Thompson v. Travelers Insurance Company

• Decision Date: 17 November 1904
• Citation: Thompson v. Travelers Insurance Company, 101 N.W. 900, 13 N.D. 444 (N.D. 1904)
• Court: North Dakota Supreme Court

101 N.W. 900

13 N.D. 444

MAY V. THOMPSON v. THE TRAVELERS INSURANCE COMPANY

Supreme Court of North Dakota

November 17, 1904

Appeal from District Court, Barnes county; Glaspell, J.

Action by May V. Thompson against the Travelers Insurance Company. Judgment for plaintiff, and defendant appeals.

Reversed.

Order vacated, and a new trial granted.

John E Greene, for appellant.

The evidence is insufficient to support the verdict on the ground of good health. Good health is that condition wherein the body is free from any disease or ailment which tends to shorten life or permanently impair the health; a state of health which is free from any disease or ailment that seriously affects the general healthfulness of the system. Richards on Insurance (2d Ed.), 199; Grattan v. Met. Life Ins. Co., 92 N.Y. 274; Bancroft v. Home Benefit Assn., 120 N.Y. 14; Plumb v. Penn. Mutual Life Ins Co., 65 N.W. 611; Met. Life Ins. Co. v. Howle, 62 Ohio St. 204; Manhattan Life Ins. Co. v. Carder, 82 F 986.

The evidence was insufficient to establish a waiver. An agent to solicit applications, deliver policies and collect premiums upon receipts countersigned by the state agent, cannot waive conditions or forfeitures, and his knowledge is not to be imputed to the insurer. Kirkman v. Farmers Ins. Co., 57 N.W. 952; Globe Mut. of N.Y. Ins. Co. v. Wolff, 95 U.S. 326, 24 L.Ed. 387; Heath v. Springfield Fire Ins Co., 58 N.H. 414; Maier v. Fidelity Mut. Life Ins. Co., 24 C. C. A. 239; Clemens v. Superior Assem. Royal Society of Good Fellows, 30 N.E. 496; Barteau v. Ins. Co., 67 N.Y. 595; Levell v. Royal Arcanum, 30 N.Y.S. 205; Wood on Ins., sections 413 and 435; Alexander v. Germania F. Ins. Co., 66 N.Y. 464; Northern Assurance Co. v. Building Assn., 183 U.S. 308; Richards on Ins., 99; Sun Ins. Co. v. Texarkana F. & M. Co., 4 Tex. Civ. App. 398.

Winterer & Winterer, for respondent.

Good health does not necessarily mean absolute freedom from any ill, pain or indisposition. May on Insurance (2d Ed.), 387; Connecticut Mutual Life Ins. Co. v. Union Trust Co., 112 U.S. 250, 5 S.Ct. 119, 28 L.Ed. 708; Brown v. Metropolitan Life Ins. Co., 32 N.W. 610; Clemens v. Mutual Life Ins. Co., 20 Pa. S.Ct. 567; Woodmen etc. v. Locklin, 67 S.W. 331.

The defendant by accepting, retaining and appropriating the premium and delivering the policy with full knowledge of assured's health on the date when the premium was paid and the policy was delivered, has by such acts waived the provision in the policy that it should not take effect if the assured was not in good health and it is estopped to deny the validity of the policy. Lightbody v. North American Ins. Co., 23 Wend. 18; Hubbard v. Hartford Ins. Co., 33 Ia. 325, 11 Am. Rep. 125.

Knowledge of the soliciting agent material to a risk would be the knowledge of the insurance company, and it would be bound thereby. Jordan v. State Ins. Co., 19 N.W. 917; Stone v. Hawkeye Ins. Co., 28 N.W. 47; Goodwin v. Provident Sav. Life Ins. Co., 66 N.W. 157.

When an agent to procure and forward applications for insurance makes out an application incorrectly, notwithstanding all the facts are correctly stated to him by the applicant, the error is chargeable to the insurer and not to the insured. American Life Ins. Co. v. Mahone, 21 Wall. 152, 22 L.Ed. 593; Miner v. Phoenix Ins. Co., 27 Wis. 693; Wians v. Allemania Fire Ins. Co., 38 Wis. 342; Brandup v. Insurance Co., 27 Minn. 393, 7 N.W. 735; Wood on Insurance, chapter 12; May on Ins., section 120; Power v. Morton Ins. Co., 80 N.Y. 111; Mut. Reserve Fund v. Summers, 107 F. 418; Johnson v. Dak. F. & M. Ins. Co., 1 N.D. 167, 45 N.W. 799.

Knowledge of its agent for soliciting insurance and collecting premiums, or facts justifying insurer in forfeiting a policy, is binding on it, though not communicated. N.W. Life Assurance Co. v. Bodurtha, 53 N.E. 787; Union Cent. Life Ins. Co. v. Halloweel, 43 N.E. 277; McElroy v. British Am. Assurance Co., 94 F. 990; Dietz v. Providence Washington Ins. Co., 8 S.E. 616; North British & Mercantile Ins. Co., v. Steiger, 16 N.E. 95; Newman v. Association, 40 N.W. 87; Lumberman's Mutual Ins. Co. of Chicago v. Bell, 45 N.E. 130.

