Valesi v. Mutual Life Ins. Co. of New York

• Decision Date: 30 January 1922
• Docket Number: 24665
• Citation: 151 La. 405,91 So. 818
• Court: Louisiana Supreme Court
• Parties: VALESI v. MUTUAL LIFE INS. CO. OF NEW YORK

91 So. 818

151 La. 405

VALESI v. MUTUAL LIFE INS. CO. OF NEW YORK

No. 24665

Supreme Court of Louisiana

January 30, 1922

Rehearing Denied March 27, 1922

Appeal from Civil District Court, Parish of Orleans; Fred D. King Judge.

Action by Mrs. Laura N. Valesi against the Mutual Life Insurance Company of New York. Judgment for plaintiff, and defendant appeals.

Affirmed.

Denegre Leovy & Chaffe, of New Orleans, for appellant.

J. G. Holmes, of Yazoo City, Miss., and Charles Rosen, of New Orleans, for appellee.

DAWKINS, J. O'NIELL, J., concurs in the result. PROVOSTY, C. J., and BAKER, J., dissent.

OPINION

DAWKINS, J.

This is an action upon a policy of insurance covering the life of plaintiff's deceased husband.

The defense are twofold:

(1) Suicide within the period during which the policy was contestible; and,

(2) Fraudulent misrepresentation of the insured as to the use of intoxicants.

There was judgment for plaintiff, and defendant appeals.

Opinion.

Defendant issued a policy of insurance on the life of Dino L. Valesi February 1, 1918, and the insured died August 20th of the same year. The policy contained the usual stipulation that there should be no liability in the event of suicide within one year.

Deceased was a subject of the King of Italy, temporarily residing in this country as the representative of a cotton firm in Italy conducted by his father. He was 32 years old, and while subject to active service in the armies of Italy, which was then engaged in the World War, was here on furlough and likely to be called for service at any time.

We shall consider the two defenses in reverse order.

Misrepresentation as to the Use of Intoxicants.

Act No. 52 of 1906, as amended by Act No. 227 of 1916, provides that "all statements purporting to be made by the insured shall in the absence of fraud be deemed representations and not warranties," and, granting that deceased was in the habit of using intoxicants to a greater extent than he indicated when being questioned on the point, the same would have the effect of a warranty and vitiate the policy only if he concealed the true facts in such a manner as to amount to a fraud or in case the misrepresentation contributed directly to the death; otherwise, under the statute, his answers were mere representations. In fact, the express stipulation of the policy so provides. It reads:

"This policy and the application herefor, copy of which is indorsed hereon or attached hereto, constitute the entire contract between the parties hereto. All statements made by the insured shall, in the absence of fraud, be deemed representations and not warranties, and no such statement of the insured shall avoid or be used in defense to a claim under this policy unless contained in the written application hereof and a copy of the application is indorsed on or attached to this policy when issued."

Therefore, both under the statute and by the policy, the answers of the insured to the questions contained in the application were representations, and are to be given effect as such, unless designedly and fraudulently untrue, and intended to deceive the insurer upon a matter which, if it had known the true facts, it would not have issued the policy. See Bacon on Life and Accident Ins. (4th Ed.) vol. 1, § 255 et seq., and authorities cited in footnotes. Both the statute, in this case, and the policy differently from ordinary cases, require that the representation shall not only be false, but fraudulent as well. In the absence of such provisions, it would make no difference as to the effect whether the false representations were innocently or intentionally made. It would be sufficient to vitiate the policy if theymaterially affected the risk (Id. § 261), or, if known to the insurer, would have deterred it from issuing the policy.

In the application signed by the insured, attached and made part of the policy, certain questions, with respect to the use of intoxicants, were asked and answered, as follows:

"26. (A) Have you used wines, spirits or malt liquors during the past year?

"Ans. Yes.

"(B) If so, what has been your daily average in the past year?

"Ans. Not daily. Wine occasionally.

"(C) How much have you used in any one day at the most?

"Ans. One or two drinks.

"(D) Have you been intoxicated during the past five years?

"Ans. No.

"(C) Have you ever taken treatment for alcoholic or drug habits?

"Ans. No.

"(F) If a total abstainer, how long have you been so?

