Powers v. North Eastern Mutual Life Ass'n

The opinion of the court was delivered by Powers, J. This was an action of debt, founded upon a policy of insurance upon the life of Daniel N. Powers, issued by the defendant, and made payable to the plaintiffs. The plaintiffs proved the execution of the policy, the death of the assured during its currency, and the giving of reasonable notice thereof to the defendant. [635] The application of the assured for the policy was put in evidence by the defendant, from which it appears that, among other things, the applicant was asked whether “ he now or has ever had * * * disease of the heart ; ” to which the applicant answered, “ No.” In the application, following this question and answer, and over the signature of the applicant, is the following stipulation : “ And it is expressly stipulated and agreed, that the above application and this declaration shall form the basis of the contract between the applicant and the North Eastern Mutual Life Association of Brattleboro, Vermont, and that if any misrepresentation, or fraudulent or untrue answers, have been made, * * * * that then, in either event, this contract shall become null and void.” The policy contains the following provision : “ In consideration of the representations and agreements made in the application therefor, and the payment, etc., * * * the said Association docs hereby issue this policy to Daniel N. Powers, upon the following agreements ; upon the death of the said Daniel N. Powers, he having conformed to all the conditions thereof,” etc., payment will be made to the plaintiffs. The policy further provides: “ This policy is issued by the association and accepted by the assured, upon the following conditions and agreements: “ V. * * * or in case the answers or declarations made in the application for this certificate shall be found in any respect untrue, then this membership shall cease, and this policy, with all its agreements and guaranties, shall be null and void, and in every such case this association shall not be liable.” At the trial the jury found specially that the applicant, at the time of his application aforesaid, had the heart disease, and also that he did not, and would not reasonably have been expected to, know that he had this disease ; and upon this verdict the defendant contends that the policy is avoided. A policy of insurance is to be construed like other contracts inter partes ; if the language is ambiguous, it is to be construed strongest against the party using it; if plain and unequivocal, it is to have its ordinary signification. In this case the parties have [636] mutually agreed upon the terms of their contract; the language embodying it is plain; and its scope and effect are neither difficult nor uncertain. By the terms of the policy and application above set forth, the parties agreed that the truthfulness of the applicant’s answers to the questions propounded should be the basis upon which the validity of the policy should stand — if true, the policy should bo a valid contract; if untrue, the policy should have no force as a contract. The applicant assumed the whole .risk of the consequences, if his answers turned out untrue. ■ The existence of disease in an applicant for life insurance, is the presence of the very peril the company insures against. It is like insuring a building already on fire. The question as to the health of the applicant is a preliminary one, to ascertain if he is an insurable subject. The force of the stipulations and conditions above recited is, to create a contract obligation on the part of the applicant that he was free from the heart disease. He agreed that such peril and risk would not be encountered by issuing the policy, and if such peril did exist, the contract should not be operative. Proof of the existence of the heart disease established a breach of the underlying contract upon which the policy rested. It is wholly immaterial whether the applicant knew of the existence of the disease, because he agreed absolutely that it did not exist. Nor is it any answer to say that the question is a scientific one, and a layman might easily be deceived into a false answer. Scientific or simple, the applicant took the risk of the answer. If he had answered that he had no knowledge that the disease existed, the finding of the jury might affect the result. The view we have taken is abundantly supported by authority. Anderson v. Fitzgerald, 4 H. L. Cases, 484; Day v. Mut. Benefit Life Ins. Co. 4 Big. 15; Miles v. Conn. Mut. Life, 3 Gray, 580; Wilbur v. Ins. Co. 10 Cush. 449; Ætna Life v. France, 1 Otto, 510. The judgment of the County Court is reversed; and as the judgment was entered upon special findings and our judgment bars a recovery, judgment is to be entered for the defendant.