Court Opinion

ID: 3234156
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:09:06.536702+00
Date Added: 2024-06-11T12:39:00.572379
License: Public Domain

While we are fully persuaded that the foregoing opinion properly interprets section 8364 of the Code, and we are content to permit it to stand without qualification, yet in view of the very earnest insistence made by counsel for appellee as to the good faith of the insured in making the statements contained in his February, 1936, application for reinstatement of the policy of insurance, we will refer briefly to the same, in response to appellee's application for rehearing.
Horton, the insured, in his application for reinstatement of the policy contract, made on February 15, 1936, was asked the following question:
"Within the past two years have you had any illness, diseases, or bodily injuries or have you consulted or been treated by any physician or physicians?
"(If so, give full details, including nature, date and duration of each illness, disease or injury, the name of each physician, and the date of and reasons for consultation or treatment?)" To which question the insured answered, "No."
This answer was patently untrue. At that time, and for more than two months prior thereto, the insured was a "sick man," and was then, and had been for more than two months under the observation and treatment of a physician. Not only this, but insured had been advised by his physician *Page 632 
that a thorough physical examination should be made to determine the nature of his illness. It was without dispute in the evidence that the two physicians, who were then treating the insured, had formed the opinion in January, 1936, that he was afflicted with Hodgkin's disease, which was a fatal malady. The misrepresentation of the insured that he had not consulted a physician had the effect to increase the risk of loss. Mutual Life Ins. Co. of New York v. Allen, 174 Ala. 511, 56 So. 568. If the insured had truthfully answered the question, the defendant company would thereby have been supplied the data and means of discovering the true condition of insured's health.
Under the second alternative of the statute, it would be of no moment that the insured was not aware of the fact he was afflicted with Hodgkin's disease. He was in fact a sick man, and had been for two months or more, and all the while under treatment of a physician. A candid and truthful answer would have enabled the insurer to discover the true facts with reference to the insured's health. Insurance companies are entitled to candid and truthful answers, and when such candor is withheld and involves matters material to the risk, no just complaint can be raised, when, in after investigations, the falsity is discovered and the policies issued in reliance upon the truthfulness of the statements, are avoided.
But recurring to the original opinion in this case, and with reference to appellee's insistence that it is in conflict with Massachusetts Mut. L. I. Co. v. Crenshaw, 195 Ala. 263,70 So. 768, we may add that the language of the opinion in that case is to be interpreted in the light of the issue there presented by the pleading, that is, of actual fraud, and that cases in which this authority is cited likewise had reference to such issue. Numerous decisions subsequent to the Crenshaw Case, which we have hereinabove noted, disclose that such expressions have been so construed as having reference to actual fraud, and not to cases where the misrepresentation related to matters which increased the risk of loss, and upon which representations the insurer had a right to rely, and did rely.
Application for rehearing overruled.
ANDERSON, C. J., and THOMAS and BROWN, JJ., concur.