Connell v. Metropolitan Life Insurance

Opinion by

W. D. Porter, J.,

The application for this insurance was not attached to the policy, and the representations therein contained were not available by the defendant company as a defense to the action. The policy did not designate a beneficiary, and the admission of the application for that purpose was proper: Norristown Title Company v. Hancock Insurance Company, 132 Pa. 385. The Act of May 11, 1881, P. L. 20, imposes a duty upon the insurer for the protection of the assured, and was not intended to prevent the latter from merely using the application as evidence for the purpose of identifying the person for whose benefit the contract was-made. The general rule is that a party offering a paper in evidence must offer the whole of it, just as it is, and if it requires explanation the burden is upon him to explain: Cary v. Cary, 189 Pa. 65. The plaintiff offered the application for the purpose of designating the beneficiary, and during the subsequent progress of the trial, the defendant sought to take advantage of the alleged warranties contained in the paper. The provisions of the act of 1881 involve more than a mere denial of the right of the insurer to offer in evidence an application not attached to the policy, and the legislative intent manifestly was to deprive the insurer of any benefit whatever from such an irregular application. The words of the act are: “Nor shall such application or by-laws be considered a part of the policy or contract between such parties.” The effect of this legislation is to take away from the irregular application any quality which it might have to in any manner affect the contract of insurance. The act did not take away from the parties their constitutional right to make contracts, but it did impose a reasonable regulation as to the manner in which those contracts should be evidenced. When such an irregular application is admitted for the purpose of identifying the beneficiary, the policy being silent upon that point, the warranties of the application are not thus made a part of the contract. The application was in evidence for all lawful purposes, but it could not have a force and effect which was forbidden by the express terms of the statute. Independently of the act of 1881, the warranties contained in the application were deprived of any efficacy; the parties had excluded them by the express terms of the policy. When the insurance company incorporated into its agreement this condition, viz: “ This form of policy is issued upon an application which omits the warranty usually contained in applications, and the policy contains the entire agreement between the company and the insured, and the holder and owner thereof,” it must be held to have meant what it said. It would still be competent to show that the company had been induced to issue the policy through misrepresentations, but to establish that defense it must be shown that the misrepresentations were fraudulently made. This is, no doubt, what the learned judge of the court below had in mind when he held that the diseased condition of the assured at the time the policy was issued did not constitute a good ground of defense, unless the jury were satisfied that she knew of her condition.

It must not be forgotten, however, that there is a difference between obtaining a contract through a misrepresentation as to a fact, and making the existence of that fact a condition upon which the contract, by its written terms, is dependent. The insurance company having, by its express contract, waived the warranties contained in the application, sought to protect itself by incorporating certain conditions into the contract. A part of the agreement between the parties was, “ This policy is void if the insured before its date has been rejected for insurance by this or any other company, or has been attended by a physician for any serious disease or complaint; or has had before this date any pulmonary disease, or chronic bronchitis, or cancer or disease of the heart, liver or kidneys.” These were unequivocal absolute covenants. Whether the policy was void was dependent upon actual conditions, past or present, and not upon the knowledge of those conditions possessed by the parties. The act of .June 23, 1885, relates “to warranties in the applications for life insurance policies,” and has not application to the express covenants of the policy itself, not directly dependent upon such warranties. The defense in this action was that the assured, prior to and at the time of the issuance of.the policy, had Bright’s disease of the kidneys, and that she continued to suffer from and died of that disease. If this was true, the express covenant of the parties, hereinbefore recited, cannot be disregarded, and the policy was void: March v. Metropolitan Life Insurance Co., 186 Pa. 629; Meyers v. Woodmen of the World, 193 Pa. 470; Smith v. Northwestern Mutual Life Ins. Co., 196 Pa. 314; McGraw v. Metropolitan Life Insurance Co., 5 Pa. Superior Ct. 488; Schwartz v. Metropolitan Life Insurance Co., 5 Pa. Superior Ct. 285; American Union Life Insurance Co. v. Judge, 191 Pa. 484; Barnes v. Fidelity Mut. Life Assn., 191 Pa. 618. The existence of the disease was a fact to be established by competent evidence, and the burden was upon the defendant. The credibility of the witnesses was for the jury, and it was proper in the cross-examination to ask any question which tended to throw light upon that subject; for that reason, the first four assignments of error are dismissed.

While some of the remaining fifteen assignments of error refer more directly to the effect of the representations made by the assured in her application, the language of the learned judge of the court below had a direct bearing upon the effect to be given to the express covenants contained in the policy. The result was to make the rights of the defendant, under those express covenants, dependent upon the knowledge of the assured as to her own condition. In this there was error and the specifications must be sustained.

The judgment is reversed and a venire facias de novo awarded.