Gulf Life Insurance Co. v. Bloodworth

1. A stipulation in an application for insurance, whereby it is agreed between the insured and the insurance company that the agent of the company has no authority to waive or dispense with full, true, and complete answers to the questions contained in the application, may not, when the application is not attached to the policy, serve as notice to the serve, would be in contravention of the Code, § 56-904, requiring the application to be attached to the policy before it may be introduced as a part of the contract of insurance or as an independent contract in any litigation between the parties interested therein.

2. The evidence did not demand a verdict in favor of the insurance company that the insured was not in sound health at the time of the delivery of the policy.

3. Where the court, in its charge to the jury, submitted the clear-cut issues involved and no others for the consideration of the jury in reaching its verdict, the admission in evidence over objection of testimony upon an irrelevant issue was harmless under the circumstances of this case.

4. Under the rulings in divisions 1 and 4, the grounds of the motion for new trial, as amended, dealt with in divisions 5, 6, 7, and 9 are without merit. The ground dealt with in division 8 is also without merit.

DECIDED OCTOBER 24, 1945. Robert L. Bloodworth, beneficiary of a life-insurance policy issued to his wife, sued the Gulf Life Insurance Company on the *Page 103 policy. The jury found for the plaintiff, and the defendant excepts to the overruling of its motion for a new trial as amended.

The application for the policy and the policy stated that the application was to be a part of the policy, but it was not attached to the policy. The application, dated May 20, 1941, contained the following provisions: "I do hereby agree. . (2) that the insurance hereby 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 herein set forth, whether such questions relate to matters already known to said agent or not; I hereby warrant . . . that I am familiar with the entire contents of this application; that I have read and verified each of the written statements and answers to the questions in parts `A' and `B' hereof; that each of said statements and answers were inserted herein by me, or by my agent there unto duly authorized, before this application was signed; that said statements and answers, and each of them, are full, complete and true in every respect, whether written by my hand or not, and that no other statement or statements has or have been made by me to the said company's agent, in any way modifying or qualifying the same." On the reverse side of the application negative answers appear to various questions, including questions as to previous diseases or impairments, including insanity, heart or blood vessels. Questions with negative answers also appear, as to whether the insured was in good health and sound condition on the date of the application, and what was the daily consumption of alcoholic beverages.

The evidence showed that the insured had been adjudged insane and committed to the asylum on May 26, 1933, and January 13, 1940, and that she died July 12, 1941, from myocardial failure of the duration of two years, and from alcoholism. The physician's statement in the proofs of death showed that the cause of death was "myocardial degeneration" and "cerebral edema;" that the contributory cause of death was renal and myocardial failure, duration two years; that death was caused directly or indirectly by alcoholism; that the deceased did not have consumption and was not afflicted with any infirmity, deformity, or chronic disease; *Page 104 and that she was a heavy drinker. There was no other evidence touching the condition of health of the insured on the date of the delivery of the policy. The beneficiary testified as follows: that he and the insured told the soliciting agent a few things, and the agent stated that all he wanted to know was that the insured was all right at that time; that the insured told the agent she was all right, and the agent wrote it down and said, "Sign this," that he told the agent everything he asked, and the agent said all he wanted to know was that she was all right then; that the agent asked but one question, and that was whether the insured was all right then; that he tried to tell the agent about the insured's insanity, but the agent would not listen; that the agent did not tell the insured what was on the paper; that, when he finished writing, he told her to sign it; that he and the insured told the agent nothing but the truth when he wrote the application; that he was present and saw the insured sign the application; that she could read and write; neither that the witness, the insured, nor the agent was in a hurry; that the insured could read and write a little; that she could not read print as fine as was exhibited to him; that she did not read anything unless she got a letter; that she hardly ever read anything or a book of any kind; that the insured did not read the application; that the agent did not use any pressure in writing the insurance; and that he told her insurance was a good thing and everybody ought to have it.

The insurance agent testified that he read the application to the insured, asked her all the questions thereon and put down thereon the answers as given by the insured. 1. Under the provisions of the Code, § 56-904, an application for insurance which is not attached to or contained in the policy of insurance issued thereunder cannot be considered as a part of the policy or as an independent contract in any controversy between the parties interested in the policy. The policy here provides that the insured agreed "that no agent of the Company or other person has any authority to waive or dispense with full, true, and complete answers hereon to any of the questions herein set forth, whether such questions relate to matters already *Page 105 known to said agent or not." The insertion of such an agreement is not effective as notice to the insured of limitations on the authority of an agent, inasmuch as the application is not attached to the policy. To allow this agreement contained in the application to serve as notice to the insured, would have the effect of circumventing the provision of the Code section cited. That section does not limit the expression "independent contract." There is no notice otherwise, in the application, relating to a limitation on the agent's authority; and, under the law applicable, when an insurance agent makes out an application for insurance, under such facts, and himself inserts the answers, he is held to do so as the agent of the insurer and not of the insured; and, under the circumstances of this case, the insured and the beneficiary are not estopped to assert that the answers were incorrectly inserted, even if the insured did not read the application and could have known of the falsity of the answers if she had done so, and even if the application stated that the insured had read it. Clubb v. American Accident Co. ofLouisville, Ky., 97 Ga. 502 (25 S.E. 333), and NationalAccident Health Insurance Co. v. Davis, 179 Ga. 595 (176 S.E. 387). The evidence did not demand a verdict for the insurance company on the question as to whether the policy was fraudulently procured.

