Bankers Health & Life Insurance v. North , 68 Ga. App. 677 ( 1942 )

1. The limitation-of-liability clause contained in this policy was the proper subject of contract between the insurer and insured, and, in the absence of fraud or misrepresentation on the part of the insurer or its authorized agents, was binding on the insured.

2. It appeared from the undisputed evidence that the insured was treated for a renal disease, such as was prohibited under this clause of the policy, and his beneficiary was not authorized to recover the face amount of the policy.

DECIDED DECEMBER 4, 1942. REHEARING DENIED DECEMBER 18, 1942. On December 2, 1941, Bessie North brought suit against Bankers Health Life Insurance Company to recover on a life-insurance policy in which the plaintiff was the beneficiary and in which the defendant insured the life of Clyde Carmichael. The policy was issued on January 22, 1940. The insured died on August 13, 1941. The plaintiff complied with all the requirements of the policy relative to furnishing proof of death, all premiums due under the policy had been paid at the time of the insured's death, and the policy was in full force and effect. On the refusal of the defendant to pay the death benefit of $260 provided in the policy to the plaintiff, she instituted the present suit from which the foregoing facts appear.

The defendant admitted the allegations of the petition with the exception that it denied liability on the policy. For further answer the defendant alleged that under section (d) of the clause in the policy sued on marked "Limitations of insurance" the defendant's liability was limited to the sum of the premiums collected on the policy, which amount ($20) the defendant tendered to the plaintiff and paid into court on the filing of the answer. The defendant further alleged that the reason its liability was limited to the return of the premiums collected was that, beginning in 1938, the insured began to have kidney colic attacks, and it was found during 1938 that he had kidney stones, and that he was in such a physical condition that it was not safe to perform an operation on him, and that the insured constantly and frequently had attacks of kidney colic from the year 1938 to the time of his death.

On the trial the plaintiff introduced evidence which supported the allegations of her petition. The defendant introduced the testimony of a physician in support of the allegations of its plea and answer that, beginning in the spring of 1938, a physician had treated the insured for renal or kidney colic. It appeared from the evidence that the insured, in his application, in answer to the question "has there been any medical or surgical attention in the past five years?" stated that there had been none, and that in such application he gave the company no information which would have tended to inform it that he had suffered from a kidney ailment. The evidence for the defendant was not contradicted. The plaintiff did not claim that, at the time of the issuance of this policy, the defendant had any knowledge, either actual or constructive, of the fact that the insured had been treated by a physician for a kidney ailment and had been sent to the hospital for treatment. The defendant introduced evidence to the effect that had the insured stated in his application that he had been treated for this kidney trouble in 1938 his application would have been rejected. The physician who testified for the defendant further testified as follows: "A man with kidney colic in 1938, he would have to either pass it, or if it forms an obstruction as to cause the urine to back up and form uremic poisoning and enlarged kidney and if he didn't pass it he possibly would have lived but two weeks to a month with uremia. In my opinion [the insured] was a well man after passing that stone, which he must have done not having seen him professionally since. . . In this case I made a careful physical examination. My best opinion as to the nature of the disease was that he did have kidney stone and kidney colic. As to whether I can testify positively as to whether this disease continued until the time of his death, the only thing I say is that he never did consult me as a physician after that time. The disease as I diagnose it is a severe disease. It all depends on the course that the disease takes. At the time he consulted me I considered that he was in relatively serious physical condition, and that is the reason I referred him to Grady Hospital. It was my opinion that he needed hospitalization. I don't know how long he stayed in Grady."

The policy sued on, which was introduced in evidence, contained under section 5, "Limitations of insurance" the following clause: "If the insured within five years prior to the date hereof has had any medical or surgical attention not specifically stated in the application herefor; or if the insured prior to the date hereof has had any illness or disease of the heart, lungs, kidneys, brain, or circulatory system, or any venereal disease . . the liability of the company under this policy shall be limited to the return of the premiums paid, provided, however, that the limitations contained in this clause shall not be effective after two years from the date of this policy. The company shall not be held or presumed to know of any rejection or of the existence of any disease prior to the issuance of this policy."

The application for insurance, which was dated January 8, 1940, was introduced in evidence. Question 20 of the application was as follows: "What medical or surgical attention have you had in the last five years?" The answer "None" is written in the blank space after this question. The application was signed by "Clyde Carmichael," and witnessed by S. H. Grogan, insurance agent.

