Yablon v. Metropolitan Life Ins. Co.

• Court: Georgia Supreme Court
• Citation: Yablon v. Metropolitan Life Ins. Co., 200 Ga. 693, 38 S.E.2d 534 (Ga. 1946)
• Decision Date: 10 May 1946
• Docket Number: 15440,15441.
• Parties: YABLON v. METROPOLITAN LIFE INS. CO. METROPOLITAN LIFE INS. CO. v. YABLON.

38 S.E.2d 534

200 Ga. 693

YABLON v. METROPOLITAN LIFE INS. CO.

METROPOLITAN LIFE INS. CO. v. YABLON.

Nos. 15440, 15441.

Supreme Court of Georgia

May 10, 1946

Syllabus by the Court.

1. Where the plaintiff and the defendant separately request a directed verdict, each in his favor, and the court directs a verdict for one of them, the other party, merely by his request for a directed verdict in his favor, does not consent to the direction of a verdict for one or the other.

(a) Under such circumstances, the party unsuccessful in his request for a directed verdict in his favor does not waive the right to have the issues submitted to the jury, or the right to except on the grounds that it was erroneous to direct a verdict for the other party, or that the verdict so directed was erroneous.

2. Where an insured, bringing suit against an insurer for total and permanent disability on an endowment life-insurance policy which contains a rider or supplemental agreement attached thereto providing for disability benefits approximately 19 years after its issue, is met by an answer denying liability because of an alleged mistake on the part of a typist for the insurer, who attached a supplemental agreement for total and permanent disability benefits instead of double indemnity for death by accidental means, for which the insurer seeks reformation of the insurance policy--the burden is upon such insurer to show by clear, unequivocal and decisive evidence that there had in fact been, in the preparation of the contract, such a mistake as is relievable in equity; that the insurer had not been negligent in the actual preparation of the contract or in discovering any mistake which may have appeared therein; that it had not been guilty of laches in making its defense for reformation; that the mistake was mutual or was a mistake on one side and fraud on the other; and that, in seeking reformation, it applies within a reasonable time.

3. In the absence of any showing that the insured had any knowledge of or connived with the insurer for the stated premium rate in the rider providing for total and permanent disability to be lower than to other persons, the insurer, approximately 19 years after the issuance and delivery of the policy and rider, and on its action to reform the contract for alleged mistake, could not lawfully contend that it was not liable because the rate of premium which it had inserted in the face of the rider was lower than its rate-book schedule for such protection, and such rate would be a discrimination. The insurer will not be allowed to benefit by its own wrong, in which the insured was not likewise a wrongdoer.

4. Testimony of a plaintiff as to transactions or communications with an agent of a corporation which is the opposite party where such agent was deceased at the time of the trial, is inadmissible.

Zavel Yablon brought a suit in Richmond superior court against Metropolitan Life Insurance Company. The original petition, filed on December 12, 1941, alleged facts substantially as follows: The plaintiff is insured by the defendant under an endowment life-insurance policy for $2500, issued on November 6, 1922, when the insured was 39 years of age, with premiums payable quarterly, and an additional quarterly premium of eighty-five cents; the policy providing for benefits of $25 per month and a waiver of premiums in case of total and permanent disability. On May 14, 1941, while said policy was in full force and effect, the plaintiff was stricken with coronary thrombosis and cerebral embolism. He is, and since he was stricken has been, totally and permanently disabled. On May 25, 1941, the defendant was notified of such disability, and refused to furnish forms for proof of the claim. Paragraph 3 of the policy was set out in the petition as follows: 'This policy (and the application therefor) constitutes the entire contract between the parties, and, except for non-payment of premiums, shall be incontestable after two years from the date of its issue.' Copies of the face of the policy and provisions for total and permanent disability and waiver of premiums were attached as exhibits and made a part of the petition. The plaintiff alleged payment to the defendant of $19.65 premium after six months' notification of disability and under protest, claimed $25 per month disability benefits, and alleged that future monthly sums of the same amount would accrue during disability. Besides process, he prayed for judgment in an accrued amount; and that he be allowed to amend the petition from time to time so as to include the accrued monthly sums becoming due.

