Travelers' Ins. Co. v. Pomerantz

• Decision Date: 20 July 1927
• Citation: 246 N.Y. 63,158 N.E. 21
• Parties: TRAVELERS' INS. CO. v. POMERANTZ et al.
• Court: New York Court of Appeals Court of Appeals

246 N.Y. 63

158 N.E. 21

TRAVELERS' INS. CO.

v.POMERANTZ et al.

Court of Appeals of New York.

July 20, 1927.

Action by the Travelers' Insurance Company against Morris Pomerantz and others, for the rescission of a policy of life and disability insurance for material misrepresentations. From a judgment of the Appellate Division, First Department (218 App. Div. 431, 218 N. Y. S. 490), affirming by a divided court a judgment of the Special Term (124 Misc. Rep. 250, 207 N. Y. S. 81), dismissing the complaint on the merits, plaintiff appeals.

Reversed, and new trial granted.

See, also, 218 App. Div. 702, 218 N. Y. S. 921.

Appeal from Supreme Court, Appellate Division, First department.

William J. Moran, of New York City, for appellant.

Louis Salant, Stanley B. Ecker, and Eugene J. Raphael, all of New York City, for respondents.

O'BRIEN, J.

Defendant, applying for a policy of life and disability insurance, signed this statement:

‘(12) I am not deformed; I have had no bodily or mental disease, nor have I received medical or surgical attention within the past five years except as herein stated.’

He made no exception and, accordingly, his statement is deemed to be wholly in the negative. He stated further in his application that ‘every declaration hereinabove contained is true.’ The consideration for the policy issued to him May 10, 1922, is based upon his signed application, made part of the policy, as well as payment of the premium. February 28, 1923, defendant made claim for permanent total disability benefits stating that, as a result of a motorcar collision in August, 1922, he became wholly disabled, that after this collision he began to feel pain in his heart and shortly thereafter had a severe heart attack and fainting spell and was advised by his physician not to attempt any form of occupation because his heart was in a weak condition. April 23, 1923, plaintiff informed the insured that it rescinded the policy, and gave him notice of its intention to contest it, and tendered to him the amount of the premium. On May 4 plaintiff delivered six copies of the summons in this action to the sheriff, who on June 19 certified to his failure to serve. They were, however, served by some one upon all these defendants, two on May 8 and all the others on May 23. The complaint was served June 7. The very day upon which the copies of the summons were delivered to the sheriff for service, the insured paid the second premium to plaintiff's general agents who were authorized to receive premiums. The agents tendered a return for this amount in June or at the beginning of July, 1923. All the elements included within the foregoing statements have been found as facts and are supported by the evidence.

[2] The first question to be determined is whether defendant made any misrepresentation in his application. The answer depends upon the meaning of statement 12 in the application form. The courts below have decided that the statement, by fair interpretation, must be held to mean that defendant was not deformed, that he had had no bodily or mental disease, and that he had received no medical or surgical attention within the past five years for a bodily or mental disease. If the statement were ambiguous, it would necessarily be resolved against plaintiff, for plaintiff drew it. To us it does not seem doubtful. We can find no other meaning in it than the enumeration of three distinct subjects: (1) Deformity; (2) previous bodily or mental disease; (3) medical or surgical attention within the past five years. If medical or surgical attention had been intended to refer only to bodily or mental disease, the statement ought to have been and presumptively would have been differently framed. Naturally, it would have read that the attention had been ‘for such bodily or mental disease,’ or ‘therefor,’ or ‘in connection therewith,’ or it would have included some other phrase expressing a relation between a disease and medical or surgical attention. The statement, as framed, affects the question whether an applicant, not deformed, and never afflicted with any bodily or mental disease, had received within five years medical or surgical attention for injuries or for illnesses other than diseases. An applicant might have fractured his bones on twenty occasions or suffered at frequent intervals from indispositions which indicate a weak constitution and reveal a tendency toward disease, but which had not yet developed into a definite disease. If any of the three parts of the statement was false, misrepresentation resulted. The applicant bound himself that ‘every declaration hereinabove contained is true;’ the policy provides that ‘all statements purporting to be made by the insured shall in the absence of fraud be deemed representations and not warranties.’ That the statement was false in at least one particular is certain. He made no exception to any part of statement 12 and so must be deemed to have made it without qualification. The proof is that within the past five years he had received medical attention no less than twelve times from five physicians. The trial court refused to make such a finding, but as the evidence is not contradicted the request to find should have been granted. Mawhinney v. Millbrook Woolen Mills, 231 N. Y. 290, 132 N. E. 93, 15 A. L. R. 1506.

[5] Misrepresentation therefore existed. Was it material? In ascertaining the true answer, a complete separation of thought must be observed between a disease and some medical or surgical attention either for a disease or for an ailment other than a disease. A disease is one thing, medical or surgical attention for an injury or a disease or for an ailment other than a disease is quite a different one, and we think that statement 12 clearly preserves the line of substantial distinction. Ailments, injuries, indispositions, sicknesses do not necessarily constitute diseases, although disease frequently develops from them. The words ‘deformity’ or ‘infirmity’ as used in connection with applications for insurance are, of course, construed to mean deformities or infirmities of such a substantial character as, if known, would have been liable to deter an insurer from issuing a policy. Eastern Dist. Piece Dye Works v. Travelers' Ins. Co., 234 N. Y. 441, 453, 454, 138 N. E. 401, 26 A. L. R. 1505. The same principle must be true respecting medical or surgical attention. The attention to which reference is made in statement 12 must be not for a trivial indisposition, but for some substantial illness, sickness, injury, or disease. The insurer has the right to an opportunity...