2. The evidence did not demand a finding that the insured was not in sound health when the policy was delivered. Sound health means "such health and strength as to justify the reasonable belief that [the insured] is free from derangement of organic functions, or free from symptoms calculated to cause reasonable apprehension of such derangement, and [that] to ordinary observation and to outward appearance her health is reasonably such that she may with ordinary safety be insured and upon ordinary terms." National Life Accident Insurance Co. v.Martin, 35 Ga. App. 1 (132 S.E. 120), and cases cited. The facts shown by the proofs of death do not exclude the hypothesis that heavy drinking materially contributed to the death, and that in its absence the insured might not have lived to a reasonable expectancy. There was no expert testimony on the subject, and this court has only meager data on which to base a conclusion.

3. It was not error requiring the grant of a new trial for the court to admit in evidence over objection the testimony of a witness *Page 106 to the effect that the agent stated after the death of the insured that the policy was in full force. The issues in the case were whether the policy was procured by fraud or whether the agent knew the true facts about the insured's condition and history. The court submitted these clear-cut issues, and no others, to the jury, and we cannot see how the testimony in question could have been harmful to the insurer.

4. It was not error, for the reason assigned, to admit testimony that the agent knew that the insured had suffered from a former illness. The objection was that the application and the policy contained limitations on the authority of the agent. These grounds are without merit because, as stated in division 1, the application contained an agreement by the insured that the agent's authority was limited; and, under the Code section cited, such an agreement in an unattached application is not binding on the insured or the beneficiary, and the limitation contained in the policy refers to a time after the delivery of the policy.Metropolitan Life Insurance Co. v. Hale, 177 Ga. 632 (170 S.E. 875), and cit.

5. The court charged the jury: "The defendant contends that she is bound by whatever paper she signed, and ordinarily that would be true, but if she did not understand the questions asked in the application, and if she didn't knowingly misrepresent to them, and if the agent of the company, Mr. Parker knew, had actual notice that she had been confined in the sanitarium at Milledgeville, why that would not be a defense for the insurance company, because in order for her to mislead the company she would have to knowingly prevaricate in answering those questions, wilfully answer them incorrectly." The exception to the charge is that it nullified the provision in the application and policy relating to the limitation on the agent's authority. This exception is without merit for the reasons assigned in divisions 1 and 4.

6. The preceding ruling applies to the same exception to the following charge: "The plaintiff contends, that is Mr. Bloodworth, that his wife did not wilfully and knowingly misrepresent anything, that she couldn't read on account of the fine print of the questions in the application, that she was afforded no opportunity of reading the questions in the application, that the agent of the company, Mr. Parker, wrote out the answers without asking *Page 107 her the questions or getting any reply to any of the questions from her, but he wrote `No' in answer to each one of those questions propounded to her in the application. Now if that be true, that she didn't know and could not on account of eyesight, education, or for any other honest reason couldn't know what was in the application and did not know the answers as written out by Mr. Parker, the agent of the insurance company, why that would not be a wailful prevarication, and if Parker, the agent of the company, had been informed then and there that the wife had been twice in the asylum, if that notice was brought home to him, it was brought home to the insurance company, because whatever their agent knew under those circumstances the law says the insurance company knew."

7. The same rulings also apply to the exceptions to the following charge: "The plaintiff, Mr. Bloodworth, the beneficiary in the policy, contends that he did advise Mr. Parker, the agent of the company, of those facts. So you consider the evidence on that situation and see whether or not the agent of the company knew about her confinement and commitment to the asylum at Milledgeville. If he did, then the company is bound by his knowledge, if that knowledge was actual. On the other hand, if he did not know anything about that, if the company's contention on that score is the truth of the case, then the company would not be bound by the policy and you should find for the defendant."

8. The following charge is excepted to: "If on the other hand the agent did have actual knowledge of the commitment to the asylum in Milledgeville, then this company is bound and you would find a verdict in favor of the plaintiff for the amount of the insurance $536, with interest from the time of her death." The grounds of exception are the same as those already dealt with, and the additional ground that the instruction eliminated from the jury's consideration all the other issues in the case. The last exception is without merit, because, immediately following the above excerpt, the court told the jury that there were numbers of other questions on the application, and that the rules he had given them about the company's being bound by the knowledge of the agent under certain conditions would be applicable to every one of those questions.

9. The ruling in division 5 applies to the exception to the *Page 108 two following excerpts, the exception being the same: "Well, that is the issue; the main issue in this case between the plaintiff and the defendant is whether the agent had actual notice of insanity or the untruthfulness of any of the other answers to the questions. If the agent had that actual notice, his knowledge would be the knowledge of the company." And: "The plaintiff contends, if there is any fraud in this transaction, it is committed by the agent of the company, and that he had actual knowledge of the true situation, that he wrote the answer, that he did not read them to Mrs. Bloodworth, and she didn't know anything about it, and in her condition on account of illiteracy or sight or any other reason, for some reason she couldn't read or understand the meaning of that application, it was never submitted to her, she was never given any opportunity to read it. On the other hand, the defendant contends that she had every opportunity to know what was in the application, that each question was read to her separately and she answered each question `No,' and Mr. Parker, the insurance agent representing the company, truthfully put down her answers on the application just as she had given them to him."

The court did not err in overruling the motion for a new trial.

Judgment affirmed. Sutton, P. J., and Parker, J., concur.