Pellon v. Conn. Gen. Life Ins. Co.
| Decision Date | 03 October 1933 |
| Citation | 168 A. 701 |
| Parties | PELLON et al. v. CONNECTICUT GENERAL LIFE INS. CO. (two cases). |
| Court | Vermont Supreme Court |
Exceptions from Washington County Court; Alfred L. Sherman, Judge.
Action by Antonia Pellon and another, and by Antonia Pellon and others, against the Connecticut General Life Insurance Company. Verdict and judgment for plaintiffs, and defendant brings exceptions.
Judgment reversed, and cause remanded.
Argued before POWERS, C. J., and SLACK, MOULTON, THOMPSON, and GRAHAM, JJ.
Theriault & Hunt, of Montpelier, for plaintiffs.
J. Ward Carver, of Barre, and Claude H. Voorhees, of Hartford, Conn. (George B. Young, of Montpelier, of counsel), for defendant.
These actions were brought by and on behalf of the beneficiaries to recover the amount of two life insurance policies on the life of Venerando Paz, who died in the city of Barre on February 13, 1931. The policies are identical, except the amount of insurance and the beneficiaries therein named. Both policies were issued on a single application, and were for $10,000 and $5,000, respectively. The cases have been heard together by agreement. There was a trial by jury resulting in a verdict and judgment for the plaintiffs, and the cases are brought to this court on defendant's exceptions. The defense pleaded and relied upon was fraud on the part of the insured in procuring the policies. The plaintiffs denied the charge of fraud, and they alleged and claimed a waiver by defendant of any forfeiture. This review involves a consideration of those questions.
The written application for the insurance consists of two parts: It was signed by the insured, copies were attached to the policies when issued, and, by the terms of the policies, it is expressly made a part of the contract. The insured signed a statement, which was contained in part 2 of the application, that all his answers to questions therein were complete and true, and that they should form a part of the insurance applied for. The policies contained this provision: "The consideration for this insurance is the application, a copy of which is attached hereto and made a part of this contract, and the payment in advance of the annual premium." It is also expressly provided in the policies that they should not take effect until the first premium was actually paid, and that the policies and the application therefor constituted the entire contract between the parties and all statements made in the application should, in the absence of fraud, be deemed representations and not warranties.
The application (part 2) was signed by the insured on October 7, 1929. The policies were dated October 14, 1929, and they were delivered to the insured two or three days thereafter. The first premium was paid by the insured on December 14, 1929, the last day the policies could be placed in force.
The charge of fraud alleged against insured and relied upon in defense is based upon the following questions and answers of part 2 of the application:
Answer: "No."
Answer: "No."
Answer: "None."
Answer: "Yes."
At the close of the evidence the defendant moved for a directed verdict on the ground, in substance, that the evidence, taken most favorably for plaintiffs, establishes that these answers were such misrepresentations of material facts as to avoid the policies, and that the forfeiture has not been waived by it. The motion was overruled, and defendant excepted. The plaintiffs argue that the evidence justifies a finding by the jury that the written application is not the true application of the insured; that the written questions were not asked the insured, nor were the signed answers given by him to the defendant's medical examiner, so the recorded answers have no legal significance or binding force as a part of the contract between the parties, or, in other words, that the defendant, by reason of the conduct and knowledge of its medical examiner, is estopped to assert the falsity of the written answers as a defense to the policies. The plaintiffs also contend that, if the charge of fraud as alleged is established, the evidence warrants the submission to the jury of the issue that the defendant is estopped to assert a forfeiture.
