Fletcher v. New York Life Ins.

(orally.) The principal facts in this case are not disputed. The matters for your consideration will fall within a very narrow compass. It is therefore not necessary that the court should charge you at any great length.

It is admitted that this policy of insurance was executed by the defendant company; that it was a policy upon the life of Chinonda S. Alford; that Mr. Alford died, having paid his premiums up to the time of his death; that the plaintiff here is his executor, and is entitled to recover, if a case has been made out upon the contract. The defense is that the applicant for insurance, Mr. Alford, at the time of making his application, made certain statements in writing, in the application, which were untrue and which were material.

It is said that he represented to the agent of the company that he never had any disease of the kidneys; that he represented that he never had an.attending physician; that in all respects his application was untrue; and, these being material matters, it is claimed that the contract based upon them is void. In answer to this, it is said that, although there is a writing containing these representations, and although it is signed by the assured, Mr. Alford, yet that writing was obtained from him by fraud on the part of the agent of the insurance company. The law is that an insurance company, like any other person, natural or artificial, may appoint an agent, and may put limitations upon the powers of the agent, provided knowledge or notice of these limitations be brought home to the party with whom the agent contracts; otherwise the principal — in this case-the insurance *848eotapanY — iá'h§’l& to whatever is the apparent se'ope of the agent’s au- , thority. This doctrine is invoked here, and is applicable to, a certain extent; and only to a certain extent; There is a limitation in this contract "upondhe power of the insurance agent. The company is not to be, b.ound by .any representations made to or by the agent, unless these, representations are put in writing and submitted to the company. Therefore-, what is contained in this application, although the answers were hot truly recorded, would be regarded as eonstitut-ihgi'.iite'h^sis of/ this contract, unless it can be avoided for fraud. Consequently the question for you to determine is whether there was a fraud' in the procuring of this policy of insura,nee by the agent of the insurance company; and upon that subject I will state, what I understand to be, the correct rule. If the jury find from the evidence that at the time of making the application Mr. Alford told the agent of the defendant that he, Alford, had had diabetes, and referred him to his physician concerning it, and that such agent committed a fraud upon Mr. Alford by inserting false answers in the application and suppressing the answers actually given, and by concealing from, him what he, the agent, had written in the application, thereby inducing him to sign said application without knowing what it 'contained, then the plaintiff is not estopped to recover.

Ygu'will'see, gentlemen, that there are two things to be shown: First,■: that- the assured, Mr/Alford, made true representations with regard to this matter of his having had a disease, and his having had ah-attending physician; secondly, it must appear that the agent of the’ company, 'for the purpose of inducing him to insure, for the purpose of. obtaining from him the premium which he was to pay, falsely inserted, in the application answers which he did not give; and then it must also be shown that Mr. Alford signed the application. in ignorance of the fact that his answers had not been truly recorded in it.

, If all these appear, then there is a case of fraud established. The burden of proving fraud is upon the plaintiff. The presumption is that the paper which was signed by Alford contained his true'answers, and that presumption must be overcome by proof offered here by the plaintiff. I, think that is really the only question that there is for your consideration — the question of fraud.

There.is another point made by counsel which deserves notice. If the plaintiff ascertained before the contract was consummated that ¡this fraud h'ad been 'practiced upon him by the agent, it was his duty then to. stop and to go no farther; that is, if at ;any time, before *849the policy was delivered to him, and the first premium was paid, be discovered that the agent had committed a fraud upon him and upon the company, because it was a fraud both upon the assured and the company, then it was his duty to stop, and to decline to go any further with the transaction. But I think if he did not discover before the policy was delivered and the first premium paid, that lie was not called upon after that to take any steps for the cancellation of the contract. The defendant has tendered here in open court the sum of $888.26. You will, in any event, return a verdict for that amount. The court will make such order with regard to costs as may be considered right, after you have returned your verdict, if you give no more than that.

The question for you to determine is whether the whole amount of this policy is due, or whether your verdict is to be only for the amount tendered, which is $888.26. If you find for the plaintiff in the whole amount, you will give him interest at the rate of 6 per cent, per an-num from 60 days after the date when the proof was filed, and that date is the fourteenth of December, 1880, so that interest would begin to run from the fourteenth of February, 1881. You will have to bear in mind these dates.

Your verdict, therefore, will either be for the sum of $888.26, or for the amount of the policy, with interest from February 14, 1881.

The jury rendered a verdict for plaintiff for the amount of the policy, with interest, and the defendant thereupon took an appeal to the supreme court.