Price v. Standard Life & Accident Insurance Company

Decision Date10 July 1903
Docket Number13,547 - (186)
Citation95 N.W. 1118,90 Minn. 264
PartiesNATHANIEL PRICE v. STANDARD LIFE & ACCIDENT INSURANCE COMPANY
CourtMinnesota Supreme Court

Action in the district court for Hennepin county by plaintiff as administrator of the estate of Margaret Price, deceased, to recover $5,000 upon a policy of accident insurance issued to Elijah Price during his lifetime. The case was tried before Elliott, J., who directed a verdict in favor of defendant. From an order denying a motion for judgment notwithstanding the verdict or for a new trial, plaintiff appealed. Reversed and new trial granted.

SYLLABUS

Accident Insurance.

Laws 1895, p. 400, § 20 (c. 175), modifies and controls the effect of statements, representations, and warranties contained in an application for accident insurance, and made part of a policy thereafter issued, so that misrepresentations made therein shall not be deemed material or defeat or avoid the policy, or prevent its attaching, unless made with actual intent to deceive and defraud, or unless the matter misrepresented increased the risk of loss.

Misrepresentations -- Brden of Proof.

Ordinarily it is for a jury to determine whether a misrepresentation has been made by the insured, whether it was material, whether it was made with actual intent to deceive and defraud, and whether it increased the risk of loss. The issues made by the pleadings in an action brought upon a policy, as to an intent to deceive and defraud, and as to a misrepresentation which, it is alleged, increased the risk of loss, are largely dependent upon the nature and duration of the disease with which it is claimed the insured had been afflicted prior to the application for the policy, and on these matters the burden of proof is upon the defendant company.

Held, it was not conclusively established by the testimony in the case at bar that the statements, representations, and warranties of the insured, contained in his application and made a part of the policy, were untrue, in the sense that any misrepresentation made as to those matters was material or increased the risk of loss, and that on these questions, especially, the cause should have been submitted to the jury.

Evidence of Disease.

A register of patients, kept at a hospital, naming or pretending to name the disease with which a patient was said to be suffering, is not admissible in evidence to show and establish the nature of the disease.

Attendance by Physician.

The well-established rule seems to be that a physician may be called upon to testify to the simple fact that he has attended a certain person as his patient, and as to the number of his visits.

John M. Rees, for appellant.

E. A. Prendergast and Cobb & Wheelwright, for respondent.

OPINION

COLLINS, J.

This action was brought upon an accident insurance policy issued to Elijah Price in March, 1901, for the term of one year, by defendant company. The premium was paid by him to the soliciting agent at the time the latter made out an application for the policy. December 15 of that year, Price was accidentally and fatally burned while attempting to light a fire by the use of kerosene oil. It is undisputed that he died as a result of injuries then received, and that they would have been fatal to any person. The defense interposed, with which we are now concerned, was that Price untruthfully stated, represented, and warranted to the agent when applying for the policy, and to the company when it was issued, that "I have never had fits or disorders of the brain, vertigo or hernia, or any bodily or mental infirmity or disorder," and also that "my habits of life are correct and temperate and I am in sound condition mentally and physically."

In the policy it was expressly stipulated that if either or any of said statements, representations, or warranties should be untrue in any respect, said document should be null and void. It was then alleged in the answer that at the time of making this application, and when the policy was issued, the habits of life of the insured were not correct or temperate; that he was not in sound condition, mentally or physically; that for a long time prior thereto he had been guilty of immoral practices, which had seriously impaired his physical and mental condition -- all of which was well known to him, and which, as a consequence, rendered the policy null and void. And further, that each of these statements, representations, and warranties were false and untrue, and were made with the actual intent on the part of Price to deceive and defraud the company, and that each of the matters so misrepresented materially increased the risk of loss. At the conclusion of the trial the court below directed a verdict for defendant company, which was returned. This appeal is from an order denying plaintiff's motion for a new trial, and it will have to be reversed.

The court below erred in at least one of its rulings when receiving testimony, and it again erred when it held that the evidence was conclusive as against plaintiff's right to recover, and thereupon directed a verdict for defendant.

1. The policy is to be construed (and it was so held upon the trial) in connection with the provisions of Laws 1895, p. 400, § 20 (c. 175), which reads:

"No oral or written misrepresentation made in the negotiation of a contract or policy of insurance by the assured, or in his behalf, shall be deemed material or defeat or avoid the policy or prevent its attaching, unless such misrepresentation is made with actual intent to deceive and defraud or unless the matter misrepresented increased the risk of loss."

This statute modifies and controls the policy, and was designed to prevent unfair practices which had theretofore been adopted by a few life and accident insurance companies when seeking risks, through which they secured opportunities to litigate actions brought to recover in case accidents happened or death came to the insured. It must be construed with reference to the wrong it was intended to reach and to remedy, and its meaning is perfectly plain and easily comprehended. A...

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