Wright v. The Equitable Life Assurance Society

Speer, J. — The main question to be considered is whether the statements contained in the application on which the policy was issued were absolute warranties or mere representations. I think it is clear that both parties intended that the policy and the application as proposed should constitute tlie contract between them. The language in the conditions of the policy expressly states that the policy is issued upon the faith of the declaration and statements of the assured, and if found in any respects untrue, the policy shall be null and void. In the application it is also expressly declared, at the foot of the answers and questions signed by the applicant, acknowledged and agreed to by him, that the above statements shall form the basis of the contract of assurance; and that any untrue or fraudulent answers, any suppression of facts, &c., will render the policy null and void, and forfeit all payments made thereon. According to well established, rules, the policy and the application must be construed as embracing a single instrument or contract. The statements by the assured, contained in the policy, by being written thereon in reply to the interrogatories, by reference to the proposal, become warranties, and must be substantially true, or the policy will be void (1 Phillips on Ins., sec. 892 ; Angel on Ins., sec. 141; Anderson agt. Fitzgerald, 4 House of Lords Cases, 484; Foot agt. Ætna Life Ins. Co., reported in vol. 4 No. 4, Insurance Law Journal, p. 260, April, 1875, Earl, commissioner). The parties to insurance contracts have the right to make their own bargains, and if they make the representations and statements material by inserting them, they alone are the j udges of their materiality; nor does it matter whether the party made the untrue statements innocently, [370] believing them to be true ( Vose agt. Eagle Life and Health Ins. Co., 6 Cush., 42). Among the conditions on which the policy is issued was, that if the declarations made in the application, or any statements on which it was issued, should be found in any respect untrue, then the policy should be null and void. If, therefore, we should consider that Dr. Pape, or Dr. Macfarlan, under whose advice as medical examiners or as family physicians, the policy was issued, as acting for the company, the fact that they or either of them, had at the time knowledge of Schott’s prior condition, obtained before, when not acting for the company, it is of no importance as affecting the company’s liability. The parties must stand by the answers contained in the contract. It is enough that the representations are warranties, and untrue in fact, to vitiate the policy (See Baker agt. Home Life Ins. Co., in Insurance Law Journal, supra, p. 315). The case of Jeffries, admr., agt. Life Insurance Company, supreme court of the United States, October term, 1874, contains clauses in the policy and application almost identical with the case before me. Mr. justice Hunt in that case says: ■“ The proposition at the foundation of this point is this : that statements and declarations made in the policy shall be true. This stipulation is not expressed to be made as to important or material statements only, or to those supposed to be material, but as to all statements. The statements need not come up to the degree of warranties. * * * A faithful performance of the agreement is made an express condition to .the existence of a liability on the part of the company.” Where false answers are made to inquiries which do not relate to the risk, the policy is not necessarily avoided, unless the mind of the company is influenced by them. But that is' not the case where it is expressly covenanted, as a condition of liability, that the statements and declarations made in the application are true, and where the truth of such statements forms the basis of the contract. Under this view of the contract it will only be necessary to [371] show that some of the statements were untrue, in fact, in order to sustain the defense. Among the questions and answers in writing, which constituted a part of the application, were the following questions, numbered as follows: Ho. 8. Is the person’s life now insured and if so for how much ? Answer. Yes; in the Guardian for $10,000. This was untrue. It was uncontradicted that his life was then insured by other policies than that of the Guardian Insurance Company for $10,000, viz.: In the Knickerbocker Company for $15,000, and .in the .¿Etna for $10,000. It is claimed by the plaintiff’s counsel that he answered correctly. He says if the company desired any further information they should have asked him “ if he was insured in other companies.” The question called not only for an answer as to insurance generally, but the specific amount of insurance. In that respect it was clearly untrue. Ho. 17. Has the person had any serious illness, local disease or personal injury, and if so of what nature? Answer. Ho; except slight fracture of the leg, about twenty years ago. This the assured answered by a simple and unqualified negative excepting the personal injury of a fractured leg twenty years prior to the time of his answer. The evidence seems to me to be conclusively established that the applicant had been suffering for along time prior to the time of his application with a serious illness, and that the disease was local. The defendant, Mrs. Schott, and wife of the applicant, states “ he had been ailing for fifteen years. The whole trouble seemed to be in his bowels, for which complaint he had consulted several physicians, and though attending to business hardly able to.” If any thing can be proved as a matter of medical science I think it is established that he had some chronic disease of the bowels, which manifested itself by alternate attacks of diarrhoea and constipation. The evidence is pretty clear to show that Schott had also had severe illness known as stricture of the rectum, chronic irritability of the mucous lining of the large intestines, especially of the rectum. As to some of these diseases, however, there may be [372] some question of fact as to their specific character and technical definition, but there seems to be no room for doubt that » he had been afflicted for many years with disease of the bowels, and that his constitution had been seriously impaired by such disease. It is very difficult to believe, from all the evidence in the case, that Schott “ was in all respects a first-class healthy risk,” on which the issue of a policy was recommended. This being so, and the answer to the above questions being shown to be untrue by the express terms of the agreement in the application and of the policy itself, the company is not liable for the amount insured, or any part thereof. There must be judgment for the defendant, The Equitable Life Insurance Society of the United States.