Pacific Mutual Life Insurance Company of California v. Glaser

• Decision Date: 09 October 1912
• Citation: 150 S.W. 549,245 Mo. 377
• Parties: PACIFIC MUTUAL LIFE INSURANCE COMPANY OF CALIFORNIA, Appellant, v. JOSEPH GLASER et ux
• Court: Missouri Supreme Court

150 S.W. 549

245 Mo. 377

PACIFIC MUTUAL LIFE INSURANCE COMPANY OF CALIFORNIA, Appellant, v. JOSEPH GLASER et ux

Supreme Court of Missouri, Second Division

October 9, 1912

Appeal from St. Louis City Circuit Court. -- Hon. Hugo Muench Judge.

Reversed and remanded (with directions).

Jones Jones, Hocker & Davis for appellant.

(1) Whether an applicant has ever applied to other companies for insurance and been rejected is regarded as material to the risk, and a false statement in this regard will void the policy. Aloe v. Insurance Co., 147 Mo.App. 647; McDermott v. M. W. A., 97 Mo.App. 561; M. W. A v. Angle, 127 Mo.App. 119; Insurance Co. v. Webb, 106 F. 808, 126 F. 635; Elliot v. Benefit Assn., 76 Hun, 378; Kelley v. Insurance Co., 113 Ala. 453; Barnard v. Association, 32 N.Y.S. 223; Kemp v. Insurance Co., 19 N.Y.S. 435, 135 N.Y. 658; Fletcher v. Insurance Co., 119 N.Y.S. 801; Insurance Co. v. Judge, 191 Pa. St. 484; Edington v. Insurance Co., 77 N.Y. 564, 100 N.Y. 538; Insurance Co. v. Raddin, 120 U.S. 189; Jeffries v. Insurance Co., 22 Wall. 47; March v. Insurance Co., 186 Pa. 629; Moore v. Mut. Res., 133 Mich. 526; Insurance Co. v. Mahone, 56 Miss. 181; Cooke on Life Insurance, Sec. 18, p. 34; May on Life Insurance, Sec. 184; 3 Cooley's Briefs on Insurance, p. 1935. (2) A breach of warranty will void the policy, though the insured had no knowledge of the falsity constituting the breach, and did not intend to deceive the insurer. M. W. A. v. Angle, 127 Mo.App. 116; McDermott v. M. W. A., 97 Mo.App. 647; Kemp v. Good Templars, 19 N.Y.S. 435; Insurance Co. v. Webb, 106 F. 808, 126 F. 635; Elliot v. Association, 76 Hun, 378; Clemans v. Association, 131 N.Y. 485; Kelley v. Insurance Co., 113 Ala. 453; Insurance Co. v. Myers, 112 F. 846; Insurance Co. v. Sole, 121 F. 664; Insurance Co. v. Llewellyn, 58 F. 940; Insurance Co. v. Johnson, 80 Ala. 467; Kelley v. Insurance Co., 113 Ala. 453; Insurance Co. v. Rogers, 119 Ill. 474; Insurance Co. v. Cannon, 48 Ind. 264; Cushman v. Insurance Co., 63 N.Y. 404; Baker v. Insurance Co., 64 N.Y. 648; Insurance Co. v. Pyle, 44 Ohio St. 19; Dinan v. Supreme Council, 201 Pa. 363; Boyle v. Relief Association, 95 Wis. 312; McGowan v. I. O. O. F., 104 Wis. 173; Peterson v. Life Association, 115 Iowa 668; 3 Cooley's Briefs on Insurance, p. 1954; Cooke on Life Insurance, Sec. 19, p. 35; May on Life Insurance, Sec. 184. (3) Where a contract has been entered into by the parties through a mutual mistake concerning a fact which is, or is agreed to be, material, the contract may be rescinded and canceled at the option of either party. Currey v. Greffet, 115 Mo.App. 364; Voorhis v. Manufacturing Co., 11 Mo.App. 108; M. W. A. v. Angle, 127 Mo.App. 94; Griffiths v. Townley, 69 Mo. 13; Brooks v. Gaffin, 192 Mo. 228; N. & M. Co. v. Kehlor, 155 Mo. 643; 24 Am. & Eng. Ency. Law (2 Ed.), 618; 1 Cooley's Briefs on Insurance, p. 551; Joyce on Insurance, Sec. 1674; Richards on Insurance, p. 108; Wilson v. Insurance Co., 5 F. 674; Cooke on Life Insurance, Secs. 133, 134; Bacon on Ben. Societies and Life Insurance, Sec. 285; Beauchamp v. Winn, L. R. 6, H. L. 233; Lyman v. Insurance Co., 14 Johns. 382; Eaton on Equity, p. 267; Thwing v. Lumber Co., 40 Minn. 184; Moran v. McLarty, 11 Hun, 66, 75 N.Y. 25; Welles v. Yates, 44 N.Y. 525; McHugh v. Insurance Co., 48 How. Pr. 230; Hearne v. Insurance Co., 87 U.S. 20; Latuarche v. Insurance Co., 126 Cal. 498.

David Goldsmith for respondents.

