the policy, said he had known insured about 20 years before he took the application; in the last few years had not seen much of him, “but 15 or 20 years ago I saw him quite frequently, and up until I took the application I met him every few days at least, and was fairly acquainted with him for some years.” Defendant's underwriter, whose duty it was to pass on applications, testified:

“Had I known that in fact Emil Olson's habits of life were not correct and temperate, I would not have * * * permitted the policy in suit to have been issued.”

He said that there was no inspection on this risk. Where there is an inspection, which is not satisfactory, they cancel the policy. The insured appears to have been a carpenter, and operated a soft drink “parlor” for a time. The alcoholism referred to was acute, and not chronic. Further evidence appears later.

[2][3] The entire application is not before us. We do not know what the insured said about his occupation or history. The agent was “fairly” acquainted with him. The question under consideration calls for an opinion. The opinions of those who indulge in intoxicating liquors and patronize bootleggers concerning the correctness and temperance of their habits differ from the opinions of those who believe in total abstinence and in the observance of the laws intended to abolish intemperance. Such opinions vary according to the circle in which the individual moves. It would have been entirely proper for the defendant to have ascertained whether the applicant used intoxicants or not. If it desired a definite representation on that subject, it might have asked the specific question. “To avoid the policy, it was necessary, not only to show the fraud alleged, but that defendant was thereby deceived, and in reliance upon the truth of the representations issued the policy which it seeks to avoid. To establish such evidentiary fact of bad faith, falsehood, or deception, it is held in a multitude of cases that the proof must be ‘clear,’ ‘satisfactory,’ ‘convincing.’ ” Ley v. Metropolitan Life Insurance Co., 94 N. W. 568, 570, 120 Iowa, 203, 208;Murphy v. National Travelers' Ben. Association, 161 N. W. 57, 179 Iowa, 213, 223, L. R. A. 1917C, 338;Teeple v. Frat. Bankers' Reserve Society, 161 N. W. 102, 179 Iowa, 65, L. R. A. 1917C, 858; Muhlbach v. Illinois Bankers' Life Ass'n, 187 N. W. 787, 108 Neb. 146.

[4][5] An incorrect statement of opinion will not avoid the policy, if made in good faith and without intention to deceive. Royal Neighbors v. Wallace, 102 N. W. 1020, 73 Neb. 409;Muhlbach v. Illinois Bankers' Ass'n, 187 N. W. 787, 108 Neb. 146. The defendant had the burden of proof. We do not think it is for the court to say as matter of law that this defense was sustained.

II. The policy insured against--

“the effects resulting exclusively of all other causes from bodily injury sustained during the life of this policy, solely through external, violent, and accidental means, * * * subject to all the conditions, limitations, and exclusions and within the amounts hereinafter expressed. * * *”

It contained the provision:

“Neither does this policy cover injuries (fatal or nonfatal) sustained by the insured by reason of the intentional act of any person (assaults upon the insured by any person committing or attempting to commit robbery or burglary excepted).”

The court told the jury in effect that, if the defendant had proved by a preponderance of the evidence that the insured came to his death by reason of the intentional act of some other person, who was not at the time engaged in or attempting to commit robbery, then said fact would not bring the plaintiff within the terms of the policy. The objection made to this instruction is that it imposed upon the defendant the burden of proving that the injuries, if the result of the intentional act of others, were not inflicted while a robbery or attempt at robbery was being committed. Defendant contends it had the burden of proving only the intentional infliction of the injuries by another, and that it was for the plaintiff then to prove that the perpetrator was engaged in committing or attempting a robbery.

[6][7][8][9][10] The burden of proof was upon the defendant to bring itself within the exception. Allen v. Travelers' Association, 143 N. W. 574, 163 Iowa, 217, 48 L. R. A. (N. S.) 600;Jordan v. Iowa Mutual Tornado Ins. Co., 130 N. W. 177, 151 Iowa, 73, Ann. Cas. 1913A, 266; Jones v. United States Mutual Accident Association, 61 N. W. 485, 92 Iowa, 652;Cole v. Iowa State Mutual Ins. Co. (Iowa) 205 N. W. 3;Correll v. National Accident Society, 116 N. W. 1046, 139 Iowa, 36, 130 Am. St. Rep. 294;Payne v. Fraternal Accident Association, 93 N. W. 361, 119 Iowa, 342;Rowe v. United Commercial Travelers' Association, 172 N. W. 454, 186 Iowa, 454, 4 A. L. R. 1235. The exception does not extend to all injuries inflicted by the intentional act of another. Therefore the defendant does not sustain the burden of proof by proving the general fact that the injuries were so inflicted. If the perpetrator was engaged in committing or attempting to commit a robbery, the case was not within the exception. The plaintiff sustained the burden of proof upon her by showing that death resulted from external, violent, and accidental means. If injuries were inflicted by another intentionally, but it did not appear that the perpetrator was not engaged in robbery, or an attempt at robbery, the defendant had not brought itself within the exception.

It may be, as argued by defendant, that there would be no presumption that the assailant was engaged in committing or attempting robbery. That would go merely to the weight of evidence or to the duty of introducing evidence. The burden of proof resting upon the defendant to bring itself within the exception was not shifted. Gibbs v. Farmers' & Merchants'...