Tarpey v. Security Trust Co.

Mr. Justice Sears delivered the opinion of the court. The only questions settled upon the former appeal in this cause were such as related to the sufficiency of the allegations of the bill of complaint and the jurisdiction of a court of equity in the case. Security Trust Co. v. Tarpey, 66 Ill. App. 589. The cause is now presented after a hearing upon bill and cross-bill and answers and replications thereto, and the question now involved is as to the sufficiency of the evidence to sustain the finding of the .trial court that the allegations of the original bill of complaint are true. The bill of complaint alleges that Cummings made application to defendant in error for the policies of insurance in question, and in so doing answered certain questions and warranted that his answers were true; that the statements thus warranted to be true were, in effect, that he had not made any application for life insurance which had been rejected, and that his health was good; that the statements were false and fraudulently made to deceive defendant in error; that by such false and fraudulent representations the policies were obtained, and that on November'3, 1895, during the lifetime of Cummings,- the defendant had tendered back premiums paid, and demanded a surrender of the policies; that in February, 1896, Cummings died;. that plaintiff in error is the beneficiary named in the policies, and prays for a decree canceling the policies. Among the other papers presented to Kellogg, the agent of defendant in error, in connection with the issuing of the policies, was what is termed “ Supplementary application, —statements made to the medical examiner as part of the application to the Trust Company.” In it is contained this clause: “ I declare that I am the person above described and understand the questions and answers in the above supplementary application and warrant said answers to be true. I agree that if, during my lifetime, any statements therein or in the original application are alleged to be untrue, and I fail when called upon to furnish to said company satisfactory evidence of their truth, the policy of insurance issued upon the faith of such statements and answers shall be ipso facto void, and I agree to surrender said policy upon tender or payment to me of the aggregate premiums paid. Dated this 6 day of Oct., 1895. Wm. C. CtTMNINGS, Person Examined.” This agreement constituting an express warranty by the insured of the truth of the statements referred to, it would seem clear that if the statements were false, and can be imputed to the insured as statements fraudulently made by him, as alleged in the bill of complaint, then the policies were subject to cancellation at the election of defendant in error. The statement that Cummings had not applied for other life insurance a,nd been rejected, was .false as related to the time of the application to defendant in error, but was true as related to the application to the Iowa company. When he applied to the Iowa company he had never been rejected. When he applied to the defendant in error, he had been rejected by the Iowa company, and defendant in error well knew this fact through its acknowledged general agent, Kellogg. The application to defendant in error, in which this statement occurs, now alleged to have been false, was merely a copy of .the application to the Iowa company; was made merely as a copy at suggestion of Kellogg, and was signed by Cummings as a copy only of that .which was true when made. Ko one was deceived by this statement. Kellogg knew of the application to the Iowa.company, and that the securing of the risk for defendant in .error depended upon the rejection by. the. former company. Kellogg testified: “ Bate and JSTeuer didn't tell me Cummings had been rejected at the time they brought the application in, but did afterward, before I had forwarded the policy, but after the application had been forwarded.” It is apparent from other evidence that it was only in the event that the Iowa company rejected, that deféndant in error was to attempt' to secure the risk. It would be contrary to conscience and common sense to treat this as a false statement made,to deceive this company. It is argued that in this class of cases the warranty of truth is held to be obligatory, whether the statement warranted be material dr not. But we hold that this copy signed by Cummings wa,s not in fact his statement of that which was false, but merely a copy of a statement •which is conceded to have been true when made and was accepted as s.uch copy by defendant in error. The remaining question is, was the statement as to good health a false statement, and is it to be imputed to Cummings as a statement by which he deceived the defendant in error. The statement in this behalf claimed to have been false, is differently framed in the application to the Iowa company, in the application to defendant in error, and in the supplementary application so-called. In the former, the applicant stated, “ Have not now nor have ever had disease of lungs; I have had pneumonia.” In the application to defendant he stated: “ I am now in good health of body and mind. I have never been afflicted, during the past ten years, with any