(1) Glaser's withdrawal of his application to the Illinois Life Insurance Co. for insurance was effective, and rendered nugatory the alleged refusal of the application by that company. 1 Cooley's Briefs on Insurance, p. 416. But, regardless of that withdrawal, the alleged refusal was rescinded according to the evidence, and the application was never finally acted upon. (2) Glaser's statement that no application for insurance previously made by him had been refused, was made in good faith, and, therefore, does not support the action herein for the cancellation of the policy issued to him by the appellant. a. That statement, if made in good faith, would not have constituted a breach of warranty at common law. Henn v. Insurance Co., 67 N. J. L. 312; Aufderheide v. Association, 66 Mo.App. 285; Semm v. Knights of Honor, 29 F. 895; Insurance Co. v. Ford, 126 Ky. 49; Ames v. Insurance Co., 58 N.Y.S. 244, 172 N.Y. 659; Kettenbach v. Association, 49 Neb. 842; Mouler v. Insurance Co., 111 U.S. 335; Owen v. Insurance Co., 67 A. 25; Association v. Wagner, 188 Ill. 133; Knights of Honor v. Dixon, 102 Tenn. 255; Annotated Case, 11 L. R. A. (N. S.) 958. b. But in this State the doctrine of warranties in life insurance no longer applies. Keller v. Insurance Co., 198 Mo. 456; Jenkins v. Insurance Co., 171 Mo. 383; Lynch v. Insurance Co., 150 Mo.App. 468. c. And, treated as a representation, the statement, if made in good faith, will not support the present action. Semm v. Knights of Honor, 29 F. 895; Insurance Co. v. Ford, 126 Ky. 49; 3 Cooley's Briefs on Insurance, p. 1956; Schuermann v. Insurance Co., 165 Mo. 649; Keller v. Insurance Co., 198 Mo. 455. (3) The provision in the application for the policy in question, that the falsity of any statement in the application should invalidate any claim under the policy, if the death of the insured should occur within one year, limits the rights of the appellant, and debars it from invoking any statement made in good faith in the application as ground for an action in equity to cancel the policy. Insurance Co. v. Lear, 31 App. Cas., D. C. 190. (4) The alleged misrepresentation was not material, and, therefore, cannot be the basis of an action in equity for cancellation. Fidelity Association v. Miller, 92 F. 63; Tribes v. Hanes, 100 Ill.App. 1.

KENNISH, J. Brown, P. J., and Ferriss, J., concur.

OPINION

KENNISH, J.

This suit in equity was brought in the circuit court of the city of St. Louis by the Pacific Mutual Life Insurance Company as plaintiff, against the defendants, Joseph Glaser and Carrie Glaser, his wife. The purpose of the suit was to have cancelled and annulled by decree of court a certain policy of insurance for ten thousand dollars, theretofore issued by plaintiff upon the life of defendant Joseph Glaser. Upon a trial the court dismissed the bill and plaintiff appealed.

In substance it is alleged in the petition that the defendant Joseph Glaser on the 27th day of December, 1906, made written application to plaintiff for a policy of insurance on his life in the sum of ten thousand dollars and payable to the defendant Carrie Glaser in the event of his death; that said policy was issued to the said Joseph Glaser and was then in his possession; that said policy was issued by the plaintiff and accepted by the defendant Joseph Glaser solely upon certain statements, warranties and representations contained in the application and made a part of the policy; that said statements, warranties and representations were false, incomplete and untrue, and that the same were intentionally false or answered by mistake or inadvertence and constituted a fraud upon the plaintiff; that immediately upon discovery of the falsity of the statements, etc., plaintiff tendered to the defendants the full amount of the premium paid to plaintiff upon said policy and demanded the surrender and return of said policy, which defendants refused to do. The prayer is that the court require the defendants to produce said policy in court and that the same be adjudged void, and for general relief. The answer was a general denial.

Plaintiff introduced in evidence the policy in controversy; also the written application and medical examination of the defendant Joseph Glaser, upon which the policy was issued. It was stipulated in the policy that: "All insurance provided by this policy is based upon the written and printed application therefor, which is made a part of the policy," etc. In the written application the applicant, Joseph Glaser, made the statement that: "No company or association to which I have ever applied for any life, accident or health insurance has refused me on the plan asked for, or postponed me." And in the medical examination, attached to and made a part of the application, the applicant was asked the question: "What company or society has declined to issue a policy on your life?" and answered "none." The following declaration was also contained in said application, namely: "I hereby warrant that all the foregoing statements and answers and all those that I make to the company's medical examiner are complete, true and correct, and, if any such statement or answer is incomplete, untrue or incorrect, no valid claim shall arise under such policy on account of death or disability occurring within one year from its date."

Plaintiff also introduced testimony tending to prove that on the 21st day of November, 1904, being about two years prior to the date of the application for the policy in suit, the defendant Joseph Glaser made a written application for insurance upon his life to the Illinois Life Insurance Company, through its agent, Charles K. Lehrberg; that he was examined by the physician of the said last named company, and that on the 3d day of December, 1904, the application was rejected by the medical board of said company, on the ground that the medical examination disclosed that the applicant was afflicted with glycosuria, a disease of the kidneys; that on the 7th day of December, 1904, letters properly addressed were sent to both Lehrberg, the agent, and the defendant Joseph Glaser, notifying them of the rejection of said application.

It was further shown by plaintiff that on the 14th day of June 1907, plaintiff notified defendants in writing that the policy issued to Joseph Glaser was cancelled and rescinded on...