United States v. Cushman

• Decision Date: 29 June 1943
• Docket Number: No. 10262.,10262.
• Citation: United States v. Cushman, 136 F.2d 815 (9th Cir. 1943)
• Parties: UNITED STATES v. CUSHMAN.
• Court: U.S. Court of Appeals — Ninth Circuit

136 F.2d 815 (1943)

UNITED STATES v.CUSHMAN.

No. 10262.

Circuit Court of Appeals, Ninth Circuit.

June 29, 1943.

Francis M. Shea, Asst. Atty. Gen., Lester P. Schoene, Director, Bureau of War Risk

Litigation, of Washington, D. C., Wilbur C. Pickett, Sp. Asst. to the Atty. Gen., Fendall Marbury and Keith L. Seegmiller, Attys.Department of Justice, both of Washington, D. C., and Leo V. Silverstein, U. S. Atty., and Daniel Dillon, Atty., Department of Justice, both of Los Angeles, Cal., for appellant.

Sloane & Steiner, of San Diego, Cal., for appellee.

Before DENMAN, MATHEWS, and STEPHENS, Circuit Judges.

MATHEWS, Circuit Judge.

Upon his application dated February 3, 1932, Government life insurance of $10,000 (policy No. K-916122) was granted to William Reynolds Cushman under § 310 of the World War Veterans' Act, 1924, as amended, 38 U.S.C.A. § 512a.The policy was issued on the five-year convertible term plan.It was converted into a twenty-payment life policy on January 1, 1937.The insurance was payable in monthly installments of $57.50 in the event of Cushman's death or total permanent disability.Asserting that he had become totally and permanently disabled, Cushman claimed the insurance on February 11, 1939.The Administrator of Veterans' Affairs denied the claim.Cushman brought an action on the claim against appellant, the United States, under § 19 of the Act, as amended, 38 U.S. C.A. § 445.Appellant answered, jury trial was waived and the case was tried by the court without a jury.Findings of fact and conclusions of law were stated, and judgment was entered in Cushman's favor.From that judgment this appeal is prosecuted.¹

There are two specifications of error.²The first is that "the trial court erred in denying defendant's appellant's motion for judgment for the reason that defendant by affirmative, substantial evidence, established as a matter of law that the insurance policy sued upon had been obtained by fraudulent misrepresentations made by the insured Cushman in his application to the defendant for said insurance."No issue of fraud was raised by the pleadings, but, on the day before the trial was commenced, appellant requested leave to file an amended answer alleging:

"That the insured herein, William R. Cushman, on to-wit, February 3, 1932, made an application for Government life insurance herein sued upon in the amount of $10,000.00; that in said application the insured denied that he had ever been treated for any diseases of brain or nerves, throat or lungs, heart or blood vessels, stomach, liver, intestines, kidney or bladder, genito-urinary organs, skin, glands, ear or eye, or bones; he denied in said application that he had ever been ill, or contracted any disease, or suffered any injury, or been prevented by reason of ill health from attending his usual occupation, or consulted a physician in regard to his health since the date of his discharge; that said denials and other representations made in said application dated February 3, 1932, which application is made a part hereof, are false and were made by the insured fraudulently for the purpose of inducing defendant to enter into the contract of insurance sued upon herein; that the said fraudulent representations are representations of material facts upon which the defendant relied in entering into the contract of insurance with the insured herein; that had this defendant known at the time of entering into said contract of insurance the true facts with respect to veteran's physical condition, the defendant would not have granted to the insured the said contract of insurance in the amount of $10,000.00, or any other amount; that by reasons of said fraudulent representations the contract of insurance in the sum of $10,000.00, herein sued upon, is null and void and of no effect whatever."

The application mentioned in the proposed amended answer was on a printed form.It consisted, in part, of questions and answers.The questions were printed, being part of the form.The answers were written or typed in spaces left for that purpose.The pertinent questions and answers were as follows:

"26.Have you ever been treated for any disease of brain or nerves No, throat or lungs No, heart or blood vessels No, stomach, liver, intestines No, kidney or bladder No, genito-urinary organs No, skin No, glands No, ear or eye No, bones No. (Answer each `Yes' or `No.'If `Yes,' describe fully and give dates).

"27.Have you been ill, contracted any disease, or suffered any injury, or been prevented by reason of ill health from attending your usual occupation, or consulted a physician in regard to your health, since date of discharge?³(Answer `Yes' or `No').No.If so, give dates and full particulars, including the name and address of physician."

Leave to file the proposed amended answer was denied.At the trial, however, the application mentioned in the proposed amended answer was admitted in evidence without objection.There was also admitted without objection evidence that some of the foregoing answers were false.Thus the issue of fraud, though not raised by the pleadings, was tried by implied consent of the parties.Accordingly, and properly, the court treated that issue as if it had been raised by the pleadings.⁴

At the close of all the evidence appella...