Quinten v. U.S. Steel Corp.

• Decision Date: 11 June 1958
• Citation: 142 A.2d 370,186 Pa.Super. 384
• Parties: Francis QUINTEN, Dolores Matvia and Walter Quinten, v. UNITED STATES STEEL CORPORATION, Appellant.
• Court: Pennsylvania Superior Court

Page 370

142 A.2d 370

186 Pa.Super. 384

Francis QUINTEN, Dolores Matvia and Walter Quinten, v. UNITED STATES STEEL CORPORATION, Appellant.

Superior Court of Pennsylvania.

June 11, 1958.

Application for Allocatur Denied Aug. 7, 1958.

Gilbert J. Helwig, Reed, Smith, Shaw & McClay, Pittsburgh, for appellant.

Ruth Forsht, Ella Graubart, Patterson, Crawford, Arensberg & Dunn, Pittsburgh, for appellees.

Before HIRT, Acting P. J., and GUNTHER, WRIGHT, ERVIN and WATKINS, JJ.

GUNTHER, Judge.

This appeal is by United States Steel Corporation from the refusal of the court below to grant motions for judgment n. o. v. and for a new trial after a directed verdict for plaintiffs in the amount of $4,927.50.

Emanuel Quinten was employed for many years by the defendant corporation. In 1935, the defendant inaugurated a group life insurance plan for its employees and a certificate of insurance was issued to him under the terms of the master policy, in which the insured designated his three children, plaintiffs, as beneficiaries. Contributions toward the premium were deducted from his pay for a period of fifteen years. the insured stopped working on January 11, 1950 because of mental illness and he was committed to Woodville State Hospital where he remained until his death on February 14, 1956.

From February, 1950 to July, 1950, the insured's premiums were paid by Francis Quinten, one of the plaintiffs, and thereafter, as a result of certain discussions in the office of industrial relations of the defendant, he requested that his father's vacation pay be applied toward the payment of premiums. Some time in the latter part of 1953, Francis Quinten moved to California where he continued to live down to the time of trial. From July, 1950 to February, 1952, defendant paid the premiums from the wages due to the insured, Emanuel Quinten. Thereafter, defendant terminated the employment and cancelled the policy.

When the father became mentally ill, Dolores Matvia, one of the children, moved into his home and remained there down to the date of trial. The other child, Walter Quinten, was a child 14 years of age when his father became ill. All of the children testified that they did not know that defendant intended to discontinue the policy and two of the children testified they knew nothing about the existence of said policy. No notice was given to anyone of the termination of employment or the cancellation of the insurance, and defendant knew that the insured had been committed to Woodville State Hospital.

On March 30, 1955, a guardian was appointed for Emanuel Quinten, who collected from the defendant the sum of $5,545.98, being the employee's pension and $157.13 in net wages. The guardian did not know of the existence of the policy until after the death of the insured.

Subsequent to the death of the insured a complaint in assumpit was filed against defendant claiming damages for failure to maintain decedent's insurance, for failure to give decedent or his representatives any notice of the intended termination of employment and cancellation of his policy by reason of which the statutory conversion rights of said policy were lost. As damages, the value of the insurance contract in effect at the time of the insured's mental illness was claimed. At the trial, defendant attempted to introduce evidence of a seniority provision of a collective bargaining agreement which tended to show that the seniority of an employee could not survive a two-year absence from active work because of illness, unless the illness was compensable under Workmen's Compensation Act, 77 P.S. § 1 et seq. This offer was refused as irrelevant and having nothing to do with defendant's duty under the group policy.

The pertinent provisions of the insurance contract provided as follows:

'Discontinuance of Insurance

'(a) The insurance on any Employee insured hereunder shall cease automatically thirty-one (31) days after the date of termination of employment of such Employee, except as provided in the second paragraph below.

'Cessation of active work by an Employee shall be deemed to constitute the termination of his employment, except as provided in the next paragraph.

'In case of the absence of an Employee from active work on account of sickness or injury, or for not longer than twenty-four months on account of leave of absence or temporary lay-off, the employment of such Employee may, for the purpose of the policy, be deemed to continue until terminated by the Employer. The insurance hereunder on such Employee shall cease thirty-one (31) days after the date of such termination by the Employer, as evidenced to the company by the Employer, whether by notification or by cessation of premium payment on account of the insurance hereunder of such Employee.

'Conversion Privilege

'In case of the termination of the employment of the Employee for any reason whatsoever his insurance shall cease thirty-one (31) days after such termination, but the Employee shall be entitled to have issued to him by the Company, without evidence of insurability, and upon application made to the Company within thirty-one (31) days after such termination of employment, and upon the payment of the premium applicable to the class of risk to which he belongs and to the form and amount of the policy at his then-attained age (nearest birthday), a policy of Life Insurance in any one of the forms customarily issued by the Company, except Term Insurance, in an amount equal to or, at the option of the Employee, less than the amount of his insurance under the Group Policy at the time of such termination. An individual policy so applied for shall become effective only upon the cessation of the Employee's insurance under the Group Policy.

'Extended Death Benefit

'The Group Policy contains, in substance, the following provision

'Upon receipt by the Company of due notice and proof--in writing--that the death of an Employee formerly insured under the Group Policy has occurred prior to his sixty-fifth birthday and (a) within twelve (12) months from the date of termination of his employment or (b) within a period, beginning with the date of termination of employment, equal to the time during which the Life Insurance under the Group Policy on such Employee had been in force, whichever is less, and upon receipt of further proof--in writing--that such Employee was, from the date of termination of his employment to the date of his death, continuously and totally disabled, as a result of bodily injury or disease, so as to have been thereby prevented from engaging in any and every business or occupation and from performing any and all work for compensation or profit, and upon the surrender of this Certificate and Certificate Riders, if any, attached hereto, the Company shall pay, subject to the Terms of the Group Policy, to the Beneficiary of record, the amount of insurance, if any, in force on account of such Employee at the date of the termination of his employent; provided, however, that...