State ex rel. Mutual Ben. Health & Acc. Ass'n v. Shain

• Decision Date: 10 November 1942
• Docket Number: 38040
• Citation: 166 S.W.2d 484,350 Mo. 422
• Parties: State of Missouri at the relation of the Mutual Benefit Health & Accident Association, a Corporation, Relator, v. Hopkins B. Shain, Ewing C. Bland and Nick T. Cave, Judges of the Kansas City Court of Appeals, and Orva C. Wheeler, Administratrix of the Estate of Richard A. Wheeler
• Court: Missouri Supreme Court

166 S.W.2d 484

350 Mo. 422

State of Missouri at the relation of the Mutual Benefit Health & Accident Association, a Corporation, Relator, v. Hopkins B. Shain, Ewing C. Bland and Nick T. Cave, Judges of the Kansas City Court of Appeals, and Orva C. Wheeler, Administratrix of the Estate of Richard A. Wheeler

No. 38040

Supreme Court of Missouri

November 10, 1942

Rehearing Denied December 1, 1942.

Writ quashed.

Ralph L. Alexander for relator.

(1) The opinion of the Kansas City Court of Appeals should be quashed because it is in direct conflict with the controlling decisions of this court in that it fails to construe the insurance contract as a whole and in that it enlarges under the guise of construction an unambiguous contract and creates an ambiguity in the contract that does not exist. (a) Plain and unambiguous contracts where the intention is clear must be enforced as written. Wendorff v. Mo. State Life Ins Co., 318 Mo. 262, 1 S.W.2d 99. (b) When a Court of Appeals gives such a contract a meaning not embraced within its terms, its opinion conflicts with such decisions. State ex rel. Mut. Benefit Health & Accident Assn. v Trimble, 334 Mo. 920, 68 S.W.2d 685; State ex rel Mut. Life Ins. Co. v. Shain, 126 S.W.2d 181; State ex rel. Mut. Benefit Health & Accident Assn. v. Shain, 89 S.W.2d 661. (c) Though facts are not identical, conflict exists if the contract as a matter of law requires the application of such rule. State ex rel. Kansas City So. Ry. Co. v. Shain, 105 S.W.2d 915. (d) On certiorari the court determines for itself whether the contract is unambiguous in order to determine whether the conflict exists. State ex rel. Met. Life Ins. Co. v. Allen, 337 Mo. 525, 85 S.W.2d 469; State ex rel. Ocean Accident & Guar. Corp. v. Hostetter, 108 S.W.2d 17. (2) The opinion of the Kansas City Court of Appeals should be quashed because it wholly fails to give effect to the valid provisions of the policy excepting from coverage disability resulting from the disease of insanity and is therefore in conflict with the following controlling decisions of this court: (a) Provisions in an insurance contract excepting particular risks are valid and binding and must be given effect. Wendorff v. Mo. State Life Ins. Co., 318 Mo. 363, 1 S.W.2d 99; State ex rel. Mut. Benefit & Accident Assn. v. Trimble, 334 Mo. 920, 68 S.W.2d 685; State ex rel. Mut. Life Ins. Co. v. Shain, 126 S.W.2d 181; Scales v. Natl. Life & Accident Co., 212 S.W. 8.

Jerome M. Joffee, Luman Spry and Henry L. Bear for respondent Orva C. Wheeler, Administratrix of Estate of Richard A. Wheeler.

The writ of certiorari should be quashed because the opinion of the Kansas City Court of Appeals is not in direct conflict with the last controlling decisions of this court upon the subject of ambiguous, inconsistent and repugnant provisions in an insurance policy. Soukup v. Employers' Liability Assur. Corp., 108 S.W.2d 86, 341 Mo. 614; State ex rel. Security Ins. Co. v. Allen, 305 Mo. 607, 267 S.W. 379; Tomnitz v. Employers' Liability Assur. Corp., 121 S.W.2d 745.

Dalton, C. Hyde and Bradley, CC., concur.

OPINION

DALTON

Original proceeding by certiorari to quash for alleged conflict the opinion of the Kansas City Court of Appeals in the case of Orva C. Wheeler, Administratrix of the Estate of Richard A. Wheeler, deceased, v. Mutual Benefit Health and Accident Association, a corporation, 157 S.W.2d 554.

In that case "plaintiff sued as administratrix to recover benefits alleged to have accrued on account of total disability occasioned by disease, and under the terms of a policy issued by defendant to Richard A. Wheeler, her deceased husband." The particular terms of the policy will be set out later. The petition alleged that while the policy was in full force and effect, and on May 1, 1937, Richard A. Wheeler became insane and continued so until his death on February 10, 1940. "All other allegations necessary to recovery," were made, provided the policy afforded "coverage for total disability and loss of time occasioned by the disease of insanity." (157 S.W.2d 554, 555.)