The jury returned a verdict for the plaintiff. The defendant moved for a new trial. The court overruled the motion and the defendant excepted. 1. A motion is made to dismiss the writ of error "because no one is named or otherwise disclosed by the bill of exceptions as plaintiff in error." The bill of exceptions does not formally name the defendant insurance company as the plaintiff in error, whereas it does formally name the plaintiff "as defendant in error," but the bill of exceptions states that "on January 20, 1942, at the regular January term of the trial court, before Judge T. O. Hathcock presiding, there came on to be tried the case of Bessie North v. Bankers Health Life Ins. Company, the same being an action to recover" the sum sued for under a policy of life insurance, and that such suit was filed on December 2, 1941. Thereafter, in the bill of exceptions, the company is referred to as the defendant and Bessie North as the plaintiff. The bill of exceptions recites that the case proceeded to verdict and judgment for the plaintiff; that the defendant duly filed a motion for new trial which was overruled, and that "to this judgment of the court defendant excepted and now excepts, and assigns error thereon as being contrary to law, and says that the court erred in overruling said motion for new trial on each and all of the grounds therein stated." The bill of exceptions recites, after the specification of material portions of the record by the defendant, that the insurance company "tenders this bill of exceptions and prays that the same may be certified to as provided by law and transmitted to the Court of Appeals of Georgia in order that the alleged errors may be considered and corrected." The bill of exceptions is signed by "Hirsch, Smith, Kilpatrick, Clay Cody, attorneys for the plaintiff in error, Bankers Health Life Insurance Company."

In Branch v. Mallory, 8 Ga. App. 797 (70 S.E. 177), relied on by the defendant in error in support of her motion to dismiss the writ of error, the bill of exceptions failed to disclose the name of Branch, the plaintiff in error. The bill of exceptions recited that on a certain date there came on to be tried "the case of W. A. Mallory and Price Hinton, then and there pending on appeal from the county court of said county." W. A. Mallory and Price Hinton were the plaintiffs in the lower court, and were the successful parties litigant. Nowhere in the bill of exceptions was the name of Branch, the defendant and losing party in the lower court, shown. The bill of exceptions in the case at bar complies with the rule announced in Branch v. Mallory, as follows: "A party plaintiff in error is essential to the prosecution of a writ of error, and where no one is named or otherwise disclosed by the bill of exceptions as plaintiff in error, the writ of error will be dismissed." The bill of exceptions now before the court, while it does not formally name the insurance company as plaintiff in error, clearly and plainly otherwise discloses that the company is the party prosecuting the writ of error. See Rosenheim Shoe Co. v. Horne, 10 Ga. App. 582,583 (73 S.E. 953); Joiner v. Singletary, 106 Ga. 257 (32 S.E. 90). The motion to dismiss the writ of error is denied.

2. The policy of insurance provided: "If the insured within five years prior to the date hereof has had any medical or surgical attention not specifically stated in the application herefor; or if the insured prior to the date hereof has had any illness or disease of the . . kidneys . . the liability of the company under this policy shall be limited to the return of the premiums paid, provided, however, that the limitations contained in this clause shall not be effective after two years from the date of this policy." The uncontradicted evidence showed that the insured in 1938, before the issuance of the policy in 1940, had been treated by a physician for a serious kidney disease, and that in applying for this insurance, in answer to the question "What medical or surgical attention have you had in the last five years?" he had untruthfully stated, "None." The limitation of liability, as appears from the above-quoted provisions of the policy, is the proper subject of contract between an insurer and an insured. In the absence of fraud or misrepresentation on the part of the company or its authorized agents this part of the policy is as binding on the insured or his beneficiary as is any other provision. The verdict for the plaintiff was not authorized by the evidence and was contrary to law. Gray v. Life c.Insurance Co. of Tennessee, 48 Ga. App. 80 (171 S.E. 835), and cit.; Life c. Insurance Co. of Tennessee v. Norton,51 Ga. App. 403 (180 S.E. 651).

The decisions of this court in Fowler v. Life CasualtyInsurance Co., 59 Ga. App. 530 (1 S.E.2d 595), andNational Life Accident Insurance Co. v. Pollard, 66 Ga. App. 895,899 (19 S.E.2d 557), involved "limitation-of-insurance clauses" materially different from the one involved in the present case. Furthermore, in the Fowler case there was a conflict in the evidence on whether the defendant had been treated by a physician for a serious disease before the issuance of the policy. In that case the limitation-of- liability clause was not identical with the one in the case at bar. In the case at bar the policy provided that "if the insured prior to the date hereof has had any illness or disease of the . . kidneys . . the liability of the company under this policy shall be limited to the return of the premiums paid, provided, however, that the limitations contained in this clause shall not be effective after two years from the date of this policy." The uncontradicted evidence showed that in the spring of 1938 and for some time subsequently the insured had a kidney disease which was serious, for which he was treated by a physician and sent to the hospital. The policy was issued in January 1940.

There is nothing in Metropolitan Life Insurance Co. v.Hale, 177 Ga. 632 (170 S.E. 875), that conflicts with the present ruling. In that case the provision of the policy involved provided that if the insured within two years before the date of the policy had been attended by a physician for any serious disease the company could declare the policy void and its liability should be limited to the refund of the premiums paid. In the case at bar the insurance company is not seeking to void the policy, but is seeking to enforce the provisions of the policy above quoted; which provisions are valid and binding on the insured as well as on the insurer.

It follows that the judge erred in overruling the motion for new trial on the general grounds.

Judgment reversed. Sutton, J., concurs.