Metropolitan Life Insurance Company, a Corporation v. Margaret L. Grant

POPE, Circuit Judge.

I concur. The court divides on the question whether the words: “and if this application is approved at the Company’s Home Office” etc., state a condition precedent or only a condition subsequent. Ransom v. The Penn Mutual Life Insurance Company, 43 Cal.2d 420, 274 P.2d 633, 636, held that similar language in that policy was not a condition precedent. I am satisfied that the California Court, were it ruling on this policy, would say that the language just quoted stated a condition subsequent. As the California Court said of that Company: “had it wished to make clear that its satisfaction was a condition precedent to a contract, it could easily have done so by using unequivocal terms.” If the approval of the application is a condition subsequent, it can not matter whether the final approval *311mentioned relates to all three parts of the application.

What most definitely convinces me that the California Court would reach this result on these facts is its clearly expressed approval in Ransom of the decision in Gaunt v. John Hancock Mutual Life Ins. Co., 2 Cir., 160 F.2d 599, 601-602. There the language of the application was substantially the same as that which was used here.1

I am impressed by Chief Justice Gibson’s statement: “There is an obvious advantage to the company in obtaining payment of the premium when the application is made.” Clearly enough many an insurance applicant, after he has cooled off, might change his mind and never go for a medical examination. It seems to me the provision for immediate payment of the premium was a deliberate device for minimizing the likelihood of such a change of mind. To obtain its advantages the company, I am satisfied, took a calculated risk. I think, as Chief Justice Gibson said, it would be unconscionable to permit the company to escape the obligation thus undertaken by it.

. That case is even stronger than the present one, for in the application in Gaunt there were two “ifs,” not just one. There the words were: “if the Company is satisfied that on the date of the completion of Part B of this application I was insurable * * * and if this application * * * is, prior to my death, approved by the Company at its Home Office, the insurance applied for ¡shall be in force as of the date of completion of said Part B.” (Emphasis mine.)

Nor can the instant case be distinguished from Gaunt on the ground that Gaunt had taken his physical examination prior to his death while Grant had not. The coming into effect of the insurance here was conditioned only upon the signing of Part A and the payment of the first full premium.