Steward v. Pioneer Pyramid Life Ins. Co.

• Decision Date: 23 July 1935
• Docket Number: 14115.
• Citation: 180 S.E. 889,177 S.C. 132
• Parties: STEWART v. PIONEER PYRAMID LIFE INS. CO.
• Court: South Carolina Supreme Court

180 S.E. 889

177 S.C. 132

STEWART v. PIONEER PYRAMID LIFE INS. CO.

No. 14115.

Supreme Court of South Carolina

July 23, 1935

Appeal from Common Pleas Circuit Court of Greenville County; Martin F. Ansel, County Judge.

Action by James Clark Stewart against the Pioneer Pyramid Life Insurance Company.Judgment for plaintiff, and defendant appeals.

Reversed and remanded, with instruction to enter judgment for the defendant.

Mann & Arnold, of Greenville, for appellant.

Nettles & Poteat, of Greenville, for respondent.

BONHAM Justice.

The respondent was insured by the Pioneer Insurance Company under a policy dated February 19, 1930, by the terms of which the company contracted to pay the named beneficiaries the sum of $5,000 at the death of the insured, and also contracted to pay $50 per month upon proof of the total and permanent disability of the insured.The Pioneer Insurance Company went out of business, and the fulfillment of its contracts of insurance, including this policy, was taken over by the Pyramid Life Insurance Company and the name of the latter was changed to Pioneer Pyramid Life Insurance Company.

Plaintiffrespondent here, brought action against the defendantappellant here, alleging that he became totally disabled by disease on or about October 25, 1933; that proofs of disability were furnished the company and liability denied that he paid under protest the premiums due February 15, 1934, in the sum of $115.85, and that due August 15, 1934, in a like sum; by supplemental complaint filed December 11, 1934, plaintiff claimed payment for disability, proofs of which were filed May 10, 1934, and the disability benefits, therefore, are claimed from said date up to the date of the trial of the case.

For answer by its first defense, the defendant admitted the formal allegations of the complaint, including that which alleged the filing of the claim for disability; further, it denied on information and belief that the insured "is totally and permanently disabled within the terms of the disability clause of the policy"; it then interposed a general denial except as to the things admitted.

For a second defense: That the disability contract of insurance was inserted in the policy on the strength of plaintiff's signed application, and his written reinstatement health certificate of January 15, 1931, upon which defendant relied, upon which plaintiff represented that he had never had any "accident, injury or occupational disease," and that "he was in good health as far as I (he) knew," and that the only causes for which he had consulted a physician in the last five years were turbinectomy in 1929 and influenza in 1925.That the application and reinstatement health certificate were the basis of the contract of insurance between the parties; that the statements in the application and reinstatement certificate were erroneous, incorrect, and known to be so by the plaintiff; that they misled defendant into issuing the insurance policy and the supplemental disability contract therewith; that by reason of such incorrect and erroneous statements, defendant denies liability in this action and is entitled to have the supplemental disability contract canceled; that on learning of the misrepresentations contained in the application and health certificate, it tendered to the plaintiff the sum of $106.67, the sum paid by plaintiff for the supplemental disability contract, together with interest, and tenders the same into court for plaintiff, and on his refusing to accept it, admits that it is due plaintiff that sum.

The case was tried by Judge Ansel and a jury in the county court of Greenville county, and a verdict was rendered for plaintiff.In due course of the trial defendant moved for a directed verdict in its favor, and after verdict rendered, moved for a new trial, both of which motions were refused.

The defendant appeals and lays his appeal upon the refusal to direct a verdict for defendant, refusal to grant a new trial, and alleged errors in the charge.These issues will be determined, but not all of the exceptions need be specifically stated.

The motion for directed verdict, except as to $106.67 which it concedes plaintiff is entitled to recover, was based on two grounds, viz.:

1.That the only reasonable conclusion to be drawn from the testimony is that the plaintiff is not totally and permanently disabled under the terms and provisions of the disability clause of the contract of insurance.

2.That plaintiff in his application or in his answer to medical questions made misstatements of material facts as to his health and concealed material information from the insurer, which misled it, and which action entitles it to have the contract of disability canceled.

