Stanford v. American Guaranty Life Ins. Co.

• Decision Date: 06 December 1977
• Citation: 280 Or. 525,571 P.2d 909
• Parties: Carl C. STANFORD, Appellant, v. AMERICAN GUARANTY LIFE INSURANCE COMPANY, an Oregon Corporation, Respondent.
• Court: Oregon Supreme Court

Page 909

571 P.2d 909

280 Or. 525

Carl C. STANFORD, Appellant, v. AMERICAN GUARANTY LIFE INSURANCE COMPANY, an Oregon Corporation, Respondent.

Supreme Court of Oregon, Department 2.

Argued and Submitted Oct. 6, 1977.

Decided Dec. 6, 1977.

Donald J. Friedman, Portland, argued the cause for appellant. On the briefs were Terry DeSylvia and Black, Kendall, Tremaine, Booth & Higgins, Portland.

Gerald R. Pullen, Portland, argued the cause for respondent. With him on the brief were Lachman & Henninger, P.C., Portland.

Before DENECKE, C. J., TONGUE and HOWELL, JJ., and GILLETTE, J. Pro Tem.

DENECKE, Chief Justice.

Plaintiff appeals from a decision denying him benefits under a credit-disability insurance policy issued by the defendant. The trial was had before the court sitting without a jury which found that plaintiff's disability came within a policy exclusion. Plaintiff asserts on appeal that there was no evidence to support the finding that he was within the exclusion. We agree and reverse.

Plaintiff voluntarily purchased the insurance policy on February 12, 1973, in connection with the purchase of an automobile. The policy provided that the insurer would make the payments on the automobile in the event that plaintiff became disabled.

The exclusion clause provided "The Company shall have no liability for payment of Disability Insurance Benefits by reason of any disability * * * caused or contributed to by: (1) Any condition for which medical advice, consultation or treatment was required or recommended within 6 months preceding the Effective Date and for which medical advice, consultation or treatment was required or recommended within 6 months following the Effective Date; * * * ."

It was conceded at oral argument that this exclusion is applicable only if advice, consultation or treatment was required or recommended within both the six-month period preceding and the six-month period following the effective date of the policy. The only controversy concerns the period following issuance of the policy.

The insurer has the burden of proof that the loss is excluded. Smith v. Ind. Hosp. Assn., 194 Or. 525, 242 P.2d 592 (1952). Also, any ambiguity in an exclusionary clause is strictly construed against the insurer. United Pac. Ins. v. Truck Ins. Exch., 273 Or. 283, 293, 541 P.2d 448 (1975).

The trial court made the following findings of fact:

"VIII

"That thereafter (following vascular surgery in 1970 and 1971) Dr. Richard Rogers recommended and prescribed and Plaintiff agreed and submitted to post operative care under Dr. Rogers, for Plaintiff's vascular condition. That said post operative care for Plaintiff's vascular condition was in effect within six months prior to the effective date of the policy (February 12, 1973) and within six months following the effective date of the policy.

"* * * .or

"XI

"That medical advice, consultation or treatment was required or recommended to Plaintiff during the six months following the effective date of the policy for the conditions for which Plaintiff received medical consultation from his doctors during the six months period prior to the effective date of the policy.

"XII

"Plaintiff received medical advice, consultation or treatment which was required or recommended by his doctors within six months following the effective date of the policy for the aforestated conditions for which medical advice, consultation or treatment was required or recommended within six months preceding the effective date of the policy."

Although the court found plaintiff to be disabled, it did not specify the condition or conditions which rendered him disabled. There was evidence in the record from which the court could reasonably have concluded that plaintiff's disability was contributed to by circulatory problems related to plaintiff's vascular surgery which left plaintiff with inadequate circulation in his legs, palpitations of the heart, flu and accompanying prostate infections, hypertension, pulmonary emphysema, chronic bronchitis, and arteriosclerotic coronary disease with angina pectoris. However, the mere fact that any or all of the above conditions existed during both of the relevant six-month periods...