Notice to a subagent while engaged in soliciting, of any fact material to the risk, is notice to the company and binds it the same as if given directly to the agent himself. Carpenter v. German-Amer. Ins. Co., 31 N.E. 1015; Goode v. Georgia Home Ins. Co., 23 S.E. 744; Steele v. German Ins. Co. of Freeport, 53 N.W. 514; Arff v. Star Fire Ins. Co., 25 N.E. 1073; Bennett v. Council Bluffs Ins. Co., 31 N.W. 948; Phoenix Ins. Co. v. Ward, 26 S.W. 763; Schoeneman v. Western etc. Ins. Co., 20 N.W. 284.

An insurance company may waive the payment of the premium at the time it is due. If it is afterwards paid after loss occurs and is retained and appropriated by the company and the policy delivered, it will be a waiver of the terms of the policy and the company cannot retain the premium and refuse to pay the loss. Schoeneman v. Western etc. Ins. Co., supra; Lobee v. Standard Live Stock Ins. Co., 33 N.Y.S. 657; Smith v. St. Paul Fire & Marine Ins. Co., 13 N.W. 355; Bloom v. State Ins. Co., 62 N.W. 810.

Acceptance of premium after loss has occurred is a waiver of the right to declare a forfeiture of the policy and not a mere act of revival. Joliffe v. Madison Mutual Ins. Co., 39 Wis. 111; Johnson v. Dak. Fire & Marine Ins. Co., 1 N.D. 167, 45 N.W. 799; Cotten v. Fidelity & Casualty Co., 41 F. 506; Oshkosh Gas Light Co. v. Germania Fire Ins. Co., 37 N.W. 819; Phoenix Life Ins. Co. v. Raddin, 120 U.S. 183, 7 S.Ct. 500, 30 L.Ed. 644; Wood on Fire Insurance, 50-51; Schoeneman v. Western etc. Ins. Co., supra; Weiberg v. Minnesota Scandinavian Relief Assn., 76 N.W. 37; Erdmann v. Mutual Ins. Co., 44 Wis. 376; McQuillan v. Mut. Reserve Fund Assn., 87 N.W. 1069; Gray v. National Benefit Assn., 11 N.E. 477.

OPINION

YOUNG, C. J.

This case has been tried twice in the district court. On both trials the plaintiff had a verdict, and each was followed by the denial of a motion for a new trial. This is the second appeal to this court. The report of the former appeal will be found in 11 N.D. 274, 91 N.W. 75. The action is upon an insurance policy for $ 2,000 issued by the defendant upon the life of plaintiff's husband. Defendant bases its denial of liability upon the following stipulation in the policy, "This policy shall not take effect unless the first premium is actually paid while the assured is in good health," and alleges that the assured was not in good health when the first premium was paid, but, on the contrary, was then suffering from a disease from which he subsequently died. Upon the former appeal we reversed the order denying the motion for a new trial upon the ground of prejudicial errors in the admission of testimony which was offered by plaintiff to show waiver of the above condition. The present order must be reversed for the same reason.

The following statement of facts from the former opinion will aid in a proper understanding of the questions involved in this appeal: On the 23d of August, 1900, the plaintiff's husband, Horace S. Thompson, made an application for a policy of life insurance in the defendant company for the sum of $ 2,000. On the 4th of September following, the policy was issued pursuant to such application, and sent to the local agent of the company at Valley City, N.D., and was received by him on September 11th. On the 15th of September the policy was delivered to one Tracy, for Thompson, upon payment of the premium, amounting to the sum of $ 53.24. The policy was payable to the plaintiff. The assured died on September 28, 1900. Proofs of death were made on October 15, 1900. Payment under the policy was refused by the company, and this suit followed. It appears that on or about September 1st the assured was injured in a runaway accident resulting in a broken rib. A doctor treated him for such injury by applying bandages on two occasions when the assured visited his office. The assured made a trip to St. Paul between the dates of these two treatments, and remained there three or four days, returning on September 10th. On September 13th he was suffering from a dull headache, and was in bed a part of the time. On the evening of that day he made arrangements with Tracy to pay the insurance premium and procure his policy on the following Saturday, in case his health or the weather prevented his going to Valley City, as he then intended to do. He did not go to Valley City, and Mr. Tracy did as requested. On Sunday night his headache became very severe, and a doctor was sent for in the morning of Monday, the 17th, and visited him on that day, and thereafter had the assured under his care, and visited him at various times until his death, on the 28th. The agent of the defendant received the premium on the 15th of September, and sent it to the St. Paul office; and in due course of business it was received at the main office of the company, at Hartford, Conn., on October 12, 1900. The policy bears date September 4, 1900, but contains no acknowledgment of the payment of the premium.

The defendant contends that the evidence is insufficient to support the verdict, in this: That it conclusively shows that the assured was not in good health when the first premium was paid, and wholly fails to show that the condition in the policy above set out was waived, and assigns a large number of errors upon the admission of testimony which was offered for the purpose of establishing a waiver. On the other hand, counsel for plaintiff contend that there is evidence in the record from which the jury was warranted in finding either that the insured was in good health, or that the condition was waived. There is no controversy as to the validity or effect of...