#### STUART v. MUTUAL RESERVE FUND LIFE ASS’N.

(Supreme Court, General Term, Second Department.

May 14, 1894.)

1. Insurance—Breach on Conditions—Waiver.

Where a life insurance company notifies the administrator of a policy holder that, as the facts then appeared, the proofs were approved, and the claim would be paid on a certain day, it does not thereby waive its right to declare the policy void for a breach of conditions of which it was not aware when the letter was written.

2. Same—False Statements in Application.

An insurance company proposed to the holders of tontine policies that additional insurance should be purchased with the dividends, subject to the condition that any person accepting the proposal should pass a satisfactory medical examination. A policy holder wishing to accept the proposal was examined by a medical examiner, who reported unfavorably, and the additional insurance was refused. *Held,*that this was a refusal to insure, within the meaning of the question, “Has any proposal to insure the life of the applicant ever been declined?” contained in an application subsequently made by such policy holder to defendant, another insurance company.

Appeal from circuit court, Kings county.

Action by James H. .Stuart against the Mutual Reserve Fund Life Association on two certificates or policies of life insurance issued by defendant on the life of John B. Page for $5,000 each. From a judgment dismissing the complaint, entered on a verdict directed by the court in favor of defendant, plaintiff appeals. Affirmed.

Argued before BROWN, P. J., and DYKMAN and PRATT, JJ.

Alfred R. Page, for appellant.

F. A. Burnham and William C. De Witt, for respondent.

BROWN, P. J.

This action was brought by the plaintiff, as assignee of William R. Page, administrator of John B. Page, deceased, upon two certificates or policies of life insurance, dated September 25, 1885, issued by the defendant upon the life of said John B. Page, and payable to his legal representatives within 90 days after receipt of satisfactory proofs of death. A verdict was directed for the defendant upon the ground that the answers made by the insured in his application to the two following questions were untrue:

“First Q. Has any proposal to insure the life of the applicant ever been declined? If so, by what company or association? Second Q. Has any physician given an unfavorable opinion upon the life of the applicant with reference to life insurance or otherwise?”

To' both questions the answer returned was “No.”

Mr. Page died on October 24th following the issuing of the policies. Proofs of death were furnished on December 16th, and on May 10, 1886, the defendant advised the administrator of Mr. Page that, as the facts then appeared, the proofs were approved, and the claim would be paid on July 30th. On June 1st a mortuary call was made by the defendant, assessing its members for approved claims, among which was the one in suit, and the money was collected.' The defendant did not pay in accordance with its notice of May 10th, and *945in March, 1887, it notified the administrator of its revocation of approval of the claim, and declined to pay it. This- action was commenced on September 28, 1888.

The appellant contends that by its approval of the proofs and promise to pay the claim, and collection of the money by assessment upon its members, the defendant waived any right to declare the policy void for breach of its conditions, and cites Smith v. Insurance Co., 62 N. Y. 87, to sustain this contention. That case is not applicable to the present controversy. It was a case of fire insurance, where, in consideration of the surrender and cancellation of the policy, the defendant agreed to pay a specified sum in settlement of the loss. The policy was surrendered, and after that defendant refused to pay, and pleaded a breach of warranty in an action to recover the sum agreed to be paid. The court held that the defense of a breach of condition of the policy did not survive its surrender and cancellation, and that the action was not on the policy, but on the new agreement, and that defendant must pay. A similar ruling was made in Insurance Co. v. Minch, 53 N. Y. 144-151. The present case has in it no element of settlement. The defendant never promised to pay absolutely. The statement of the letter of May 10th. was: that “on the evidence then with the association, and as the facts then appeared,” it would pay on July 30th. At the time of writing that letter it did not know of the facts now asserted as a defense, *0*and consequently then could not waive a defense based upon them. Robertson v. Insurance Co., 88 N. Y. 541. Neither is the fact that the money to pay the claim was collected by assessment upon the members of the association available to the plaintiff, nor does it affect the right of defendant to reject the claim upon evidence subsequently obtained. Such, I think, would be the duty the officers owed to the association, if they were satisfied from their examination that there was a breach of the contract. Fisher v. Andrews, 37 Hun, 176; Mayer v. Life Ass’n, 42 Hun, 237.