"Ans. ."

It is contended by defendant that these answers were fraudulently false, and the burden is upon it to establish such fact. Bacon on Life & Accident Ins. vol. 1, § 259. Fraud is not presumed, and he who alleges must prove it. R. C. C. 1848.

Defendant produced some five or six witnesses, consisting of a clerk, house detective, porter, and bell boy, at hotels where deceased stopped, and also a chauffeur and police officer, who swore that on several occasions they saw Valesi come into the hotel at different hours, from 12 to 5 or 6 o'clock a. m., under the influence of intoxicants, and some say as much as one to four times a week over a period of several weeks. Some of these say they saw him as many as three, four, or five times in a condition which they term "drunk." The most positive testimony on this score was given by those witnesses who were employed by the Grunewald Hotel, where he first stopped when coming to New Orleans, during the latter part of 1916 and early in 1917. However, since the application was made on February 1, 1918, this proof with regard to what took place prior to February 1, 1917, would only be pertinent to the question of whether or not deceased had been intoxicated within the preceding five years, for all other questions with regard to his use of intoxicants are, by the terms of the inquiry, confined to the year preceding the application.

As against the proof of defendant, plaintiff introduced as witnesses the business associates of Valesi, consisting of the president and other members of the New Orleans Cotton Exchange, the members of a reputable cotton firm, in whose office deceased had his desk, and worked during business hours of the day, and who testified that they had been intimately associated with Valesi constantly, both during the day and at night, and had never seen him under the influence of intoxicants; that some of them had had lunch with him almost every day, and that he occasionally took a bottle of beer or a glass of wine, with his meals; that he was always at his desk by 8:30 o'clock each morning, seemed happy and contented, and showed no signs of dissipation the preceding nights, which, in the nature of things, could hardly have been possible, if deceased had indulged in the manner which the testimony of some of the defendant's witnesses would indicate.

Deceased was an Italian, with the impetuous nature characteristic of that nationality, and no doubt gave the impression, to those unfamiliar with his disposition, that he was under the influence of liquor, when, in fact, he was not. Of all the witnesses who testified for defendant, only two said that they had ever seen him when he was unable to take care of himself, and those were the detective, who said he found Valesi on the samefloor (fifth) on which his room was located, unable to find it and showed him where it was; and the other, the porter, who said the deceased drove up to the hotel one morning between midnight and day, was unable to get out of the car, and the automobile drove away. The record shows that deceased was in good health, of robust constitution; in fact, athletic. It does not show that he drank daily contrary to his answer to the second question quoted above; that he did drink wine principally, and, while he might have taken more than one or tow drinks a day at times, the excess is not clearly established. If we are to believe defendant's witnesses, he did at times drink more than a literal interpretation of the words "one or two drinks" would indicate; while, on the other hand, if we believe those most intimately associated with deceased, his answers were substantially correct. Therefore the fraudulent purpose to deceive has not been established with that reasonable certainty necessary to vitiate the policy. The trial judge, who saw and heard the witnesses testify, so concluded, and we are unable to say he was wrong.

With regard to the statement by Valesi that he had not been intoxicated within the five years preceding the application for insurance, what we have said above is equally applicable. The term "intoxicated" has no well-settled meaning, though the dictionaries describe the condition as follows:

Black and Bouvier say "intoxicated" means "drunk," and define "drunkenness" as:

"The condition of a man whose mind is affected by the immediate use of intoxicating drinks."

The Standard Dictionary:

"Intoxicate -- Intoxicated; inebriated; drunk, and hence excited to frenzy."

Same authority:

"Drunk -- Under the influence of intoxicating liquors to such an extent as to have lost the normal control of one's bodily and mental faculties, and commonly to evince a disposition to violence, quarrelsomeness and bestiality; inebriated, intoxicated; figuratively saturated and stupefied."

We cannot say what degree the defendant intended by the use of the term "intoxicated"; and since the question of whether or not a man is intoxicated depends a great deal upon the opinion of the one who asserts it, or the conclusions dran from appearances, the insurer might have made the matter clearer by the use of the words bearing a more definite meaning. It is entirely possible that the deceased, as well as many other men of integrity and veracity, in good faith, might not have...