We may dispose of the second of these propositions in a few words.It was a question for the jury to say whether the insured intentionally, and for the purpose of committing a fraud on the insurer, concealed material facts from the insurer.This is the settled rule of this jurisdiction.It is held in the case of Johnson v. New York Life Ins. Co.,165 S.C. 494, 164 S.E. 175, 177, in these words: "We recognize that, ordinarily, the question of fraud in a case of this kind is for the jury."Although in that case a verdict for defendant was directed on other grounds, Mr. Justice (now Chief Justice) Stabler, said: "Under the circumstances of this case, we do not see how any reasonable inference as to the applicant's intent in making his answer to the questions under consideration could be drawn from the undisputed facts other than that he deliberately intended to deceive the company and thereby procure the insurance."

Again, from the same opinion: "Where a statement of fact in an application is only a representation, its mere falsity is not sufficient to avoid the policy, its materiality and the good faith of the applicant in making it being important considerations.Under the issues made in the case at bar, it would be necessary for the defendant to show that the statements in the application relied on to defeat the policy were untrue, that their falsity was known to the applicant, that they were material to the risk and relied on by the insurer, and that they were made with intent to deceive and defraud the company."

See, also, Suggs v. New York Life Ins. Co.,174 S.C. 1, 176 S.E. 457.Also McLester v. Met. Life Ins. Co., 175 S.C. 425, 179 S.E. 490, 493.In the last-named opinion the court, commenting on the case of Sirgany v. Equitable Life Assur. Co.,173 S.C. 120, 175 S.E. 209, said: "In the case of Sirgany v. Equitable Life Assur. Co.,173 S.C. 120, 175 S.E. 209, the physicians did not disclose to the insured the nature of her disease; it was held to be a question for the jury whether by her answers in her application she intended to deceive the insurer and perpetrate a fraud."

It is patent, in the light of these cases, that the trial judge in the present case committed no error in refusing to direct a verdict for defendant on this ground.

This disposes of the question made by Exceptions II, IV, and V.Defendant was not entitled on the showing made to have the court direct a verdict for plaintiff in the sum of $106.67, and thereupon to order the disability clause of the insurance contract canceled.

Appellant charges error to the presiding judge for that he denied the motion to direct a verdict for the defendant on ground that the only reasonable conclusion to be deduced from the testimony is that the plaintiff is not permanently and totally disabled under the terms and conditions of the disability clause contained in the contract of insurance.That clause, which is set out in the record, does not differ materially from those usually contained in such insurance contracts.

What constitutes total and permanent disability within the purview of such contracts has been definitely determined by this court in a number of cases.There is no doubt thereabout; the difficulty lies in the application of the law.Each case must be governed by the facts as shown by the evidence.

In the recent case of Owens v. Sovereign Camp, W. O. W.,174 S.C. 514, 178 S.E. 125, 126, Mr. Justice Stabler (now Chief Justice) gave this succinct and clear definition of total and permanent disability: "We have held that 'what amounts to a total disability is a relative matter, and depends largely upon the circumstances of each case, and upon the occupation and employment in which the person insured is engaged'(McCutchen v. Insurance Co.,153 S.C. 401, 151 S.E. 67, 80); that the phrase is not to be literally construed, but that a person is 'deemed totally disabled when he is no longer able to do his accustomed task, and such work as he has only been trained to do, and upon which he must depend for a living'(Taylor v. Insurance Co.,106 S.C. 356, 91 S.E. 326, 327, L. R. A. 1917C, 910); and that the total disability contemplated by contracts of insurance 'is inability to do substantially all of the material acts necessary to the prosecution of the insured's business or occupation, in substantially his customary and usual manner' (Berry v. Insurance Co., 120 S.C. 328, 113 S.E. 141, 142."

To this standard of the law and definition of total and permanent disability we will apply the facts and circumstances of this case.

The appellant is the secretary and assistant treasurer of Pelham Mill.In his original complaint he sought to recover disability from October 25, 1933, but on trial respondent sought to recover disability only from May 10, 1934, the date when the proofs of disability were filed.It appears from the record that plaintiff was confined to his bed "practically all of the time" from January 2 1934, to March 12, 1934.It will be seen that no claim for...