Benseman v. Prudential Insurance Co. of America

Opinion by Rice, P. J., This was an action of assumpsit upon two policies of insurance issued upon the life of Mary Smith who died on September 19, 1895. In the first policy, dated November 4, 1889, her age was stated as being forty-five years; in the second, dated June 16, 1890, it was stated as being forty-six years. One of the agreements indorsed on the policies and made part of the same reads: “ In case the age of the insured shall have been understated by mistake, the sum insured will be reduced to the amount the premium would pay for at the true age.” It was stated in one of the certificates of identity that “she appeared to. be fifty-three years of age,” in another fifty-five years, in the undertaker’s certificate that her “ apparent age ” was sixty years, and in the attending physician’s certificate it was stated that her “correct age at death” was fifty-six years. This last certificate was witnessed by a son of the deceased, and had this instruction plainly printed on it: “ Be careful to give correct age at death.” All these certificates were submitted to the company by the administrator as parts of the proofs of death. On October 15, 1895, the superintendent of the company wrote to the administrator as follows: “ I beg to inform you that check drawn to your order 'in settlement of the claim under policies No. 3,136,167, etc., on the life of Mary Smith, deceased, is at this office awaiting your calling for the same, and I will thank you to arrange and call for the same. The company has adjusted the claim at ages forty-nine and fifty, but will be willing to reopen the case at any time upon receipt of the family record or other satisfactory proof that their adjustment is incorrect. Awai ting your calling, ” etc. On November 2 the attorney of the administrator wrote to the superintendent, and after referring to the above letter said: “ Under this adjustment I understand $856.63 will be paid. I have concluded to advise my client to accept this offer, and will settle the claim for the present on that basis, if your company is still willing to carry out their proposition. I would suggest, however, that [369] inasmuch as you requested us to surrender the original policies or certificates, that you furnish us with copies thereof for any future use for which they may be required.” On November 8 the superintendent wrote in reply to this letter as follows: “ Replying to your favor of the 2d inst. T would inform you that check in the amount of $856.63, drawn in favor of the administrator of the Mary Smith estate, C. Benseman, administrator, is at this office awaiting his demand for the same upon giving the usual receipt therefor and surrendering of the policies and premium receipt books. As to furnishing of copies of the policies, would say that we deem the length of time in which these policies have been in your hands to be sufficient to fully acquaint yourself with the contents thereof, and do not consider copies necessary. Furthermore, the administrator holds our letter in which we ‘ will be willing to reopen the case at any time upon receipt of family records or other satisfactory records that the adjustment is incorrect.’ ” On the same day the parties met, and after some parleying the company’s check for $856.63, “in full for all claims under ” the policies was given the administrator, and he gave the following receipt: “ Received of the Prudential Insurance Company of America eight hundred fifty-six and sixty-three one hundredth dollars, which payment is in full for all claims against said company, under policyNo. 3,136,167 — 3,688,427, issued upon the life of Mary Smith, adjusted at ages forty-nine and fifty years respectively.” The check was duly paid, and was for the amount of insurance the premiums would pay for if the correct age of the insured was as stated in the proofs of death. This action was brought to recover the difference between that amount and the amount expressed on the face of the policies. There was an unfortunate conflict of testimony as to what was said when this check and receipt were exchanged. The plaintiff’s attorney testified: “I said to Mr. Roth that Mr. Benseman would only accept a partial payment because of the pressing claims against the estate; Mr. Roth replied to that, ‘ You can’t have this money unless I get a receipt,’ and I, about as short and snappy as him, said that ‘ whenever you produce your receipt I will determine whether Mr. Benseman will sign it or not; ’ Mr. Roth went into an adjoining room and in a few minutes came back with the receipt which appears here and now [370] bears the signature of Benseman, excepting that the receipt ended at the word Mary Smith; he handed the receipt to Benseman and Benseman turned it over to me, and I said, ‘ Mr. Benseman, I instruct you not to execute that receipt,’ and Mr. Both said, ‘Well, then you can’t have this check.’ We had some further parley about the matter and I said, ‘ There is only one way this can be settled, Mr. Both, and that is to accept this money as a partial payment and leave the balance of tins claim open for future adjustment, but in my opinion the only way it can ever be adjusted is by a law suit; ’ I said, ‘ If you will put after the name Mary Smith something to show that this has been adjusted at your claim at the ages of forty-nine and fifty, we will take this partial payment; ’ Mr. Roth went in the other room and came back with the receipt containing these words, meaning the words,' ‘ adjusted at ages forty-nine and fifty years respectively.’ ” On the other hand, the defendant’s representative, whilst admitting that these words were added at the plaintiff’s request, denied that anything was said about bringing suit for the balance, and asserted, that, when the plaintiff’s attorney spoke about settling the matter on account, “ I told him emphatically that it would not be settled in any other way excepting in accordance with my letter.” A receipt in full is not conclusive, but is open to explanation (Sargeant v. Ins. Co., 189 Pa. 341, and cases cited); yet if there be no explanatory evidence it has a defined legal meaning. “ While a receipt of this kind is not conclusive, yet it is always prima facie evidence of a settlement, and should only be set aside for weighty reasons, especially after a lapse of years, and the reasons should be fully and clearly stated. Fraud, accident or mistake would be sufficient to avoid such an instrument, but in such case the cause of avoidance should clearly appear:” Harris v. Hays, 111 Pa. 562; Hamsher v. Kline, 57 Pa. 397. Speaking of the case of Harris v. Hays, Mr. Justice Green said: “We thus have a clear and well defined expression as to the legal effect of such an instrument, and it is authoritatively ruled that it cannot be set aside except for weighty reasons, such as fraud, accident or mistake, and such causes for disregarding them must be made to appear distinctly. Such receipts then are placed in the same category as other written instruments which are made the. depositories of the solemn [371] agreements of contracting parties. The rules as to setting aside or disregarding such contracts are too familiar to need recital here: ” Rhoads’s Estate, 189 Pa. 460. Where a receipt in full was set up as a defense in an action for professional services, and the plaintiff’s testimony that when the receipt was given it was agreed that it should not have the effect of a receipt in full, but that he should receive additional compensation, was directly contradicted by the defendant’s agent, it was held, that, as the evidence was evenly balanced, the receipt was conclusive against the plaintiff’s right to recover: Crawford v. Forest Oil Co., 189 Pa. 415. In the recent case of MacDonald v. Piper, 193 Pa. 312, the trial judge instructed the jury to the same effect, and this was held not to be error. We are of opinion that these principles of the law of evidence are applicable in the present. case. There was no relation of trust or confidence between the parties. There was a controversy between them. They were dealing at arm’s length. There was no concealment of facts, no fraud and no mistake either of fact or of law. At least, none was proved. On the contrary, the claim was adjusted on as favorable a basis as the plaintiff had a right to insist on if, as stated in the sworn certificate of the attending physician, the “ correct age at death ” of the insured was fifty-six years. Was there not a prima facie presumption that the adjustment was correct? It is urged that in an action on a life insurance policy the plaintiff is not bound by admissions contained in the proofs of death, and may offer evidence to contradict or vary them: Fisher v. Life Association, 188 Pa. 1. Let this be granted, yet this positive affidavit having been furnished by the plaintiff to the defendant as part of the death proofs it was, to say the least of it, some evidence of the age of the insured: Conn. Mut. Life Ins. Co. v. Schwenk, 94 U. S. 593; 24 L. ed. 294. In the absence of any evidence whatsoever to explain it or to show that it was not strictly true, it may well be questioned whether a jury ought to have been permitted to guess that it was not true, even if there had been no settlement. In other words, was not the burden of proof shifted ? We think it was. At all events it is clear that there was not sufficient evidence to warrant them in finding, not only that it was not true, but also that the receipt was not what it purported to be, a settlement in full of all claims under these policies. It fol [372] lows that the defendant’s eighteenth point, (eighth assignment) should have been affirmed. The eighth assignment of error is sustained, the judgment is reversed, and judgment is now entered for the defendant.