Supreme Lodge of Modern American Fraternal Order v. Miller

Ibach, C. J. Appellee, beneficiary of her husband, John Miller, deceased sued appellant to recover the amount of a fraternal insurance policy issued by it on the life of her said husband. The answer of appellant is a breach of the warranties contained in the application upon which the beneficiary certificate was issued and which by the terms of such certificates becomes a part of it. The reply stated that statements made to the appellant’s medical examiner, by the decedent were true, but [271] that in certain respects the medical examiner had not truthfully recorded his answers in the application. A trial by jury resulted in a verdict for. appellee for the amount of the certificate, $1,000. The court overruled appellant’s motion for new trial and entered judgment on the verdict. The overruling of this motion is the only error assigned. 1. 2. John Miller, the insured, in his application for insurance warranted his answers to the several questions contained in the medical examination to be true and agreed that such answers should constitute a part of the contract between himself and appellant and that the same should be binding upon him and his beneficiary and further agreed that any false statement in such answers or any of them or in any part of any of them should render the contract null and void, and. forfeit the rights of himself or beneficiary to all benefits under the policy. All persons who are competent are at liberty to contract with each other as they may desire, and the courts will enforce such contracts if legal and not against public policy when called upon so to do. With respect to insurance contracts, the rule in this State seems to be that where it is expressly agreed that the application for life insurance shall be a part of the certificate or policy and the statements in such application are warranted to be true, such statements will be deemed material, and if proven to be false, there can be no recovery on the policy, whether they were made innocently or not. Catholic Order of Foresters v. Collins (1912), 51 Ind. App. 285, 99 N. E. 745. The applications and certificate involved in this case plainly show that the answers were intended by both parties to be treated as warranties, but if they were construed merely as representations, it would make no difference in our holding, for the answers [272] whieh were proved to be false were material to the risk. 3. In his application the insured, in substance, made the following statements: that he had never received sick benefits from any other, society; that he had never applied to any company for insurance without receiving a policy of the exact kind applied for; that there was nothing in his physical condition or personal history tending to impair or shorten his life; that he had never had any disease of the abdominal viscera or chronic ulcers; that he had had no illnesses not specifically inquired about; that he then had no physician; and that he had never consulted a physician. The uncontradicted evidence shows that the assured had upon three different occasions, been paid sick'benefits from the Eagles’ society for disabling sickness'covering a period of fourteen weeks; and that but a few. months before the date of the application he had applied for reinstatement in the Bankers Life Insurance Company of Iowa and had been refused; that he had consulted with and been treated by several physicians during the three years immediately preceding the time of application; that he had been treated for gastritis of the stomach, ulcers and syphilis, and at one. time a conference of physicians was held with, a view of performing a major operation to relieve him from his troubles. There was some evidence tending to show that the doctor who wrote the answers to the questions contained in the application relating to diseases and certified to making a medical examination, had not made a complete examination, and had ■falsified some of Miller’s answers and filled in other blanks without asking him the questions and that such physician knew that the appellant was complaining of stomach trouble when the application [273] was made. It is unnecessary for us to discuss the legal effect to be given the conduct of the physician as shown by some of the evidence relating to the foregoing. It is. sufficient to state that there is no evidence showing or tending to show that the statements made by the insured that he had not received sick benefits from, other societies and had never befen refused insurance on application, and that he had not consulted physicians theretofore, were not written exactly as Miller had stated them and. there is no contention but that they were written just as they were made. Indeed by appellee’s reply it was admitted that the answers relating to sick bene-, fits and otherinsuranee were written as made, and that such answers as made were in fact true. .Appellee’s contention is that there is no evidence, to show these particular- answers were untrue. With this contention we can not agree, for all the evidence in regard to sick benefits, and other insurance are entirely uncontroverted by appellee’s evidence, and whether they be construed as representations or warranties, they were made with reference, to facts material to the risk, and afforded ground for the prompt rescission of the contract, unless there has been a waiver of such false statements, which is not the ease here. Union Cent. Life Ins. Co. v. Hollowell (1897), 20 Ind. App. 150, 153, 50 N. E. 399; Iowa Life Ins. Co., v. Haughton (1910), 46 Ind. App. 467, 472, 87 N. E. 702; Security, etc., Ins. Co. v. Webb (1901), 106 Fed. 808, 45 C. C. A. 648, 55 L. R. A. 122; Eddington v. Aetna Life Ins. Co. (1879), 77 N. Y. 564, 568. 4 Elliott, Contracts §§4118, 4380, 4381. [274] 4. [273] Upon the question of rescission there is no dispute in the evidence, for it appears therefrom, that immediately upon learning that Miller had received [274] . sick benefits from other societies and had made application for other insurance which had- been refused, appellant immediately rescinded the contract of insurance and tendered ■back the amount of premiums received by it. We fail to see what good purpose can be accomplished by discussing the evidence received on these propositions, for after all it is apparent that the uncontradicted evidence establishes a state of facts in direct and irreconcilable conflict with the verdict, and the judgment rendered on the verdict is not in accord with the principles of law controlling such cases. 5. Certain instructions are also questioned by appellant, and we need not consider them separately, it is sufficient to say that the construction of this. particular contract was exclusively for the court. It is in writing, plain and unambiguous, and the jury under all the circumstances of the case had nothing to do with its construction. Union Life Ins. Co. v. Jameson (1903), 31 Ind. App. 28, 31, 67 N. E. 199. Neither was there any dispute with reference to the evidence relating to the knowledge which appellant had, acquired of the breach of the warranties enumerated and the facts connected with the rescission of the contract, so that the question as to whether there was a timely rescission of the contract of insurance, under the facts of this case, was also one exclusively for the court and not for the jury. Metropolitan Life Ins. Co. v. Frankel (1915), 58 Ind. App. 115, 103 N. E. 502; Insurance Co. of North America v. Brim (1887), 111 Ind. 281, 12 N. E. 315; Baker v. German Fire Ins. Co. (1890), 124 Ind. 490, 24 NT. E. 1041; Morgan v. McKee (1874), 77 Pa. St. 228; Nickey v. Zonker (1903), 31 Ind. App. 88, 67 N. E. 277. Consequently there was error in giving the instruc [275] tion complained of. which informed the jury that it was for it to determine the facts, although undisputed, and was for it to say as a .matter of law whether the facts showed a disaffirmance within a reasonable time. Other instructions given were outside the issues and the effect which would necessarily follow therefrom would be to confuse and mislead the jury. Error in giving such instructions can not be regarded as harmless. Summerlot v. Hamilton (1889), 121 Ind. 87, 91, 22 N. E. 973. The commission of the indicated errors requires the reversal of the judgment. Judgment reversed. Note. — Reported in 110 N. E. 556. As to misrepresentations by assured as' to health, see 3 Am. St. 634.. As to forfeiture of life in-' suranee by false representations with respect to previous applications for insurance, see 55 L. R. A. 122. See, also, under (1) 9 Cyb 587; (2) 25 Cye 805, 806; (3) 29 Cyc 89; (5) 38 Cye 1511, 1602, 1612.