Case Name: Elaine F. Glickman, as Administratrix of the Estate of Celia Katz, Deceased, Appellant, v. New York Life Insurance Company, Respondent
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1943-07-20
Citations: 291 N.Y. 45
Docket Number: 
Parties: Elaine F. Glickman, as Administratrix of the Estate of Celia Katz, Deceased, Appellant, v. New York Life Insurance Company, Respondent.
Judges: 
Reporter: New York Reports
Volume: 291
Pages: 45–55

Head Matter:
Elaine F. Glickman, as Administratrix of the Estate of Celia Katz, Deceased, Appellant, v. New York Life Insurance Company, Respondent.
Submitted June 8, 1943;
decided July 20, 1943.
Harry Matter and Isadore B. Hurwitz for appellant.
Defendant is estopped to set up the condition as a bar and is also deemed to have waived it. Armand v. Metropolitan Life Ins. Co., 135 Misc. 357, 228 App. Div. 625; Ames v. New York Life Ins. Co., 154 Minn. 111; Chinery v. Metropolitan Life Ins. Co., 112 Misc. 107.) On this record to set up as a bar the condition in the application would violate section 142 of the Insurance Law. (Sternaman v. Metropolitan Life Ins. Co., 170 N. Y. 13; Archer v. Equitable Life Assur. Society, 218 N. Y. 18; Bollard v. New York Life Ins. Co., 98 Misc. 286; Lampke v. Metropolitan Life Ins. Co. 279 N. Y. 157; Eastern D. P. Dye Works v. Travelers Ins. Co., 234 N. Y. 441; Minsker v. John Hancock Mut. Life Ins. Co., 254 N. Y. 333; Bible v. John Hancock Mut. Life Ins. Co., 256 N. Y. 458; Davern v. American Mut. Liability Ins. Co., 241 N. Y. 318.) The photostatic copies of the application attached to the policy were so reduced in size as not to be a compliance with section 142 of the Insurance Law. This renders unenforcible the condition in the application. (Fidelity Mut. Ins. Co. v. Preuser, 195 Ky. 271; New York Life Ins. Co. v. Miller, 73 F. 2d 350; New York Life Ins. Co. v. Halpern, 57 F. 2d 200, 61 F. 2d 1037; Janunas v. Metropolitan Life, 239 Mich. 150; Eastman v. Metropolitan Life, 228 Mich. 125.) Assuming the condition is applicable, section 150 of the Insurance Law nevertheless precludes a construction of the condition which would void the policy perforce a showing that the insured consulted a physician without anything more. (Silverstein v. Metropolitan Life Ins. Co., 254 N. Y. 81; Independent Life Ins. Co. v. Vann, 24 Ala. App. 93; Eastern D. P. Dye Works, Inc., v. Travelers Ins. Co., 234 N. Y. 441; Geer v. Union Mut. Life Ins. Co., 273 N. Y. 261; Smith v. Travelers Ins. Co., 76 Misc. 441; Dilleber v. Home Life Ins. Co., 69 N. Y. 256; Cushman v. U. S. Life Ins. Co., 70 N. Y. 72; Northern Life Ins. Co. v. King, 53 F. 2d 613, 285 U. S. 544; Lampke v. Metropolitan Life Ins. Co., 279 N. Y. 157; Travelers Ins. Co. v. Pomerants, 246 N. Y. 63; Mansbacher v. Prudential Ins. Co., 273 N. Y. 140; Sommer v. Guardian Life Ins. Co., 281 N. Y. 508.) The insured was not guilty of any common law fraudulent concealment. (Sebring v. Fidelity-Phenix Fire Ins. Co., 255 N. Y. 382; Armand v. Metropolitan Life Ins. Co., 135 Misc. 357, 228 App. Div. 625; Ames v. N. Y. Life Ins. Co., 154 Minn. 111; Eastern D. P. Dye Works v. Travelers Ins. Co., 234 N. Y. 441; Mallory v. Travelers Ins. Co., 47 N. Y. 52; Lampke v. Metropolitan Life Ins. Co., 279 N. Y. 157; N. Y. Life Ins. Co. v. Bacalis, 94 F. 2d 200; New York Life Ins. Co. v. Kwetkauskas, 63 F. 2d 890, 289 U. S. 762; Dilleber v. Home Life Ins. Co., 69 N. Y. 256; Blair v. National Security Ins. Co., 126 F. 2d 955.)
Ronald B. Swinford, Kenneth de F. Carpenter and Ferdinand H. Pease for respondent.
