Pacific Mut. Life Ins. Co. of California v. Fishback

• Decision Date: 06 January 1933
• Docket Number: 24265.
• Court: Washington Supreme Court
• Parties: PACIFIC MUT. LIFE INS. CO. OF CALIFORNIA v. FISHBACK, Insurance Com'r.

17 P.2d 841

171 Wash. 244

PACIFIC MUT. LIFE INS. CO. OF CALIFORNIA v. FISHBACK, Insurance Com'r.

No. 24265.

Supreme Court of Washington

January 6, 1933

Department 1.

Appeal from Superior Court, Thurston County; D. F. Wright, Judge.

Action by the Pacific Mutual Life Insurance Company of California against H. O. Fishback, insurance commissioner of the state of Washington. Decree for plaintiff, and defendant appeals.

Affirmed in part, and reversed and set aside in part.

John H Dunbar, Atty. Gen., and E. W. Anderson, Asst. Atty. Gen., for appellant.

Ryan Desmond & Ryan, Howard W. Sanders, and George R. Stuntz, all of Seattle, for respondent.

PARKER J.

The plaintiff, insurance company, having been duly authorized to conduct its life insurance business in this state, sought, by this action commenced in the superior court for Thurston county against our state insurance commissioner, an adjudication of its claimed right to insert in its life insurance policies issued in this state the aviation clause hereinafter quoted. The commissioner refused to approve such clause as a proper provision in life insurance policies issued in this state, resting his disapproval upon the incontestable policy provision required by our Insurance Code to be embodied in life insurance policies issued in this state. The superior court rendered its decree awarding to the insurance company relief as prayed for by it upon the facts alleged in its complaint; the commissioner having demurred thereto upon the ground that the alleged facts did not constitute cause for relief as prayed for, and, upon the overruling of his demurrer, having declined to plead further. From this disposition of the cause in the superior court, the commissioner has appealed to this court.

The alleged, and by the demurrer admitted, facts, so far as need be further noticed, are that the insurance company requested the commissioner to approve, and permit it to insert in its life insurance policies issued in this state, the following aviation clause; which request was by the commissioner refused:

'Except as hereinbelow provided, death resulting directly or indirectly, in whole or in part, from being in or on any vehicle or mechanical device for aerial navigation, or from falling therefrom or therewith, or while operating or handling any such venicle or device, is a risk not assumed under this Policy, but in the event of death so occurring, the Company will pay the reserve under this Policy and the Policy shall thereupon be terminated.

'Exception: This Policy covers the death of the Insured while riding as a fare-paying passenger in a licensed passenger aeroplane or a licensed passenger dirigible owned and provided by an incorporated passenger carrier for passenger service and while operated by a licensed passenger pilot on a regular passenger schedule over a definitely established regular passenger route of such carrier and between definitely established air ports.'

We assume, as counsel for both sides have assumed in their argument, that the request was made by the insurance company to the commissioner and refused by him in writing; that is, that the proposed aviation clause was so filed in the office of the commissioner, accompanied by the request, and was disapproved by him, all in the manner provided by the statutory provision presently to be noticed, though the allegations of the complaint are not specific in this particular.

In our Insurance Code, being chapter 49, pp. 161, 261, Laws of 1911, we read:

'Sec. 183. On and after January first, nineteen hundred twelve, no policy of life or endowment insurance shall be issued or delivered in this state until a copy of the form thereof has been filed at least thirty days with the commissioner, unless Before the expiration of said thirty days the commissioner shall have approved the same in writing; nor if the commissioner notifies the company in writing, that, in his opinion, the form of said policy does not comply with the requirements of the laws of this state, specifying the reasons for his opinion: Provided, That upon the petition of the company the opinion of the commissioner shall be subject to review by any court of competent jurisdiction.

'Sec. 184. No life insurance policy, except policies of industrial insurance or where the premiums are payable monthly or oftener, shall be issued or delivered in this state on and after January first, nineteen hundred and twelve, unless it contains in substance the following provisions: * * *

'(2) A provision that (the) policy, so far as it relates to life or endowment insurance, shall be incontestable after two years from its date of issue except for non-payment of premiums, and except for violation of the conditions of the policy relating to military or naval service in time of war.' See sections 7229, 7230, Rem. Comp. Stat.

The commissioner's reason for his disapproval of the proposed aviation clause is stated in the brief of his counsel, as follows: 'His position, briefly stated, is that the incontestable clause is exclusive in its enumeration of exceptions available as a defense against liability after the expiration of the two-year period and that, in so far as the rider undertakes to limit liability for death by aerial navigation after the policy becomes incontestable, it violates the statute. Since, under the statute, a company is permitted after two years to contest liability only (1) for non-payment of premiums and (2) for violation of conditions respecting war service, says...