sickness, disease, ailment, injury or complaint.” And in the supplementary application the following statements were contained: “ I have never had habitual cough, raising or coughing blood; difficult or short breathing, habitual expectoration, pain in chest, or pulmonary system. I have not now, nor have ever had disease of lungs, or la grippe. I have had pneumonia. I have had no ailment since childhood. The pneumonia above mentioned occurred when applicant was eight years old.” The evidence as to the truth or falsity of these statements at the time when they were made is briefly as follows: Two physicians testify, each a witness called by the defendant in error. Dr. Eidlon, who made the original examination for the Iowa company, .and who also made, after .the rejection by the Iowa company, the certificate of examination for the defendant in error, testified that there was “ a prolonged expiratory murmur at the top of the right lung ” at the time of his original examination of Cummings; that he so notified Cummings; that he said in substance to Cummings, that if it were tuberculosis he should go away to some different climate, and if it was not tuberculosis, it was a matter of no importance, and that he advised Cummings to consult a specialist. This physician further testified that there was but a small area of the lung affected, not enough to cause any inconvenience to the ■patient, and that Cummings might or might not know that he was sick.at all. Dr. Johnstone, the other physician who testified, stated that at his examination on October 81, 1895, after the issuing of the policies, he found Cummings suffering from what he, Cummings, claimed was a cold recently contracted, but that he was then, in fact, in the opinion of witness, afflicted with tubercular consumption. He also stated that he was unable to see how the disease could have then been in progress for less than three months. Keither physician made any examination of the sputum, and Dr. Eidlon testified that by no other means could it be accurately determined whether the patient was suffering from tuberculosis. Bate, one of the agents who transacted the business of the insurance in question, testified that at the time of the application Cummings “ appeared all right as to health.” Eight witnesses called by plaintiff in error, testified that at the time in question Cummings appeared perfectly healthy and well, excepting that one of these witnesses testified that Cummings had a slight cold. Another witness, Mrs. Kane, testified that she was present when Dr. Eidlón examined Cummings, and that she heard Cummings ask the doctor “ if he thought that there was anything the matter with his lungs,” and that the doctor, after examination, said that “ if there was anything the matter with his lungs, he could not detect it.” From a careful examination of all the evidence we think that the preponderance of it goes to establish that Cummings, except for information given him by the examining physician, supposed himself to be in a fair state of health, and that if there was then any tubercular condition of the lungs, it was latent and not known to Cummings himself. It is true, that his application to the Iowa company having been refused, he might therefrom have reasoned that there was something unfavorable in the physician's opinion of his history or his condition; but the evidence indicates that Dr. Ridlon, who was the physician upon whom, the defendant relied for advice, gave a report of his conclusions to Cummings which was likely to lull him into a feeling of security as to his health, and did not make known to him all of his unfavorable opinion which he reported to the defendant in error. That under the facts here, Dr. Ridlon was the agent of the defendant for the purposes of the examination of Cummings, we think is clearly established, and without any contradiction or conflict in the evidence. Royal Neighbors v. Bowman, 177 Ill. 27. He reported the condition of Cummings accurately to defendant, so far as he could discern it, and this included all that Cummings could, from the evidence, be said to have known of the matter, and more. Nothing which Cummings said in any of his statements could have misled defendant in error, for it was fully informed. Questions as to the agency of Dr. Ridlon, Bate and Neuer are not controlling, for the information as to the previous application and refusal and the information as to condition of health, all reached the appellee through Kellogg, as to whose agency no question is raised. We therefore hold that the finding that these statements as to previous application and as to health were falsely made by Cummings, as alleged, and for the purpose of deceiving defendant in error, and that defendant was thereby deceived, is against the clear preponderance of the evidence. The writer is of opinion that the decree should be reversed and the cause remanded for another trial; but in conformity with the views of a majority of the court, the decree is reversed and the cause is remanded, with directions to the Superior Court to dismiss the bill of complaint of defendant in error for want of equity, and to enter a decree in accordance with the prayer of the cross-bill of plaintiff in error. Reversed and remanded with directions.