The policy never took effect as a contract of insurance because between the date of the written application for insurance and the date of the delivery of the policy the applicant violated the condition precedent provisions in the application relating to consultations and treatments by any physician in that he consulted with, was examined and received treatment by a physician between the date of his medical examination for insurance and the date of the delivery of the policy. (New York Life Ins. Co. v. Watkin, 229 App. Div. 211, 256 N. Y. 618; Polacheck v. New York Life Ins. Co., 147 Misc. 16, 240 App. Div. 1028, 151 Misc. 172, 243 App. Div. 692; Goldman v. New York Life Ins. Co., 152 Misc. 289, 242 App. Div. 665; Goldstein v. New York Life Ins. Co., 176 App. Div. 813, 227 N. Y. 575; New York Life Ins. Co. v. Conrad, 47 F. 2d 885; Hurt v. New York Life Ins. Co., 51 F. 2d 936; Wilder v. New York Life Ins. Co., 81 F. 2d 89; Zemler v. New York Life Ins. Co., 225 N. W. 81; Jones v. New York Life Ins. Co., 253 Pac. 200; Harrisburg Trust Co. v. Mutual Life Ins. Co., 122 Atl. 292; Piedmont & Arlington Life Ins. Co. v. Ewing, 92 U. S. 377; Drilling v. New York Life Ins. Co., 234 N. Y. 234; Oilman v. Metropolitan Life, 213 App. Div. 839, 242 N. Y. 512; Provancha v. Prudential Ins. Co., 202 App. Div. 778, 235 N. Y. 582.) The statements in the application for the policy in suit respecting certain diseases and consultations with a physician were continuing representations and as such they were not true on the delivery date of the policy, and the applicant having failed to disclose to the defendant the true facts, which it was his duty to do, there was a fraudulent concealment of material facts. (Stipcich v. Metropolitan Life Ins. Co., 277 U. S. 311; Goldstein v. New York Life Ins. Co., 176 App. Div. 813, 227 N. Y. 575; Equitable Life Assur. Soc. v. McElroy, 83 F. 631; New York Life Ins. Co. v. Gay, 36 F. 2d 634.) Defendant is not estopped to set up the breach of condition as a bar to recovery and is not to be deemed to have waived it because it did not make any inquiry at the time of the delivery of the policy as to whether or not the insured had consulted a physician. (Bollard v. New York Life Ins. Co., 98 Misc. 286, 182 App. Div. 915, 228 N. Y. 521; Metzger v. Aetna Ins. Co., 227 N. Y. 411; Drilling v. New York Life Ins. Co., 234 N. Y. 234.) Defendant fully complied with the statutory requirements of section 142 of the Insurance Law by attaching to and making a part of the policy in suit a “ true copy ” of the original application. Section 150 of the Insurance Law is not applicable because the written application for insurance which contains the agreement relied on herein was executed on December 13, 1939, whereas this section did not become effective until January 1, 1940. (Drilling v. New York Life Ins. Co., 234 N. Y. 234.) Even if section 150 of the Insurance Law were applicable there is no question but what the breach of this condition precedent to the coming into existence of any insurance contract did materially increase the risk of loss for duodenal ulcer is a serious condition. (Jenkins v. John Hancock Mut. Life Ins. Co., 257 N. Y. 289; Hurt v. New York Life Ins. Co., 51 F. 2d 936.)

Opinion:
Desmond, J.
