Sargeant v. National Life Insurance

Opinion by

Mb. Justice Gbben,

On the trial of this case the defendant company offered to prove by the agent who negotiated the policy that only one premium of $182.63 was paid at the time of the delivery of the policy. It was objected to this offer (1) that the agent was an incompetent witness, and (2) that there being a printed and written receipt on the policy for the whole ten premiums, it was incompetent to contradict the receipt by parol proof.

The learned court below rejected the proffered testimony for both of these reasons, and this ruling is assigned for error. We are clearly of the opinion that the court was in error on both of these subjects. As to the first, the witness was held to be incompetent because he was the surviving party to a thing or contract in action, and was disqualified under the act of 1869. This was an entire misconception of the act, and also of the act of 1887. The fault in the reasoning lies in treating a mere agent of a party as if he were the party himself. The act does not exclude agents, but parties, surviving parties where the other party is dead. But an agent is not a party to the thing or contract in action. It is the principal for whom the agent acted who is the surviving party to the contract.

In this case the witness, Holland, was not a party to the suit, and he was not a party to the contract. He had no interest in it, he was not a party on the record, he was but an agent of the defendant company, who transacted the business for the company, not for himself. If the ruling was sound agents would be excluded in > all cases in which they transacted the business in question on behalf of their principals if the other party to the contract was dead. Such an agent was never incompetent, either before or after the act of 1869, and that act had nothing to do with the question. In American Life Ins. & Trust Co. v. Shultz, 82 Pa. 46, the action was upon a policy of life insurance, and at the trial the agent who effected the policy was dead. The other party was offered as a witness and, under objections to his competency, he was allowed to testify; we sustained the ruling. Moreover, he wás permitted to testify to a verbal covenant made between himself and the deceased agent, and which was not contained in the policy. As a matter of course, if the opposite party was competent in such circumstances it must have been upon the assumption that the agent would have been competent if he had survived and the opposite party were dead.

On the second question, it is too plain for argument that the proposed testimony was competent and should have been admitted. The familiar principle that all receipts may be explained by parol is directly applicable. Even the receipt in a deed, which almost universally recites that the purchase money has been paid, and although followed by an express additional receipt at the end of the deed, is always open to verbal explanation and contradiction. Thus it was held in Hamilton v. McGuire, 3 S. & R. 355, and in Weigley v. Weir, 7 S. & R. 309, that an acknowledgment of the payment of the purchase money in the body of a deed and a receipt indorsed are not conclusive evidence of such payment. In Strawbridge v. Cartledge, 7 W. & S. 394, it was held that the recital of the consideration money in a deed is not conclusive evidence of the amount paid; it may be shown by parol to have been a much greater sum. Watson v. Blaine, 12 S. & R. 131, is to the same effect. In Hoffman v. Strohecker, 9 Watts, 183, it was held that a receipt for purchase money indorsed on a deed, may be disproved in an action of covenant for the purchase money. In Barclay v. Morrison, 16 S. & R. 129, it was ruled that a receipt is prima facie proof of the payment of the money as therein stated. In Hamsher v. Kline, 57 Pa. 397, Sharswood, J., said: “ A receipt in full is prima facie, but not conclusive, evidence of a settlement. It may be attacked on the ground of fraud, mistake or ignorance of his legal rights by the party who gave it.” To the same effect are Jack v. Dougherty, 3 Watts, 157, Audenreid’s App., 89 Pa. 114, and many other cases.

We do not think the learned court below was correct in assuming absolutely that the marginal note was a positive assertion that the whole of the ten premium payments had actually been made. Of course, it might have that meaning, but it is also consistent with the meaning that “ if ” or “ when ” the whole number of payments were made the policy would become a full paid participating policy. It certainly could have been expressed with much more precision to have the last of these meanings, but the language is sufficiently dubious to justify the admission of verbal testimony as to what was the actual fact.

On the merits of the defense there cannot be the least doubt. The proof was absolute and entirely uncontradicted that the insured did commit suicide within the two year limit of the policy, and it clearly followed that there was no right of recovery on the policy. By the explicit terms of the policy death by self destruction, sane or insane, within two years from the date of the policy, was a risk which was not insured against. That there can be no recovery where a breach of this condition has taken place was positively ruled in the very recent case of Tritschler, etc., v. The Keystone Mut. Ben. Assn., 180 Pa. 205. In that case we held that no recovery can be had upon a policy of life insurance where the insured has killed himself while insane, if it is a condition of the policy that it shall be void in case the person whose life is insured shall die by suicide, feloniously or otherwise, sane or insane. In this class of cases it must be borne in mind that the crucial question is not, whether the insured was sane or insane at the time of his death, but did he die of his own act ? If he did, that kind of a death was a risk against which the policy did not insure. It was outside of the policy, and hence the policy was inapplicable. There being no kind of question under the evidence that the insured did die of his own act, it is perfectly clear there could be no recovery.

Judgment reversed.