We therefore reach the inquiry whether the court properly determined that the answers to the questions I have quoted were untrue. The evidence on the subject was not in dispute. The question is, did it compel the conclusions drawn from it? It appears that Mr. Page had a tontine policy in the Equitable Life Assurance Society. That policy provided that the tontine dividend should be applied only to purchase an annuity to reduce premiums during the subsequent continuation of the policy. The tontine period had expired in November, 1884. The association had, however, made an offer to the holders of such policies, including Mr. Page, in addition to the provision I have quoted from the contract, that the tontine dividend might be applied to the purchase of additional insurance equal in value to the annuity provided in the contract; but the offer was subject to the condition that the person accepting it should pass a satisfactory medical examination as to the insurable character of his life. On the day preceding the application for the policies in suit, Mr. Page called upon the Equitable Association, and saw Mr. Van Cise, the assistant actuary. The additional insurance to which he *946would have been entitled was $4,100, and he expressed a desire to accept the offer made to him. He was sent by Mr. Van Cise to the medical department to be examined for that insurance. He was examined by Dr. William S. Seaman, a medical examiner of the company. The result of that examination was that albumen was found in his urine, and Dr. Seaman refused to approve the application, and communicated that conclusion to Mr. Van Cise. Mr. Van Cise testified:

“I saw Mr. Page the same day after I had sent him to the medical department. * * * I told him that our doctor had refused to pass him for increased insurance. I told him that the doctor would not approve him. In the conversation it was stated that the doctor refused to approve him on account of the condition of his health. I think he asked why the doctor refused to approve him,—what was the matter with him. My recollection is that I evaded the answer.”

• It further appears by the testimony of Dr. Gale, who was Mr. Page’s physician at his home in Vermont, that on his return from Hew York in September, 1885, at Page’s request he made an examination of his urine, and that Page then told him of his application to the Equitable Association for additional insurance, and that he had submitted to an examination, and an unfavorable opinion had been passed upon him, and he wanted Dr. Gale to examine his urine, and see if there was any trouble.

The appellant claims that, as no formal proposal for insurance was made by Mr. Page to the Equitable Association, but the offer made to the policy holders was in the nature of a settlement of their ton-tine dividend, this evidence does not establish that the negative answer given to the first question was false; but, passing this, I think it permits no other conclusion than the untruthfulness of the answer to the second question. That inquiry was not limited to an opinion given upon an application for .insurance. The information called for was whether, in ^reference to insurance or otherwise,”an unfavorable opinion had been given as to the applicant’s life. The criticism made upon the form of this question is not, I think well founded. I do not consider it equivocal or ambiguous. It does not call for an opinion as to the manner of living or the present condition of health of the applicant, further than those elements might affect the risk of insurance upon the individual. The life is referred to as the subject of insurance, just as in fire or marine insurance a building or vessel would be referred to; and the inquiry is whether an opinion had ever been given that was unfavorable to the life, considered as an insurable thing. Undoubtedly, when the sense in which language is used or intended by parties is in doubt, its proper meaning may present a mixed question of law and fact, which must be left to a jury to determine; but I do not think this is such a case. The question was plain and intelligible, and the insured must be held to have known that Dr. Seaman had given to Mr. Van Oise an opinion that was unfavorable to his life as an insurable risk. His answer was therefore properly held by the trial court to have been untrue. The answer to this and other ques*947tions was, by the terms of the policy, warranted to be true, and made a part of the contract. Its untruthfulness, therefore, avoided the contract. Foot v. Insurance Co., 61 N. Y. 571; Edington v. Insurance Co., 77 *N.*Y. 564.

The respondent has called our attention to alleged breaches of -other conditions, and to the clause in the contract providing that no spit shall be brought after the lapse of one year from the date of the death of the insured. I am of the opinion that the evidence permitted the conclusion that the breach of the condition as to other insurance, and as to the time of the commencement of an action to recover upon the policies, was waived by .the defendant; but whether the question was one to be determined by the court or jury it is unnecessary to decide; nor, inasmuch as we think the judgment must be affirmed, is it necessary to state the reason that leads to that conclusion. The judgment must be affirmed, with costs.