Court Opinion

ID: 5838120
Source: CourtListenerOpinion
Date Created: 2022-01-12 22:44:47.054936+00
Date Added: 2024-06-11T08:43:40.931215
License: Public Domain

Markewich and Silverman, JJ.,
dissent in the following memorandum by Silverman, J.: I would reverse the judgment appealed from and dismiss the complaint. This is an action on a savings bank life insurance policy issued pursuant to article 6-A of the Banking Law. The decedent died within 10 months after issuance of the policy, of causes including "hypertensive and arteriosclerotic cardiovascular disease.” On the application for the policy, the decedent had answered in the negative the question whether he had ever had or had any reason to expect having, or whether he had ever been treated by a physician for, among other things, any diseases of the heart, high blood pressure or blood disorder. He also stated that he had not had a physical examination or consulted a physician within the preceding five years except for a premarital Wasserman. In fact, he had suffered for years from hypertension and had consulted at least one physician and was under care for elevated blood pressure. The court found undisputed proof that decedent suffered from hypertension at the time he had applied for the policy and that his response in the application that he did not have high blood pressure was a material misrepresentation. The court instructed the jury to return a verdict for the defendant bank unless the jury found that the defendant bank had waived the defense because its assistant vice-president, who filled out the application and issued the policy on decedent’s life, allegedly had knowledge of decedent’s high blood pressure. The jury brought in a verdict for the plaintiff, thus finding such a waiver. There is some evidence from which a jury could have found that the bank knew of decedent’s hypertension. (Decedent had formerly been an employee of the bank.) The difficulty with plaintiff’s case I think is that the bank could not waive the misrepresentation because only the Savings Bank Life Insurance Fund could approve the issuance of the policy. Thus knowledge of an officer of the bank as to decedent’s condition cannot be a waiver that validates the *505policy. The statute provides for a life insurance department in each participating savings bank (Banking Law, § 263), and also for a State-wide Savings Bank Life Insurance Fund managed by seven trustees appointed by the Superintendent of Banks with the consent of the Governor. (Banking Law, § 270.) The statute seems to me to make a clear distinction between the power of the life insurance department of each bank to reject a particular application on its own authority, and the power to issue a policy which can be issued only with the approval of the Savings Bank Life Insurance Fund. Thus section 263 of the Banking Law provides: "Such life insurance department [of a bank] may decline particular classes of risks or reject any particular application.” On the other hand, with respect to issuance of policies, the statute provides: "no policy or contract shall be delivered or issued for delivery except with the approval of the fund.” (Banking Law, §271.)