Strickland v. Gulf Life Insurance Co. ( 1943 )

Where the uncontroverted facts showed that the insured was not in sound health at the time the policy was delivered, as required by the terms of the policy for it to become effective, for the reason that he had suffered a stroke of paralysis after the submission of the application for the policy and before the policy was delivered, and there being no evidence of any waiver of this provision of the policy by an officer of the company having the authority to make such waiver, the court did not err in directing the verdict for the defendant.

DECIDED DECEMBER 3, 1943. REHEARING DENIED DECEMBER 17, 1943. The plaintiff, as beneficiary, sued the defendant on a policy of life insurance on the life of her husband. The defendant pleaded in bar of any recovery, except the return of the premiums paid, that the insured was not in sound health at the time the application for the policy was made; that he was not in sound health at the time the policy was delivered; and that the policy was procured through fraud, in that the answers and declarations made by the insured in the application for the policy were untrue.

The policy contained the following pertinent provision: "Preliminary provision. This policy shall not take effect unless on the date and delivery hereof the insured is alive and in sound health. The company assumes no obligation prior to the date hereof. The application and this policy constitute the entire agreement by the company and the insured which terms cannot be changed or its conditions varied except by written agreement by the president or secretary of the company." The application for insurance contained the following pertinent provisions: "I do hereby agree for myself and for any person who may have or claim an interest in any policy which may be issued upon this application . . (2) that the insurance applied for shall not take effect unless and until the policy is delivered to and received by me while I am in good health and free from injury; (3) that no agent of the company or other person has any authority to waive or dispense with full, true and complete answers in writing hereon to any of the questions set forth." And it recited that the applicant had read the questions, that the answers were true, that he had never had syphilis, and was in good health and sound condition and did not have any disease or impairment.

It was stipulated and agreed by the plaintiff that the insured signed the application for the policy, and that "the insured, at the time of the application for the policy sued on, and at the time of the issuance and delivery of the policy sued on, was sick, not in sound health, and he was in bad health, and this fact was known to the insured at all times herein mentioned." It was further stipulated by counsel for the plaintiff that "the insured suffered a stroke of paralysis subsequent to the submission of the application and prior to the delivery of said policy, and that the insured had knowledge of this condition at the time the policy was delivered." It was further stipulated that the defendant had made a continuing tender of the amount of the premiums paid, and that the proper amount of the premiums had been paid into court.

The plaintiff testified, in substance, that on May 15, 1942, while her husband was at home sick, the superintendent and an agent of the defendant came to their home and attempted to induce her husband to apply for a policy of insurance; that he told them he was sick, and they asked if he had tuberculosis; that they asked him to sign an application for insurance, and the only question asked him was if he had tuberculosis; that none of the questions set out in the application were asked him or read to him; that her husband could read, but he was not in a humor to read at that time, and he did not read the application; that the agent of the defendant told her husband the questions were all routine questions, and that it was not necessary for him to ask them, for if all of them were asked, it would be impossible to get any policies issued; that her husband signed the application for insurance, and she paid them fifty-five cents as the first premium, and they left; that on May 22, 1942, her husband had a stroke of paralysis, and the following day she carried him to the Middle Georgia hospital, where he remained until they could get him admitted to the veterans hospital in Augusta, Georgia; that he was carried to the veterans hospital on June 7, 1942, and while he was in the hospital, the superintendent and the agent of the defendant came to deliver the policy, and told her she saw what she would have missed if her husband had not applied for the insurance when he did; that she told them he had suffered a stroke of paralysis and they said that made no difference, that if she would pay the premiums for five weeks in advance the policy would be binding, and she paid them through January, 1943, in advance, and they delivered the policy to her. Her husband remained in the hospital until his death on August 1, 1942.

A daughter of the plaintiff testified that she was present when the superintendent and the agent of the defendant came to her mother's to deliver the policy, and that her mother told them at that time that her father had suffered a stroke of paralysis and was sick.

The report of the veterans hospital with respect to the condition and treatment of the insured was placed in evidence, and it showed the insured had been afflicted with syphilis for several years, and that when admitted to the hospital on June 7, 1942, he was suffering from a mental disorder caused by syphilis, paralysis of half of his body, and arteriosclerosis; that he was in a poor condition when admitted and continued to grow weaker until he died on August 1, 1942.

