Case Name: Phillip JACKSON v. CONTINENTAL CASUALTY COMPANY
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1982-04-05
Citations: 412 So. 2d 1364
Docket Number: No. 81-C-1759
Parties: Phillip JACKSON v. CONTINENTAL CASUALTY COMPANY.
Judges: CALOGERO, J., concurs and assigns reasons.
Reporter: Southern Reporter, Second Series
Volume: 412
Pages: 1364–1369

Head Matter:
Phillip JACKSON v. CONTINENTAL CASUALTY COMPANY.
No. 81-C-1759.
Supreme Court of Louisiana.
April 5, 1982.
Rehearing Denied May 14, 1982.
Leo J. Berggreen, Baton Rouge, for plaintiff-applicant.
Paul H. Spaht, of Kantrow, Spaht, Weaver & Walter, Baton Rouge, for defendant-respondent.

Opinion:
WATSON, Justice.
ISSUE
Is a person who pays group insurance premiums for almost six years to insure the life of his "spouse" barred from collecting benefits for her death by the fact that their thirty-five year union was not a legal marriage?
FACTS
Plaintiff, Phillip Jackson, an illiterate Louisiana State University employee, was insured under a group policy with Continental Assurance Company. Beulah Jackson was enrolled for life insurance coverage as his spouse on September 8,1973. Premiums for that coverage were deducted from Jackson's pay checks. After living with Phillip Jackson for thirty-five years, Beulah Jackson died on July 9, 1979. The two were never legally married, but Beulah Jackson was economically dependent on Phillip.
Continental Assurance Company contested liability because it was unaware the parties were not legally married until after Beulah's death. The trial court dismissed plaintiff's suit. The Court of Appeal affirmed because Beulah Jackson was not a "legal spouse" and therefore was ineligible for coverage. Jackson v. Continental Cas. Co., 402 So.2d 175 (La.App. 1 Cir. 1981). A writ was granted to review the judgment. 405 So.2d 532 (La.1981).
LAW
LSA-R.S. 22:176(2) requires that all group life insurance policies issued in the State of Louisiana have the following or an equivalent provision:
"(2) Incontestability: A provision that the validity of the policy shall not be contested, except for nonpayment of premiums, after it has been in force for two years from its date of issue and that no statement made by an individual insured under the policy relating to his insurability shall be used in contesting the validity of the insurance with respect to which such statement was made after such insurance has been in force prior to the contest for a period of two years during such individual's lifetime nor unless it is contained in a written instrument signed by him."
CONCLUSION
The Court of Appeal relied on Crawford v. Equitable Life Assurance Society of the United States, 56 Ill.2d 41, 305 N.E.2d 144 (1973), which held that a defense of ineligibility was not barred by an incontestability clause. Crawford reasoned that the question of eligibility for group coverage is not foreclosed because the insurer's risk and premium is affected by whether the insured was, as represented, an employee. "[E]mployment or active or full-time employment may protect the insurer against adverse selection." 305 N.E.2d at 150. Even on that point, the various jurisdictions "are not uniform in result." 305 N.E.2d at 149. See, for example, Simpson v. Phoenix Mutual Life Insurance Co., 24 N.Y.2d 262, 299 N.Y.S.2d 835, 247 N.E.2d 655 (1969). The result in Crawford is also contrary to past Louisiana jurisprudence. See Michel v. Washington National Insurance Co., 315 So.2d 863 (La.App. 3 Cir. 1975); Allison v. Aetna Life Ins. Co., 158 So. 389 (La.App. 2 Cir. 1935); and Garrell v. Good Citizens Mut. Ben. Ass'n, 204 La. 871, 16 So.2d 463 (1943). Irrespective of its merits, Crawford's rationale is inapplicable here. The adverse selection factor is not present. Eligibility can be contested only if allowing coverage extends the risk beyond that contemplated by the insurer when the policy was written. Continental's exposure was not increased because the Jacksons' thirty-five year union was not blessed by the sacrament of matrimony. Their unmarried state, a very technical point in this factual situation, was apparently insignificant to Phillip and Beulah Jackson. He listed her as his "spouse" for insurance purposes. One who is, for all practical purposes, a spouse should not be barred from recovery by an irrelevant legal status. "[A]n immaterial, technical breach of condition should not be the occasion for forfeiture." 1979 Ill.Law Forum 817.
A dependent concubine or "common law wife" can recover workmen's compensation benefits because the insurer should not "benefit by the windfall" of discovering that there was an illicit rather than licit relationship. Henderson v. Travelers Insurance Co., 354 So.2d 1031 at 1034 (La.1978). Similarly, Continental, who has been paid premiums for life insurance coverage on Beulah Jackson, should not benefit from the belated discovery that she maintained a marital relationship without a legal marriage. For purposes of group insurance, there is no reason to distinguish between a dependent concubine who is scheduled as the "spouse" in an insuring agreement and a legal spouse.
The incontestability provision bars the defense urged by Continental because Jackson's policy had been in force over two years and the premiums had been paid. See Bernier v. Pacific Mut. Life Ins. Co. of California, 173 La. 1078, 139 So. 629 (1932).
For the foregoing reasons, the judgment of the trial and appellate courts herein are reversed and judgment is entered in favor of plaintiff, Phillip Jackson, for the benefits due under his policy with Continental Casualty Company for the death of Beulah Jackson.
REVERSED AND RENDERED.
CALOGERO, J., concurs and assigns reasons.
DENNIS, J., concurs with reasons.
LEMMON, J., dissents.
BLANCHE and MARCUS, JJ., dissent and assign reasons.
. Crawford and Simpson are analyzed in Vol. 1979 of the University of Illinois Law Forum at 809.