The scope of the contract presents the first question for discussion. The insured was a retired stonecutter, but when the application for insurance was made and at the time of his decease, he was engaged in the automobile business. He owned a large building in the city of Barre, in which was located his garage. He did business with the public generally. He was of Spanish descent, and he could' not read the English language; he could speak English only brokenly, and had difficulty in understanding spoken English. The defendant's medical examiner did not ask him the questions as framed in the written application, but there was no intent or purpose on his part to deceive either the company or the insured. The only inference justified by the record is that the questions were framed and asked by the medical examiner in modified form to make the examination more understandable to the insured. The schedule of diseases in question 7 of the application was not read to the insured, but he was asked if he had had any cough, been sick, and he answered, "Nothing only little colds and cough"; that he had not ever been seriously sick, except he had the "flu" in 1918. Instead of question 8 (a) as appears in the application, the insured was asked if he had been sick to have a doctor within the last five years, and he answered, "No." Instead of question 8 (b), he was asked, "Who is your regular doctor?" and he answered, "None." Instead of question 9, he was asked if he felt well, or, "Do you feel good?" and he answered, "Yes." The statement that the answers were complete and true was not read to the insured before he signed the application. The facts of the examination appeared from testimony introduced by the defendant, so no question is presented as to the admissibility of parol testimony to contradict the written answers to the questions in the application. Our inquiry is confined to a determination of whether the facts disclosed, known to the company through the knowledge of its medical examiner and agent, estops the defendant from asserting fraud based upon any of the alleged false answers in the written application. Ring v. Windsor County Mutual Fire Ins. Co., 51 Vt. 563, 568, 569; Arnhorst v. National Union, 179 Ill. 486, 53 N. E. 988; Sternaman v. Metropolitan Life Ins. Co., 170 N. Y. 13, 62 N. E. 763, 57 L. R. A. 318, 88 Am. St. Rep. 625.
The defendant contended below and argues here that, since the insured had the policies in his possession, with copies of the application attached, for a considerable length of time before his death, and for about sixty days before the payment of the first premium, the plaintiffs are estopped from denying that the policies and the written application constitute the contract between the parties, and that they can recover only in accordance with its terms. The plaintiffs say in their brief that such an estoppel is not available to the defendant because it was not pleaded, but as this question was not raised below it is not before us for review. Cutler Co. v. Barber 93 Vt. 468, 475, 108 A. 400. The transcript discloses that this issue was raised by the defendant early in the trial below.
In support of its contention that if the insured could not read the English language it was his duty to have some one in whom he had confidence read the contract to him, and that he was still bound by its terms after having accepted and retained it, the defendant cites, among other cases, several recent decisions of the New York Court of Appeals, including Kwiatkowski v. Brotherhood of American Yeomen, 243 N. Y. 394, 153 N. E. 847; Satz v. Mass. Bonding & Ins. Co., 243 N. Y. 385, 153 N. E. 844, 59 A. L. R. 606; Stanulevich v. St. Lawrence Life Ass'n, 228 N. Y. 586, 127 N. E. 315. See, also, Minsker v. John Hancock Mutual Life Insurance Co., 254 N. Y. 333,173 N. E. 4, 81 A. L. R. 829. But it should be noted that the rule of the New York court as applied in Sternaman v. Metropolitan life Ins. Co., supra, has been superseded by a statutory rule which provides, in effect, that a copy of the application shall be attached to the policy when issued, and that the policy shall contain the entire contract between the parties. The recent New York cases cited by defendant are apparently governed by this statute. See Minsker v. John Hancock Mut. Life Ins. Co., supra.
'On the other hand, the facts do not support the contention of the plaintiffs that the written application as a part of the contract did not have any legal existence. It is the unquestioned rule of our cases that parol evidence is admissible to show that a written contract never had any binding force because induced by fraud. Vaillancourt v. Grand Trunk Ry. Co., 82 Vt. 416, 424-425, 74 A. 99; Drown v. Odcrkirk, 89 Vt. 484, 488, 96 A. 11; Holbrook Grocery Co. v. Armstrong, 97 Vt. 197, 201, 122 A. 458. But here the evidence does not justify the inference that the insured was induced to sign the written application through any fraud of the medical examiner. He did nothing to induce the insured not to have the application read to him by some one on whom he could rely before it was signed; that this was not done was due rather to the negligence of the insured than to any deception of the medical examiner. At most, the...
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