The judge directed a verdict for the defendant, the plaintiff moved for a new trial, the motion was overruled, and the exception is to that judgment. The application for the policy, which was executed by the insured, provided "that the insurance applied for shall not take effect unless and until the policy is delivered to and received by me while I am in good health and free from injury," and the policy provided: "This policy shall not take effect unless on the date and delivery hereof, the insured is alive and in sound health." It was stipulated by the plaintiff that the insured was not in sound health at the time of the application for the policy sued on and at the time of the delivery thereof; but that he was sick and in bad health; that "the insured suffered a stroke of paralysis subsequent to the submission of said application and prior to the delivery of said policy, and that the insured had knowledge of this condition at the time the policy was delivered." The undisputed evidence showed that subsequently to the time the application for the insurance was executed by the insured and before the policy was delivered, the right side of his body became paralyzed, and that he had never been advised that he might have a stroke of paralysis. The plaintiff testified she did not think anyone could have known that the insured would have a stroke of paralysis. There was evidence to the effect that at the time the policy was delivered the superintendent and the agent of the company were told that the insured had suffered a stroke of paralysis, and that they told her this made no difference, and delivered the policy to her. The plaintiff contended that under the evidence a jury would have been authorized to find that the defendant had notice, through its agent and superintendent, sufficient to put it on inquiry as to the soundness of the insured's health at the time the policy was delivered, and that the defendant had waived, or was estopped from setting up that the insured was not in sound health at that time. Both the application and the policy provided that the insurance should not become effective until the policy was delivered to the insured while he was in sound health, and the policy limited the powers of the agents of the company to change or vary the provisions of the policy by providing that only the president and secretary of the company had the power to change or vary its terms. "An insurance company may limit the power of its agent, and when notice that the agent's power is limited is brought home to the insured in such manner as would put a prudent man on his guard, the insured relies at his peril on any act of the agent in excess of his power. The insured is bound by plain and unambiguous limitations upon the power of the agent contained in his policy." Reliance Life Insurance Co. v.Hightower, 148 Ga. 843 (98 S.E. 469). The policy in the present case provided: "The application and this policy constitute the entire agreement by the company and the insured which terms cannot be changed or varied except by written agreement by the president or secretary." While the agent and the superintendent had knowledge that the insured suffered a stroke of paralysis after the application for insurance was made and before the policy was delivered, and told the plaintiff that this made no difference, still under the terms of the policy itself, only the president or secretary of the company had the power to change or vary the terms of the policy. By the acceptance of the policy the insured assented to this stipulation, and therefore cannot rely upon any waiver of its terms thereafter made by an agent of the company, or upon any consent, assent, or agreement on the part of such agent (the waiver not being made in the exact manner required by this stipulation, or, in contemplation of the law, by an ``office of the company) to dispense with, waive, or relax any of the binding conditions or provisions recited in the policy itself, by compliance with which the liability on the policy alone could be established. Great Eastern Casualty Co. v. Reed, 17 Ga. App. 613 (87 S.E. 904). In this connection, see also the cases of National Life Accident Ins. Co. v.Weaver, 38 Ga. App. 590 (3) (144 S.E. 682); American National Ins. Co. v. Potts,35 Ga. App. 32 (132 S.E. 142); New York Life Ins. Co. v.Patten, 151 Ga. 185 (106 S.E. 183); Metropolitan Life Ins.Co. v. Alexander, 43 Ga. App. 385 (159 S.E. 124). "It may be unfortunate if the wife of the insured relied upon such statements of the agent; but if one takes a policy containing such limitations upon the authority of the company's agent, he has to abide by the agreement, unless it is waived by someone having greater authority than the agent." Rome IndustrialInsurance Co. v. Eidson, 138 Ga. 592, 594 (75 S.E. 657).

Under the facts of this case, the court did not err in directing the verdict for the defendant, upon the ground that the undisputed evidence showed that the insured was not in sound health at the time the policy was delivered, as required by the provisions of the policy. There was no evidence of any waiver of this provision of the policy by any agent or officer of the defendant having authority to make such waiver.

Judgment affirmed. Stephens, P. J., and Felton, J., concur.