Insurance Company v. Wilkinson - 80 U.S. 222 (1871)
U.S. Supreme Court
Insurance Company v. Wilkinson, 80 U.S. 13 Wall. 222 222 (1871)
Insurance Company v. Wilkinson
80 U.S. (13 Wall.) 222
1. The assured in a life policy, in reply to the question, "had she ever had a serious personal injury," answered "no." She had, ten years before,
fallen from a tree. The criteria of a serious personal injury considered.
2. This is not to be determined exclusively by the impressions of the matter at the time, but its more or less prominent influence on the health, strength, and longevity of the party is to be taken into account, and the jury are to decide from these and the nature of the injury whether it was so serious as to make its nondisclosure avoid the policy.
3. Insurance companies who do business by agencies at a distance from their principal place of business are responsible for the, acts of the agent within the general scope of the business entrusted to his care, and no limitations of his authority will be binding on parties with whom he deals which are not brought to their knowledge.
4. Hence when these agents, in soliciting insurance, undertake to prepare the application of the insured or make any representations to the insured as to the character or effect of the statements of the application, they will be regarded, in doing so, as the agents of the insurance companies, and not of the insured.
5. This principle is rendered necessary by the manner in which these agents are sent over the country by such companies and stimulated by them to exertions in effecting insurance which often lead to a disregard of the true principles of insurance, as well as fair dealing.
6. In such cases, the insurers cannot protect themselves under instructions to their agents that they are only agents for the purpose of receiving and transmitting the application and the premium.
7. Therefore, where the agent had inserted in the application for life insurance a representation of the age of the mother of the assured at the time of her death which was untrue but which the agent himself obtained from a third person and inserted without the assent of the assured, it was the act of the company, and not of the assured, and did not invalidate the policy.
8. To permit verbal testimony to show how this was done by the agent does not contradict the written contract, though the application was signed by the party. It proceeds on the ground that it was not his statement, and that the insurance company, by the acts of their agent in the matter, are estopped to set up that it is the representation of the assured.
The Union Mutual Insurance Company, of Maine, insured the life of Mrs. Malinda Wilkinson in favor of her husband. Both husband and wife, prior to the rebellion, had been slaves, and the husband came to Keokuk, Iowa, from Missouri. The company did business in Keokuk (where the application was made and the policy delivered) through an agent, one Ball, to whom it furnished blank applications. The mode of doing business appeared to have been that the agent propounded certain printed questions, such as are usual on applications for insurance on lives, contained in a form of application, and took down the answers, and when the application was signed by the applicant, the friend and physician forwarded it to the company, and if accepted, the policy was returned to this agent, who delivered it and collected and transmitted the premiums.
On this form of application were the usual questions to be
answered by the person proposing to effect the assurance, and by the terms of the policy it became void if any of the representations made proved to be untrue.
Among the questions was this one:
"Has the party ever had any serious illness, local disease, or personal injury; if so, of what nature, and at what age?"
And the question was answered:
So too, after an interrogatory as to whether the parents were alive or dead -- they being, in the case of Mrs. Wilkinson, both dead -- were the questions and answers:
"Question. Mother's age, at her death?"
"Question. Cause of her death?"
Mrs. Wilkinson having died, and the company refusing to pay the sum insured, Wilkinson, the husband, brought suit in the court below to recover it. The defense was that the answers as above given to the questions put were false; that in regard to the first one, Mrs. Wilkinson, in the year 1862, had received a serious personal injury, and that in regard to the others, the mother had not died at the age of 40, but at the earlier age of 23, and had died not of fever but of consumption.
As to the first matter, that of the personal injury, the judge (under a rule of practice in the state courts of Iowa, adopted by the circuit court of that district, and which allows the jury in addition to its general verdict to find also special verdicts and answers to interrogatories put), required the jury to respond to certain interrogatories. These and the answers to them were thus:
"Interrogatory. Did Malinda Wilkinson, in the year 1862, receive a serious personal injury, by falling from a tree?"
"Answer. Yes, injured; not seriously."
"Interrogatory. Were the effects of such fall temporary, and had these effects wholly passed away without influencing or
affecting her subsequent health or length of life prior to the time when the application for insurance in this case was taken?"
As to the other matter, the age at which the mother died and the disease which caused her death, evidence having been given by the defendant tending to show that she died at a much younger age than forty years, and of consumption, the plaintiff, in avoidance of this, was permitted (under the plaintiff's objection and exception) to prove that the agent of the insurance company, who took down the answers of the applicant and his wife to all the interrogatories, was told by both of them that they knew nothing about the cause of the mother's death, or of her age at the time; that the wife was too young to know or remember anything about it, and that the husband had never known her; and to prove that, there was present at the time the agent was taking the application, an old woman, who said that she had knowledge on that subject, and that the agent questioned her for himself, and from what she told him he filled in the answer which was now alleged to be untrue without its truth being affirmed or assented to by the plaintiff or the wife.
This the jury found in their special verdict, as they had the other facts, and found that the mother died at the age of 23, did not die of consumption, and that the applicant did not know when the application was signed how the answer to the question about the mother's age and the cause of her death had been filled in.
In charging the jury, the court said on the first branch of the case -- that relating to the personal injury -- that if the effects of the fall were temporary and had entirely passed away before the application was taken, and if it did not affect Mrs. Wilkinson's health or shorten her life, then the nondisclosure of the fall was no defense to the action; but on the other hand that if the effects of the fall were not temporary, and remained when the application was taken, or if the fall affected the general health or was so serious that it might affect the health or shorten life, then the nondisclosure
would defeat recovery, although the failure to mention the fall was not intentional or fraudulent.
On the second branch -- that relating to the age of the mother -- the court said to the jury that if the applicant did not know at what age her mother died and did not state it and declined to state it, and that her age was inserted by the agent upon statements made to him by others in answer to inquiries he made of them and upon the strength of his own judgment, based upon data thus obtained, it was no defense to the action to show that the agent was mistaken and that the mother died at the age of 23 years.
Verdict and judgment having gone for the plaintiff, the insurance company brought the case here on error.