The suit is on a life insurance policy. The insurer's defense is based on what the insurer calls the violation of a condition precedent which violation, according to defendant, produced a situation where," although a policy was issued, no insurance thereunder ever took effect. On December 13, 1939, Louis C. Katz applied to defendant for a $5,000 policy of insurance on his life. In the application form which was furnished to him by defendant and which he signed, there appeared this language: "It is mutually agreed as follows: 1. That the insurance hereby applied for shall go into force only if the applicant has not consulted or been treated by any physician or practitioner since his medical examination It is conceded that the applicant Katz did, without defendant's knowledge, consult his own physician after he had undergone a medical examination conducted by a physician nominated by the insurer. The company's medical examination was had on December 15, 1939, and the company issued the policy to Mr. Katz on January 17, 1940. His visits to his own physician (really two physicians acting together) were on January 15 and 16, 1940. His own physician, called as a witness by defendant, gave evidence that the tests made on those dates and other information then obtained, disclosed that the applicant Katz was suffering from a duodenal ulcer. The witness stated that the symptoms of such an ulcer will, " generally speaking," be completely relieved after four to six weeks of a dietetic regime, combined with complete or partial rest. Defendant's assistant medical director, who had never seen applicant Katz but who had approved the issuance of the policy on the basis of information made available to the company, was another witness. He was asked whether a duodenal ulcer was serious; plaintiff objected to the question but the Trial Justice announced that he would take judicial notice that it was a serious condition; the witness then answered the question in the affirmative, saying that " it may be considered so." This physician was prevented, on plaintiff's objection, from stating what action defendant would have taken, had it known of the ulcer. There was no other testimony as to the insured's state of health except that of his wife who told of her husband's active life and apparent vigor and freedom from illness about the time of the issuance of the policy. It is undisputed that the insured died on June 8, 1940, from coronary sclerosis, a disease unrelated to the intestinal ulcer. At the close of the proof, defendant moved for a directed verdict, which was denied, then asked the Court to let the case go to the jury, which motion was denied also; plaintiff's motion for a directed verdict was thereupon granted. The Appellate Division unanimously reversed and dismissed the complaint, citing Goldman v. New York Life Ins. Co. (152 Misc. 289, affd. 242 App. Div. 665); New York Life Ins. Co. v., Watkin (229 App. Div. 211, affd. 256 N. Y. 618); Polachek v. New York Life Ins. Co. (151 Misc. 172, affd. 243 App. Div. 692), and Geer v. Union Mut. Life Ins. Co. (273 N. Y. 261). In none of those cases did this court pass on the precise question here presented to us, although the Goldman, Watkin and Polaohek cases dealt with the same language found in the application here, language which says distinctly that the policy shall not go into effect if the applicant on his own behalf consults a physician after he has been examined by the insurance company's physician and before the policy is actually handed to him. In Drilling v. New York Life Ins. Co. (234 N. Y. 234) we held valid and effective a somewhat similar agreement written into the application, that the insurance was not to take effect unless the policy should be delivered and the premium paid while the applicant was in good health. We need not go so far as did the Supreme Court in Stipcich v. Metropolitan Life Ins. Co. (277 U. S. 311) (also involving a duodenal ulcer) where it was held that, without any promise or covenant in the application blank, an applicant was under a .duty .to inform the insurer fully of changes in his physical condition seriously affecting his health, which duty, held the Supreme Court, rested on no stipulation of the parties but was imposed by law because of the relationship of the parties and their obligations one to the other. We have no doubt that, unless our statutes dictate a different result, the agreement signed by applicant Katz is valid and to be interpreted as written, at least in cases where, as here, t he visit to the physician has to do with an ailment or condition which is reasonably to be considered serious.
Appellant urges the applicability to her case of sections 142 and 150 of the Insurance Law, as revised in 1939. (L. 1939, ch.-, 882.) As to section 142, we see in the dealings between the parties to this contract no violation of subdivision 1, which requires every life policy to contain the whole contract between the parties, and forbids the admission In evidence of the application unless a copy thereof is attached to the policy when issued. There is no requirement that a copy of the application be left with the applicant, or that the insurer make further inquiries, when issuing the policy, as to applicant's health or visits to doctors. Mr. Katz's signature to the application bound him as an applicant or offeror. (Drilling v. New York Life Ins. Co., supra.) Subdivision 3 of section 142 obviously has no place in this discussion since it relates to statements made by the applicant, and no such statements are litigated here. The same is true of section 149.
Nor do we see that section 150 of the statute serves appellant's cause in any way. That section uses the term " warranty " to cover an insurance contract provision which has the effect of requiring, as a condition precedent of the taking effect of the insurance contract, the existence of a fact which tends to diminish, or the nonexistence of a fact which tends to increase, the risk of the occurrence of any loss within the policy's coverage. Section 150 then lays down the rule that no breach of such a " warranty " shall avoid the insurance contract " unless such breach materially increased the risk of loss, damage or injury within the coverage of the contract Appellant says that under section 150 there must now be shown a " de facto increase in the risk." But the only showing here is that the applicant's visits to his physicians disclosed the existence of an intestinal ulcer, and that an intestinal ulcer is a serious condition. Apparently in section 150 the Legislature was seeing to it that a policy of insurance will not be avoided by proof of an immaterial " breach of warranty." Arguments and decisions as to the legal effect of nondisclosure of trivial ailments, or consultations with physicians relative to such ailments, do not furnish the answer to this case. We will leave to future litigations the question of the effect, under the application form here used, of a nondisclosed visit by the applicant after he has filed his application, to a physician, for treatment of an illness which is obviously trivial or which may be so considered. In the present case we have the covenant in the application, the undisclosed consultations, and the unquestioned fact that the condition found was not trivial. Defendant, not plaintiff, is entitled to judgment. The fact that the applicant died from another cause does not disprove the increase of risk. We find no evidence that the insurer ever knew of the breach of the condition, and so it is plain that there is neither waiver nor estoppel.
The judgment should be affirmed, with costs.