The defendant in its answer admitted, in effect, that the plaintiff was in possession of an endowment insurance policy on his life, upon which the quarterly premium of $18.80 was paid; and admitted that the policy contained an endorsement or rider for total and permanent disability with a stated quarterly premium of 85 cents, which was paid; but denied that it was liable under the total and permanent disability provisions, because of a mistake alleged to have been made by an office clerk of the defendant in attaching to the said policy total and permanent disability-benefit provisions instead of double indemnity for accidental-death provisions. In said answer and by way of cross-action, the defendant, in substance, alleged: That 'endowment at age 85, with double indemnity' was applied for by the plaintiff in his application dated October 27, 1922. An office clerk of the defendant through mistake attached the total and permanent disability slip or supplemental agreement instead of the double indemnity for accidental death. That from November 22, until some time in 1941, when he notified the defendant of his claim for total and permanent disability, the plaintiff had the policy in his possession, and that the defendant did not discover the mistake until claim was made on the policy about June 16, 1941. The defendant, asserting that no such contract as claimed by the plaintiff could be upheld by the court, alleged that the quarterly premium of 85 cents, paid by the plaintiff for the supplemental agreement, was the proper amount to be charged for the double-indemnity insurance for death by accidental means, as requested by the plaintiff, but that the premium for total and permanent disability was $1.48 per quarter. To allow the plaintiff total and permanent disability insurance for the premium paid by him, would be a discrimination in favor of the plaintiff against other policy holders of the same class, in violation of the laws of Georgia, and would subject the defendant to danger of having its license revoked, and both the plaintiff and the defendant would be guilty of a misdemeanor. The defendant alleged further: That it was understood between the parties that the policy contained a provision for double indemnity in case of death by accidental means; and that this provision is in accordance with a double indemnity for accidental death form, representing the true agreement, a copy of which was made a part of the answer and attached as exhibit 'A.' The defendant alleged that the policy sued on should be reformed to express the true agreement between the parties, as shown by said application for insurance; and prayed that the total and permanent disability supplemental agreement, set forth in the petition as exhibit 'B,' be cancelled as having been issued through mistake, and that the policy provisions and agreements be reformed to express the true agreement between the parties as contained in the form for double indemnity in case of death by accidental means, attached as 'exhibit A' to the answer. The total and permanent disability of the plaintiff was neither denied nor admitted.

The plaintiff filed a first amendment to his original petition adding five paragraphs, to wit: 15. Alleging the accrual of four additional monthly benefits of $25 each, and an additional payment of a quarterly premium of $19.65. 16. Referring to and attaching a photostatic copy of the application for insurance, made by the plaintiff on October 27, 1922. 17. Alleging that at the time of the application for insurance, attached hereto, he had been in the United States only nine years, had not attended school, and was unable to read the English language, and that nothing had been said with reference to a double-indemnity feature in said policy, either by the plaintiff or the defendant's duly authorized agent, E. S. Harter, and if 'double indemnity' appeared anywhere in the original application for insurance signed by the plaintiff, the same was added without the plaintiff's knowledge or consent. 18. Alleging that the plaintiff had requested of the defendant's said agent, at the time of making said application, a policy that would give him and his family protection in case of his inability to work because of sickness or accident, and said agent said that his policy would include such a feature, and the plaintiff relied on said representation by the agent; that, when said policy arrived on or about November 8, 1922, said agent brought said policy to the plaintiff, and read him the provisions of said policy with reference to waiver of premiums and disability benefits, as set out in 'exhibit B' of the original petition, and assured the plaintiff that the policy contained the protection requested by the plaintiff at the time of the application for insurance. 19. Further showing by way of answer to the allegations set out in paragraph 15 of the answer, that the defendant is not entitled to an equitable reformation of said insurance policy for the following reasons--(a) because the mistake that is alleged to have occurred was brought about by the defendant's own negligence; (b) because the mistake that is alleged to...