Sipp v. Philadelphia Life Ins. Co.
| Decision Date | 07 May 1928 |
| Docket Number | 148 |
| Citation | 293 Pa. 292,142 A. 221 |
| Parties | Sipp, Appellant, v. Philadelphia Life Insurance Co |
| Court | Pennsylvania Supreme Court |
Argued April 17, 1928
Appeal, No. 148, Jan. T., 1928, by plaintiff, from order of C.P. No. 1, Phila. Co., March T., 1925, No. 1910, discharging rule for judgment for want of sufficient affidavit of defense, in case of Katherine V. Sipp v. Philadelphia Life Insurance Co. Affirmed.
Assumpsit on policy of life insurance.
Rule for judgment for want of sufficient affidavit of defense. Before McDEVITT, P.J.
Rule discharged. Plaintiff appealed.
Error assigned was order, quoting it.
The order appealed from is affirmed.
Robert V. Bolger, for appellant. -- The policy contract does not set forth either the custom, rule and practice of the company or the method by which defendant seeks to determine the amount it claims to be due plaintiff: Central Trust Co. v. Ins Co., 45 Pa.Super. 313; Thompson v. Ins. Co., 136 U.S. 297; Imperial Fire Ins. Co. v. Dunham, 117 Pa. 460; Mowry v. Protective Society, 27 Pa.Super 390; McCaslin v. Ins. Co., 59 Pa.Super. 475; Southside Trust Co. v. Ins. Co., 74 Pa.Super. 566; Hohman v. Indemnity Co., 41 Pa. C.C.R. 273; Custer v. Mutual Aid Assn., 211 Pa. 257; Mitchell v. Ins. Co., 90 Pa.Super. 426; Doll v. Ins. Co., 21 Pa.Super. 434; Hall v. Life Assn., 19 Pa.Super. 31.
Russell Duane, of Duane, Morris & Heckscher, with him Edward J. Boughton, for appellee. -- The age adjustment provision of this policy should be enforced not only because it forms an integral part of the contract, but for the further reason that this provision is in strict accord with the policy of the law as laid down in a series of Pennsylvania statutes.
The section of plaintiff's policy which provides that it shall be incontestable after the lapse of one year, imposes no restriction on age adjustment at any time: Brady v. Ins. Co., 168 Pa. 645; Hall v. Life Assn., 19 Pa.Super. 31; McCreighton v. Am. C. Union, 71 Pa.Super. 332; Doll v. Ins. Co., 21 Pa.Super. 434.
No known statute or court decision other than that in Mitchell v. Penna. Mutual Life Ins. Co., 90 Pa.Super. 426, ever required such tables of figures to be inserted in a policy of life insurance as the court intimated to be necessary in that case, nor has such insertion been shown to be customary in the practice of insurance companies.
Before FRAZER, WALLING, SIMPSON, KEPHART, SADLER and SCHAFFER, JJ.
The defendant company executed, on January 6, 1911, a policy of insurance for $ 3,000 on the life of Julia Lynch, in which her daughter Katherine Sipp, the present plaintiff, was named as beneficiary. In the application, the mother stated her age to be fifty, and on this basis the annual premium was fixed. Prior to her death on March 7, 1919, she borrowed from the company $ 423, and this sum was not repaid during lifetime. After the decease of Mrs. Lynch, the beneficiary named made prompt demand for payment of the insurance, and, upon failure of defendant to comply, brought this suit. The defense interposed was a denial of liability for the full sum of $ 3,000, claiming that the insured had misrepresented her date of birth when the contract was made, being at that time in fact 65, and, under the terms of the policy, the beneficiary was therefore entitled to such amount only as could have been purchased for the premium charged, had a correct statement of the facts been given, a total of $ 1,585. After deducting the loan from this amount the balance was tendered in satisfaction of further claim. From the order, discharging a rule for judgment for want of a sufficient affidavit of defense, plaintiff has appealed.
The complaint here made is directed to the refusal to enter a summary judgment, and the action of the court below must be sustained unless it appears to have been based on a plain error of law: Yentis v. Mills, 291 Pa. 591. The merits of the controversy are not to be reviewed in such cases, nor will the legal questions ordinarily be discussed until an opportunity is had to fully develop the evidence at trial: Brown v. Unger, 269 Pa. 471. It is only when the right to relief is clear, assuming the facts set forth by defendant to be true, that we will reverse. Appellant claims error was committed in holding that any legal defense has been interposed, and it is the correctness of this assertion we are asked to consider.
The policy upon the life of Mrs. Lynch provided for the payment of a fixed sum at death, less indebtedness due the company, in case the annual premiums named were paid. This, with the application attached, in which the insured represented her age to be fifty, constituted, by express stipulation, the entire contract between the parties. By the former, it was provided that: "This policy shall be incontestable, except for nonpayment of premiums, after one year from its date," subject, however, to the following condition set forth under the same heading: "If the age of the insured has been misstated, the amount payable hereunder shall be such a sum as the premium actually paid would have purchased at the correct age." The affidavit of defense averred the age of Mrs. Lynch was sixty-five when the contract was entered into, and, under "the practice, rules and custom" of the company, the amount of premium actually charged and paid would have purchased insurance to the amount of $ 1,585 only, had the true facts been set forth.
Prior to the Act of June 23, 1885 (P.L. 134), a misrepresentation as to age, though sincerely made, would have been ground for forfeiture of the policy (U.B. Mut. Aid Society v. White, 100 Pa. 12), and this was true even thereafter where the insurer was a beneficial association: Dinan v. Supreme Council, 201 Pa. 363; Alta Friendly Society v. Brown, 8 Pa. Superior Ct. 267. The legislation referred to protected the policyholder by providing that, if the wrong date of birth had been given in good faith, the company should "not be required to pay the face value of the policy, but such sum as the premium paid would have purchased at the applicant's real age at the time of effecting the insurance." The contract before us was written on January 6, 1911, while this statute was in force, but went further in permitting a recovery on the corrected basis, irrespective of the honesty of the insured in making the representation. Later (Act June 1, 1911, P.L. 581, section 25, subdivision 5), the privileges of the insured were similarly extended in all cases of incorrect statements of age, and provision was made for adjustment of payments under such circumstances. The General Insurance Law of 1921 (May 17, 1921, P.L. 682, 720, section 410, par. e) requires a like stipulation inserted in every life policy. In the present instance we find the company's demand that its payment be on the basis of the true age, sustained not only by statutory direction, but by an express condition of the contract itself. Unless other considerations make the suggested correction of the amount due inapplicable, the defendant was justified in reducing it to the sum admitted to be owing.
It is first insisted that there was a waiver of the right to complain of the misstatement as to date of birth, as the policy is made incontestable after one year. Under the same heading there appears a limitation of liability in providing for the adjustment of the sum payable in case of error. If such stipulation did not appear, it might well be that the statutory provision for correction could not be enforced, for the parties could agree that no defense whatsoever should be interposed, and, unless in contravention of some rule of public policy, the contract would control. Such was the situation disclosed in Central Trust Co. v. Fidelity M.L.I. Co., 45 Pa.Super. 313, and in which the distinction is drawn between the case there presented and one where the policy showed an intent to permit a correction for misstatement, though the time for contest was limited, as appeared in Doll v. Prudential Ins. Co., 21 Pa.Super. 434. What was said by the court in the last cited decision is applicable here.
The incontestability clause and the one fixing the amount of recovery in case of misstatement of age are not inconsistent. The like question has been the subject of discussion when there appeared a stipulation against liability in case of suicide (Starck v. Union Life Ins. Co., 134 Pa. 45; Hall v. Mutual...
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