"Defendant filed a demurrer to the petition on the ground that it failed to state facts sufficient to constitute a cause of action. The demurrer was overruled, defendant declined to plead further, and on motion of plaintiff to assess damages the court heard evidence and rendered judgment for plaintiff."

Respondents stated the issue before them on appeal as follows: "The only question on appeal is the propriety of the ruling on the demurrer to the petition. . . . It is the position of appellant that the policy does not afford coverage on account of a restrictive clause hereafter shown." (157 S.W.2d 554, 555.) Respondents then described the policy and its terms as follows: "At the top of the first page of the policy, in prominent type, is the recital that 'this policy provides benefits for loss of life, limb, sight or time, by accidental means, or loss of time by sickness as herein provided.' The first paragraph of the policy recites that: 'Mutual Benefit Health and Accident Association Omaha does hereby insure Richard A. Wheeler (Herein called the Insured) of City of Glasgow, State of Missouri, against loss of life, limb, sight or time, resulting directly and independently of all other causes, from bodily injuries sustained during any term of this Policy, through purely Accidental Means (Suicide, sane or insane, is not covered), and against loss of time beginning while this Policy is in force and resulting from disease contracted during any term of this Policy, respectively, subject, however, to all the provisions and limitations hereinafter contained.'

"On one side of the words 'Does Hereby Insure' appears in prominent words and figures 'Monthly Benefits $ 60.00, Maximum Monthly Benefits $ 120.00.' And on the other side, 'Death Benefit $ 1,500, Maximum Death Benefit $ 3,000.' Following the first paragraph above quoted are various sub-divisions of the policy designated alphabetically as Parts A to O, inclusive. Parts A to J, inclusive, provide mainly for accident indemnities, and parts K to O, inclusive, provide specially for illness indemnities. Part K in its entirety reads as follows:

"'Part K. Confining Illness Benefits for Life.

"'The Association will pay, for one day or more at the rate of Thirty ($ 30.00) Dollars per month for the first fifteen days and at the rate of Sixty ($ 60.00) Dollars per month thereafter for disability resulting from disease, the cause of which originates more than thirty days after the effective date of this policy, and which confines the Insured continuously within doors and required regular visits therein by legally qualified physician; provided said disease necessitates total disability and total loss of time.'

"Following the fifteen alphabetical parts are seventeen paragraphs numbered numerically. None of them pertain to any question that arises on this appeal. Following the seventeen paragraphs are 'Additional Provisions' lettered (a) to (f) inclusive. The first additional provision, lettered (a), is in these words: '(a) This policy does not cover death, disability, or other loss sustained in any part of the world except the United States and Canada, or while engaged in military or naval service in time of war, or any act of war, or while the Insured is not continuously under the professional care and regular attendance, at least once a week, beginning with the first treatment, of a licensed physician or surgeon, other than himself; or received because of or while participating in aeronautics, except as provided in Part H; or while suffering from insanity or mental infirmity; or while the Insured is suffering from syphilis or venereal disease. Disability resulting from tuberculosis or heart trouble shall be covered only if the disease originates after the policy has been in continuous force for the six (6) preceding months.'" (157 S.W.2d l. c. 555-556.)

No one here complains of this statement by respondents and it is unnecessary to refer to other provisions of the policy.

Respondents held: "If the words in Paragraph (a) of 'Additional Provisions' were to be given full effect they would control Part K to the extent of completely excluding any payment for disability resulting from the disease of insanity. Whether or not such effect should be given to Paragraph (a) will determine the correctness or error of the court's ruling on the demurrer to the petition. The conclusion which we have reached is that Part K of the policy constitutes a definite promise to pay a specified sum upon the happening of a certain contingency resulting from any disease, and subject only to the conditions expressed in said part; and that the subsequent provision described as paragraph (a) under the title 'Additional Provisions', which seeks to eliminate liability for loss of time occasioned by the disease of insanity, is repugnant to the provisions of Part K, and creates an irreconcilable conflict therewith. Under such circumstances the subsequent restricting clause cannot be given the force claimed for it by appellant, but will be ignored to the end that the promise of indemnity in Part K may be given effect. Entertaining the above views, the finding must be that the trial court properly ruled the demurrer."

Respondents further said: "It is entirely reasonable and just to hold that by Part K of the policy the company agreed to pay a definite amount for loss of time resulting from total disability occasioned by any disease. It was undoubtedly so understood by the insured when he purchased this policy, and it may fairly be said that the minds of the parties never met upon an agreement that the disease of insanity was an excepted risk. Part K is subject to certain conditions expressed...