Blattenberger v. Holman , 1883 Pa. LEXIS 207 ( 1883 )

Mr. Justice Paxson

delivered the opinion of the court,

The defendant was the holder of a policy of insurance on the life of Mary Owen, issued by the Lochiel Insurance Company of Harrisburg. One S. E. Klinger was the beneficiary named in the policy. Klinger transferred the policy to the defendant, who in turn assigned it to the plaintiff for the consideration of $350. Upon the death of the assured the plaintiff! brought this suit to recover from the defendant the money paid for the assignment, upon the ground that the policy had been obtained from the company under such circumstances of fraud that the company declined to pay. The court below, after rejecting several offers of evidence on the part of the plaintiff, directed a non-suit, which, with the rejection of the offers of evidence, is assigned for error.

The entire case is so saturated with fraud that its presence in this court is offensive. The company which issued the policy was one of those unfortunate excrescences on the insurance system, which sprung up in a night only to be swept away by the attorney-general. The transaction out of which this suit grew was a speculation upon the life of a decrepit woman, eighty-four years of age, who was on her death bed when the policy was issued. The application was dated March 26th 1881; the assured died April 19th 1881. The policy was not only worthless because of the fraud set forth in the plaintiff’s offer, but was wholly invalid because taken out for speculative purposes, and by parties who had no insurable interest in the life of Mary Owen. See Gilbert v. Moose, decided at the present term, in. which this subject is discussed and the authorities cited by our brother Gobdon.

The plaintiff, as assignee of the policy, claims to recover upon the implied warranty of title. It is settled law, that one who sells a note, bond or other chose in action impliedly warrants not only the title thereto, but the validity thereof and the right to recover thereon : Flynn v. Allen, 7 P. F. S. 485; Lyons v. Divelbis, 10 Harris 185.

If, therefore, the plaintiff took this assignment in ignorance of the time character of the transaction, he is entitled to recover back the money paid therefor. But his own testimony shows that he was as deep in the fraud as any of the others. It appears that he was a recognized agent of this and other companies of like character and was engaged in what he naively terms “ the speculative life insurance business as a business.” It also appears this was only one of several policies which he held on this same woman. His testimony is so remarkable that I give it at some length :

“ I bought a policy from Mr. Holman, No. 581, in the Lochiel of Harrisburg on the life of Mary Owen. S. E. Klinger was the original beneficiary. It was assigned by Klinger April 1st 1881, to Mr. Holman. I bought the policy from Mr. Holman for $350. . . . He said the claim was all right, and the company would assess. The subject was then dead, but he had not filed a death proof. His reason for not filing it was that he was a member of the legislature and could not attend to it at that time. Holman assigned to me June 14th 1881. ... I owned other policies of insurance on this same subject; probably interested in four or five. . . I took out my first policy on Mary Owen in latter part of January or first of February 1881. About all I had on her I took out at the same time. S. E. Klinger was the beneficiary in these policies. I obtained the policy by an assignment from S. E. Klinger. We .first took out the applications; they were all signed on the same day, because I was at Mary Owen’s only the one time. Her condition, when I was there, was a desirable condition for speculative purposes. ... I was in the speculative life insurance business as a business. ... I knew she was a good risk — one who would drop off soon. She was 84 years of age. I knew she was a favorable risk. It was part of the history of life insurance, that whenever an old, decrepit and favorable risk was known, speculators took out ,as many policies as they could on such risk. ... I took out all my applicacations on said subject (Mai’y Owen) on the same day, 31st January 1881. She signed them all on the same day ; I did not send -them to the respective companies all on the same day of the application.. I sent them in accordingly as I sold them to different parties.”

In view of this statement by the plaintiff he cannot justly claim to be axx innocent assignee of tlxe policy. It is true, he may not have known that tlxe signature of the assured was a forgery, if the fact be so; but he did know that it was a speculative policy, issued to one who had no insurable interest in the assured, excepting in her death. Such transactions are against the policy of the law.- They lead to murder.

The plaintiff bought a worthless thing, knowing it to be worthless.. He perhaps supposed that owing to his connection “with the-company,.the latter would assess the loss and pay. Be -that as it may, he certainly knew that if he got his money some one would be cheated. In doing this the law will xxot aid him. ■

“We are clearly of opinion that the. learned judge below committed no erx’or when he rejected the plaintiff’s evidence and directed a nón-suit.

Judgment affirmed