Travelers' Ins. Co. of Hartford v. Henderson

• Decision Date: 05 August 1895
• Docket Number: 527.
• Citation: 69 F. 762
• Parties: TRAVELERS' INS. CO. OF HARTFORD v. HENDERSON.
• Court: U.S. Court of Appeals — Eighth Circuit

69 F. 762

TRAVELERS' INS. CO. OF HARTFORD v. HENDERSON.

No. 527.

United States Court of Appeals, Eighth Circuit.

August 5, 1895

Charles N. Potter and Timothy F. Burke, for appellant.

A. C Campbell and R. W. Breckons, for appellee.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

THAYER Circuit Judge.

This was a suit which was commenced by the appellee, Fannie L Henderson, against the appellant, the Travelers' Insurance Company of Hartford, Conn., in the circuit court of the United States for the district of Wyoming, to reform an accident policy of insurance. The policy in question was solicited and written at Cheyenne, Wyo., by an agent of the defendant company at that place. The material provisions of the policy were as follows:

'Accident Policy. The Travelers' Insurance Company of Hartford, Conn., in consideration of the warranties in the application for this policy and of fifty dollars, does hereby insure (subject to conditions on back hereof, not waivable by agents) George B. Henderson, of Cheyenne, county of Laramie, state of Wyoming, under classification preferred (being a manager of Wyoming Cattle-Ranch Company, not riding on range by occupation), for the term of twelve months from noon of January 7, 1889, in the sum of fifty dollars per week, against loss of time not exceeding 26 consecutive weeks, resulting from bodily injuries effected during the term of this insurance, through external, violent, and accidental means, which shall, independently of all other causes, immediately and wholly disable him from transacting any and every kind of business pertaining to his occupation above stated; or, if loss of one entire hand or foot shall result from such injuries alone within ninety days, will pay the insured one-third the principal sum herein named, in lieu of said weekly indemnity, and, upon such payment being made, this policy shall cease and be surrendered to said company; or in event of the loss of two entire hands or feet, or one entire hand and one entire foot, or the entire sight of both eyes, solely through the injuries aforesaid, within ninety days, will pay the insured the full principal sum aforesaid, provided he survives said ninety days; or, if death shall result from such injuries alone within ninety days, will pay ten thousand dollars to Fannie L. Henderson, if surviving; in event of her prior death, to the legal representatives or assigns of the insured. * * * Agreement and conditions under which this policy is issued and accepted: * * * (4) This insurance does not cover disappearances; nor suicide, sane or insane; nor injuries of which there is no visible mark upon the body; nor accident; nor death; nor loss of limb or of sight; nor disability resulting wholly or partly, directly or indirectly, from any of the following causes, or while so engaged or affected: Disease or bodily infirmity; * * * medical or surgical treatment (amputations necessitated solely by injuries made within ninety days of the occurrence of accident excepted); intoxication or narcotics; taking poison, contact with poisonous substances, or inhaling gas; sunstroke or freezing; dueling or fighting; war or riot; violating law or the rules of a corporation; intentional injuries inflicted by the insured or any other person. * * * '

The policy was delivered to George B. Henderson, the assured, on the day it was executed, to wit, January 7, 1889, and remained in force and in his possession for 21 months. At the expiration of the first year, the policy was renewed by the assured for another year by the payment of a premium of $50. During the second year while the policy was in force, to wit, on October 7, 1890, the assured was instantly killed by 'a gunshot wound intentionally inflicted by one John Tregoning.'

The bill of complaint averred as a ground for relief that a mistake was made in reducing the oral agreement between the assured and the insurer to writing, 'in this, to wit: That, by the agreement really made, it was agreed that in case the said George B. Henderson came to his death through intentional injuries inflicted upon him by some other person, without his consent, then, in such case, your orator should receive from said defendant the sum of ten thousand dollars'; whereas, by the terms of the policy as reduced to writing, it was provided that, 'in case of the said George B. Henderson came to his death through intentional injuries inflicted upon him by any other person, then, in such case, your orator should receive nothing.' The circuit court found that a mistake had been made, as alleged, in reducing the oral agreement to writing. It accordingly ordered that the policy be reformed by expunging the clause 'This insurance does not cover * * * intentional injuries inflicted by the insured or any other person,' and by inserting therein the following provision in lieu thereof: 'Or if death shall result from injuries intentionally inflicted on the insured by some other person, without the consent of the insured, within ninety days, will pay ten thousand dollars to Fannie L. Henderson, if surviving; in the event of her prior death, to the legal representatives of the insured.' 65 F. 438. To reverse such decree, the defendant company has prosecuted an appeal to this court.

The general question that arises on the appeal is whether the testimony shows that the parties to the contract of insurance acted under such a mutual mistake, either of law or fact, as a court of equity will undertake to rectify by altering the provisions of the contract. In the determination of this question, the testimony must be examined in the light of the well-established rule that a written agreement will not be altered or reformed on the ground of accident or mistake, unless the proof offered to establish the mistake is clear, satisfactory, and decisive.

Mr Justice Story once said:

'There cannot, at the present day, be any serious doubt that a court of equity has authority to reform a contract where there has been an omission of a material stipulation by mistake. * * * But a court of equity ought to be extremely cautious in the exercise of such an authority, seeing that it trenches upon one of the most salutary rules of evidence, that parol evidence ought not to be admitted to vary a written instrument. It ought therefore, in all cases, to withhold its aid where the mistake is not made out by the clearest evidence according to the understanding of both parties, and upon testimony entirely exact and satisfactory. There is less danger where the instrument is to be reformed by reference to a preliminary written contract which it was designed to execute. But even here there is abundant room for caution, since the parties may have varied their intentions, or the clause may not have been originally understood by either party to go to the extent now required. And these considerations acquire additional force where circumstances have occurred in the intermediate time which give an intense importance to the asserted mistake. ' Andrews v. Insurance Co., 3 Mason, 6, Fed.Cas.No. 374.

The same view was expressed by the supreme court in Snell v Insurance Co., 98 U.S. 85, 90, where it was said that parol proof to establish a mistake in a written contract 'is to be received with great caution, and, where the mistake is denied, should never be made the foundation of a decree variant from the written contract, except it be of the...