Prudential Ins. Co. of America v. Ordonoff
| Decision Date | 10 July 1936 |
| Docket Number | 23-1936 |
| Citation | 186 A. 391,122 Pa.Super. 485 |
| Parties | Prudential Insurance Company of America v. Ordonoff, Appellant |
| Court | Pennsylvania Superior Court |
Argued March 16, 1936
Appeal by defendant, from decree of C. P. Dauphin Co., Equity Docket, 1933, No. 1089, in case of The Prudential Insurance Company of America v. Tana Ordonoff.
Bill in equity for cancellation of insurance policy. Before Fox, J.
The facts are stated in the opinion of the Superior Court.
Decree entered directing cancellation of policy. Defendant appealed.
Error assigned, among others, was refusal of defendant's motion to have the case remanded to the law side.
Decree affirmed.
George L. Reed, with him Morley W. Baker, for appellant.
George H. Hafer, with him Geo. Ross Hull, of Snyder, Hull, Hull & Leiby, for appellee.
Before Keller, P. J., Cunningham, Baldrige, Parker, James and Rhodes, JJ.
This is a bill in equity filed by The Prudential Insurance Company of America to compel the surrender for cancellation of its policy of insurance upon the life of Mary Ordonoff, a minor issued on September 3, 1931, in the amount of $ 1,500. The insured died of tuberculosis on July 10, 1932, and the defendant below and appellant herein is her mother, the designated beneficiary.
Upon investigation of the beneficiary's claim and discovery of the facts set out in the bill, appellee notified appellant thereof, and sought a rescission of the policy, although a return of the full amount of the premiums received was not tendered at that time. Appellant refused to surrender the policy, but brought no suit thereon. This proceeding in equity was instituted by appellee on August 31, 1933, three days before the policy would have become incontestable under the following clause, contained therein: "This policy shall be incontestable after two years from its date of issue, except for non-payment of premiums . . . ."
No medical examination of the insured was made for the company, the policy having been issued upon her application and declaration in lieu of such examination, which became a part of the contract. The bill of complaint sought cancellation upon the ground that the insured, in this declaration, knowingly and fraudulently misrepresented the condition of her health, and falsely stated that she had never had a serious illness, had had no medical or surgical treatment in a hospital or sanitarium, was at the time of the application in good health, had not been attended by a physician within three years prior to the application, and did not have consumption.
The case came on for trial on March 14, 1934, before the chancellor, Fox, A.L.J., and on March 27, 1934, when testimony was resumed, appellee moved to amend its bill by setting forth as an additional ground for cancellation that the policy contained a provision that unless it were delivered and the first premium paid while the health of the insured was the same as described in the application, the policy would not take effect, and that on September 8, 1931, when the first premium was paid and the policy delivered, the insured's health had changed for the worse. The amendment was allowed, over appellant's objection, and the trial proceeded to the final decree from which this appeal has been taken.
The chancellor found that, contrary to the representations made in the application, the insured had been admitted to a sanitarium in 1927 to be treated for tuberculosis, and knew at that time that she had an involvement of the lungs; that she had attended tuberculosis clinics from 1926 to 1930, and knew when she attended the clinics that she had an affection of the lungs; that in 1930 her doctor found marked involvement of her lungs, both anteriorly and posteriorly, so much so that he advised her to discontinue school and on his advice to the superintendent of schools she was given leave of absence for the school year 1930-1931, on account of being "Tubercular Type"; that she knew when she was given this leave that she had lung involvement; that on September 8, 1931, she was examined by her doctor who found she had pleurisy and difficulty in breathing; and that on that day she was in a poorer condition of health than on the date of the application for the policy.
He also found that the answers made by the insured in her application were material and were made with full knowledge of them, and that they were false and fraudulent. Accordingly, a decree nisi was entered cancelling the policy and ordering appellant to surrender it to appellee; directing appellee to pay to appellant all premiums and other money paid on account of the policy, with interest; and enjoining appellant and her assigns from bringing and maintaining any action upon the policy, either at law or in equity. The exceptions filed thereto by appellant were overruled by the court, in banc, and the decree became final.
We have examined the record and find ample evidence to support the findings of the chancellor, approved by the court in banc. The third to eighth assignments of error, inclusive, are therefore dismissed, but certain questions of law remain to be considered.
First appellant contends that the amendment to the bill of complaint introduced a new cause of action and therefore should not have been allowed, since the two year period of contestability had expired before the amendment was offered. This question need not be determined. The fraudulent representations in the application, set out in the bill as originally filed and found by the court below, furnish sufficient grounds for the decree of cancellation: Equitable Life Assur. Society v. Klein, 315 Pa. 156, 173 A. 188; New York Life...
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