Ponder v. Jefferson Standard Life Insurance Company

• Decision Date: 28 October 1940
• Docket Number: 4-6067
• Citation: 143 S.W.2d 1115,201 Ark. 179
• Parties: PONDER v. JEFFERSON STANDARD LIFE INSURANCE COMPANY
• Court: Arkansas Supreme Court

143 S.W.2d 1115

201 Ark. 179

PONDER v. JEFFERSON STANDARD LIFE INSURANCE COMPANY

4-6067

Supreme Court of Arkansas

October 28, 1940

Appeal from Pulaski Circuit Court, Second Division; Lawrence C Auten, Judge; affirmed.

Judgment affirmed.

Walter L. Pope and H. M. Trieber, for appellant.

Owens Ehrman & McHaney, for appellee.

OPINION

SMITH, J.

At the time of his death, which occurred December 7, 1935, Dr. Edgar T. Ponder had in effect three life insurance policies issued by the Jefferson Standard Life Insurance Company in the aggregate amount of $ 15,000. The policies were all payable to his wife, Nora D. Ponder. After the death of the insured the beneficiary widow submitted proof of the death of the insured, in which proof it was stated that the insured was born December 24, 1882, this date being the date of birth given in the applications for the insurance policies. Upon receipt of this proof the insurance company paid the full face amount of all three policies.

Within a few weeks after the payment had been made, the insurance company, hereinafter referred to as the company, learned that the insured was not born December 24, 1882, but was born some years prior to that date, either December 24, 1877, or December 24, 1878.

Each of the policies contained the following clauses:

"After this policy shall have been in force for two full years from the date hereof it shall be incontestable for any cause except for nonpayment of premium."

"The company will admit age upon satisfactory proof; otherwise, if age is not truly stated in the application, the benefits hereunder will be what the premiums paid would have purchased at the true age."

The policies were dated September 1, 1926 (for $ 3,000), January 15, 1928 (for $ 2,000), and June 23, 1928 (for $ 10,000). It is not questioned that the premiums had been paid. All the policies had, therefore, been in force for more than two years prior to the date of the death of the insured.

After having discovered the discrepancy as to the insured's age, the company instituted suit against Mrs. Ponder to recover the excess payments which had been made to her. The suit was filed in the chancery court, and a garnishment issued against the Hercules Life Insurance Company, which, at that time, was indebted to Mrs. Ponder on certain other life insurance policies issued by it on the life of Dr. Ponder in which Mrs. Ponder was the named beneficiary.

The complaint alleged that Dr. Ponder was older than his applications for the policies stated and the proof of his death had indicated, and that such erroneous statements of age were fraudulent on the part of both the insured and the beneficiary, and that in consequence of such fraud, or by mistake, the company had overpaid Mrs. Ponder, and was entitled to recover from her the difference between the face of the policies and the lesser amount of insurance which the premiums paid would have purchased, at the insured's true age.

Mrs. Ponder moved to dissolve the garnishment, on the ground that insurance money was not, under the statutes of this state, subject to garnishment; and she also moved to transfer the case to the circuit court. Both motions were denied, and she appealed to this court, where the judgment of the court below was reversed and the cause remanded with directions to sustain both motions. Ponder v. Jefferson Standard Life Ins. Co., 194 Ark. 829, 109 S.W.2d 946. Following the remand, the garnishment was dissolved, and the cause was transferred to the circuit court, where, by consent, it was tried by the court sitting as a jury.

The court rendered judgment for the company for $ 2,329.90, with interest at six per cent. from February 21, 1936, the date of payment, and also rendered judgment in favor of Mrs. Ponder for $ 324.59, with interest at six per cent. from December 21, 1937, on account of the garnishment, but credited the smaller sum on the larger, and final judgment was rendered in favor of the company for the difference, and this appeal is from that judgment.

The judgment is based upon the finding of fact that the insured was born December 24, 1878. The accuracy of the calculations as to the amount of insurance for which the premiums would have paid at this age is not questioned; but the reversal of the judgment is prayed upon the grounds: (a) that it was not sufficiently shown that the insured was born in 1878, and not in 1882 as stated in the applications for the insurance; (b) that the payment of the insurance was voluntarily made, and cannot be recovered for that reason; (c) that statements of the insured in his applications for the insurance, although false, are not admissible against the beneficiary; and (d) that the right to recover is defeated by the incontestable clause appearing in the policies, set out above.

Upon the first question, we have no hesitancy in saying that the testimony is legally sufficient to support the finding that the insured was not born in 1882, as stated in the applications for the insurance, but was, in fact, born not later than 1878.

The widow, in her proof of death, stated that her husband was born December 24, 1882. She did not testify at the trial, the explanation being made that she was physically unable to be present.

The attending physician, who had known the insured for twelve years, stated the age of deceased to be 54 years. The source of his information does not appear, and the physician did not testify at the trial.

The undertaker gave 52 as his answer to the question, "How old did the deceased appear to be?" But the undertaker did not testify at the trial, nor did any other witness who had any personal knowledge of the actual age of the insured.

Opposed to this was the following testimony. The application of the insured for license to practice medicine dated June 18, 1903, stated the applicant's age to be 25. If this statement were true, the insured was born, not in 1878, as found by the court, but in 1877.

The application for insured's marriage license was executed January 24, 1903, by insured's brother, and stated the insured's age, at that time, to be 25, which, if true, fixed the date of his birth as December 24, 1877.

The personnel officer of the State Military Department, who was the custodian of the records of that department, produced the original muster-in-roll of the Second Arkansas Volunteer Infantry of 1898 showing enlistments in the Spanish-American War. This record stated that Dr. Ponder had enlisted May 19, 1898, when he stated his age to be 19 years. According to this record, he was born December 24, 1878, as found by the court.

There is another incident of even greater persuasiveness. On January 5, 1920, Dr. Ponder executed an application for a policy with a company which subsequently merged with the Hercules Life Insurance Company, in which he stated the date of his birth to be December 24, 1880. Later, and on July 5, 1926, he executed another application to the same company for an additional policy, in the application for which he stated the date of his birth to be December 24, 1879. Upon the receipt of the second application, the company called Dr. Ponder's attention to the discrepancy between the two applications in regard to his age. In response, Dr. Ponder wrote a letter to the company in which he stated that the correct date of his birth was that stated in the policy which he then held, to-wit, December 24, 1880. Thereafter the Hercules Company had Dr. Ponder execute an amendment to his application on August 11, 1926, in which he changed the application to read: "Date of birth, December 24, 1880," and the premium rate was changed accordingly.

On the next day, August 12, 1926, Dr. Ponder executed his application for the first policy with appellee insurance company in which he stated the date of his birth to be December 24, 1882.

In his written opinion the trial court said that these were ancient documents, properly accounted for, which had not been questioned. As a man grows older each year, he might easily be confused as to his age at any particular time; but the date of his birth remains constant.

In view of this testimony, we are unable to say that the finding of the court--that deceased was born in 1878, and not in 1882--is not sufficiently supported by the testimony; notwithstanding the court found that "From a careful study of the record and the testimony, the court finds there has been no fraud perpetrated, therefore, it leaves only the matter of mistake to be considered by this court."

This finding immediately follows the statement in the opinion that "Plaintiff has advanced two theories, one of which is fraud upon the part of the defendant in filing the proof of death and claims for the said sum payable under the policies in which the defendant gave the birthday of the deceased as 1882, which corresponds to the age given by the deceased at the time said policies were taken out by the deceased."

It appears obvious, therefore, that, in finding there was no fraud, the court was referring to the proof of death, and this finding does not conflict with...